London midday: Stocks muted ahead of US inflation print

(Sharecast News) - London stocks had popped higher by midday on Friday but gains were muted ahead of a key US inflation reading, while NatWest tumbled after results. The FTSE 100 was up 0.1% at 7,365.06.

Investors were mulling strong results from Amazon overnight, which showed that third-quarter net income jumped to $9.9bn from $2.9bn in the same period a year earlier. Meanwhile, net sales rose 13% to $143.1bn.

Looking ahead to the rest of the day, eyes will be on US personal consumption expenditure figures - the Federal Reserve's preferred measure of inflation - at 1330 BST.

Tickmill Group said: "Similar to the previously released CPI figures, it's anticipated that headline PCE inflation will remain unchanged at 3.5%.

"However, the core measure, which excludes energy and food, is expected to decrease to 3.7% from the previous 3.9%. The declining trend in inflation, along with the recent increase in Treasury bond yields, contributes to the expectation that the Fed will maintain unchanged interest rates in its upcoming meeting next week.

"Nevertheless, robust economic activity, as indicated by the Q3 GDP report released yesterday, could potentially complicate the longer-term policy outlook. Strong personal spending figures projected for September suggest substantial momentum at the end of the quarter, which may carry over into Q4."

In equity markets, NatWest slid after third-quarter results.

Matt Britzman, equity analyst at Hargreaves Lansdown, said the results were "largely disappointing" as net interest margin dipped below 3%, and the outlook was lowered.

He noted that deposit levels grew, which is a positive sign that NatWest is pricing itself at the right levels to attract customers searching for higher rates. However, he also pointed out that it's a less profitable business than non/low-interest current accounts.

"Add in mortgage headwinds as highly profitable business written over the pandemic rolls off, and that's caused the hit to net interest margin," he said.

Lloyds, Barclays and Standard Chartered - which took a hammering of its own on Thursday after its third-quarter results - were all down.

British Airways and Iberia owner IAG flew lower red despite posting a record third-quarter profit of €1.75bn, driven by strong demand.

On the upside, Trainline rallied after an upgrade to 'overweight' at JPMorgan.

Digital 9 Infrastructure surged after saying that it was assessing a potential divestment of its entire stake in Verne Global.

Market Movers

FTSE 100 (UKX) 7,365.06 0.14% FTSE 250 (MCX) 16,864.31 0.48% techMARK (TASX) 3,972.10 0.23%

FTSE 100 - Risers

Fresnillo (FRES) 549.60p 2.96% Prudential (PRU) 851.20p 2.60% Smurfit Kappa Group (CDI) (SKG) 2,674.00p 2.37% Shell (SHEL) 2,748.00p 2.21% Smith (DS) (SMDS) 278.10p 2.17% BP (BP.) 545.30p 2.15% Vodafone Group (VOD) 76.35p 2.06% Flutter Entertainment (CDI) (FLTR) 12,790.00p 1.83% Endeavour Mining (EDV) 1,681.00p 1.76% RS Group (RS1) 673.80p 1.75%

FTSE 100 - Fallers

NATWEST GROUP (NWG) 182.50p -11.32% Weir Group (WEIR) 1,688.50p -2.65% CRH (CDI) (CRH) 4,325.00p -2.55% Ocado Group (OCDO) 474.90p -2.50% Lloyds Banking Group (LLOY) 40.20p -2.36% Diageo (DGE) 3,046.50p -2.03% Barclays (BARC) 130.06p -1.65% Reckitt Benckiser Group (RKT) 5,502.00p -1.64% International Consolidated Airlines Group SA (CDI) (IAG) 141.00p -1.30% GSK (GSK) 1,455.40p -1.29%

FTSE 250 - Risers

Trainline (TRN) 246.60p 6.66% Digital 9 Infrastructure NPV (DGI9) 38.30p 4.93% Centamin (DI) (CEY) 82.00p 4.93% Mobico Group (MCG) 61.95p 4.56% Mitchells & Butlers (MAB) 205.60p 3.16% Great Portland Estates (GPE) 382.60p 2.85% Harbour Energy (HBR) 256.60p 2.52% Mitie Group (MTO) 97.40p 2.42% Diversified Energy Company (DEC) 69.90p 2.27% Essentra (ESNT) 146.80p 2.23%

FTSE 250 - Fallers

888 Holdings (DI) (888) 81.00p -2.00% Watches of Switzerland Group (WOSG) 491.60p -1.68% Virgin Money UK (VMUK) 147.20p -1.60% IP Group (IPO) 43.00p -1.60% Drax Group (DRX) 433.40p -1.37% easyJet (EZJ) 362.50p -1.25% FDM Group (Holdings) (FDM) 403.00p -1.23% Oxford Instruments (OXIG) 1,728.00p -1.14% Hipgnosis Songs Fund Limited NPV (SONG) 73.40p -1.08% CAB Payments Holdings (CABP) 51.45p -1.06%