London open: FTSE dips as wariness sets in ahead of Budget

London stocks dipped in early trade on Friday as investors mulled a decline in consumer confidence and as wariness set in ahead of next week’s Budget.

At 0840 BST, the FTSE 100 was down 0.1% at 8,258.78.

A survey released earlier by GfK showed that UK consumer confidence fell slightly in October, with consumers in a "despondent" mood ahead of the Budget.

GfK’s consumer confidence index nudged down one point to -21, falling back down to the level last seen in March this year.

Neil Bellamy, consumer insights director at GfK, said: "As the Budget statement looms, consumers are in a despondent mood despite a fall in the headline rate of inflation.

"This month’s consumer confidence barometer paints a picture of people holding their breath to see what’s in store for them on 30th October."

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "The FTSE 100 is in a holding pattern at the end of the week, as the UK Budget looms and investors remain highly cautious. The index has opened lower, with little to ignite overall investor sentiment. However, buoyant results from NatWest, as it joined the banking results party, did provide some cheer with the stock more than 3% higher in early trade.

"As the guessing game continues about what Chancellor Rachel Reeves will include in her first Budget, it’s dented consumer confidence in the UK. A closely watched survey from GfK indicates that a despondent mood has taken hold ahead of revelation of the government’s tax and spending plans with concerns about the UK economy rising.

"GfK’s consumer confidence survey fell one point to -21 in October from -20 in September. This is the lowest since March, when the former Conservative Chancellor Jeremy Hunt delivered his last Budget. However, with fresh interest rate cuts expected optimism around consumers’ finances and confidence about making major purchases ticked up. This will provide hope that once the government’s financial plan becomes clear, uncertainty may ease off and overall consumer confidence may rebound."

On the corporate front, NatWest jumped to the top of the FTSE 100 as it raised its full-year income forecasts after a strong third quarter, in which profits jumped by 34.6% on last year.

Profit for the three months to 30 September totalled £1.24bn, up from £924m, as total income rose 7.3% to £3.49bn.

The banking group said it now expects to achieve a return on tangible equity above 15%, up one percentage point on previous guidance, while adjusted income should come in at £14.4bn, compared with an earlier forecast of £14bn.

Airtel Africa slumped as it reported a 16.5% drop in first-half earnings before interest, tax, depreciation and amortisation.

SSE was knocked lower by a downgrade to ‘sell’ at Citi. The bank said: "SSE has an attractive set of networks and renewable assets. However, we are increasingly concerned around the deployment of its offshore wind fleet and see risks of further delays, which could impact EPS and/or returns."

Market Movers

FTSE 100 (UKX) 8,258.78 -0.13%
FTSE 250 (MCX) 20,762.38 -0.14%
techMARK (TASX) 4,730.36 -0.34%

FTSE 100 - Risers

NATWEST GROUP (NWG) 377.40p 5.92%
Barclays (BARC) 247.25p 3.82%
London Stock Exchange Group (LSEG) 10,665.00p 2.70%
Unilever (ULVR) 4,771.00p 2.54%
Anglo American (AAL) 2,375.50p 2.24%
Intermediate Capital Group (ICG) 2,130.00p 2.11%
Standard Chartered (STAN) 858.20p 1.90%
Scottish Mortgage Inv Trust (SMT) 861.20p 1.27%
Entain (ENT) 725.60p 1.20%
Melrose Industries (MRO) 451.50p 1.19%

FTSE 100 - Fallers

Airtel Africa (AAF) 109.40p -4.45%
SSE (SSE) 1,818.00p -3.94%
United Utilities Group (UU.) 1,043.50p -2.57%
Severn Trent (SVT) 2,616.00p -2.53%
B&M European Value Retail S.A. (DI) (BME) 398.40p -2.19%
Intertek Group (ITRK) 4,742.00p -2.11%
Schroders (SDR) 355.60p -1.98%
Hikma Pharmaceuticals (HIK) 1,934.00p -1.98%
Smurfit Westrock (DI) (SWR) 3,504.00p -1.96%
BAE Systems (BA.) 1,299.00p -1.81%

FTSE 250 - Risers

Softcat (SCT) 1,666.00p 8.75%
Bloomsbury Publishing (BMY) 738.00p 8.21%
Burberry Group (BRBY) 760.60p 6.83%
Trustpilot Group (TRST) 250.50p 5.70%
Indivior (INDV) 688.00p 5.28%
Petershill Partners (PHLL) 223.50p 4.20%
Spire Healthcare Group (SPI) 227.00p 3.18%
Aston Martin Lagonda Global Holdings (AML) 110.60p 3.08%
Kainos Group (KNOS) 819.00p 2.89%
Essentra (ESNT) 155.20p 2.78%

FTSE 250 - Fallers

Abrdn (ABDN) 143.65p -12.38%
Kier Group (KIE) 142.00p -4.95%
Travis Perkins (TPK) 877.00p -4.88%
Inchcape (INCH) 725.50p -4.85%
Pennon Group (PNN) 567.00p -4.38%
RHI Magnesita N.V. (DI) (RHIM) 3,105.00p -3.72%
Endeavour Mining (EDV) 1,814.00p -3.15%
Bakkavor Group (BAKK) 155.00p -3.13%
Jupiter Fund Management (JUP) 81.00p -3.11%
Morgan Sindall Group (MGNS) 3,835.00p -3.03%