London close: Stocks rise as dip buyers enter the fray

(Sharecast News) - London markets ended Thursday in positive territory, with sentiment buoyed by robust corporate updates, as investors digested the latest producer price data out of the United States.

The FTSE 100 index climbed 0.51% to close at 8,071.19 points, while the FTSE 250 rose 0.8%, finishing at 20,522.81 points.

In currency markets, sterling was last down 0.02% on the dollar to trade at $1.2706, while it edged 0.01% lower against the euro, changing hands at €1.2029.

"European indices finally got a bit of a break today, as dip buyers came in and prompted substantial gains in these beaten-down markets," said IG chief market analyst Chris Beauchamp.

"Key levels were defended and the broad-based buying augurs well for a near-term recovery. But with so much uncertainty around the implementation of the new administration's policies, the relief might be short-lived.

"In London, the FTSE 100 recovered from its three-month low after briefly dipping below 8,000 yesterday."

Beauchamp added that gold prices looked to have stabilised too, but quipped that it was "far from clear" that the correction had run its course.

"After the unstoppable rally of the past few months, the drop from $2,800 has helped to take some froth out of the market, and like European stocks there will be hopes of a new leg higher in this, one of 2024's solid performers."

US producer prices rise modestly in October

In economic news, US producer prices rose modestly in October, reflecting a 0.2% monthly increase, according to the Bureau of Labor Statistics.

The producer price index (PPI) reached 145.62 points, consistent with initial estimates and up from September's revised 145.33.

Annually, the PPI showed a 2.4% rise, while core PPI, which excludes food, energy, and trade services, was up 3.1% year-on-year.

The October increase was mainly driven by a 0.3% uptick in final demand services.

In employment, US jobless claims declined by 4,000 to 217,000 in the week ended 9 November, outperforming expectations of a rise to 223,000.

The Labor Department also reported a decrease in continuing claims to 1.87 million.

It said the four-week average of claims dropped to 221,000, underscoring the resilience of the US labour market despite recent Federal Reserve rate hikes.

On home shores, UK house prices continued their upward trajectory in October, aided by lower borrowing costs.

The Royal Institution of Chartered Surveyors noted a rise in its house price net balance to 16, up from 11 in September, with sales volumes also improving.

Despite stable buyer demand, expectations for further price increases grew, reflecting optimism following the Bank of England's recent rate cut aimed at easing borrowing costs amid falling inflation.

"The improvement in buyer demand [has translated] into growth in the number of sales being agreed," said Tarrant Parsons, head of market analysis at RICS.

"Just as importantly, forward-looking sentiment points to this bright trend remaining in place in the coming months.

"That said, the rise in bond yields following the Budget, alongside a general increase in financial market implied interest rate expectations over the past couple of weeks, will likely present something of a headwind."

On the continent, eurozone employment edged up by 0.2% in the third quarter, leading to an annual growth rate of 1%, according to Eurostat.

However, eurozone industrial production slipped by 2% in September, a sharper decline than the anticipated 1.4% drop.

That followed a revision of August's growth figure from 1.8% to 1.5%, highlighting ongoing challenges in the region's industrial sector despite steady labour market gains.

Aviva up on solid quarter, WH Smith slides

On London's equity markets, Aviva rose 4.05% after the insurer reported robust third-quarter results, with double-digit growth in general insurance premiums, life insurance, retirement sales, and wealth net flows.

Spirax Group added 4.5%, as it maintained its full-year outlook amid rising organic sales across all three business lines, though it noted a slight currency impact.

3i Group gained 3.51% on a "good" first half that delivered a £2.05bn total return, equating to a 10% increase on opening shareholders' funds.

Discount retailer B&M European Value Retail climbed 4.92% after it reaffirmed its full-year outlook after a solid half-year sales performance, while United Utilities rose 2.6% following robust first-half revenue, despite a drop in profits due to increased financing costs.

Luxury brand Burberry surged 9.31%, with new chief executive Joshua Schulman announcing a strategic overhaul, 'Burberry forward', targeting £40m in savings and a renewed focus on outerwear to rejuvenate the brand after a half-year loss of £80m, largely due to weakened sales in China.

FirstGroup's shares jumped 6.07% as it raised its full-year forecast and announced a further £50m share buyback after a strong first half.

Kier Group shares climbed 8.35%, buoyed by a robust start to its fiscal year and a growing order book, now totaling £10.9bn.

Meanwhile, Petershill Partners rose 6.56% following a partial sale of its stake in Accel-KKR for $282m.

On the downside, Keller Group plunged 9.47% as the contractor pointed to sluggish European activity, despite expecting to meet full-year guidance.

QinetiQ Group dropped 9.18% despite meeting expectations in its first-half results and announcing an extension of its buyback programme.

WH Smith was down 3.15%, despite a strong performance in its UK travel division and robust summer results.

"Relatively modest growth in the key North American market and underlying earnings per share, as well as revenue a smidge below consensus expectations from WH Smith seems to have disappointed investors," said Russ Mould, investment director at AJ Bell.

"The full-year results were also a tad messy with fairly significant non-recurring costs, including impairments linked to software and supply chain upgrades and provisions for loss-making contracts, affecting the headline figures.

"Performance followed the same trend of the last decade, with the travel arm the engine of growth and the high street operation running to a standstill."

Elsewhere, Lancashire Holdings, J Sainsbury, and Bunzl also declined as they traded ex-dividend, falling 8.31%, 1.48%, and 0.75% respectively.

Convatec Group, which raised its 2024 guidance earlier in the week, fell 1.59% as investors took profits.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 8,071.19 0.51% FTSE 250 (MCX) 20,522.81 0.80% techMARK (TASX) 4,642.29 0.55%

FTSE 100 - Risers

B&M European Value Retail S.A. (DI) (BME) 398.80p 5.00% Spirax Group (SPX) 6,670.00p 4.71% Schroders (SDR) 312.80p 4.62% Aviva (AV.) 475.40p 4.55% Severn Trent (SVT) 2,679.00p 3.68% 3i Group (III) 3,447.00p 3.51% Prudential (PRU) 630.40p 3.45% United Utilities Group (UU.) 1,084.00p 3.39% Informa (INF) 853.00p 3.14% Centrica (CNA) 121.75p 2.74%

FTSE 100 - Fallers

Convatec Group (CTEC) 247.40p -3.51% Experian (EXPN) 3,663.00p -2.87% Melrose Industries (MRO) 502.60p -2.63% Rolls-Royce Holdings (RR.) 545.20p -2.22% BAE Systems (BA.) 1,315.00p -2.19% Intermediate Capital Group (ICG) 2,042.00p -1.73% Next (NXT) 9,526.00p -1.53% Sainsbury (J) (SBRY) 239.60p -1.48% Weir Group (WEIR) 2,136.00p -1.20% Coca-Cola HBC AG (CDI) (CCH) 2,768.00p -1.14%

FTSE 250 - Risers

Burberry Group (BRBY) 868.00p 18.68% Close Brothers Group (CBG) 210.20p 13.95% Kier Group (KIE) 150.60p 8.35% TI Fluid Systems (TIFS) 182.00p 7.44% Petershill Partners (PHLL) 235.50p 6.56% Dr. Martens (DOCS) 57.70p 6.16% FirstGroup (FGP) 145.10p 6.07% Pennon Group (PNN) 553.50p 4.73% Raspberry PI Holdings (RPI) 346.70p 3.69% 4Imprint Group (FOUR) 5,330.00p 3.50%

FTSE 250 - Fallers

Keller Group (KLR) 1,476.00p -9.78% QinetiQ Group (QQ.) 423.20p -9.18% Lancashire Holdings Limited (LRE) 607.00p -8.31% Hochschild Mining (HOC) 200.00p -6.76% Wood Group (John) (WG.) 50.70p -5.50% WH Smith (SMWH) 1,260.00p -3.15% Greencoat UK Wind (UKW) 126.50p -2.47% NextEnergy Solar Fund Limited Red (NESF) 72.10p -2.04% Bellevue Healthcare Trust (Red) (BBH) 135.80p -2.02% Schroder Oriental Income Fund Ltd. (SOI) 267.00p -2.02%