London close: FTSE rises on back of StanChart cheer

London stocks finished with a mixed performance on Friday, as Standard Chartered underpinned the top-flight index following its announcement of a $1bn share buyback programme.

The FTSE 100 edged up 0.28% to close at 7,706.28, while the FTSE 250 experienced a slight decline of 0.44% to end the session at 19,179.56.

In currency markets, sterling was last up 0.13% on the dollar, trading at $1.2676, while it managed gains of 0.09% against the euro to change hands at €1.1708.

“Risk on sentiment in the wake of stellar Nvidia earnings helped the Nikkei 225, CAC 40 and all three major US indices top their record highs,” said IG senior market analyst Axel Rudolph.

“They did so as German business morale improved slightly and euro area inflation expectations edged up ahead of next week's second estimate of US fourth quarter GDP growth, PCE inflation and Germany’s consumer price inflation readings which may take some of the wind out of the equity rally's sails.

“After all, the Dow and S&P 500 have seen 17 weeks of gains bar two from their October lows.”

Rudolph added that on both sides of the pond, gas prices had fallen significantly through the day.

“Whereas US natural gas price remain set for a weekly gain, European gas prices declined to their lowest level since May 2021 amid ample stocks, supply and clement weather.

“The oil price also declined by over one percent on the day while the gold price ended up in slightly positive territory.”

Consumer confidence takes a hit, Fed hints at longer wait for rate cuts

In economic news, UK consumer confidence took a hit in February, according to the latest GfK consumer confidence barometer.

The overall index fell two points to -21, signalling continued worries about the economy.

While respondents expressed slightly more confidence in their personal finances, the measure for the general economic situation over the last 12 months and the outlook for the coming year both declined.

“The metric is key to understanding the financial mood of the nation, because confident householders are more likely to spend despite the cost-of-living crisis,” said Joe Staton, client strategy director at GfK.

“It will be interesting to see what the forthcoming budget delivers in terms of taxation and inflation.

“These are important issues to everyone, especially in an election year; the recent performance of the economy will play a crucial role in determining results at the ballot box.”

On the energy front, households were told to expect some relief earlier in the day, as the cap on gas and electricity charges was set to decrease from April.

Ofgem confirmed the reduction, citing a drop in wholesale energy prices.

Despite the welcome news, bills would remain significantly higher than pre-pandemic levels, with energy debt reaching a record £3.1bn.

To address that, an extra payment of £28 per year would be added to all bills to support struggling customers.

“This is good news to see the price cap drop to its lowest level in more than two years, but there are still big issues that we must tackle head on to ensure we build a system that’s more resilient and fairer to customers,” said Jonathan Brearley, chief executive of Ofgem.

“These steps highlight the limitations of the current system - we can only move costs around - so we welcome news that the government is opening the conversation on the future of price regulation."

Across the Atlantic, comments from US Federal Reserve governor Christopher Waller were in focus during the afternoon, underscoring the central bank's cautious approach to monetary policy.

Waller's remarks hinted at a potential delay in interest rate cuts, citing the need for more inflation data before making significant decisions.

The stance aligned with prior indications from Federal Reserve officials, tempering expectations for aggressive rate-cutting measures in 2024.

On the continent, data from Germany painted a mixed picture, as Europe’s largest economy contracted by 0.3% in the fourth quarter, in line with initial estimates.

Despite economic challenges, investor sentiment in Germany showed a modest improvement.

The Ifo Institute’s business climate index edged up to 85.5 in February, indicating a slight uptick in optimism, particularly regarding future expectations.

Standard Chartered leads gains, Chemring Group slips

On London’s equity markets, Standard Chartered jumped 4.85% following its announcement of a new $1bn share buyback, an increased dividend, and higher annual profits.

Despite revising down income growth guidance for the current year, the bank reported an 18% rise in pre-tax profit to $5.1bn and raised its full-year dividend by 50%, exceeding analyst estimates.

Insurer Beazley saw a positive uptick of 1.11%, building on its previous day's rally.

The firm had upgraded its guidance on 2023 undiscounted combined ratio and announced an additional capital return for shareholders, further boosting confidence.

On the downside, Chemring Group declined 2.62% after it adjusted its annual results outlook due to severe winter conditions impacting manufacturing operations at the start of the financial year.

Despite maintaining guidance, the aerospace and defence firm highlighted the increasing weighting of results towards the second half of the year.

Harbour Energy and Diversified Energy both faced downturns of 3.45% and 3.15%, respectively, attributed to falling crude prices.

Brent crude and West Texas Intermediate futures were both last down more than 2%.

“The oil price has held steady, ending the week at around $83 for a barrel of Brent crude,” said Hargreaves Lansdown analyst Sophie Lund-Yates earlier.

“While there have been fluctuations throughout the week, as the market assessed supply and demand dynamics brought about by higher-for-longer interest rate expectations and ongoing tension in the Middle East, the net effect is one of relative calm in the price.”

In broker note action, Breedon Group saw a modest increase of 0.95% following an upgrade to 'overweight' from 'equalweight' by Barclays, while Domino’s Pizza Group declined 4.25% after being downgraded to 'equalweight' by the same firm.

Outside the FTSE 350, Hornby surged by 33.33% after reports emerged of Mike Ashley’s Frasers Group increasing its stake in the model train maker to 8.9%.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 7,706.28 0.28%
FTSE 250 (MCX) 19,179.56 -0.44%
techMARK (TASX) 4,401.96 0.16%

FTSE 100 - Risers

Standard Chartered (STAN) 635.00p 4.85%
Rightmove (RMV) 561.20p 1.85%
AstraZeneca (AZN) 10,220.00p 1.83%
InterContinental Hotels Group (IHG) 8,752.00p 1.77%
JD Sports Fashion (JD.) 115.40p 1.72%
Airtel Africa (AAF) 94.85p 1.72%
Bunzl (BNZL) 3,306.00p 1.50%
Beazley (BEZ) 643.50p 1.50%
NATWEST GROUP (NWG) 231.50p 1.49%
Croda International (CRDA) 4,879.00p 1.46%

FTSE 100 - Fallers

St James's Place (STJ) 643.00p -2.96%
Admiral Group (ADM) 2,529.00p -1.40%
Schroders (SDR) 397.50p -1.34%
Scottish Mortgage Inv Trust (SMT) 787.60p -1.18%
Smith (DS) (SMDS) 320.80p -1.14%
Glencore (GLEN) 375.80p -1.08%
Ashtead Group (AHT) 5,466.00p -1.05%
Rolls-Royce Holdings (RR.) 354.00p -1.04%
Lloyds Banking Group (LLOY) 45.50p -1.00%
Compass Group (CPG) 2,181.00p -1.00%

FTSE 250 - Risers

PureTech Health (PRTC) 213.50p 11.55%
TBC Bank Group (TBCG) 3,055.00p 3.21%
Hochschild Mining (HOC) 91.90p 2.73%
Dunelm Group (DNLM) 1,159.00p 2.29%
Telecom Plus (TEP) 1,482.00p 2.06%
Indivior (INDV) 1,687.00p 1.63%
Centamin (DI) (CEY) 92.30p 1.60%
Direct Line Insurance Group (DLG) 166.00p 1.47%
Pets at Home Group (PETS) 292.40p 1.46%
SDCL Energy Efficiency Income Trust (SEIT) 63.20p 1.44%

FTSE 250 - Fallers

Domino's Pizza Group (DOM) 351.60p -4.25%
W.A.G Payment Solutions (WPS) 79.00p -4.13%
Me Group International (MEGP) 153.00p -4.02%
TUI AG Reg Shs (DI) (TUI) 564.00p -4.00%
Harbour Energy (HBR) 249.40p -3.45%
Watches of Switzerland Group (WOSG) 425.60p -3.36%
Ibstock (IBST) 162.90p -3.15%
Diversified Energy Company (DEC) 952.50p -3.15%
Close Brothers Group (CBG) 337.00p -3.11%
Ithaca Energy (ITH) 132.60p -3.07%