London close: Stocks manage solid finish after turbulent week

London stocks finished well above the waterline on Friday, having taken cue from positive US and Asian sessions earlier, as investors digested the latest retail sales and consumer confidence data.

The FTSE 100 ended the session up 2.68% at 7,208.81, and the FTSE 250 was ahead 2.3% at 19,123.71.

Sterling was in a mixed state, meanwhile, last trading 0.19% stronger on the dollar at $1.2283, while it weakened 0.09% against the euro to change hands at €1.1643.€

“The bulls are in control as stock markets in Europe and the US are showing strong gains,” said Equiti Capital market analyst David Madden.

“European equities have rebounded from the multi-month lows that were registered yesterday in the wake of the disappointing services and manufacturing reports.

“Over in the US, stocks have been rebounding this week and today they are building on those gains.”

In economic news, official figures released earlier showed UK retail sales falling in May, as households cut spending on food amid the cost-of-living crisis.

Retail sales were down 0.5% on the month following a 0.4% increase in April, which was revised down from 1.4% growth.

That was mainly due to a 1.6% decline in food store sales, and left sales volumes 2.6% above their pre-Covid level.

Analysts had been expecting a 0.7% month-on-month fall.

“Retail sales fell in May driven by a decline in food sales,” said Heather Bovill, deputy director for surveys and economic indicators at the ONS.

“Feedback from supermarkets suggested customers were spending less on their food shop, because of the rising cost of living.”

The figures came as the latest survey from GfK showed that UK consumer confidence fell to an historic low in June as soaring inflation and the weakening economic outlook weighed heavily.

GfK’s consumer confidence barometer overall index was -41 in June, down on May’s -40 and April’s -38.

The lowest score recorded during the pandemic was -36, in the first lockdown.

Earlier this week, data from the ONS showed that consumer price inflation rose to a fresh 40-year high of 9.1% in May as energy and food prices continued to surge.

That was up from 9% in April and marked the highest level since March 1982.

“Stepping back from the May data, it’s clear that sales have been on a steady downward trend since the April 2021 peak when the economy began to emerge from the last Covid-19 lockdown,” said Martin Beck, chief economic advisor to the EY ITEM Club.

“In the earlier part of this period, the fall was largely a function of the rotation back towards social consumption and away from goods.

“But that process appeared to have been largely completed by the first few months of this year, and the recent weakness is likely to be a function of the squeeze on household finances.”

Across the channel, German business sentiment unexpectedly deteriorated in June, according to a survey from the Ifo Institute.

The business climate index fell to 92.3 from 93.0 in May, coming in below expectations for a reading of 92.9.

Meanwhile, the expectations index edged down 85.8 in June from 86.9 the month before, while the current situation gauge printed at 99.3, down from 99.6.

Stateside, consumer confidence in the US was a tad weaker than expected in June, but inflation expectations also fell back over the month according to a closely-followed survey.

The University of Michigan's headline consumer confidence index printed at 50.0 at the end of June, against a reading of 58.4 at the of May and a preliminary estimate of 50.2.

Economists had expected the preliminary estimate to stand.

On London’s equity markets, Ultra Electronics surged 12.31% as the £2.6bn takeover of the British defence manufacturer by a US private equity firm looked set to be waved on by the UK government, after the Department for Business said it was minded to accept the deal.

Elsewhere, Barclays was 3.15% firmer after it agreed to buy UK specialist mortgage lender Kensington Mortgage Company as part of a deal valued at around £2.3bn.

Miners reversed earlier losses to close stronger, with Glencore up 0.78%, Rio Tinto Group rising 1.41%, Antofagasta ahead 1.11%, and Anglo American managing gains of 0.16%.

On the downside, travel firm TUI lost 3.85% after it announced that chief executive Fritz Joussen was stepping down after 10 years in the job.

Energean slid 1.62% after top shareholder Growthy Holdings, which is owned by the company’s chief executive Mathios Rigas, sold five million shares at £11.06 each in an accelerated bookbuild.

Reporting by Josh White at Sharecast.com. Additional reporting by Michele Maatouk, Frank Prenesti and Alexander Bueso.

Market Movers

FTSE 100 (UKX) 7,208.81 2.68%
FTSE 250 (MCX) 19,123.71 2.30%
techMARK (TASX) 4,322.51 2.59%

FTSE 100 - Risers

Hikma Pharmaceuticals (HIK) 1,637.00p 5.85%
Ashtead Group (AHT) 3,551.00p 5.72%
Croda International (CRDA) 6,304.00p 5.67%
Spirax-Sarco Engineering (SPX) 9,652.00p 5.60%
Dechra Pharmaceuticals (DPH) 3,426.00p 5.54%
Prudential (PRU) 986.20p 5.52%
Howden Joinery Group (HWDN) 614.20p 5.47%
Abrdn (ABDN) 170.95p 5.36%
InterContinental Hotels Group (IHG) 4,404.00p 5.03%
Flutter Entertainment (CDI) (FLTR) 8,790.00p 4.79%

FTSE 100 - Fallers

Centrica (CNA) 81.16p -2.05%
Rolls-Royce Holdings (RR.) 81.13p -1.11%
Aveva Group (AVV) 2,463.00p -0.44%
Endeavour Mining (EDV) 1,743.00p -0.23%
Vodafone Group (VOD) 126.50p 0.00%
Anglo American (AAL) 3,066.00p 0.16%
Avast (AVST) 526.80p 0.42%
International Consolidated Airlines Group SA (CDI) (IAG) 114.68p 0.44%
Glencore (GLEN) 446.25p 0.78%
NATWEST GROUP PLC ORD 100P (NWG) 221.50p 1.10%

FTSE 250 - Risers

Ultra Electronics Holdings (ULE) 3,448.00p 12.31%
Carnival (CCL) 756.80p 8.67%
Liontrust Asset Management (LIO) 989.00p 7.03%
Grafton Group Ut (CDI) (GFTU) 793.60p 6.30%
XP Power Ltd. (DI) (XPP) 2,885.00p 5.68%
Chrysalis Investments Limited NPV (CHRY) 116.60p 5.62%
Aston Martin Lagonda Global Holdings (AML) 540.60p 5.42%
Urban Logistics Reit (SHED) 174.50p 5.12%
Volution Group (FAN) 356.50p 5.01%
Softcat (SCT) 1,349.00p 4.98%

FTSE 250 - Fallers

Hochschild Mining (HOC) 104.90p -4.03%
TUI AG Reg Shs (DI) (TUI) 145.95p -3.85%
Baltic Classifieds Group (BCG) 142.80p -2.86%
Mitie Group (MTO) 57.50p -2.21%
Syncona Limited NPV (SYNC) 201.50p -2.18%
Ferrexpo (FXPO) 140.00p -2.10%
Energean (ENOG) 1,153.00p -1.62%
Diversified Energy Company (DEC) 112.00p -1.32%
FirstGroup (FGP) 133.70p -1.18%
Essentra (ESNT) 270.00p -0.92%