London close: Stocks end turbulent week in a mixed state

London's stock markets finished with a mixed performance on Friday, driven by multiple factors including a policy change from the Bank of Japan, and significant results from companies such as NatWest, Standard Chartered, and International Airlines Group (IAG).

The FTSE 100 closed with a slight increase of 0.02%, finishing the day at 7,694.27 points, while the FTSE 250 dropped 0.77% to end the trading day at 19,124.14.

On the currency front, sterling was last up 0.66% on the dollar, trading at $1.288, while it climbed 0.15% against the euro to change hands at €1.1674.

“Worries about a stagnation in Germany took some of the shine off European markets, but with the DAX having clocked up a new intraday high yesterday it looks like indices this side of the Atlantic have bestirred themselves again,” said IG chief market analyst Chris Beauchamp.

“After a busy week, markets might be hoping for a breathing space, but they will be disappointed.

“More central banks, plus US job numbers and another wave of earnings, will mean that any further gains in stocks are likely to come with a hefty dose of volatility too.”

Japan's central bank increases flexibility, US labour costs ebb, German economy stagnates

There was a distinct lack of local economic news for London investors to sink their teeth into on Friday, but in a shift of policy, the Bank of Japan announced earlier that it would maintain its negative interest rates while also providing "greater flexibility" for its 10-year government bond yield target range.

The central bank said it would now allow the yield curve to fluctuate up to 0.5%, both above and below its target, without imposing stringent limits.

In addition, the BoJ said it had decided to purchase 10-year bonds at a fixed rate of 1% on each business day, thus increasing its tolerance by another 50 basis points.

The move came as bond yields reached 0.539%, marking their highest point since September 2014.

Across the Pacific, the cost of labour in the US decreased during the second quarter of the year.

The employment cost index, as reported by the Department of Labor, increased by just 1.0% in seasonally-adjusted terms, slowing from a rise of 1.2% recorded in the first three months of the year.

That figure was slightly below the economist forecasts for a 1.1% rise.

In related news, Americans turned to their savings to facilitate higher spending towards the end of the second quarter.

Personal incomes, as per seasonally adjusted terms, grew by 0.3% in June, below the expected growth of 0.5%.

On the other hand, personal consumption expenditures – the Federal Reserve’s preferred measure of inflation - saw an increase of 0.5%, slightly above the predicted increase of 0.4%.

Closer to home, Germany's economy showed signs of stagnation in the second quarter, according to data from Destatis.

The country’s gross domestic product (GDP) remained unchanged, underperforming against the expected growth of 0.1%.

Additionally, the figures for the first quarter were revised, showing a slight contraction of 0.1% compared to the initially-reported 0.3% contraction.

Standard Chartered, IAG lead gainers as Vanquis Banking Group, Darktrace falter

On London’s equity markets, Standard Chartered rose 3.98%, propelled by a robust first-half performance that featured a 20% surge in profits, largely due to rising interest rates.

The bank lifted its annual guidance, and launched a $1bn share buyback.

International Airlines Group (IAG), the owner of British Airways and Iberia, meanwhile ascended 6.58%.

The company posted an operating profit before exceptional items of €1.3bn - a significant turnaround from its loss of €466m in the same period last year.

Pharmaceutical giant AstraZeneca's shares jumped 3.35% as its second-quarter results surpassed estimates.

NatWest Group saw a 2.33% uptick in its share price, driven by better-than-expected interim profits.

The positive report came after a turbulent week for the bank, following the resignation of its chief executive officer Alison Rose.

It also revealed plans for a £500m share buyback on Friday.

Property portal Rightmove reversed earlier losses to close up 1.12% after it endorsed its full-year expectations.

The company reported a significant increase in first-half profit, with revenues recording their most significant growth in five years, despite a challenging backdrop.

On the downside, Vanquis Banking Group tumbled 29.17% after the release of its interim results, while cybersecurity firm Darktrace also experienced a downturn, losing 4.07% as Summit Partners offloaded 20.8 million shares in a placing.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 7,694.27 0.02%
FTSE 250 (MCX) 19,124.14 -0.77%
techMARK (TASX) 4,443.61 -0.29%

FTSE 100 - Risers

International Consolidated Airlines Group SA (CDI) (IAG) 165.15p 6.58%
Standard Chartered (STAN) 737.60p 3.98%
AstraZeneca (AZN) 11,058.00p 3.35%
Airtel Africa (AAF) 117.20p 3.17%
Intertek Group (ITRK) 4,371.00p 2.69%
Ocado Group (OCDO) 976.40p 2.50%
NATWEST GROUP (NWG) 245.50p 2.33%
Rolls-Royce Holdings (RR.) 193.30p 1.95%
JD Sports Fashion (JD.) 158.10p 1.25%
Rightmove (RMV) 558.80p 1.12%

FTSE 100 - Fallers

Admiral Group (ADM) 2,158.00p -5.10%
St James's Place (STJ) 945.60p -4.81%
Beazley (BEZ) 553.50p -3.40%
SEGRO (SGRO) 754.20p -2.36%
Aviva (AV.) 390.70p -2.18%
Kingfisher (KGF) 247.10p -2.06%
Land Securities Group (LAND) 642.40p -1.83%
Anglo American (AAL) 2,383.00p -1.81%
Phoenix Group Holdings (PHNX) 551.20p -1.71%
Informa (INF) 762.80p -1.70%

FTSE 250 - Risers

Fidelity China Special Situations (FCSS) 229.00p 2.92%
Moneysupermarket.com Group (MONY) 274.00p 2.54%
Future (FUTR) 819.50p 2.31%
North Atlantic Smaller Companies Inv Trust (NAS) 3,800.00p 2.12%
Bridgepoint Group (Reg S) (BPT) 194.90p 2.10%
Ithaca Energy (ITH) 164.40p 1.86%
Schroder Asia Pacific Fund (SDP) 513.00p 1.79%
Aston Martin Lagonda Global Holdings (AML) 378.40p 1.67%
Pacific Horizon Inv Trust (PHI) 585.00p 1.56%
Redde Northgate (REDD) 343.50p 1.48%

FTSE 250 - Fallers

Vanquis Banking Group 20 (VANQ) 128.20p -29.17%
QinetiQ Group (QQ.) 321.60p -6.57%
Bakkavor Group (BAKK) 100.50p -6.07%
IntegraFin Holding (IHP) 250.00p -4.58%
Mobico Group (MCG) 90.85p -4.37%
Ferrexpo (FXPO) 91.10p -4.16%
Darktrace (DARK) 375.00p -4.07%
Babcock International Group (BAB) 372.60p -3.52%
Inchcape (INCH) 819.00p -3.31%
Target Healthcare Reit Ltd (THRL) 72.80p -3.07%