London midday: Stocks hold gains as GDP meets expectations

London stocks were maintaining gains by midday as investors waded through a deluge of earnings and digested the latest reading on the UK economy, which met expectations.

The FTSE 100 was up 0.5% to 7,472.97, while the pound was up 0.2% against the euro and the dollar at 1.1210 and 1.3055, respectively.

According to the Office for National Statistics, UK economic growth remained tepid in the second quarter, though the initial estimate for gross domestic product was in line with economists' forecasts.

GDP grew 0.3% in the second quarter of the year, up only slightly from the disappointing growth of 0.2% in first quarter but in line with the consensus forecast. Year-on-year, GDP rose 1.7%, also as expected, but down from the 2.0% in the previous quarter.

ONS said economic growth was driven by the services sector, notably the retail and film sectors, with construction and manufacturing acting as a drag.

GDP per head was estimated to have increased by 0.1% during the quarter.

Azad Zangana, senior European economist at Schroders, said: “Overall, the latest figures are as expected, highlighting the weakness in the economy post the Brexit referendum. We forecast some improvement in the second half of the year as inflation starts to abate, but we doubt growth will return to above trend levels for at least a year."

Investors in the UK were also looking ahead to a rate announcement from the Federal Reserve after the close at 1900 BST, although no change is expected.

In corporate news, broadcaster ITV was on the front foot after upping its interim dividend as a show of confidence in the underlying business as first-half profits fell 8%.

Catering company Compass gained as it reported a 3.9% rise in third-quarter organic revenue, while Metro Bank advanced after saying it swung to a profit in the first half late on Tuesday.

Tullow Oil gushed higher as it said revenue rose but it swung to a pre-tax loss in the first half, as the numbers were in line with expectations, while Paragon rallied after reporting a solid third quarter.

Brewin Dolphin edged up after it said third-quarter total assets increased 3.7%, while Petrofac got a boost as it said it had won Iraq contracts worth $100m.

Fresnillo turned up after reaffirming its 2017 production guidance and reporting a rise in second-quarter silver and gold production, while Antofagasta also reversed course to trade up after reporting growth in copper and gold production in the second quarter.

Berendsen popped higher after earlier losses, as it posted a 5.6% drop in half-year profit amid a deteriorating UK performance.

On the downside, 3i Group slipped a touch after posting net asset value per share of 628p and a total return of 4.1%.

Retail property developer Hammerson reversed earlier gains to trade lower after it reported a rise in first half pre-tax profits of £289.7m from £167.2m, while engineer GKN ticked just a touch lower as it reported a jump in first-half profit, but said margins were down across the board, with the performance of the aerospace division failing to impress.

Sage Group was lower as it disappointed with slowing third quarter trading and its guidance for the full year.

Pub and brewing company Marston's declined despite reporting a rise in sales in the 42 weeks to 22 July.

Market Movers

FTSE 100 (UKX) 7,472.97 0.51%
FTSE 250 (MCX) 19,747.60 0.54%
techMARK (TASX) 3,512.91 0.13%

FTSE 100 - Risers

ITV (ITV) 181.20p 3.01%
SEGRO (SGRO) 534.00p 2.79%
Compass Group (CPG) 1,629.00p 1.88%
British American Tobacco (BATS) 5,369.00p 1.63%
Anglo American (AAL) 1,190.50p 1.62%
Diageo (DGE) 2,284.00p 1.53%
Sainsbury (J) (SBRY) 248.80p 1.51%
Fresnillo (FRES) 1,551.00p 1.51%
Severn Trent (SVT) 2,196.00p 1.43%
Mondi (MNDI) 2,046.00p 1.39%

FTSE 100 - Fallers

Sage Group (SGE) 680.50p -2.86%
Paddy Power Betfair (PPB) 7,495.00p -1.83%
Standard Chartered (STAN) 834.90p -0.75%
HSBC Holdings (HSBA) 751.60p -0.62%
Experian (EXPN) 1,514.00p -0.53%
Hammerson (HMSO) 582.50p -0.51%
Convatec Group (CTEC) 306.70p -0.49%
Provident Financial (PFG) 2,153.00p -0.46%
3i Group (III) 931.00p -0.32%
Direct Line Insurance Group (DLG) 370.30p -0.22%

FTSE 250 - Risers

Paragon Group Of Companies (PAG) 430.70p 5.56%
Tullow Oil (TLW) 161.10p 4.81%
Metro Bank (MTRO) 3,631.00p 4.79%
Petrofac Ltd. (PFC) 467.10p 3.39%
OneSavings Bank (OSB) 396.00p 3.07%
PayPoint (PAY) 884.50p 2.85%
Hikma Pharmaceuticals (HIK) 1,446.00p 2.84%
Spectris (SXS) 2,506.00p 2.75%
Virgin Money Holdings (UK) (VM.) 286.50p 2.47%
Jupiter Fund Management (JUP) 550.00p 2.33%

FTSE 250 - Fallers

Acacia Mining (ACA) 158.90p -5.98%
Petra Diamonds Ltd.(DI) (PDL) 104.80p -3.23%
Marston's (MARS) 117.70p -3.05%
Cobham (COB) 133.10p -2.13%
Stobart Group Ltd. (STOB) 269.40p -1.89%
Sirius Minerals (SXX) 29.76p -1.62%
Euromoney Institutional Investor (ERM) 1,044.00p -1.42%
Ascential (ASCL) 357.40p -1.27%
BGEO Group (BGEO) 3,430.00p -1.21%
IG Group Holdings (IGG) 618.00p -1.20%