London close: Stocks reverse early losses ahead of US inflation data

London stocks reversed earlier losses in the next to last trading session of May, with Auto Trader pacing gains on the back of well-received results.

Stocks are often pushed higher towards the end of each month on account of 'window dressing' by fund managers.

On this occasion however, investors were also expectant ahead of US PCE inflation numbers due out the next day that some economists believed would show prices rising at their slowest pace year-to-date.

The FTSE 100 was up 0.59% at 8,231.05, despite having opened in the red as worries about higher-for-longer interest rates continued to weigh on sentiment.

In parallel, the yield on the benchmark 10-year Gilt was retracing part of the prior day's gains, trading down by six basis points to 4.35%.

"Friday's US PCE inflation print should help the Fed in its monetary policy decision making, especially after Thursday's Q1 GDP growth downward revision as corporate profits unexpectedly fall in Q1 while initial jobless claims rise slightly more than expected," said Axel Rudolph, senior market analyst at IG.

On home shores, the latest figures from Zoopla showed the number of homes coming to market has soared as the recovery in the UK housing market continued to gain pace.

According to the latest Zoopla UK house price index, the average estate agent had 31 homes for sale in April, up 20% year-on-year and the highest amount in eight years. The number of agreed sales was also higher, up 13% year-on-year.

The greater number of homes coming to market meant annual house price inflation was largely flat, however, at 0.1%.

The average house price in the UK was now £264,300.

Richard Donnell, executive director, research, at Zoopla, said: "Greater choice will keep prices in check over 2024. The general election is likely to dampen the number of sales agreed in the run up to summer."

In equity markets, Auto Trader surged to the top of the FTSE 100 as it said the new financial year had got off to a strong start and posted in jump in annual sales and profits.

The car marketplace specialist said revenues in the year to 30 May rose 14% to £570.9m. Within that, Auto Trader sales increased 12% to £529.7m while leasing specialist Autorama saw a 51% increase to £41.2m. Group adjusted earnings before interest, tax, depreciation and amortisation rose 14% to £375.3m, while pre-tax profits increased 18% to £345.2m.

Troubled bootmaker Dr Martens edged up as it held guidance for the current year and announced a cost savings target of up to £25m. It also posted a bigger-than-expected fall in annual revenue and operating profit as its US woes continued.

Frasers Group rallied following a report the company is closing in on a deal to take control of Ted Baker’s British arm. According to Drapers, the prospective deal will not include the business’s head office workers in London.

Currys jumped after Berenberg upgraded the shares to ‘buy’ from ‘hold’ and lifted the price target to 90p from 67p as it said the electricals retailer was "a sound way to play the expected improvement in UK retail demand".

Anglo American recovered from early weakness even after BHP abandoned its £39bn pursuit of the London-listed miner. Both Jefferies and UBS downgraded their stance on Anglo shares, to ‘hold’ from ‘buy’ and to ‘neutral’ from ‘buy’, respectively.

Coca-Cola HBC, Centrica, and Severn Trent were all on the back foot as they traded without entitlement to the dividend.

Market Movers

FTSE 100 (UKX) 8,231.05 0.59%
FTSE 250 (MCX) 20,670.87 1.15%
techMARK (TASX) 4,800.65 0.66%

FTSE 100 - Risers

Auto Trader Group (AUTO) 825.00p 12.92%
Ocado Group (OCDO) 383.50p 6.50%
Frasers Group (FRAS) 875.00p 6.06%
JD Sports Fashion (JD.) 133.80p 5.60%
St James's Place (STJ) 505.00p 4.33%
Land Securities Group (LAND) 660.00p 3.21%
Flutter Entertainment (DI) (FLTR) 14,975.00p 3.17%
Airtel Africa (AAF) 123.80p 3.17%
SEGRO (SGRO) 914.60p 3.00%
Burberry Group (BRBY) 1,054.00p 2.73%

FTSE 100 - Fallers

Sage Group (SGE) 1,015.50p -4.20%
Coca-Cola HBC AG (CDI) (CCH) 2,640.00p -3.44%
Antofagasta (ANTO) 2,205.00p -2.86%h
Severn Trent (SVT) 2,336.00p -1.97%
Intertek Group (ITRK) 4,754.00p -1.57%
RS Group (RS1) 712.50p -0.97%
GSK (GSK) 1,730.00p -0.94%
Centrica (CNA) 139.15p -0.93%
BP (BP.) 485.25p -0.79%
Experian (EXPN) 3,627.00p -0.71%

FTSE 250 - Risers

Trainline (TRN) 324.40p 7.47%
Currys (CURY) 76.60p 7.21%
Pets at Home Group (PETS) 298.40p 6.95%
Ithaca Energy (ITH) 135.00p 6.64%
WH Smith (SMWH) 1,165.00p 6.36%
Watches of Switzerland Group (WOSG) 407.40p 5.43%
Diversified Energy Company (DEC) 1,163.00p 5.34%
Foresight Group Holdings Limited NPV (FSG) 480.00p 5.26%
Close Brothers Group (CBG) 483.80p 5.08%
Caledonia Investments (CLDN) 3,505.00p 4.63%

FTSE 250 - Fallers

PZ Cussons (PZC) 110.80p -4.72%
Bank of Georgia Group (BGEO) 3,680.00p -4.17%
Auction Technology Group (ATG) 551.00p -3.67%
Allianz Technology Trust (ATT) 352.00p -2.09%
Keller Group (KLR) 1,320.00p -2.08%
Ashmore Group (ASHM) 195.30p -1.56%
Bytes Technology Group (BYIT) 571.50p -1.55%
JPMorgan Global Growth & Income (JGGI) 540.00p -1.28%
Britvic (BVIC) 961.50p -1.13%
Great Portland Estates (GPE) 351.00p -1.13%