London close: Stocks manage gains after deluge of updates

The FTSE 100 index rose 0.17% to reach 7,459.09 points, while the FTSE 250 recorded a gain of 0.44%, closing at 18,948.04.

In currency markets, sterling was last up 0.03% on the dollar, trading at $1.2680, while it gained 0.27% against the euro to change hands at €1.1679.

“After a dismal start to the week, European stock indices managed to regain some recently lost ground alongside their US counterparts as US building permits rose more than expected, jobless claims plunged to a 16-month low and the S&P information technology sector hit a record high,” said IG senior market analyst Axel Rudolph.

“European equity markets stabilised despite ECB policymakers advocating a prolonged restrictive stance and eurozone construction falling the most in nearly three years.”

Rudolph added that ongoing missile attacks between US and UK warships and Houthis in Yemen had been joined by exchanges between Iran and Pakistan.

“This pushed the oil price higher for a second straight day and also provoked a recovery in the gold price on flight to safety flows.”

UK housing market shows signs of stabilising

In economic news, the UK housing market showed signs of stabilisation as mortgage rates continued to ease.

According to the Royal Institution of Chartered Surveyors' latest UK residential market survey, the net balance of respondents reporting a rise in house prices over the past three months to December, improved to -30.

While still in negative territory, it was a notable improvement compared to November's figure of -41 and exceeded consensus expectations of -38.

Additionally, the balance of new buyer inquiries strengthened to -3 from -13, the highest level since April 2022.

New property instructions also moved into positive territory, rising from -4 to 1, while the agreed sales balance reached -6, the highest since March 2022.

However, there was still a surplus of unsold properties, with the average number on estate agents' books rising to 38.9, the highest in 30 months.

“December’s Rics survey adds credence to our view that house prices will bounce back this year,” said Gabriella Dickens, senior UK economist at Pantheon Macroeconomics.

“The net balance expecting prices to rise over the next 12 months rose to a 17-month high of -13, from -23, and is consistent with a return to positive year-over-year growth in the official measure of house prices in the coming months.

“So after a 5% peak-to-trough, with the nadir coming in the first quarter, we still expect the official measure of house prices to rise by at about 5% over the final three quarters of 2024.”

On the continent, construction output in the eurozone declined in November, marking its most significant annual drop in nearly three years, according to Eurostat.

Seasonally adjusted production in the construction sector decreased by 1.0% in November, accelerating from a revised 0.6% drop in October.

Compared to the same month in 2022, output fell by 2.2%, with building construction declining by 2.4% and civil engineering falling by 1.0%.

That represented a substantial deterioration compared to October's 0.7% decline and the most significant annual contraction since February 2021.

Across the Atlantic, initial jobless claims in the US saw a decelerated pace of Americans seeking state assistance in the week ended 18 January, according to the US Labor Department.

Initial jobless claims dropped by 16,000 compared to the prior week, reaching 187,000, the lowest reading since September 2022 and well below market expectations, which had anticipated 207,000.

Continuing claims also decreased by 26,000 to 1.8 million in the previous week, marking the lowest level since October 2023, suggesting that Americans could be finding it somewhat easier to secure new positions.

Additionally, the four-week moving average, designed to mitigate week-to-week fluctuations, declined by 4,750 to 203,250.

Non-seasonally adjusted initial claim counts plunged by 29,543 to 289,228, with significant declines observed in New York following mass layoffs in the transportation and warehousing, construction, and information industries.

Flutter jumps on planned US listing, Watches of Switzerland tumbles

On London’s equity markets, Flutter Entertainment jumped 15.34% despite fourth-quarter revenues falling below guidance.

Investors reacted positively to the company's planned listing on Wall Street, foreseeing substantial growth potential in the crucial US market.

Ferrexpo rallied 17.13% as the iron ore pellet producer declared an interim dividend of 3.3 US cents per share after surpassing expectations in 2023.

Strong performance in the second half of the year, along with production optimisation and an improved pricing environment, allowed the company to consider this dividend.

Currys gained 9.85% after the electrical retailer indicated that full-year profit was expected to surpass consensus expectations, despite a reported drop in sales.

Travis Perkins gained 6.24% after the builders' merchant and home improvement retailer reported a stabilising of pricing in the fourth quarter and announced plans to enhance its cost-savings programme.

Specialty chemicals company Elementis rose 6.46% after it announced that its 2023 profit would slightly exceed expectations following a “resilient” performance in the fourth quarter.

AJ Bell increased 4.64% after its assets under management surged 53% year-on-year to £5.2bn.

Chief executive officer Michael Summersgill noted improvements in some macroeconomic headwinds throughout 2023, driving global equity markets higher and alleviating some pressure on household finances.

Food producer Cranswick added 1.13% after it projected adjusted pre-tax profit for the financial year ending in March to surpass the board's previous expectations, driven by stronger-than-expected trading in the third quarter.

On the downside, B&M European Value Retail declined 3.35% and Compass Group slipped 0.91% as both traded without entitlement to the dividend.

Watches of Switzerland Group plummeted 36.73% after it lowered its annual revenue guidance due to reduced demand for luxury products amid the cost-of-living crisis, particularly in the UK.

The company said it anticipated volatile trading conditions for the rest of its financial year.

JD Sports Fashion declined 0.28% after gaining 100% control of Poland's Marketing Investment Group.

Admiral Group fell 2.32% after Bank of America Merrill Lynch expressed concerns about potential disappointment as profits normalised.

The bank anticipated further margin recovery and a return to growth in UK motor operations, but considered consensus earnings overly optimistic.

BAE Systems declined 1.17% following a downgrade to 'underperform' from neutral by Exane BNP.

Harbour Energy and Energean both slid due to trading and operations updates, with Harbour Energy dropping by 8.52% and Energean experiencing a more moderate decline of 0.6%.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 7,459.09 0.17%
FTSE 250 (MCX) 18,948.04 0.44%
techMARK (TASX) 4,312.67 1.03%

FTSE 100 - Risers

Flutter Entertainment (CDI) (FLTR) 15,225.00p 15.34%
Entain (ENT) 949.60p 6.12%
Rolls-Royce Holdings (RR.) 306.50p 3.34%
St James's Place (STJ) 637.20p 2.74%
InterContinental Hotels Group (IHG) 7,344.00p 2.31%
RS Group (RS1) 756.40p 2.16%
Kingfisher (KGF) 219.80p 2.14%
Persimmon (PSN) 1,426.00p 2.11%
Anglo American (AAL) 1,786.60p 2.09%
International Consolidated Airlines Group SA (CDI) (IAG) 144.55p 1.98%

FTSE 100 - Fallers

B&M European Value Retail S.A. (DI) (BME) 524.80p -3.35%
Admiral Group (ADM) 2,501.00p -2.34%
Centrica (CNA) 139.70p -2.24%
Hikma Pharmaceuticals (HIK) 1,926.00p -1.98%
Smurfit Kappa Group (CDI) (SKG) 2,922.00p -1.81%
Smith (DS) (SMDS) 278.40p -1.76%
Ocado Group (OCDO) 571.40p -1.48%
Vodafone Group (VOD) 66.08p -1.42%
Unilever (ULVR) 3,708.50p -1.40%
British American Tobacco (BATS) 2,289.00p -1.31%

FTSE 250 - Risers

Ferrexpo (FXPO) 84.65p 16.92%
Currys (CURY) 50.25p 8.62%
Syncona Limited NPV (SYNC) 120.20p 6.56%
Elementis (ELM) 125.20p 6.29%
Bakkavor Group (BAKK) 96.80p 5.68%
Travis Perkins (TPK) 786.00p 5.62%
AJ Bell (AJB) 313.80p 5.59%
Trainline (TRN) 322.40p 5.02%
TUI AG Reg Shs (DI) (TUI) 546.00p 4.20%
Abrdn (ABDN) 179.85p 4.14%

FTSE 250 - Fallers

Watches of Switzerland Group (WOSG) 371.40p -36.73%
Harbour Energy (HBR) 289.00p -8.78%
Drax Group (DRX) 464.40p -6.67%
Dr. Martens (DOCS) 74.30p -4.13%
NB Private Equity Partners Ltd. (NBPE) 1,580.00p -3.07%
Big Yellow Group (BYG) 1,080.00p -2.44%
Diversified Energy Company (DEC) 955.00p -2.40%
Tritax Eurobox (GBP) (EBOX) 52.20p -2.06%
Hammerson (HMSO) 25.64p -2.06%
Future (FUTR) 749.50p -2.03%