London close: Stocks finish mixed on China demand concerns

The FTSE 100 index declined by 0.22%, ending the day at 8,164.90 points, while the FTSE 250 index showed resilience, edging up by 0.11% to close at 21,213.79 points.

In currency markets, sterling was last down 0.09% on the dollar, trading at $1.2956, while it strengthened marginally against the euro, rising 0.01% to change hands at €1.1903.

“Concerns over weakening demand from China led to a second day of falling retail and mining sector stocks in the UK and Europe as German investor morale worsened for the first time in a year,” said IG senior market analyst Axel Rudolph.

“On the other side of the Atlantic the S&P 500 and Dow hit fresh record highs despite slowing retail sales as the core metric rose the most since April of last year, pointing to robust consumer spending.

“An around 95% probability of a September Fed rate cut also contributed to the buoyant mood.”

Rudolph noted that the crude oil price dropped for a third consecutive day, by around 1.5% to its lowest level in three weeks, as the Chinese economy slowed.

“Gold and silver prices both gained around a percentage point.”

Supermarket sales rise in the UK, eurozone trade surplus takes a dip

In economic news, supermarket take-home sales in the UK rose 2.2% in the four weeks ending 7 July, driven by summer events and shifting consumer habits, according to new data from Kantar.

The men's UEFA European Football Championship spurred increased purchases of beers, crisps, and snacks on matchdays.

Grocery price inflation fell to 1.6%, the lowest since September 2021, as foot traffic hit its highest monthly increase this year.

Britons made 2% more supermarket trips than the previous year, reflecting growing consumer confidence.

Branded product sales grew by 3.6%, surpassing the 2.7% rise in own-label items.

Despite the summer season, unseasonably wet weather led to a 35% rise in cold and flu treatments sales, while sun cream sales dropped by 10%.

Sales of artificial tanning products increased by 16% as consumers sought a summer glow despite the weather.

“Football fans drove beer sales up by an average of 13% on the days that the England men’s team played, compared with the same day during the previous week,” said Fraser McKevitt, head of retail and consumer insight at Kantar.

“Sales of crisps and snacks also got a boost, up by 5% compared with the month before.”

On the continent, the eurozone's trade surplus fell to its lowest in four months in May, according to Eurostat.

The region reported a trade balance of €13.9bn, down from a revised €14.2bn in April and below the €17.1bn expected by economists.

Despite that, the trade balance improved compared to a €0.4 billion deficit in May 2023.

Exports decreased by 0.5% year-on-year to €241.5bn, while imports fell 6.4% to €227.6bn.

The broader European Union saw a trade surplus of €9.7bn, up from a €2.6bn deficit a year earlier.

Germany's economic outlook meanwhile dimmed in July for the first time in a year, according to the ZEW Center for European Economic Research.

The ZEW investor expectations index dropped by 5.7 points from June to 41.8, below the forecast of 42.3.

Conversely, the current conditions index improved by 4.9 points to -68.9 in July.

Across the Atlantic, retail sales in the United States were flat in June, meeting economists' expectations, according to the Census Bureau.

Total monthly sales were estimated at $704.3 billion, unchanged from May's revised figure.

Year-on-year, June sales were up 2.3%, a slowdown from May's 2.6% annual growth.

Excluding motor vehicles and parts, retail sales increased by 0.4% in June, improving from 0.1% growth in May.

However, gas station sales saw a notable decline, dropping 3.0% from the previous month.

Rio Tinto and Burberry close lower, B&M jumps on quarterly revenue growth

On London’s equity markets, Rio Tinto saw a 2.7% drop after its second-quarter iron ore shipments underperformed due to a train derailment during the period.

Burberry shares declined by 4.35%, influenced by weak demand in China highlighted by Cartier owner Richemont and a sales guidance cut from Germany's Hugo Boss.

Elsewhere, despite Experian backing its full-year expectations and reporting a 7% revenue increase in the first quarter, its shares fell by 2.39%.

United Utilities and Severn Trent both dropped, by 3.45% and 4.13% respectively, following Ofwat's expansion of its investigation into the management of wastewater treatment works and networks to include these companies.

Trustpilot shares slumped 6.4% after Vitruvian Partners sold 12.5 million shares at 220p each, representing about 3% of Trustpilot's issued share capital.

Auction Technology Group fell by 3.75% after RBC Capital Markets initiated coverage with a 'sector perform' rating.

Vanquis Banking tumbled 6.23% as it warned it would not meet its 2024 guidance for low single-digit returns on tangible equity due to additional write-downs.

On the upside, B&M European Value Retail rose by 4.34%, driven by a 2.4% increase in group revenues for the first quarter, attributed to volume growth and its store opening program.

Airtel Africa gained 2.93% following an upgrade to 'overweight' from 'neutral' by JPMorgan Cazenove.

Ocado surged 6.35% after it reported narrower interim losses and raised its full-year guidance.

The company’s revenue grew across all divisions, and it lifted its full-year EBITDA margin forecast for its technology solutions division to mid-teens from over 10%, also projecting an improvement in underlying cash flow by £150m.

Pre-tax losses decreased to £154m from £289.5m, core earnings more than tripled to £71.2m, and sales rose by 12.6% to £1.54bn.

Spectris climbed 2.63% after announcing its acquisition of US-based Micromeritics Instrument Corporation for $630m, enhancing its particle characterization offerings for advanced materials analysis.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 8,164.90 -0.22%
FTSE 250 (MCX) 21,213.79 0.11%
techMARK (TASX) 4,829.99 0.24%

FTSE 100 - Risers

B&M European Value Retail S.A. (DI) (BME) 466.00p 4.34%
JD Sports Fashion (JD.) 118.70p 3.53%
Smith (DS) (SMDS) 438.00p 3.45%
Marks & Spencer Group (MKS) 309.30p 3.13%
Airtel Africa (AAF) 119.60p 3.10%
Kingfisher (KGF) 274.40p 2.39%
Rolls-Royce Holdings (RR.) 458.90p 2.09%
F&C Investment Trust (FCIT) 1,048.00p 1.95%
Sainsbury (J) (SBRY) 266.20p 1.91%
CRH (CDI) (CRH) 6,294.00p 1.71%

FTSE 100 - Fallers

Burberry Group (BRBY) 704.60p -5.30%
Severn Trent (SVT) 2,473.00p -4.81%
United Utilities Group (UU.) 997.00p -3.67%
Glencore (GLEN) 458.55p -2.71%
Rio Tinto (RIO) 5,071.00p -2.33%
Anglo American (AAL) 2,309.50p -2.33%
Experian (EXPN) 3,567.00p -2.01%
International Consolidated Airlines Group SA (CDI) (IAG) 172.90p -1.26%
Intermediate Capital Group (ICG) 2,210.00p -1.25%
Entain (ENT) 668.60p -1.24%

FTSE 250 - Risers

Ocado Group (OCDO) 360.50p 5.90%
Carnival (CCL) 1,336.50p 4.58%
Ascential (ASCL) 367.00p 3.97%
Close Brothers Group (CBG) 517.00p 3.40%
Diversified Energy Company (DEC) 1,248.00p 3.31%
Quilter (QLT) 122.40p 3.29%
Wizz Air Holdings (WIZZ) 2,244.00p 2.75%
Moonpig Group (MOON) 206.50p 2.74%
Tyman (TYMN) 387.00p 2.65%
Spectris (SXS) 3,118.00p 2.63%

FTSE 250 - Fallers

Trustpilot Group (TRST) 208.50p -11.09%
Pennon Group (PNN) 620.50p -4.54%
Aston Martin Lagonda Global Holdings (AML) 152.10p -4.28%
Ithaca Energy (ITH) 124.80p -3.85%
Jupiter Fund Management (JUP) 85.40p -3.28%
Jlen Environmental Assets Group Limited NPV (JLEN) 89.90p -3.23%
W.A.G Payment Solutions (WPS) 63.40p -3.06%
Bakkavor Group (BAKK) 151.50p -2.57%
Elementis (ELM) 145.00p -2.43%
SDCL Energy Efficiency Income Trust (SEIT) 60.70p -2.41%