London midday: FTSE flattish as early gains ease

London stocks were losing their earlier positive momentum by midday on Monday, growing tentative as they near an all-time high.

The FTSE 100 was up just over four points or less than 0.1% to 7,516.48, with the pound pretty much flat on the dollar at 1.3041 and continuing the long fall against the euro, slipping another 0.2% lower at 1.1057.

With the Footsie less than 100 points from its all-time peak, this may have some investors questioning its value, suggested analyst Connor Campbell at Spreadex.

Helping sentiment overnight was another Monday morning rally for iron ore prices on fears of winter supply issues, though copper was soft and Brent crude oil was down 1.2%, with the latter continuing to trade near a two-month high as it had done so for around a week.

Mining heavyweights Anglo American, Glencore, BHP Billiton and Rio Tinto led the top risers in the session.

Gold miners Randgold Resources and Fresnillo were up even though the yellow metal's prices were back below $1,260/oz. after Friday’s jobs report led to big gains for the dollar and increased the relative cost of owning the zero-yielding metal.

"In theory we should now be at the start of the real summer lull that will likely last until the Jackson Hole build-up," said Jim Reid at Deutsche Bank, pointing out that the week after the US non-farm payrolls is normally quiet anyway but this week could be extra so.

"There's only really one obvious observable candidate to create a little noise this week and that's the US CPI numbers on Friday. Friday's slightly stronger than expected payroll number and hint of stronger wages did have an impact on markets as we'll see below. Inflation data is probably where the market is most sensitive to a surprise at the moment."

The macroeconomic data was indeed thin on the ground on Monday, with the Halifax house price index showing a 0.4% monthly increase, which partially offset declines recorded between May and June but still products a quarterly fall of 0.2%.

This was the fourth successive quarterly decrease in house prices, which has not happened since November 2012.

Over on the continent, Germany's DAX was the only real source of movement in Europe, erasing much of Friday’s gains after June’s German manufacturing production reading came in at a six-month low, down 1.1%, far worse than both the 0.2% forecast and the 1.2% gain in May.

In the afternoon, US labour market conditions data is due at 1500 BST, which dropped sharply in June to a six-month low, alongside some Fedspeak from James Bullard and Neel Kashkari.

In company news, retirement product specialist Just Group was higher as its principal insurance subsidiary was given an A+ financial strength rating by Fitch. In its inaugural ratings for the group, the ratings agency also gave the subsidiary and the parent company issuer default ratings of single A. All three ratings had a stable outlook attached.

Health and safety group Halma was moderately higher after completing two overseas acquisitions in its medical business for the equivalent of £12.1m and £3.4m, which were expected to both boost earnings. The larger was Cardios, a Brazilian specialist in ambulatory blood pressure monitoring, while the other purchase was for a range of non-invasive blood pressure devices.

Leading the fallers was bookmaker Paddy Power Betfair after confirming that chief executive Breon Corcoran will be stepping down after 16 years in the job. The recently merged group said interim revenue growth would be up 9% and underlying EBITDA up 21% when it reports on Tuesday.

With Visa's Consumer Spending Index showing a fall in consumer spending for a third consecutive month, the longest such streak since February 2013, several retailers were in the red, led by Next, Marks & Spencer and Kingfisher. Consumer spending saw an overall annual drop of -0.8% following declines in May and June.

Ultra Electronics's shares were lower as it announced top and bottom lines that were little changed at the half-year stage, though the company sounded a confident note on the full-year outlook, pointing to a "strong" order intake during the final part of the reporting period.

UBM was down after announcing the death of chair Dame Helen Alexander over the weekend.

NewRiver REIT announced that chief executive David Lockhart was shortly undergoing an medical procedure that will require him taking a leave of absence. The FTSE 250 firm’s board said that during that time, the day-to-day executive responsibilities of the company would be shared between the company’s property director Allan Lockhart and its chief financial officer Mark Davies.

Market Movers

FTSE 100 (UKX) 7,522.02 0.14%
FTSE 250 (MCX) 19,977.44 0.04%
techMARK (TASX) 3,448.84 -0.25%

FTSE 100 - Risers

Anglo American (AAL) 1,300.50p 2.36%
Glencore (GLEN) 344.85p 2.09%
Coca-Cola HBC AG (CDI) (CCH) 2,397.00p 2.09%
BHP Billiton (BLT) 1,387.50p 1.65%
Rio Tinto (RIO) 3,601.50p 1.57%
Convatec Group (CTEC) 288.90p 1.55%
Persimmon (PSN) 2,499.00p 1.42%
Taylor Wimpey (TW.) 190.50p 1.38%
easyJet (EZJ) 1,279.00p 1.11%
Legal & General Group (LGEN) 275.40p 1.06%

FTSE 100 - Fallers

Paddy Power Betfair (PPB) 7,450.00p -5.93%
Merlin Entertainments (MERL) 479.10p -2.10%
Mediclinic International (MDC) 742.00p -1.85%
Next (NXT) 4,312.00p -1.84%
Pearson (PSON) 645.00p -1.60%
Imperial Brands (IMB) 3,267.50p -1.22%
Provident Financial (PFG) 2,076.00p -1.14%
Marks & Spencer Group (MKS) 326.80p -1.12%
Centrica (CNA) 197.60p -1.05%
Kingfisher (KGF) 304.50p -0.81%

FTSE 250 - Risers

Just Group (JUST) 155.00p 5.59%
Acacia Mining (ACA) 186.50p 5.37%
QinetiQ Group (QQ.) 244.70p 4.22%
Ferrexpo (FXPO) 258.30p 4.07%
Evraz (EVR) 259.30p 3.89%
Nostrum Oil & Gas (NOG) 404.00p 3.59%
Carillion (CLLN) 58.10p 2.74%
esure Group (ESUR) 290.90p 2.47%
Vedanta Resources (VED) 763.50p 2.14%
Renishaw (RSW) 4,390.00p 2.02%

FTSE 250 - Fallers

Ultra Electronics Holdings (ULE) 2,014.00p -2.71%
Telecom Plus (TEP) 1,139.00p -2.57%
Polypipe Group (PLP) 403.60p -2.20%
AA (AA.) 201.90p -2.18%
CLS Holdings (CLI) 205.60p -2.10%
Rank Group (RNK) 233.80p -2.01%
Petra Diamonds Ltd.(DI) (PDL) 91.35p -1.88%
Petrofac Ltd. (PFC) 474.00p -1.86%
Coats Group (COA) 75.75p -1.81%
FDM Group (Holdings) (FDM) 925.00p -1.70%