London close: Stocks rise as UK election enters final hours

The FTSE 100 index was up 0.86%, reaching 8,241.26 points, while the FTSE 250 climbed 0.39% to 20,610.34 points.

In currency markets, sterling was last up 0.14% on the dollar, trading at $1.2760, while it saw a slight decline of 0.08% against the euro to change hands at €1.1802.

“London's FTSE 100 rose with support from Smith & Nephew, as the UK parliamentary polls indicated a potential win for the Labour Party,” said TickMill market analyst Patrick Munnelly.

He noted that polling for the UK parliamentary elections began at 0700 BST and was continuing throughout the day, with an exit poll scheduled for 2200 BST.

“Opinion polls suggest that the Labour Party may replace the Conservatives after 14 years in power.

“Investors believe this potential change is already factored into the market, with results expected early on Friday.

“Trading activity has been muted as US markets are closed for a holiday.”

UK construction sector slows in June

In economic news, the UK construction sector experienced a notable slowdown in June due to a renewed decline in housing activity, according to the latest purchasing managers' index (PMI) from CIPS and S&P Global.

The construction PMI dropped to 52.2 from May's two-year high of 54.7, falling short of the 53.6 expected by economists.

That marked the fourth consecutive month above the 50 threshold, indicating growth, but the rate of expansion has clearly decelerated.

The overall rise in new orders slowed, attributed to election uncertainties and reduced growth in civil engineering.

Housing was the only sub-sector to see a decline, reversing its first increase in 19 months recorded in May.

On a positive note, job creation in construction reached its highest level since August 2023.

“While there were signs of a slowdown in the latest survey period, most notably around housing activity, firms indicated that a slowdown in new order growth was in part related to election uncertainty,” said Andrew Harker, the economics director at S&P Global Market Intelligence.

“We may therefore see trends improve once the election period comes to an end.

“Moreover, confidence in the year ahead outlook remained strong and firms increased employment to the largest extent in 10 months.”

In the automotive sector, new car registrations in the UK surpassed one million in the first half of 2024 for the first time since the Covid-19 pandemic, according to the Society of Motor Manufacturers and Traders.

Registrations increased 1.1% in June, totaling 179,263 units, while year-to-date, registrations were up 6.0% year-on-year at 1,006,763, although still 20.7% below 2019 levels.

The growth in June was primarily driven by the fleet sector, which saw a 14.2% increase, while private demand declined for the ninth consecutive month, down 15.3%.

Electric vehicle registrations saw significant growth, with plug-in hybrids rising 30% to capture a 9.3% market share and hybrid vehicles increasing by 27.2% to account for 14.9% of the market.

“With the UK heading to the polls today, the automotive industry calls on the next government to provide greater support to the consumer on the journey to zero-emission mobility,” the SMMT said in its statement.

“Reinstating fiscal incentives for the private consumer by way of a halving of VAT on BEVs for three years would re-energise the market, putting an additional 300,000 private BEVs - rather than petrol or diesel cars - on the road over the next three years, on top of current outlooks.

“This would help ensure that in 2035, half of all cars in use would be zero emission, cutting road transport carbon dioxide emissions by 175 million tonnes between now and then.”

On the continent, the eurozone construction sector continued to struggle in June, as indicated by the latest HCOB eurozone construction PMI.

The index fell to 41.8 from 42.9 in May, signalling a sharp contraction in output.

That rate of decline was the second-steepest since mid-2020, driven by weak demand and declining order book volumes, leading to further job cuts.

All sub-sectors saw output decreases, with residential construction being the weakest.

In Germany, factory orders experienced a surprising decline in May, underlining the challenges facing Europe's manufacturing sector.

Orders fell by 1.6% from the previous month and by 8.6% year-on-year, contrary to analysts' expectations of a 0.5% increase.

Smith & Nephew jumps, ex-divs prove a drag

On London’s equity markets, Smith & Nephew was in focus after activist investor Cevian Capital acquired a 5% stake, sending its shares up by 6.87%.

Cevian now held 43.9 million shares, becoming the third-largest shareholder in the medical equipment manufacturer.

Barclays gained 0.39% following its agreement to sell its German consumer finance business to Austrian bank Bawag Group for a modest premium to net assets.

Precision instrument maker Spectris rose 1.75% after announcing its acquisition of US-based SciAps for up to $260m (£205m).

SciAps specialises in handheld instruments for materials analysis.

Polymer manufacturer Victrex saw a slight increase of 0.11%, reversing earlier losses.

The company reported volume and revenue growth for the third quarter but warned of challenging conditions in its medical segment.

Bunzl's shares increased by 2.9%, and Ibstock rose by 3.99%, buoyed by positive broker notes.

The former was upgraded to 'buy' by HSBC, while RBC Capital Markets initiated coverage of Ibstock at 'outperform'.

On the downside, Great Portland Estates fell by 0.29%, despite reporting strong leasing activity for the quarter ended 30 June.

Next, Workspace, and Big Yellow Group declined by 1.91%, 3.17%, and 3.67%, respectively, as they traded without entitlement to the dividend.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 8,241.26 0.86%
FTSE 250 (MCX) 20,610.34 0.39%
techMARK (TASX) 4,759.37 0.71%

FTSE 100 - Risers

Smith & Nephew (SN.) 1,054.00p 6.87%
Bunzl (BNZL) 3,120.00p 2.90%
Barclays (BARC) 224.35p 2.84%
Melrose Industries (MRO) 573.80p 2.68%
Lloyds Banking Group (LLOY) 57.28p 2.51%
Vistry Group (VTY) 1,259.00p 2.44%
Standard Chartered (STAN) 739.20p 2.30%
Whitbread (WTB) 3,007.00p 1.86%
Shell (SHEL) 2,900.00p 1.72%
BP (BP.) 490.30p 1.59%

FTSE 100 - Fallers

Next (NXT) 8,938.00p -1.91%
Spirax Group (SPX) 8,435.00p -1.75%
Croda International (CRDA) 4,035.00p -1.34%
Haleon (HLN) 322.20p -1.20%
Halma (HLMA) 2,686.00p -0.99%
easyJet (EZJ) 458.80p -0.89%
Darktrace (DARK) 579.60p -0.69%
JD Sports Fashion (JD.) 112.30p -0.53%
Rightmove (RMV) 536.40p -0.41%
CRH (CDI) (CRH) 5,652.00p -0.35%

FTSE 250 - Risers

Bakkavor Group (BAKK) 147.00p 6.14%
Bridgepoint Group (Reg S) (BPT) 243.40p 4.73%
Jupiter Fund Management (JUP) 81.20p 4.08%
SSP Group (SSPG) 155.60p 4.08%
Ibstock (IBST) 172.20p 3.99%
Coats Group (COA) 82.20p 3.14%
PureTech Health (PRTC) 184.60p 3.13%
CMC Markets (CMCX) 334.50p 3.08%
Drax Group (DRX) 536.00p 2.58%
Me Group International (MEGP) 171.20p 2.51%

FTSE 250 - Fallers

Big Yellow Group (BYG) 1,154.00p -3.67%
Workspace Group (WKP) 580.00p -3.17%
Currys (CURY) 72.40p -2.56%
Safestore Holdings (SAFE) 776.00p -1.96%
Foresight Group Holdings Limited NPV (FSG) 508.00p -1.93%
Babcock International Group (BAB) 517.00p -1.80%
W.A.G Payment Solutions (WPS) 68.80p -1.78%
Primary Health Properties (PHP) 93.10p -1.64%
Hochschild Mining (HOC) 183.00p -1.61%
Wood Group (John) (WG.) 196.80p -1.55%