London midday: Stocks flat as Autumn Statement looms

London stocks had pared earlier small gains to trade flat by midday on Wednesday, as investors eyed the Autumn Statement.

The FTSE 100 was steady at 7,480.25, with Chancellor Jeremey Hunt due to deliver his statement at around 1230 GMT, after Prime Minister’s Questions.

Victoria Scholar, head of investment at Interactive Investor, said: "All eyes are on Chancellor Jeremy Hunt today as he prepares to deliver the Autumn Statement. With the Conservatives lagging in the polls, a looming general election, Rishi Sunak achieving his goal of halving inflation ahead of schedule, and the UK’s public finances in a better position than expected, the Treasury is anticipated to unveil some vote-winning tax cuts today. This marks a change from recent fiscal policy with the government until now refraining from tax cuts and keeping a lid on spending where possible in order to support the Bank of England in its attempts to tame inflation.

"We could see a one-year extension to tax breaks for business investment as well as a cut to national insurance contributions and business taxes. It has already been revealed that the minimum wage will go up and expand to cover 21- and 22-year-olds for the first time. The Chancellor will also announce a back to work plan to boost employment and help those with long-term health conditions. Other areas to watch out for include a ‘pot for life’ in major pensions reforms as well as possible changes to ISAs, inheritance tax and stamp duty. Focus will also be on the OBR’s independent economic forecasts for clues into the outlook for growth and inflation."

Investors were also mulling the latest survey from the Confederation of British Industry, which showed that manufacturing output fell sharply in November as orders slid to their lowest level in nearly three years.

According the latest monthly industrial trends survey, output volumes in the three months to November had a balance of -17, a sharp decline on October’s balance of -6.

A balance is the weighted percentage of companies reporting an increase minus those reporting a decrease.

In equity markets, Sage Group rallied as it reported an 18% jump in full-year underlying operating profit, lifted its dividend and announced a share buyback programme of up to £350m.

Johnson Matthey gained as it raised the outlook for its full-year underlying operating performance despite posting a drop in first-half sales and profit due to lower precious metal market prices.

JD Sports was on the rise again, having surged on Tuesday after US peer Dick’s Sporting Goods lifted its outlook.

On the downside, B&Q and Castorama owner Kingfisher slumped as it cut its profit guidance for the second time owing to continued market weakness in France.

The company, which also owns Screwfix in the UK and a host of other DIY brands across Europe, said adjusted pre-tax profit for the year ending January 2024 will now come in at around £560m, compared with £758m the year before. In September, the company had slashed its guidance from £634m to £590m.

HSBC was weaker after RBC Capital Markets downgraded the shares to 'sector perform' from 'outperform'. "HSBC has outperformed UK bank peers by 31% YTD, however, we think that now is a good time to take profits," it said.

"Earnings momentum looks to have turned and an improved capital distribution profile is now reflected in consensus."

Market Movers

FTSE 100 (UKX) 7,480.25 -0.02%
FTSE 250 (MCX) 18,490.82 0.78%
techMARK (TASX) 4,120.52 0.75%

FTSE 100 - Risers

Sage Group (SGE) 1,128.50p 13.17%
JD Sports Fashion (JD.) 148.65p 2.80%
BT Group (BT.A) 120.55p 2.12%
Barratt Developments (BDEV) 500.80p 1.71%
Unite Group (UTG) 976.50p 1.61%
SEGRO (SGRO) 822.40p 1.61%
Land Securities Group (LAND) 650.00p 1.59%
International Consolidated Airlines Group SA (CDI) (IAG) 157.90p 1.58%
London Stock Exchange Group (LSEG) 8,808.00p 1.45%
Halma (HLMA) 2,107.00p 1.40%

FTSE 100 - Fallers

Kingfisher (KGF) 216.50p -6.11%
HSBC Holdings (HSBA) 601.40p -1.94%
Rentokil Initial (RTO) 455.90p -1.36%
Barclays (BARC) 140.28p -1.02%
Shell (SHEL) 2,588.00p -0.96%
BP (BP.) 472.15p -0.92%
Entain (ENT) 824.20p -0.89%
Whitbread (WTB) 3,314.00p -0.78%
Standard Chartered (STAN) 657.20p -0.73%
Aviva (AV.) 420.40p -0.61%

FTSE 250 - Risers

Johnson Matthey (JMAT) 1,531.00p 4.93%
Digital 9 Infrastructure NPV (DGI9) 43.70p 4.05%
Big Yellow Group (BYG) 1,098.00p 3.98%
Wizz Air Holdings (WIZZ) 1,916.00p 3.93%
Telecom Plus (TEP) 1,644.00p 3.92%
Energean (ENOG) 954.00p 3.70%
AJ Bell (AJB) 275.60p 3.61%
Sirius Real Estate Ltd. (SRE) 89.30p 3.54%
CAB Payments Holdings (CABP) 63.45p 3.17%
Genuit Group (GEN) 318.50p 3.07%

FTSE 250 - Fallers

Ceres Power Holdings (CWR) 203.20p -2.87%
Genus (GNS) 2,052.00p -2.84%
TUI AG Reg Shs (DI) (TUI) 491.00p -2.29%
Diversified Energy Company (DEC) 70.50p -1.47%
Liontrust Asset Management (LIO) 580.00p -1.44%
Bodycote (BOY) 586.50p -1.18%
Crest Nicholson Holdings (CRST) 183.00p -1.13%
Dr. Martens (DOCS) 112.10p -1.06%
Ninety One (N91) 178.90p -1.05%
Virgin Money UK (VMUK) 157.60p -0.94%