London close: Stocks rise after UK borrowing data, Nvidia results

21st Nov 2024 16:00

(Sharecast News) - London stocks ended Thursday on a positive note, as markets rebounded following quarterly results from US tech giant Nvidia and investor response to the latest UK government borrowing figures.

The FTSE 100 index rose 0.79% to close at 8,149.27 points, while the FTSE 250 advanced 0.52% to 20,349.92 points.

In currency markets, sterling was last down 0.56% on the dollar to trade at $1.2581, while it edged up 0.17% against the euro, changing hands at €1.2021.

"The FTSE 100's day has been dominated by the weak outlook from JD Sports, which has sent the shares diving 16%, and the solid update by Halma, which has gained over 5%," said IG chief market analyst Chris Beauchamp.

"But the updates from one of its flashiest members and also one of its more staid constituents has had little overall effect given their small weighting.

"Bigger names like Shell, bolstered by a rising oil price, have had more effect on a day that has seen a continuation of the index's recent strength."

Beauchamp added that antitrust worries had resurfaced stateside for Alphabet, after US regulators pushed for the giant to divest its Chrome search engine.

"Combined with last night's Nvidia earnings, which surprisingly failed to lift a stock that has gained 50% in almost three months, the news has been enough to prevent the Nasdaq and S&P 500, with its heavy tech weighting, joining in the gains by the Dow and the small cap Russell 2000.

"Crypto stocks like Coinbase have also suffered a check after recent strong gains."

UK government borrowing surges past forecasts in October

In economic news, the UK government's borrowing rose to £17.4bn in October, far exceeding economists' expectations of £12.3bn and marking a £1.6bn increase compared to the same month last year.

The Office for National Statistics noted it was the second-highest borrowing figure for October since records began in 1993.

The rise, driven by higher spending and debt repayments outpacing tax receipts, was the first since Chancellor Rachel Reeves's budget announcement last month.

"Despite the cut in the main rates of National Insurance earlier in 2024, total receipts rose on last year," said Jessica Barnaby, deputy director for public sector finances at the ONS.

"However, with spending on public services, benefits and debt interest costs all up on last year, expenditure rose faster than revenue overall."

Meanwhile, the Confederation of British Industry's latest Industrial Trends Survey revealed that UK manufacturing output volumes fell in the three months to November, with a weighted balance of -12, down from -6 in October.

Output declines were reported across 14 of 17 sub-sectors, and total order books remained below seasonal norms, albeit with some improvement from the previous month.

Manufacturers expressed cautious optimism, with a balance of 9 anticipating higher output over the next three months.

"Output has underperformed expectations in recent months, with manufacturers pointing to uncertainty around the Budget, the US elections and recent political instability in Europe as among the factors leading customers to pause or cancel orders," said Ben Jones, CBI lead economist.

"Many firms still need to work through the implications of the Budget for their own plans for pay, hiring and investments.

"But it's an encouraging sign that output volumes are expected to return to growth in the quarter ahead, with order books also showing some improvement this month."

Across the Atlantic, US labour and housing markets showed signs of recovery.

Weekly jobless claims fell by 6,000 to 213,000 in the week ended November 16, the lowest level since April and well below forecasts.

The four-week average also dropped to 217,750, suggesting continued strength in employment.

In US housing, existing home sales rose 3.5% in October, reversing a 14-month low, with annualised sales reaching 3.96 million - slightly above expectations.

Home prices climbed 4% to an average of $407,200, ending a three-month decline.

Halma and Ithaca Energy rise, ex-divs prove a drag

On London's equity markets, Halma rose 6.08% after the safety equipment specialist reported record first-half sales exceeding £1bn and announced a 7% increase in its interim dividend.

The group also reaffirmed its full-year guidance.

Ithaca Energy jumped 9.22% on news of a $200m special dividend, rewarding shareholders with an unexpected payout.

On the downside, JD Sports Fashion plummeted 14.79% as the retailer cautioned that full-year profits would hit the lower end of expectations.

The company cited a challenging October marked by heavier discounts, unseasonably warm weather, and cautious consumer spending ahead of the US election.

Similarly, CMC Markets tumbled 14.77% despite reporting a swing to a £49.6m interim pre-tax profit from a £2m loss a year earlier.

PayPoint slid 5.51% despite a 20.6% rise in first-half underlying EBITDA to £37.5m, driven by strong operational momentum.

Vodafone Group, National Grid, Petershill Partners, DCC, and Great Portland Estates all lost ground as they traded ex-dividend.

Among other movers, Frasers Group edged down 0.61% after calling for a leadership change at Boohoo Group, whose shares gained 3.92%.

Auction Technology Group dropped 3.71% after Jefferies initiated coverage with an 'underperform' rating, adding to its pressure.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 8,149.27 0.79%

FTSE 250 (MCX) 20,349.92 0.52%

techMARK (TASX) 4,632.60 0.68%

FTSE 100 - Risers

Halma (HLMA) 2,645.00p 5.72%

Smurfit Westrock (DI) (SWR) 4,400.00p 4.71%

Beazley (BEZ) 776.00p 3.60%

Rolls-Royce Holdings (RR.) 540.80p 2.77%

Flutter Entertainment (DI) (FLTR) 21,350.00p 2.74%

B&M European Value Retail S.A. (DI) (BME) 339.00p 2.70%

Marks & Spencer Group (MKS) 371.90p 2.45%

Diploma (DPLM) 4,224.00p 2.38%

Experian (EXPN) 3,710.00p 2.18%

Hiscox Limited (DI) (HSX) 1,036.00p 2.17%

FTSE 100 - Fallers

JD Sports Fashion (JD.) 95.44p -15.50%

Vodafone Group (VOD) 68.88p -3.31%

National Grid (NG.) 963.60p -1.89%

Vistry Group (VTY) 624.50p -1.50%

BT Group (BT.A) 148.00p -1.43%

Croda International (CRDA) 3,462.00p -1.11%

British Land Company (BLND) 375.00p -1.11%

Fresnillo (FRES) 647.50p -1.07%

Convatec Group (CTEC) 229.80p -1.03%

easyJet (EZJ) 511.80p -0.89%

FTSE 250 - Risers

Ithaca Energy (ITH) 109.00p 9.22%

IP Group (IPO) 42.05p 6.19%

Wood Group (John) (WG.) 54.15p 5.04%

Grainger (GRI) 232.50p 4.73%

Ninety One (N91) 162.70p 4.56%

Bytes Technology Group (BYIT) 446.20p 4.34%

W.A.G Payment Solutions (WPS) 85.00p 3.66%

Oxford Instruments (OXIG) 2,020.00p 3.59%

Harbour Energy (HBR) 267.80p 3.40%

Bridgepoint Group (Reg S) (BPT) 342.20p 3.07%

FTSE 250 - Fallers

CMC Markets (CMCX) 296.00p -14.77%

Petershill Partners (PHLL) 238.50p -6.29%

PayPoint (PAY) 786.00p -5.99%

Mitie Group (MTO) 106.00p -4.50%

Urban Logistics Reit (SHED) 104.80p -4.37%

Auction Technology Group (ATG) 426.50p -3.71%

Discoverie Group (DSCV) 640.00p -3.32%

Dr. Martens (DOCS) 54.10p -3.13%

Wizz Air Holdings (WIZZ) 1,275.00p -3.12%

Genus (GNS) 1,644.00p -2.49%