London midday: Stocks push higher at month's end ahead of US inflation data

London stocks were pushing higher still into the end of the month as investors waited on a raft of inflation indicators in the US while digesting a very large and positive surprise on second quarter euro area gross domestic product.

As of 1216 BST, the FTSE 100 was up by 26.27 points or 0.35% to 7,370.82, alongside a 1.29% or 253.29 point gain on the second-tier index to 20,109.49.

In parallel, futures for the US Nasdaq-100 were climbing by 140.50 points to 12,878.0, as investors cheered the latest quarterly results out of Amazon.com and Apple released overnight.

Shares of the former were running up by nearly 13% before the start of the regular trading session in New York.

Commenting on the market backdrop, BofA strategists led by Michael Hartnett cautioned that one of the big lead indicators for the market, Brent crude oil, had yet to fall below $100 a barrel, thus giving the all-clear on the "peak yield" theme.

Still on the economic calendar for Friday, a slew of inflation indicators were due out in the US at 1330 BST, including the second quarter employment cost index and price deflators for personal consumption expenditures in June.

Courtesy of the University of Michigan, gauges of US consumers' inflation expectations for the month of July would follow at 1500 BST.

Back in the UK, consumer credit data for June surprised to the upside, showing that households were prepared to save less and borrow more to defend their lifestyles - thus buoying consumption - said Pantheon Macroeconomics's chief UK economist, Samuel Tombs.

However, it remained to be seen if they would do the same when real disposable incomes lurhc lower again in the last quarter of 2022 and the first quarter of 2023, Tombs, meaning that a recession in the UK remained a "major" risk.

Across the Channel meanwhile, Eurostat reported that euro area GDP bounded ahead at a quarter-on-quarter clip of 0.7% over the three months to June (consensus: 0.1%).

But whereas growth jumped by 1.1% in Spain, it stalled in the bloc's largest economy, Germany, and economists were wary going forward.

NatWest paces gains

NatWest beat analysts' estimates for both operating pre-tax proit and total income for its second quarter. The lender posted pretax profits of £1.4bn on £3.21bn of revenues while net profit came in at £1.05bn. Net interest margins meanwhile improved by 26 basis points against the prior quarter to 2.72%. A dividend payout of 3.5p per share was declared for the quarter.

StanChart shares were higher at the end of the week after delivering what the lender itself labelled a "strong" set of first half figures, announced a new $500m share buyback programme and expressed confidence on its full-year targets. Commenting on the group's performance, chief executive officer, Bill Winters, highlighted the "continued positive" momentum seen during the quarter, discipline on expenses and significant savings. Income for the half was ahead by 8% to $8.2bn or by 10% at constant currencies and during the second quarter it was 11% higher at constant currencies. That saw a 10% jump in statutory pre-tax profits for the latest six months to $2.8bn.

Drugmaker AstraZeneca raised full-year revenue guidance on Friday as it provided details of its "strong" first trading half and announced that Michel Demaré would take over as the group's chairman in April 2023. Astra-Zeneca, which reported a 48% increase in interim revenues to $22.16bn, said total revenues were now expected to increase by "a low twenties percentage", up from previous estimates in the "high teens".

IAG returned to profit in the second quarter as its Iberia and Vueling airlines were boosted by post-Covid pandemic demand. The company on Friday said operating profits for the three months to June 30 came in at €293m, compared with a loss of €967m a year earlier. IAG, which also owns British Airways, posted an operating loss for the half year of €438m, significantly lower than 2021’s €2.03bn.

Chemicals company Croda International said on Friday that profits had surged in the six months ended 30 June, driven by improved interim sales and margins. Croda said interim pre-tax profits were up 211% at £636.5m, operating profits were 32.1% higher at £288.6m, and basic earnings per share had grown 254% to 389.6p, driven by a 20.7% increase in revenues to £1.12bn.

UK luxury sportscar maker Aston Martin said first-half losses had widened as supply chain constraints hit production. The company reported a pre-tax loss of £285.4m in the six months to June 30, compared with a loss of £90.7m a year ago. It sold 2,676 vehicles wholesale, compared with 2,901 a year earlier. Aston Martin, which is pinning its hopes on the lucrative Chinese market, said it expected the supply chain issues to unwind in the second half and forecast higher sales after ramping up production of its DBX707 and the V12 Vantage.

Market Movers

FTSE 100 (UKX) 7,374.11 0.39%
FTSE 250 (MCX) 20,112.65 1.30%
techMARK (TASX) 4,356.48 0.49%

FTSE 100 - Risers

NATWEST GROUP PLC ORD 100P (NWG) 247.20p 7.48%
Ocado Group (OCDO) 830.20p 5.65%
Fresnillo (FRES) 730.60p 4.70%
Aveva Group (AVV) 2,328.00p 4.35%
Rolls-Royce Holdings (RR.) 90.14p 4.28%
Scottish Mortgage Inv Trust (SMT) 869.00p 4.00%
B&M European Value Retail S.A. (DI) (BME) 424.50p 3.79%
Barclays (BARC) 155.86p 3.67%
Anglo American (AAL) 2,948.00p 3.64%
Antofagasta (ANTO) 1,153.50p 3.41%

FTSE 100 - Fallers

Intertek Group (ITRK) 4,292.00p -3.85%
Avast (AVST) 467.30p -3.61%
Rightmove (RMV) 621.60p -3.60%
British American Tobacco (BATS) 3,270.50p -3.02%
Compass Group (CPG) 1,900.50p -2.69%
AstraZeneca (AZN) 10,586.00p -2.61%
Centrica (CNA) 86.94p -2.14%
Imperial Brands (IMB) 1,800.00p -1.77%
BT Group (BT.A) 159.05p -1.73%
BAE Systems (BA.) 766.20p -1.69%

FTSE 250 - Risers

Vesuvius (VSVS) 358.40p 10.28%
Hammerson (HMSO) 24.78p 5.90%
Baltic Classifieds Group (BCG) 157.80p 5.62%
Kainos Group (KNOS) 1,347.00p 5.56%
Currys (CURY) 67.55p 5.05%
Ferrexpo (FXPO) 149.50p 4.69%
TI Fluid Systems (TIFS) 175.80p 4.64%
Ashmore Group (ASHM) 213.80p 4.50%
IP Group (IPO) 85.05p 4.16%
Morgan Advanced Materials (MGAM) 315.50p 4.13%

FTSE 250 - Fallers

Babcock International Group (BAB) 337.80p -2.37%
Jupiter Fund Management (JUP) 125.50p -2.33%
Moneysupermarket.com Group (MONY) 206.00p -1.62%
Fidelity China Special Situations (FCSS) 257.50p -1.34%
Plus500 Ltd (DI) (PLUS) 1,639.00p -0.85%
Rathbones Group (RAT) 1,840.00p -0.76%
Beazley (BEZ) 539.00p -0.65%
Spire Healthcare Group (SPI) 236.50p -0.63%
Biffa (BIFF) 359.60p -0.61%
VinaCapital Vietnam Opportunity Fund Ltd. (VOF) 492.00p -0.61%