London midday: Stocks stay up as investors eye US inflation reading

(Sharecast News) - London stocks were still in the black by midday on Friday, with NatWest pacing the gains after well-received results, as investors eyed a key US inflation reading. The FTSE 100 was up 0.6% at 8,237.13.

Danni Hewson, head of financial analysis at AJ Bell, said: "The FTSE 100 looks set to end the week on a high despite a continued sell-off in US tech names.

"After a week dominated by the reaction to US corporate announcements, attention may shift back to the macro-economic backdrop later with the release of core PCE data - the Federal Reserve's preferred measure of inflation. The market will be hoping for a reading which reinforces hopes of a rate cut at the Fed's September meeting."

The PCE index for June is due at 1330 BST.

In equity markets, NatWest surged to the top of the FTSE 100 as it lifted its full-year guidance for total income to around £14bn from between £13bn and £13.5bn previously. The bank also said that return on tangible equity was set be above 14%, up from previous guidance of 12%.

Richard Hunter, head of markets at Interactive Investor, said: "Overall, this is a highly reassuring update which has received a very warm welcome in opening exchanges. The share price bounce adds to an increase of 35% over the last year, as compared to a gain of 6.6% for the wider FTSE 100, and is further evidence of the momentum which propelled the price by 55% in the last six months alone.

"NatWest has delivered an outcome which could mean that it regains its spot as the preferred play on the sector, recently being edged out by Barclays, with a market consensus which comes in at a comfortable buy."

Elsewhere, Drax rallied after saying that full-year adjusted EBITDA was set to be at the "top end" of analysts' consensus estimates of £881m to £996m following a strong performance in the first half.

Jupiter Fund Management and Man Group were both higher after results.

Babcock International gained after it posted a jump in full-year profit as it continued to be boosted by a "sustained uplift" in global defence budgets, with a strong performance in Nuclear, Land and Aviation.

On the downside, Segro fell even as it reported a 14.6% increase in first-half adjusted pre-tax profit and said it had continued to perform well.

Computacenter lost ground as it said it was expecting to report a drop in first-half profit due to the delay of the fulfilment of some orders in North America, but also announced a £200m share buyback programme.

Lloyds Banking Group was knocked lower by a downgrade to 'sector perform' from 'outperform' at RBC Capital Markets.

Market Movers

FTSE 100 (UKX) 8,237.13 0.62% FTSE 250 (MCX) 21,106.83 1.07% techMARK (TASX) 4,776.23 0.49%

FTSE 100 - Risers

NATWEST GROUP (NWG) 357.40p 5.71% Anglo American (AAL) 2,359.50p 4.17% Burberry Group (BRBY) 741.20p 3.35% JD Sports Fashion (JD.) 122.50p 2.68% Intertek Group (ITRK) 4,938.00p 2.66% Ashtead Group (AHT) 5,438.00p 2.29% Reckitt Benckiser Group (RKT) 4,479.00p 2.28% Airtel Africa (AAF) 109.00p 1.96% Vistry Group (VTY) 1,357.00p 1.65% Melrose Industries (MRO) 566.40p 1.58%

FTSE 100 - Fallers

SEGRO (SGRO) 882.00p -2.78% Smurfit Westrock (DI) (SWR) 3,670.00p -1.71% BT Group (BT.A) 138.10p -1.57% InterContinental Hotels Group (IHG) 7,882.00p -1.43% Mondi (MNDI) 1,530.00p -1.23% Rentokil Initial (RTO) 462.00p -1.07% Imperial Brands (IMB) 2,129.00p -1.07% Lloyds Banking Group (LLOY) 60.06p -0.96% Pershing Square Holdings Ltd NPV (PSH) 3,790.00p -0.79% Admiral Group (ADM) 2,619.00p -0.53%

FTSE 250 - Risers

Drax Group (DRX) 632.00p 11.56% Babcock International Group (BAB) 511.00p 4.76% CMC Markets (CMCX) 314.50p 4.14% Jupiter Fund Management (JUP) 85.80p 4.00% GCP Infrastructure Investments Ltd (GCP) 83.20p 3.48% Ocado Group (OCDO) 440.30p 3.48% Elementis (ELM) 150.00p 3.45% BBGI Global Infrastructure S.A. NPV (DI) (BBGI) 137.80p 3.30% Dr. Martens (DOCS) 71.00p 3.27% Future (FUTR) 1,106.00p 3.17%

FTSE 250 - Fallers

Computacenter (CCC) 2,598.00p -2.11% Bellevue Healthcare Trust (Red) (BBH) 147.00p -1.61% ITV (ITV) 79.95p -1.36% Pennon Group (PNN) 606.50p -1.22% FirstGroup (FGP) 168.90p -0.94% Centamin (DI) (CEY) 118.30p -0.92% Herald Investment Trust (HRI) 2,155.00p -0.69% Discoverie Group (DSCV) 724.00p -0.69% Hargreaves Lansdown (HL.) 1,098.00p -0.63% Worldwide Healthcare Trust (WWH) 367.00p -0.54%