London midday: Stocks up but off highs ahead of Powell speech

(Sharecast News) - London stocks were off earlier highs but still firmer by midday on Thursday as investors eyed the Jackson Hole symposium and a speech by Federal Reserve chair Jerome Powell. The FTSE 100 was up 0.2% at 7,482.50.

Richard Hunter, head of markets at Interactive Investor, said: "Markets maintained their holding pattern, ahead of an important couple of days which should provide further short-term directional clues.

"The usual Thursday jobless claims number will give some further indications of a relatively tight labour market, while the Federal Reserve's preferred measure of inflation, the Personal Consumption Expenditures index, will reveal the current state of play tomorrow. Following the last reading, the release could give further substance as to whether there is any additional evidence of inflation nearing or indeed hitting a peak.

"However, the highlight of the week for investors is the Jackson Hole symposium and in particular the latest comments from Fed Chairman Powell when he speaks on Friday. Investors have been bracing for a reiteration of the Fed's hawkish tone in continuing to raise rates to combat rampant inflation.

"Indeed, despite some emerging signs of slowing economic growth, caused in part by the rate hikes already undertaken, the Fed is expected to maintain its dogged determination to rein in inflation at all costs, with the next hike in September expected to be one of 0.75%."

On home shores, investors were mulling the latest survey from the Confederation of British Industry, which showed that retail sales unexpectedly rose in the year to August but retailers remained pessimistic.

The CBI's reported sales balance jumped to +37 from -4 in July, coming in well ahead of consensus expectations for a decline to -8. Still, sentiment remained gloomy, with firms feeling the most pessimistic about the business situation over the next three months since the early phase of the pandemic in May 2020.

The survey also showed that average selling price inflation sped up to its fastest pace since 1985, rising to +87 +77 in May.

Martin Sartorius, Principal Economist at the CBI, said: "While retail sales returned to solid growth in the year to August, firms remain pessimistic about their business situation over the next three months - to the greatest extent since the first Covid-19 lockdown in 2020. This gloom is reflected in retailers' investment intentions, which continue to be resolutely negative.

"Firms now need support from the Government in order to encourage investment and create sustainable growth. Crucially, business rates reform and a more flexible apprenticeship levy will help with dwindling business confidence."

In equity markets, Harbour Energy jumped to the top of the FTSE 100 after the oil and gas producer lifted its share buyback programme by $100m and said pre-tax profits for the six months to June 30 surged to $1.5bn from $120m.

Building products maker CRH rallied as it said it expects full-year core earnings to rise slightly to $5.5bn "against a continually challenging cost environment" after posting an increase in interim profits.

Recruiter Hays rose as it reported an increase in full-year profit thanks to an "excellent" fee performance across all regions amid a recovery from the pandemic.

Oil giants Shell and BP gushed higher as oil prices rose. Shell was also in focus after Ofgem fined the company for overcharging more than 11,000 customers paying its default tariffs.

On the downside, building materials distributor and DIY retailer Grafton fell as it posted a jump in first-half revenues but a decline in profits as activity levels normalised following the pandemic boost.

Phoenix Group, NatWest, RHI Magnesita, FDM and Drax all lost ground as they traded without entitlement to the dividend.

Market Movers

FTSE 100 (UKX) 7,482.50 0.15% FTSE 250 (MCX) 19,275.15 -0.16% techMARK (TASX) 4,305.34 0.12%

FTSE 100 - Risers

Harbour Energy (HBR) 479.90p 11.48% CRH (CDI) (CRH) 3,234.00p 3.29% Pershing Square Holdings Ltd NPV (PSH) 2,830.00p 2.91% Fresnillo (FRES) 747.00p 2.67% BP (BP.) 461.60p 1.91% Rentokil Initial (RTO) 544.40p 1.83% Antofagasta (ANTO) 1,167.50p 1.79% Endeavour Mining (EDV) 1,846.00p 1.60% Shell (SHEL) 2,326.50p 1.48% Glencore (GLEN) 504.10p 1.29%

FTSE 100 - Fallers

Phoenix Group Holdings (PHNX) 600.80p -4.39% Persimmon (PSN) 1,504.50p -2.56% Hargreaves Lansdown (HL.) 867.80p -2.19% Admiral Group (ADM) 2,200.00p -1.96% NATWEST GROUP PLC ORD 100P (NWG) 251.90p -1.91% Haleon (HLN) 263.80p -1.86% JD Sports Fashion (JD.) 114.80p -1.59% B&M European Value Retail S.A. (DI) (BME) 383.20p -1.57% Coca-Cola HBC AG (CDI) (CCH) 2,024.00p -1.56% Prudential (PRU) 915.80p -1.53%

FTSE 250 - Risers

BlackRock World Mining Trust (BRWM) 634.00p 2.42% Hays (HAS) 117.50p 2.35% FirstGroup (FGP) 111.90p 2.19% Diversified Energy Company (DEC) 142.20p 2.16% Carnival (CCL) 759.80p 2.01% Abrdn Private Equity Opportunities Trust (APEO) 425.00p 1.92% Centamin (DI) (CEY) 95.20p 1.82% Marshalls (MSLH) 348.00p 1.81% Ibstock (IBST) 194.50p 1.78% Tullow Oil (TLW) 51.60p 1.67%

FTSE 250 - Fallers

Polymetal International (POLY) 200.00p -6.54% RHI Magnesita N.V. (DI) (RHIM) 1,810.00p -4.08% Wood Group (John) (WG.) 137.55p -3.91% FDM Group (Holdings) (FDM) 778.00p -2.63% Provident Financial (PFG) 174.50p -2.46% Drax Group (DRX) 720.50p -2.44% Marks & Spencer Group (MKS) 124.15p -2.44% Grafton Group Ut (CDI) (GFTU) 707.50p -2.32% 888 Holdings (DI) (888) 135.80p -2.16% Currys (CURY) 59.70p -2.05%