24 Feb, 2025 08:50

London open: FTSE ticks up as investors mull German election result; B&M slumps

dl city of london square mile financial district skyline river thames london stock exchange lse ftse trading finance generic pexels — Sharecast / Lina Kivaka via Pexels

London stocks edged higher in early trade on Monday as investors mulled news that Germany’s conservatives have won the national election, as expected.

At 0845 GMT, the FTSE 100 was up 0.2% at 8,678.27.

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "A dose of more certainty has been injected into European politics, with the Germany’s Conservatives winning the elections. It comes at a crucial time for the continent. Three years on from the invasion of Ukraine, high stakes deal making between the US and Russia continues, Ukraine is out in the cold and the outcome will have huge implications for security in Europe.

"There is a dawning realisation that European nations will have to pull together and present a more united deterrent force, and Friedrich Merz, the CDU leader, is reading from that script. He has pledged to relax fiscal rules, to increase defence spending and inject the economy with much needed investment.

"But while Merz seems determined to ease off the so-called debt brake, which limits annual borrowing to 0.35% of GDP, it won’t be straightforward, because he will need a two-third majority in parliament. However, with Russia’s aggression set to stay an unrelenting black cloud, the recognition of the need to contribute more to NATO’s budget may see political factions pull together."

In equity markets, British Gas owner Centrica was still on the rise after well-received results last Thursday, when it hiked its dividend and announced a £500m share buyback as full-year earnings beat forecasts.

National Grid gained as it announced the sale of its US onshore renewables business, National Grid Renewables, to Brookfield Asset Management and its institutional partners, including Brookfield Renewable Partners, for $1.7bn.

Deliveroo jumped as Just Eat Takeaway.com agreed to be bought by Dutch private equity firm Prosus in a €4.1bn deal.

On the downside, discount retailer B&M European Value Retail slumped as it cut profit guidance again, citing an uncertain economic outlook and said chief executive Alex Russo would retire at the end of April.

The company said annual adjusted EBITDA was now expected to be in the range of £605m to £625m, down from previously-trimmed guidance of £620m to £650m outlined in January.

The latest cut also includes the potential impact of exchange rate volatility on the valuation of stock and creditor balances.

Market Movers

FTSE 100 (UKX)8,678.270.22%
FTSE 250 (MCX)20,629.140.07%
techMARK (TASX)4,728.390.64%

FTSE 100 - Risers

Centrica (CNA)149.55p3.07%
BAE Systems (BA.)1,283.50p2.23%
GSK (GSK)1,458.50p2.06%
British American Tobacco (BATS)3,017.00p1.75%
Land Securities Group (LAND)577.50p1.23%
Melrose Industries (MRO)620.20p1.21%
Barratt Redrow (BTRW)429.70p1.20%
Taylor Wimpey (TW.)115.70p1.18%
SSE (SSE)1,512.00p1.17%
Smith & Nephew (SN.)1,045.00p1.11%