London midday: FTSE flat ahead of US PCE; Pets at Home tumbles

London stocks were still steady by midday on Wednesday as investors continued to mull the implications of US President-elect Donald Trump’s new tariffs and ahead of a key US inflation reading.

The FTSE 100 was flat at 8,257.13.

Dan Coatsworth, investment analyst at AJ Bell, said: "Investors are growing increasingly concerned that Donald Trump’s next tariff target is continental Europe, creating another potential headwind on top of the existing one in the form of lacklustre economic activity."

Looking ahead to the rest of the day, the US PCE is due at 1330 GMT.

Patrick Munnelly at Tickmill Group said: "The October PCE report will be released later today. Expect headline PCE to climb 0.2% m/m, or 2.3% y/y vs. 2.1% in September. Core prices to climb 0.3% m/m and 2.8% y/y from 2.7%. Both metrics are above the inflation objective, and core PCE would exceed the 2.6% Fed forecast in the latest Summary of Economic Projections for this year. That may be the Q4/Q4 change, so there is more wood to chop, but base effects suggest that core PCE will overshoot that forecast.

"Disinflation appears to have stopped according to recent forecasts. That would match market estimates that the Fed will suspend its easing cycle in December (only 40% probability of another 25bps drop).

"However, markets believe the Fed still views policy settings as too restrictive, and next year would be a better time to assess the outlook, supported by the FOMC's assumptions revisions at the December meeting and before Trump's inauguration. Trading activity is expected to decrease further as Thursday marks the beginning of a four-day Thanksgiving weekend for many in the United States."

In equity markets, low-cost airline easyJet pared earlier strong gains to trade just a touch higher as it reported a surge in full-year profit and boosted its dividend on strong summer demand and a narrowing of winter losses.

The company posted a 34% rise in pre-tax profit to £610m. The dividend was lifted to 12.1p a share from 4.5p.

Auction Technology surged to the top of the FTSE 250 on the back of well-received full-year results and an upbeat outlook.

Pennon reversed earlier losses to trade up even as it said it swung to a loss in the first half as restructuring costs and investments weighed on the bottom line.

Mitchells & Butlers also gained after the pub group reported better-than-expected annual profits and said like-for-like sales in the first seven weeks of the current fiscal year were up 4%.

Aviva was boosted by an upgrade to ‘outperform’ at KBW.

On the downside, Pets at Home tumbled as it cut its full-year outlook, highlighting a "subdued" market.

Johnson Matthey slumped as it reported a drop in sales and profits for the six months to September end, weighed down by the "challenging" macroeconomic backdrop.

Aston Martin slid after the car maker raised £210m through share and private debt placings to support its growth and investment strategy and shore up its balance sheet, one day after announcing its second profit warning within two months.

Market Movers

FTSE 100 (UKX) 8,257.13 -0.02%
FTSE 250 (MCX) 20,595.55 0.13%
techMARK (TASX) 4,693.22 -0.07%

FTSE 100 - Risers

Anglo American (AAL) 2,414.00p 1.75%
Vistry Group (VTY) 668.50p 1.67%
Airtel Africa (AAF) 101.50p 1.65%
LondonMetric Property (LMP) 192.30p 1.21%
BT Group (BT.A) 157.85p 1.09%
Marks & Spencer Group (MKS) 379.80p 1.04%
British Land Company (BLND) 387.00p 0.99%
Pershing Square Holdings Ltd NPV (PSH) 3,714.00p 0.98%
Aviva (AV.) 486.50p 0.98%
Tesco (TSCO) 353.80p 0.97%

FTSE 100 - Fallers

Whitbread (WTB) 2,840.00p -1.32%
Antofagasta (ANTO) 1,646.50p -1.14%
NATWEST GROUP (NWG) 387.10p -1.12%
Flutter Entertainment (DI) (FLTR) 21,730.00p -1.09%
Kingfisher (KGF) 249.20p -1.07%
Sage Group (SGE) 1,296.50p -1.07%
Barclays (BARC) 258.40p -0.98%
Scottish Mortgage Inv Trust (SMT) 939.40p -0.91%
Smurfit Westrock (DI) (SWR) 4,376.00p -0.88%
Diageo (DGE) 2,344.50p -0.85%

FTSE 250 - Risers

Auction Technology Group (ATG) 522.00p 18.50%
Pennon Group (PNN) 598.00p 3.10%
IP Group (IPO) 44.35p 2.66%
Mitchells & Butlers (MAB) 251.50p 2.65%
Fidelity China Special Situations (FCSS) 209.50p 2.44%
Crest Nicholson Holdings (CRST) 160.10p 2.30%
BH Macro Ltd. GBP Shares (BHMG) 405.00p 2.27%
Keller Group (KLR) 1,492.00p 2.19%
SThree (STEM) 355.50p 2.16%
Ocado Group (OCDO) 328.40p 2.05%

FTSE 250 - Fallers

Pets at Home Group (PETS) 242.40p -12.49%
Johnson Matthey (JMAT) 1,411.00p -5.49%
Aston Martin Lagonda Global Holdings (AML) 102.40p -5.10%
Kainos Group (KNOS) 784.00p -4.04%
Wood Group (John) (WG.) 53.40p -3.00%
Softcat (SCT) 1,582.00p -1.86%
Wizz Air Holdings (WIZZ) 1,290.00p -1.75%
Allianz Technology Trust (ATT) 398.00p -1.73%
Baillie Gifford Japan Trust (BGFD) 698.00p -1.69%
BlackRock Greater Europe Inv Trust (BRGE) 537.00p -1.65%