London stocks were higher by midday on Wednesday following heavy losses in the previous session, as investors mulled UK GDP data and looked ahead to the latest US inflation numbers.
The FTSE 100 was up 0.8% at 7,005.92, having slumped 2.5% on Tuesday amid fears over rising inflation.
Spreadex analyst Connor Campbell said: “The FTSE received an early helping hand thanks to a better-than-forecast Q1 GDP reading, showing the UK contracted by 1.5% in the lockdown-hit opening months to the year, compared to the -1.6% forecast.
“A stronger sign of recovery was news that the economy actually grew by 2.1% in March, instead of the 1.5% expected, as the country cautiously started to open up. That’ll only boost hopes of a robust rebound in the second and third quarters.”
Despite the positive tone, Campbell said the gains “should be caveated as they come before this afternoon’s US inflation reading for April has been unveiled”.
“And given that Monday and Tuesday’s losses can in large part be explained by fears of surging inflationary pressures, the trading landscape could look very different once the figure has been released.”
US inflation figures for April are due at 1330 BST. AJ Bell investment director Russ Mould said: “If these come in ahead of expectations then investors may need to prepare themselves for more pain but a lower than forecast reading could help calm tensions over rising prices.”
In corporate news, Diageo was a high riser as the drinks maker said it has restarted its £4.5bn plan to return capital to shareholders after business continued to recover in the second half of its financial year.
Spirax-Sarco Engineering rallied after it said margins in the four months to April 30 were higher than expected following a rise in sales.
UDG Healthcare surged as it agreed to to be bought by private equity firm Clayton, Dubilier & Rice in a £2.6bn deal, and reported a “strong” first half.
Redde Northgate shares shot higher as it said full-year profits are set to beat forecasts following a stronger-than-expected second half.
Marshalls gained after the landscape products company said trading for the full year was set to be ahead of its previous expectations amid increased demand.
On the downside, Flutter Entertainment fell after saying the boss of its US FanDuel operation had resigned and that his departure would affect the timing of a potential listing for the business in the US.
Tui was in the red after saying it plunged to a 1.5bn (£1.3bn) first-half loss and that it expects annual revenue to fall in the current year because of travel restrictions and reduced expectations for the summer season.
4Imprint was knocked lower by a downgrade to ‘hold’ at HSBC.
Market Movers
FTSE 100 (UKX) 7,005.92 0.83%
FTSE 250 (MCX) 22,264.56 0.44%
techMARK (TASX) 4,251.03 0.19%
FTSE 100 – Risers
Diageo (DGE) 3,320.00p 4.08%
Spirax-Sarco Engineering (SPX) 11,935.00p 3.29%
SSE (SSE) 1,476.00p 2.89%
Glencore (GLEN) 335.35p 2.27%
National Grid (NG.) 932.10p 1.95%
Ashtead Group (AHT) 4,823.00p 1.94%
Hargreaves Lansdown (HL.) 1,769.50p 1.93%
United Utilities Group (UU.) 982.60p 1.87%
Coca-Cola HBC AG (CDI) (CCH) 2,527.00p 1.77%
Weir Group (WEIR) 1,907.50p 1.76%
FTSE 100 – Fallers
Just Eat Takeaway.Com N.V. (CDI) (JET) 6,569.00p -3.60%
NATWEST GROUP PLC ORD 100P (NWG) 186.30p -2.46%
Flutter Entertainment (CDI) (FLTR) 13,045.00p -2.32%
Renishaw (RSW) 5,510.00p -2.04%
International Consolidated Airlines Group SA (CDI) (IAG) 192.10p -1.14%
Standard Chartered (STAN) 504.80p -0.63%
Fresnillo (FRES) 897.60p -0.60%
Croda International (CRDA) 6,504.00p -0.58%
Intermediate Capital Group (ICP) 1,995.00p -0.55%
Lloyds Banking Group (LLOY) 46.47p -0.43%
FTSE 250 – Risers
UDG Healthcare Public Limited Company (CDI) (UDG) 1,020.00p 21.14%
Chemring Group (CHG) 296.00p 5.71%
Redde Northgate (REDD) 380.50p 4.25%
Mitie Group (MTO) 62.10p 4.02%
Marshalls (MSLH) 751.00p 3.94%
Dr. Martens (DOCS) 463.00p 2.89%
Airtel Africa (AAF) 80.05p 2.76%
Ferrexpo (FXPO) 497.80p 2.68%
Games Workshop Group (GAW) 10,900.00p 2.54%
Bytes Technology Group (BYIT) 489.20p 2.43%
FTSE 250 – Fallers
Just Eat Takeaway.Com N.V. (CDI) (JET) 6,569.00p -3.60%
Hammerson (HMSO) 36.47p -2.88%
4Imprint Group (FOUR) 2,260.00p -2.80%
Provident Financial (PFG) 236.40p -2.72%
TUI AG Reg Shs (DI) (TUI) 416.10p -2.69%
Homeserve (HSV) 1,028.00p -1.53%
Network International Holdings (NETW) 376.90p -1.39%
Cineworld Group (CINE) 91.08p -1.36%
Virgin Money UK (VMUK) 195.75p -1.34%
Vivo Energy (VVO) 106.80p -1.29%
