London midday: FTSE turns higher as oil dips below $100 a barrel

(Sharecast News) - London stocks had turned higher by midday on Friday, shaking off earlier losses as oil eased back below $100 a barrel, and despite weaker-than-expected UK GDP figures. The FTSE 100 was up 0.1% at 10,313.09, while Brent crude was down 1.2% at $99.30 and West Texas Intermediate was 2% lower at $93.83.

Neil Wilson, UK investor strategist at Saxo Markets, said: "Crude oil prices dipped by around 2% after India stated it has an oil tanker moving out of the Strait of Hormuz. Brent slipped below $99/barrel."

Wilson said it was "too early to comment or speculate on what this means but markets are still very much trading the headlines and keen to latch on to any shred of good news".

"Expect this to be faded," he added.

On home shores, data from the Office for National Statistics showed the UK economy stalled in January, just weeks before war in the Middle East sent global energy prices soaring.

GDP was 0.0% in January, down on December's 0.1% uptick and below expectations for growth of 0.2%.

While construction improved by 0.2%, the dominant services sector showed zero growth and production fell 0.1%.

In the three months to January, GDP rose 0.2%, although that was below forecasts for a 0.3% uplift. Over the quarter, services grew by 0.2% - after showing no growth in the three months to December - while production output was 1.3% stronger. Construction output, however, slid 2.0%, compounding a 2.1% fall in the previous three months.

The Bank of England's Monetary Policy Committee meets next week and had been widely expected to trim interest rates to help bolster anaemic economic growth. However, oil and gas prices have soared since the end of February in response to war in the Middle East and analysts now widely expect the cost of borrowing to be left on hold at 3.75%.

Liz McKeown, director of economic statistics at the ONS, said: "Growth ticked up slightly in the latest three months, partly reflecting the recovery of car manufacturing following the cyber incident in the autumn.

"Within services, which also increased, wholesale continued to rebound from a weak summer.

"However, the overall picture remains subdued, with no growth in the latest month."

Dan Coatsworth, head of markets at AJ Bell, said: "The UK's latest economic reading is a major disappointment and that relates to a period pre-Iran conflict, which makes things even worse. If the UK economy is digging in its heels and refusing to grow in a 'normal' environment, the odds are even lower of growing against a backdrop of geopolitical tensions and higher inflation."

Looking to the rest of the day, US PCE and inflation data will be in focus at 1230 GMT.

In equity markets, oil giants BP and Shell were among the gainers, but precious metals miner Fresnillo and gold miner Hochschild lost their shine as gold prices dipped.

Corporate news was scarce, but property developer Berkeley Group fell as it reaffirmed annual guidance of £450m in pre-tax profit but warned the war on Iran was "weighing heavily" on risk sentiment.

In a trading update for the four months to 28 February, the company said demand had remained constrained by the impact on consumer confidence of geopolitical events and macroeconomic uncertainty, although sales enquiries "remain good and the value of underlying reservations has been recovering towards the levels seen over the summer prior to the pre-Budget hiatus".

"While reaffirming guidance, we are aware of the risk of a further deterioration in macro conditions with the potential for higher inflation in the near term and for interest rates to remain higher for longer," Berkeley said.

Market Movers

FTSE 100 (UKX) 10,313.09 0.08% FTSE 250 (MCX) 22,155.60 -0.06% techMARK (TASX) 5,865.88 0.32%

FTSE 100 - Risers

Legal & General Group (LGEN) 247.60p 2.49% London Stock Exchange Group (LSEG) 8,772.00p 2.10% M&G (MNG) 295.30p 2.04% Tesco (TSCO) 484.60p 1.87% Metlen Energy & Metals (MTLN) 37.15p 1.85% BP (BP.) 537.00p 1.55% Imperial Brands (IMB) 3,174.00p 1.54% Vodafone Group (VOD) 109.65p 1.53% Shell (SHEL) 3,368.50p 1.36% Centrica (CNA) 209.40p 1.31%

FTSE 100 - Fallers

Weir Group (WEIR) 2,878.00p -3.23% Smurfit Westrock (DI) (SWR) 2,997.00p -3.04% Mondi (MNDI) 833.60p -2.67% Entain (ENT) 554.00p -2.50% IMI (IMI) 2,696.00p -2.32% JD Sports Fashion (JD.) 73.08p -2.22% Smiths Group (SMIN) 2,422.00p -2.18% Informa (INF) 758.00p -1.94% Fresnillo (FRES) 3,540.00p -1.94% Flutter Entertainment (DI) (FLTR) 8,074.00p -1.82%

FTSE 250 - Risers

Trainline (TRN) 196.00p 4.98% Shawbrook Group (SHAW) 378.75p 4.65% Kainos Group (KNOS) 789.50p 3.41% Pantheon Infrastructure (PINT) 115.50p 3.13% WPP (WPP) 242.40p 3.06% Trustpilot Group (TRST) 173.20p 2.86% Bridgepoint Group (Reg S) (BPT) 234.60p 2.82% Harbour Energy (HBR) 288.20p 2.78% Vistry Group (VTY) 414.90p 1.89% ITV (ITV) 83.75p 1.82%

FTSE 250 - Fallers

Greggs (GRG) 1,640.00p -3.24% Bodycote (BOY) 687.00p -3.04% Utilico Emerging Markets Ltd (DI) (UEM) 271.00p -2.87% Playtech (PTEC) 359.50p -2.84% Helios Towers (HTWS) 173.80p -2.80% THG (THG) 30.36p -2.75% Dr. Martens (DOCS) 61.70p -2.68% Ibstock (IBST) 102.60p -2.67% Hill and Smith (HILS) 2,195.00p -2.66% Lion Finance Group (BGEO) 9,860.00p -2.47%