London open: Stocks flat ahead of Bank of England announcement
London stocks opened in muted fashion on Thursday as investors kept their powder dry ahead of the Bank of England's monthly policy decision and quarterly Inflation Report.
The FTSE 100 was up less than three points at 6,636.69 after half an hour's trading, while the FTSE 250 was down 30 points at 16,966.57.
This followed a positive session in Asia and a guarded by positive close from Wall Street overnight, boosted by an oil price rebound that has since lost some of its momentum.
Financial stocks were leading the way as investors looked to the BoE's Super Thursday for some sort of stimulus, even if the market's keen expectation of an interest rate cut fails to materialise.
CMC Markets’ Michael Hewson said: “While it is widely expected today that the Bank of England will lower its growth forecasts it is also expected to make a move on interest rates for the first time since 2009, and cut rates by at least 25 basis points to a new record low of 0.25%. It could also go on to announce the intention to implement further asset buying programs, however there is a school of thought that suggests the Bank should hold firm and wait and see.
“This is because there is a widespread acknowledgement that any such action today will probably not make a blind bit of difference and could well make things much worse, not only for banks, who are already struggling with wafer thin margins, but also for pension funds who are struggling with spiralling deficits, while savers continue to struggle with meagre returns.”
Later on in the day, market participants will turn their attention to the US, where initial jobless claims are at 1330 BST and durable goods orders and industrial new orders at 1500 BST.
In corporate news, insurance giant Aviva was top of the blue chip leaderboard, ahead of a slew of insurers and banks. Aviva's interim results for the six months to 30 June showed operating profit rising 13% to £1.325bn and operating earnings per share improving 1% to 22.4p.
During the period, general insurance net written premiums were up 7% to £3.991bn, the life insurance value of new business increased 7% to £583m, its fund management operating profit grew 48% to £49m, and its UK Life assets under management were up 23% to £10.3bn.
Inmarsat posted a respectable set of interim results on Thursday after the satellite services group returned to growth in the second quarter thanks to growth from the aviation sector, government contracts and its deal to supply mobile network Ligado Networks.
Full-year guidance was maintained, as revenues in the six months to 30 June rose 2.1% on the previous period to $629.0m, earnings before interest, tax, depreciation and amortisation (EBITDA) 7.5% at $368.4m.
Traffic at low-cost carrier EasyJet was up 6.7% in July to 7.5m passengers, while the load factor – which gauges how full the flights were – nudged up to 95.8% from 94.3%.
On a rolling 12-month basis, traffic was up 6.8% to 72.3m and the load factor ticked just a touch higher to 91.7% from 91.4%.
Market Movers
FTSE 100 (UKX) 6,640.53 0.09%
FTSE 250 (MCX) 16,994.23 -0.02%
techMARK (TASX) 3,423.71 -0.49%
FTSE 100 - Risers
Aviva (AV.) 400.00p 3.90%
RSA Insurance Group (RSA) 511.00p 2.57%
HSBC Holdings (HSBA) 514.20p 1.94%
Standard Chartered (STAN) 626.10p 1.92%
Royal Dutch Shell 'B' (RDSB) 1,939.50p 1.81%
Royal Dutch Shell 'A' (RDSA) 1,868.00p 1.72%
Legal & General Group (LGEN) 208.50p 1.51%
International Consolidated Airlines Group SA (CDI) (IAG) 393.40p 1.34%
Kingfisher (KGF) 341.70p 1.12%
Barclays (BARC) 149.95p 1.11%
FTSE 100 - Fallers
Hikma Pharmaceuticals (HIK) 2,302.00p -13.72%
Randgold Resources Ltd. (RRS) 8,175.00p -8.96%
Fresnillo (FRES) 1,891.00p -2.58%
SABMiller (SAB) 4,335.00p -1.60%
Rio Tinto (RIO) 2,386.00p -1.53%
Relx plc (REL) 1,388.00p -1.28%
Unilever (ULVR) 3,442.00p -1.04%
InterContinental Hotels Group (IHG) 3,057.00p -0.97%
Intertek Group (ITRK) 3,421.00p -0.75%
Next (NXT) 5,300.00p -0.75%
FTSE 250 - Risers
Serco Group (SRP) 136.00p 14.57%
Inmarsat (ISAT) 811.00p 3.91%
Ladbrokes (LAD) 143.40p 3.61%
AA (AA.) 249.40p 3.06%
Shawbrook Group (SHAW) 189.30p 3.05%
Aldermore Group (ALD) 138.50p 2.97%
Tullow Oil (TLW) 191.00p 2.96%
Amec Foster Wheeler (AMFW) 446.50p 2.38%
Darty (DRTY) 174.00p 2.05%
Wood Group (John) (WG.) 673.50p 1.97%
FTSE 250 - Fallers
Cobham (COB) 158.40p -5.71%
Aggreko (AGK) 1,040.00p -2.89%
Halfords Group (HFD) 343.90p -2.58%
DFS Furniture (DFS) 206.10p -2.55%
Rank Group (RNK) 213.30p -2.51%
Centamin (DI) (CEY) 165.00p -2.31%
Acacia Mining (ACA) 570.00p -2.15%
Ibstock (IBST) 139.20p -2.04%
AO World (AO.) 142.10p -2.00%
QinetiQ Group (QQ.) 219.00p -1.79%