London midday: FTSE stays down but Virgin Money jumps on takeover

(Sharecast News) - London stocks were still in the red by midday on Thursday as investors waded through a deluge of corporate news and continued to digest the Spring Budget, but Virgin Money surged on takeover news. The FTSE 100 was down 0.3% at 7,660.15.

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "The dust is already settling on a UK Budget which offered a sweet rush of optimism for consumer-focused stocks, and now some of that positivity is ebbing away with the FTSE 250 dipping in early trade before making up ground.

"Reality appears to be sinking in that although the cuts to National Insurance may fire up some discretionary spending power the fiscal drag of freezing income tax thresholds will counter the effect."

Figures released earlier by Halifax showed that house prices rose for the fifth month in a row in February.

Prices were up 0.4% on the month following a 1.2% jump in January. This marked the smallest month-on-month rise in house prices since September.

On the year, house prices rose 1.7% in February, easing from a 2.3% gain a month earlier.

The average cost of a home now stands at £291,699, versus £290,608 in January.

Kim Kinnaird, director of Halifax Mortgages, said the figures continue to suggest a relatively stable start to 2024 and align with other promising signs of increased housing activity, such as mortgage approvals.

"In fact, the average price tag of a home is now only around £1,800 off the peak seen in June 2022," she said. "While it is encouraging that we've seen growth in recent months, what happens next remains uncertain.

"Although lower mortgage rates, alongside expectations of Bank of England interest rate cuts this year, should help buyer confidence in the short term, the downward trend on rates is showing signs of fading.

"Even with growing wages and inflation falling back, raising a deposit and affording a sizeable mortgage remains challenging, especially for those looking to join the property ladder, so it remains a possibility that there could be a slowdown in the housing market this year."

Still to come, the latest policy announcement from the European Central Bank is due at 1315 GMT.

In equity markets, Ladbrokes owner Entain tumbled as it said full-year results were in line with expectations, with underlying earnings hitting the £1bn mark and record-high online customers, but warned of the significant impact from regulatory changes which will dampen profits in 2024.

Melrose lost ground despite lifting its profit outlook for this year and posting a jump in 2023 profit.

HSBC fell as it traded without entitlement to the dividend.

Door and window parts maker Tyman slumped after saying it expects a "challenging" market outlook this year as the building sector continued to struggle amid high interest rates and inflation, reflected in a 19% fall in 2023 profits.

On the upside, Rentokil rallied as the pest control firm reported a rise in full-year profit and revenue as it benefited from the acquisition of Terminix in the US.

Spirax-Sarco also racked up strong gains after saying it was well-positioned to return to growth in 2024.

Aviva rose as the insurance giant unveiled a £300m share buyback and better-than-expected 9% increase in full-year earnings on a strong increase in general insurance premiums.

Beazley was trading up as it announced plans to return cash to shareholders after annual profits at the Lloyds' of London insurer topped $1bn.

Virgin Money rocketed after agreeing to be taken over by Nationwide Building Society in a £2.9bn deal. Virgin shareholders will receive 220p per share, which is a 38% premium to the closing share price on Wednesday.

Broadcaster ITV gained as it reported a 41% fall in annual profits as weak ad revenues offset a record performance from its studios unit. Pre-tax profit for the year to December 31 came in at £396m from £672m a year earlier.

Market Movers

FTSE 100 (UKX) 7,660.15 -0.25% FTSE 250 (MCX) 19,576.09 0.53% techMARK (TASX) 4,516.27 0.12%

FTSE 100 - Risers

Rentokil Initial (RTO) 491.70p 14.75% Spirax-Sarco Engineering (SPX) 10,860.00p 5.74% Smith (DS) (SMDS) 327.20p 3.61% Anglo American (AAL) 1,826.20p 3.33% Antofagasta (ANTO) 1,788.00p 2.67% Glencore (GLEN) 399.00p 2.53% GSK (GSK) 1,715.00p 2.50% Aviva (AV.) 465.80p 2.40% Convatec Group (CTEC) 274.00p 2.32% Ocado Group (OCDO) 447.10p 2.10%

FTSE 100 - Fallers

Entain (ENT) 769.60p -7.32% Melrose Industries (MRO) 602.00p -4.75% HSBC Holdings (HSBA) 587.90p -3.94% JD Sports Fashion (JD.) 114.30p -2.31% Burberry Group (BRBY) 1,241.00p -2.21% Standard Chartered (STAN) 664.60p -1.92% Airtel Africa (AAF) 95.30p -1.75% Admiral Group (ADM) 2,621.00p -1.61% Ashtead Group (AHT) 5,102.00p -1.54% Rio Tinto (RIO) 5,003.00p -1.42%

FTSE 250 - Risers

Virgin Money UK (VMUK) 216.00p 35.81% Darktrace (DARK) 405.00p 15.06% Coats Group (COA) 75.30p 9.77% ITV (ITV) 65.50p 7.45% W.A.G Payment Solutions (WPS) 79.60p 5.57% Domino's Pizza Group (DOM) 365.00p 4.35% TUI AG Reg Shs (DI) (TUI) 583.50p 2.55% Foresight Group Holdings Limited NPV (FSG) 454.00p 2.25% OSB Group (OSB) 468.80p 2.18% Moonpig Group (MOON) 169.10p 1.99%

FTSE 250 - Fallers

Tyman (TYMN) 279.50p -5.25% Quilter (QLT) 98.80p -4.45% PZ Cussons (PZC) 93.50p -3.81% Aston Martin Lagonda Global Holdings (AML) 155.20p -2.63% Safestore Holdings (SAFE) 759.50p -2.44% SDCL Energy Efficiency Income Trust (SEIT) 64.60p -2.27% Assura (AGR) 41.98p -2.10% Energean (ENOG) 1,032.00p -1.99% Watches of Switzerland Group (WOSG) 384.40p -1.69% Bank of Georgia Group (BGEO) 5,080.00p -1.36%