London close: Stocks mixed as fresh PMI data disappoints

London's stock markets closed with a mixed result on Monday, reflecting investors' mixed sentiment as they reacted to a weak set of economic data at the start of a busy week on the economic calendar.

The FTSE 100 index closed up 0.19% to finish at 7,678.59, while the mid-cap FTSE 250, often seen as a better barometer of domestic sentiment, slipped 0.29% to end the session at 19,144.98.

In currency markets, sterling was last down 0.28% against the dollar to trade at $1.2818, while it strengthened 0.13% on the euro to change hands at €1.1571.

“The FTSE 100 and other markets have reversed their morning weakness despite the raft of poorer PMIs,” said IG chief market analyst Chris Beauchamp.

“These have pushed down the euro and sterling, giving European indices their usual modest lift, but ahead of this week’s central bank decisions a view is gathering pace that the period of rising rates is at an end, providing some hope of a market uplift into year-end.”

Economic activity slows in UK and eurozone amid dimming outlook

In economic news, significant slowdowns were recorded in the UK's manufacturing and services sectors in July, marking a notable dip in economic activity, according to fresh survey results.

The S&P Global/CIPS 'flash' composite output Index - a major indicator of overall economic health - slumped to a six-month low of 50.7, falling from a June reading of 52.8.

The purchasing managers' index (PMI), a key measure of economic trends in manufacturing and service sectors, also fell in July.

The PMI for manufacturing dropped from 46.5 in June to 45.0, failing to meet the consensus prediction of 46.0.

Similarly, the services PMI backtracked from 53.7 to 51.5, a notable decline from the expected consensus of 53.0.

“The UK economy has come close to stalling in July which, combined with gloomy forward-looking indicators, reignites recession worries,” said S&P Global chief business economist Chris Williamson.

“An upside to the deteriorating growth and demand picture is a further cooling of inflationary pressures.

“Manufacturing prices are falling at an increased rate and service sector inflation is continuing to moderate.

“Although ongoing upward wage pressures mean service sector price growth remains elevated, the survey data signal further, potentially marked, falls in consumer price inflation in the months ahead.”

On the continent, economic activity levels in the eurozone also contracted in July, adding to concerns about the region's recovery.

The HCOB 'flash' eurozone composite purchasing managers' output index, a closely-watched economic indicator that combines manufacturing and services output, fell from a June reading of 49.9 to 48.9 in July.

The index revealed the second consecutive contraction in output volumes after five months of growth, signalling an accelerated decline following a marginal drop observed at the end of the second quarter.

Mixed performances shape equity market; Ocado soars, S4 Capital tumbles

On London’s equity markets, Ocado Group soared 14.26% following a successful resolution to a lengthy legal dispute.

The online supermarket won a £200m settlement from Norwegian company AutoStore over disputed 'robot' patents.

The lawsuit had spanned three years, and was centred around claims to intellectual property rights for warehouse technology, which both companies license globally to retailers.

Vodafone Group also had a strong day, closing up 4.08% after the telecom giant announced a 3.7% rise in first-quarter group service revenue, driven primarily by its UK operations.

Total revenue for the period reached €10.7bn, an increase from €9.5bn a year earlier.

Additionally, Vodafone revealed the appointment of former SAP chief financial officer, Luka Mucic, who will assume the same role at Vodafone from 1 September.

In other gainers, GSK saw a modest rise of 0.55% after its majority-owned subsidiary, ViiV Healthcare, received a positive opinion from the European Medicines Agency for its long-acting injectable HIV prevention drug, cabotegravir.

Liontrust Asset Management edged up by 0.45% after extending its offer period to acquire GAM Holding AG by three days, in a bid to win over hesitant shareholders.

On the downside, S4 Capital suffered a drop of 21.25% after the digital advertising and marketing services firm slashed its full-year targets for revenues and profits, citing challenging macroeconomic conditions.

The firm pointed to particular caution from its technology sector clients, with like-for-like growth in net revenues now expected at 2% to 4%, a significant decrease from the previously predicted 6% to 10%.

Airline shares also took a hit, with easyJet falling 4.43% and Wizz Air down 6.41%.

That was in response to low-cost carrier Ryanair's cautious forecast for winter demand, despite better-than-expected first-quarter profits, which affected sentiment towards its FTSE 250 rivals.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 7,678.59 0.19%
FTSE 250 (MCX) 19,144.98 -0.29%
techMARK (TASX) 4,461.73 -0.14%

FTSE 100 - Risers

Ocado Group (OCDO) 785.00p 14.26%
Vodafone Group (VOD) 76.51p 4.08%
BT Group (BT.A) 126.10p 2.27%
BP (BP.) 483.70p 1.66%
Persimmon (PSN) 1,187.00p 1.54%
Airtel Africa (AAF) 110.10p 1.47%
Glencore (GLEN) 478.65p 1.29%
Antofagasta (ANTO) 1,554.50p 1.24%
Shell (SHEL) 2,443.00p 1.03%
Prudential (PRU) 1,053.50p 0.96%

FTSE 100 - Fallers

Beazley (BEZ) 558.00p -3.04%
Burberry Group (BRBY) 2,182.00p -2.76%
Hargreaves Lansdown (HL.) 906.80p -2.18%
Sage Group (SGE) 919.40p -1.96%
WPP (WPP) 811.80p -1.96%
International Consolidated Airlines Group SA (CDI) (IAG) 153.10p -1.70%
Spirax-Sarco Engineering (SPX) 10,865.00p -1.63%
Unilever (ULVR) 4,018.50p -1.56%
DCC (CDI) (DCC) 4,556.00p -1.34%
B&M European Value Retail S.A. (DI) (BME) 557.00p -1.14%

FTSE 250 - Risers

ICG Enterprise Trust (ICGT) 1,190.00p 4.39%
Molten Ventures (GROW) 279.80p 4.01%
Paragon Banking Group (PAG) 549.00p 3.08%
Babcock International Group (BAB) 387.80p 2.76%
Abrdn Private Equity Opportunities Trust (APEO) 448.00p 2.75%
Darktrace (DARK) 392.80p 2.56%
OSB Group (OSB) 362.00p 2.55%
Synthomer (SYNT) 81.65p 2.31%
Vanquis Banking Group 20 (VANQ) 186.00p 2.20%
HarbourVest Global Private Equity Limited A Shs (HVPE) 2,295.00p 2.00%

FTSE 250 - Fallers

Wizz Air Holdings (WIZZ) 2,504.00p -6.41%
easyJet (EZJ) 454.10p -4.43%
Bakkavor Group (BAKK) 101.00p -4.27%
TUI AG Reg Shs (DI) (TUI) 588.50p -3.53%
Ferrexpo (FXPO) 91.75p -3.37%
Target Healthcare Reit Ltd (THRL) 76.40p -3.05%
Shaftesbury Capital (SHC) 124.30p -2.99%
Me Group International (MEGP) 151.80p -2.82%
Assura (AGR) 47.54p -2.74%
PureTech Health (PRTC) 223.50p -2.61%