London midday: Stocks flat as investors digest Fed comments; Shell gushes lower

by | Apr 7, 2022

London stocks had pared earlier small losses to trade broadly flat by midday on Thursday as investors mulled hawkish minutes from the US Federal Reserve.
The FTSE 100 was steady at 7,585.21.

Russ Mould, investment director at AJ Bell, said the sober mood in markets was “unsurprising given some tough rhetoric from the US Federal Reserve on interest rates and the latest round of sanctions imposed by the West on Russia yesterday”.

“Both the cure, higher interest rates, and the disease, surging prices, are harmful to markets right now. The minutes from the Fed’s latest meeting showed it plans to drastically scale back asset purchases and that there is backing among its members for big rate hikes, all helping to pour cold water on investor sentiment,” he said.

On home shores, the latest survey from Halifax showed that house prices rose in March at the fastest pace in six months. Prices rose 1.4% on the month, taking the average property price to a new record high of £282,753. On the year, prices were up 11%.

Russell Galley, managing director at Halifax, said: “The story behind such strong house price inflation remains unchanged: limited supply and strong demand, despite the prospect of increasing pressure on households’ finances. Although there is some recent evidence of more homes coming onto the market, the fundamental issue remains that too many buyers are chasing too few properties.

“The effect on house prices makes it increasingly difficult for first-time buyers looking to make their first step onto the ladder, but also challenges home movers who face ever bigger leaps to move up the rungs to a larger property.”

In equity markets, Aviva was the worst performer on the FTSE 100 as it traded without entitlement to the dividend. Barratt Developments, Smurfit Kappa and Mondi also fell as they went ex-dividend.

Shell was in the red as the oil giant said it expected to book up to $5bn in post-tax write offs after its decision to exit Russia, adding that oil & gas earnings would be “significantly higher” on the back of surging prices.

Countryside Properties tumbled as it said annual profit would fall after the housebuilder published a damning review of its own operations. The company said it expanded too quickly and botched the acquisition of Westleigh in 2018. Project delays, poor workmanship and rising costs also affected the group at some sites.

TI Fluid Systems was under the cosh after a downgrade to ‘hold’ from ‘buy’ at Jefferies, which slashed its price target to 195p from 350p.

On the upside, 888 Holdings surged after it and Caesars Entertainment agreed a cut in the deal value of William Hill’s international assets due to tougher economic and regulatory conditions. 888 also unveiled plans to raise funds via a placing to help pay for its acquisition of the non-US operations.

Market Movers

FTSE 100 (UKX) 7,585.21 -0.03%
FTSE 250 (MCX) 21,140.44 0.19%
techMARK (TASX) 4,382.13 0.52%

FTSE 100 – Risers

Airtel Africa (AAF) 142.60p 2.74%
Ocado Group (OCDO) 1,233.00p 2.41%
BT Group (BT.A) 190.35p 2.26%
Sainsbury (J) (SBRY) 245.80p 1.91%
Scottish Mortgage Inv Trust (SMT) 996.20p 1.82%
ITV (ITV) 80.06p 1.75%
NATWEST GROUP PLC ORD 100P (NWG) 213.90p 1.52%
International Consolidated Airlines Group SA (CDI) (IAG) 136.70p 1.44%
British Land Company (BLND) 536.60p 1.32%
AstraZeneca (AZN) 10,596.00p 1.28%

FTSE 100 – Fallers

Aviva (AV.) 427.10p -3.85%
Barratt Developments (BDEV) 514.00p -3.09%
Smurfit Kappa Group (CDI) (SKG) 3,035.00p -3.04%
Abrdn (ABDN) 206.40p -2.18%
Smith (DS) (SMDS) 303.40p -2.03%
Anglo American (AAL) 3,971.50p -1.94%
Howden Joinery Group (HWDN) 748.60p -1.89%
British American Tobacco (BATS) 3,255.00p -1.51%
Mondi (MNDI) 1,440.00p -1.40%
Persimmon (PSN) 2,208.00p -1.30%

FTSE 250 – Risers

888 Holdings (888) 232.20p 20.94%
Wizz Air Holdings (WIZZ) 2,871.00p 4.13%
AJ Bell (AJB) 314.60p 3.62%
Caledonia Investments (CLDN) 3,640.00p 3.56%
Workspace Group (WKP) 707.00p 3.44%
Trustpilot Group (TRST) 149.40p 3.32%
easyJet (EZJ) 540.20p 3.09%
Chrysalis Investments Limited NPV (CHRY) 180.00p 2.86%
CMC Markets (CMCX) 243.00p 2.75%
Baltic Classifieds Group (BCG) 149.40p 2.61%

FTSE 250 – Fallers

Countryside Partnerships (CSP) 248.60p -10.77%
TI Fluid Systems (TIFS) 162.00p -10.60%
Polymetal International (POLY) 267.20p -7.54%
Direct Line Insurance Group (DLG) 263.90p -5.24%
Marshalls (MSLH) 661.50p -4.48%
Pets at Home Group (PETS) 323.40p -3.52%
Vistry Group (VTY) 930.00p -3.48%
Savills (SVS) 1,084.00p -3.47%
Hays (HAS) 114.80p -2.88%
Unite Group (UTG) 1,128.00p -2.59%

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