London midday: Stocks maintain gains after retail sales
London stocks were still a little higher by midday on Friday, with the mood underpinned by better-than-expected UK retail sales data, as investors continued to digest recent central bank moves.
The FTSE 100 was up 0.3% at 7,281.31.
IG market analyst Joshua Mahony said: "Between growing Omicron cases and monetary tightening, belief in an impending Santa rally has been somewhat shaky this time around. However, with this week providing greater clarity over the outlook for monetary policy, it is likely that markets will soon look beyond the impending sharp Omicron wave and buy the temporary dip in retail and travel names.
"Markets will typically pre-empt any major market moving event and look to the medium term, thus raising the attractiveness of ‘reopening’ names as seen today for the likes of WHSmith, Restaurant Group, Card Factory, and Cineworld."
On the macro front, figures released earlier by the Office for National Statistics showed retail sales unexpectedly jumped in November, boosted by strong demand for clothing and a bumper Black Friday.
Retail sales volumes rose by 1.4% in November, following growth of 1.1% in October, which was revised up from 0.8%. The November increase was above consensus, with most analysts looking for growth closer to 0.8%.
Year-on-year sales growth strengthened to 4.7%, compared to a 1.5% decline in October, also above consensus, for 4.2%.
Retail sales are now 7.2% higher than February 2020 levels.
Driving the improvement was stronger clothing sales, which rose 2.9% and beat pre-Covid levels for the first time; volumes were 3.2% higher than their February 2020 level.
Overall, non-food sales volumes, which include computer, toy and jewellery stores, rose by 2.0%, with retailers noting strong Black Friday trading. Food store sales volumes fell 0.2% in November, although they remain 3.2% above February 2020 levels.
Consumers also continued to return to shopping in-store, with the proportion of retail sales online falling to 26.9%, the lowest proportion since the first lockdown in March 2020.
Helen Dickinson, chief executive of the British Retail Consortium, said: "It is clear that plenty of customers used the Black Friday sales as an opportunity to snap up bargains ahead of Christmas.
"While traditional sales in TV and other electronics could be found, there has been a clear expansion in clothing and footwear in Black Friday discounts, boosting sales growth in these areas. This was bolstered by the cold weather during November."
In equity markets, Johnson Matthey ticked up after saying it had sold its health business to Altaris Capital Partners for £325m.
Qinetiq was a high riser after an upgrade to ‘buy’ at Citi.
HSBC was in focus after the Financial Conduct Authority fined the bank £64m for anti-money laundering failings.
On the downside, Wood Group gushed lower after a downgrade to ‘equalweight’ at Morgan Stanley.
Market Movers
FTSE 100 (UKX) 7,281.31 0.29%
FTSE 250 (MCX) 22,649.92 0.01%
techMARK (TASX) 4,441.84 0.52%
FTSE 100 - Risers
Fresnillo (FRES) 918.80p 3.17%
International Consolidated Airlines Group SA (CDI) (IAG) 130.88p 3.04%
Polymetal International (POLY) 1,308.50p 2.55%
Associated British Foods (ABF) 1,925.50p 2.23%
Melrose Industries (MRO) 146.95p 2.23%
Anglo American (AAL) 2,959.00p 2.16%
BT Group (BT.A) 169.80p 2.10%
Antofagasta (ANTO) 1,380.00p 2.00%
British American Tobacco (BATS) 2,742.00p 1.95%
Rentokil Initial (RTO) 538.00p 1.89%
FTSE 100 - Fallers
Scottish Mortgage Inv Trust (SMT) 1,338.00p -1.62%
Relx plc (REL) 2,338.00p -1.47%
Croda International (CRDA) 10,095.00p -1.46%
Intermediate Capital Group (ICP) 2,129.00p -1.21%
Pershing Square Holdings Ltd NPV (PSH) 3,005.00p -1.15%
Royal Dutch Shell 'A' (RDSA) 1,609.80p -1.06%
Spirax-Sarco Engineering (SPX) 15,535.00p -1.05%
Royal Dutch Shell 'B' (RDSB) 1,610.40p -1.03%
Halma (HLMA) 3,074.00p -1.03%
BP (BP.) 335.95p -0.89%
FTSE 250 - Risers
National Express Group (NEX) 248.20p 5.71%
Syncona Limited NPV (SYNC) 201.50p 4.95%
Centamin (DI) (CEY) 88.96p 4.61%
Hochschild Mining (HOC) 143.20p 4.60%
QinetiQ Group (QQ.) 255.00p 4.08%
Ninety One (N91) 268.60p 4.03%
Petropavlovsk (POG) 21.54p 3.86%
Capita (CPI) 34.90p 3.84%
TBC Bank Group (TBCG) 1,612.00p 3.47%
Baltic Classifieds Group (BCG) 230.00p 3.14%
FTSE 250 - Fallers
Trustpilot Group (TRST) 320.00p -6.43%
Kainos Group (KNOS) 1,764.00p -3.18%
JPMorgan Japanese Inv Trust (JFJ) 658.00p -2.81%
Fidelity China Special Situations (FCSS) 303.50p -2.57%
C&C Group (CDI) (CCR) 217.00p -2.52%
Allianz Technology Trust (ATT) 337.00p -2.32%
Wood Group (John) (WG.) 183.00p -2.14%
Volution Group (FAN) 509.00p -1.93%
JTC (JTC) 873.00p -1.91%
Edinburgh Worldwide Inv Trust (EWI) 291.50p -1.85%