London open: Stocks flat ahead of expected ECB rate cut
London stocks were flat in early trade on Thursday as investors eyed an expected rate cut by the European Central Bank.
At 0830 BST, the FTSE 100 was steady at 8,326.32.
Kathleen Brooks, research director at XTB, said: "There are two key events today, the ECB meeting and this evening’s Netflix results. Both events are highly anticipated, and the market has big expectations: the ECB will cut rates and signal a new more dovish phase, while Netflix is set to announce a stellar quarter of earnings growth and news about future revenue streams.
"We don’t think that the market is wrong to assume that the ECB will turn super dovish, or that Netflix will kick off the start of tech earnings season in style, however, we do think that there is no room for error. The market has fully priced in just over two 25bp rate cuts from the ECB by the end of the year, and there are another 4.5 cuts priced in after that. Bloomberg’s ECB Speak index has fallen to one of its lowest levels, which suggests that ECB officials are now more dovish than they were during the peak of the pandemic.
"This also suggests that ECB officials are singing from the same hymn sheet, as the typically hawkish German ECB members also shift to a dovish stance. This compares to the Fed, although Fed members have generally spoken in more dovish tones, they are hovering somewhere around neutral. This fits with the switch from expecting a 50bp rate cut at the November Fed meeting to expecting a 25bp rate cut."
The ECB rate announcement is due at 1315 BST.
In equity markets, pest control services group Rentokil Initial surged as it held on to full-year guidance following a profit warning last month, reporting a steady third quarter with revenues unchanged year-on-year at £1.38bn.
Gambling and gaming group Entain rallied as it boosted its full-year outlook after third-quarter numbers came in ahead of expectations.
St James’s Place gained as it said funds under management reached a record £184.4bn in the three quarters to September end, up from £158.6bn a year earlier, boosted by an improving macroeconomic environment.
It was also an improvement on the second quarter, when FUM reached £181.9bn.
Chemring was in the black as it said its performance remained in line with analyst expectations, supported by a robust order intake of £638m and an order book of £1.1bn as of 30 September.
Outside the FTSE 350, N Brown rocketed after agreeing to be taken private by a company owned by Joshua Alliance - whose family has been involved with the group since the 1960s - in a £191m deal.
On the downside, miners fell in tandem with copper prices, with Antofagasta, Rio Tinto and Glencore all down.
Paper and packaging group Mondi tumbled as it said that underlying core profit fell in the third quarter in "muted" trade, mainly due to more planned maintenance shuts.
Investment management firm Man Group was also weaker as it said assets under management fell to $174.9bn as at 30 September, from $178.2bn as at 30 June.
Market Movers
FTSE 100 (UKX) 8,326.32 -0.03%
FTSE 250 (MCX) 20,968.00 -0.05%
techMARK (TASX) 4,780.70 0.12%
FTSE 100 - Risers
Rentokil Initial (RTO) 370.50p 8.62%
Entain (ENT) 736.00p 3.37%
Spirax Group (SPX) 6,900.00p 2.76%
Informa (INF) 820.00p 1.33%
Flutter Entertainment (DI) (FLTR) 17,650.00p 1.26%
International Consolidated Airlines Group SA (CDI) (IAG) 214.40p 1.13%
Diageo (DGE) 2,600.00p 0.89%
Barclays (BARC) 239.05p 0.84%
Rolls-Royce Holdings (RR.) 564.60p 0.82%
Anglo American (AAL) 2,275.00p 0.64%
FTSE 100 - Fallers
Mondi (MNDI) 1,288.50p -7.30%
Antofagasta (ANTO) 1,778.50p -2.25%
Persimmon (PSN) 1,686.00p -1.98%
Smiths Group (SMIN) 1,623.00p -1.93%
Rio Tinto (RIO) 4,950.00p -1.77%
Whitbread (WTB) 3,204.00p -1.66%
Glencore (GLEN) 401.75p -1.20%
Taylor Wimpey (TW.) 164.25p -0.88%
Halma (HLMA) 2,465.00p -0.68%
Vodafone Group (VOD) 75.60p -0.66%
FTSE 250 - Risers
Elementis (ELM) 147.00p 3.38%
Hochschild Mining (HOC) 225.00p 3.21%
Fidelity European Trust (FEV) 369.50p 2.35%
W.A.G Payment Solutions (WPS) 82.60p 2.23%
Trainline (TRN) 333.60p 2.08%
Keller Group (KLR) 1,698.00p 2.04%
Helios Towers (HTWS) 112.60p 1.99%
Spirent Communications (SPT) 178.00p 1.71%
Bluefield Solar Income Fund Limited (BSIF) 105.40p 1.54%
Games Workshop Group (GAW) 11,830.00p 1.46%
FTSE 250 - Fallers
Bytes Technology Group (BYIT) 466.40p -4.97%
ITV (ITV) 75.90p -3.19%
Hays (HAS) 83.75p -2.33%
AJ Bell (AJB) 470.00p -2.29%
Man Group (EMG) 209.00p -2.25%
Pagegroup (PAGE) 364.80p -2.09%
Grainger (GRI) 241.50p -2.03%
Tate & Lyle (TATE) 791.00p -1.98%
Fidelity China Special Situations (FCSS) 210.00p -1.87%
Close Brothers Group (CBG) 377.00p -1.82%