London open: Stocks nudge lower; Melrose surges on buyback

At 0855 BST, the FTSE 100 was down 0.1% at 7,589.30.

CMC Markets analyst Michael Hewson said: "Sentiment continues to remain extremely fickle, prone to the ebb and flow of inflation expectations, followed by fears that central banks will over react in combatting said inflation, which is then followed by concern about what that might do to global growth.

"This argument which the market appears to be having with itself, over whether we see a recession, or a soft landing is likely to become a lot clearer, over the next week or so, starting with US CPI on Friday, followed by PPI and the Fed meeting a week from now."

On home shores, investors were mulling the latest data from mortgage lender Halifax, which showed that house prices slowed again in May as the market showed signs of cooling, with soaring inflation starting to hit buyers.

The annual pace of house price increases slowed to 10.5% in May from 10.8% in April. Prices rose for the 11th consecutive month, up by 1.0% in May after a 1.2% increase in April. Housing shortages remained the key driver for prices, said Russell Galley, managing director at Halifax.

"However, the housing market has begun to show signs of cooling. Mortgage activity has started to come down and, coupled with the inflationary pressures currently exerted on household budgets, it's likely activity will start to slow," he said.

"So, there is perhaps one green shoot for prospective purchasers; with overall buying demand down compared to last year, we may be past the peak sellers' market."

In equity markets, Melrose Industries surged to the top of the FTSE 100 after the GKN owner announced the launch of a £500m share buyback following the agreed sale of its Ergotron business earlier in the week.

Retailers were also in the black following losses in the previous session on the back of disappointing retail sales data from the British Retail Consortium. Next, JD Sports and Marks & Spencer all gained.

Flexible office space provider Workspace rose after saying it swung to a full-year pre-tax profit, with customer demand now running at pre-Covid levels.

On the downside, Chemring slid after the release of its interim results.

Low-cost airline Wizz Air flew lower after saying it expected to make a first-quarter loss despite strong summer demand as it deployed extra resources to minimise disruption due to staff shortages and supply chain issues.

Information technology consultancy Aveva was also down after saying it swung to a full-year loss.

Market Movers

FTSE 100 (UKX) 7,589.30 -0.13%
FTSE 250 (MCX) 20,378.30 -0.10%
techMARK (TASX) 4,393.12 0.18%

FTSE 100 - Risers

Melrose Industries (MRO) 154.05p 8.41%
JD Sports Fashion (JD.) 121.15p 2.28%
Scottish Mortgage Inv Trust (SMT) 792.80p 2.09%
Rolls-Royce Holdings (RR.) 93.43p 1.71%
Next (NXT) 6,534.00p 1.65%
GSK (GSK) 1,740.80p 1.23%
BP (BP.) 451.50p 1.12%
Associated British Foods (ABF) 1,705.50p 1.10%
AstraZeneca (AZN) 10,328.00p 0.96%
InterContinental Hotels Group (IHG) 5,002.00p 0.77%

FTSE 100 - Fallers

Airtel Africa (AAF) 150.40p -3.96%
Royal Mail (RMG) 301.50p -1.89%
HSBC Holdings (HSBA) 520.30p -1.70%
Rio Tinto (RIO) 5,988.00p -1.69%
Intermediate Capital Group (ICP) 1,517.00p -1.65%
Anglo American (AAL) 3,952.50p -1.62%
Diageo (DGE) 3,599.50p -1.53%
British Land Company (BLND) 528.00p -1.49%
Antofagasta (ANTO) 1,501.50p -1.38%
Bunzl (BNZL) 2,725.00p -1.12%

FTSE 250 - Risers

JPMorgan European Discovery Trust (JEDT) 440.00p 3.04%
Capricorn Energy (CNE) 218.40p 2.34%
TP Icap Group (TCAP) 136.90p 2.09%
Johnson Matthey (JMAT) 2,113.00p 1.83%
Baillie Gifford US Growth Trust (USA) 163.00p 1.75%
Workspace Group (WKP) 734.50p 1.73%
Micro Focus International (MCRO) 395.00p 1.73%
Trustpilot Group (TRST) 97.00p 1.62%
Ferrexpo (FXPO) 186.90p 1.47%
Plus500 Ltd (DI) (PLUS) 1,603.00p 1.46%

FTSE 250 - Fallers

Chemring Group (CHG) 340.50p -6.97%
National Express Group (NEX) 234.40p -4.33%
Baltic Classifieds Group (BCG) 143.40p -3.89%
Wizz Air Holdings (WIZZ) 2,687.00p -2.64%
Weir Group (WEIR) 1,573.50p -2.15%
Britvic (BVIC) 799.00p -1.96%
Grainger (GRI) 304.20p -1.87%
TBC Bank Group (TBCG) 1,448.00p -1.76%
Virgin Money UK (VMUK) 142.75p -1.69%
Network International Holdings (NETW) 213.80p -1.47%