London close: Stocks rise as US consumer confidence remains stable

26th Mar 2024 17:06

(Sharecast News) - London markets closed in positive territory on Tuesday, buoyed by a stable US consumer confidence report and anticipation for upcoming inflation data.

The FTSE 100 index edged up 0.17% to 7,930.96 points, while the FTSE 250 saw a stronger increase of 0.84%, reaching 19,777.64 points by the end of trading.

In currency markets, sterling was last down 0.03% on the dollar, trading at $1.2632, while it strengthened 0.02% against the euro, changing hands at €1.1662.

"While US and European stock indices continue to grind higher, investors are still flocking to the German stock market which made yet another record high close to the 18,500 mark, buoyed by slightly improved German consumer morale," said IG senior market analyst Axel Rudolph.

"In the US, durable goods orders rose more than expected and home prices soared at a faster pace ahead of Friday's PCE inflation data."

Rudolph said that as the Federal Reserve's preferred inflation gauge, it could provide some volatility in a quiet market as many would be closed on Friday and Monday for Easter.

"Oil, natural gas and gold prices were little changed on Tuesday amid a dearth of data but the silver price took a hit as last week's buying gave way to selling pressure."

Households struggling despite slower grocery inflation, US consumer confidence stable

In economic news, fresh survey data revealed that nearly a quarter of UK households perceived themselves as financially strained, despite a notable 4.5% decline in grocery price inflation over the last four weeks.

Kantar reported the drop in price inflation compared to the last four-week period, attributing it to a number of factors.

"Grocery inflation has come down significantly since hitting an eye-watering peak of 17% in March 2023," said Fraser McKevitt, Kantar's head of retail and consumer insight.

"However, despite this continued slowdown, many British households are still feeling the squeeze.

"23% identified themselves as struggling financially in our data - the same proportion as reported in November last year."

Online supermarket Ocado emerged as the fastest-growing retailer in Britain for the 12 weeks ended 17 March, propelled by a sustained voucher campaign that drew in customers.

Ocado saw its sales surge by 9.5% during the period, outpacing the total online market growth of 6.6% and claiming 1.9% of all take-home sales.

Among the UK's major grocers, Tesco and J Sainsbury experienced healthy annual increases in sales, climbing by 5.8% and 6.7% respectively.

As a result, their market shares edged up 0.4 percentage points each, reaching 27.3% and 15.2% respectively.

Meanwhile, Morrisons saw a 3.6% increase in sales, maintaining its share of spend at 8.7%, while Asda saw a modest uptick in sales of 0.2%, holding 13.8% of the market.

Discounters Aldi and Lidl continued their growth trajectory, with Aldi's sales rising by 3.1% and Lidl's by 8.8%, capturing 9.8% and 7.8% of the market, respectively.

Iceland saw a 2.2% growth in sales, while Waitrose and the Co-op held 4.5% and 5.5% of the market respectively, with sales up by 3.9% and 2.2%.

On the continent, German consumer sentiment displayed sluggish improvement but maintained its upward trajectory, according to a joint survey from GfK and the Nuremberg Institute for Market Decisions (NIM).

The consumer sentiment index for April rose slightly to -27.4 from a revised -28.8 in March.

Across the Atlantic, consumer confidence in the United States remained largely stable in March, with the Conference Board's consumer confidence index recording 104.7, nearly unchanged from the prior month.

Despite improving perceptions about the current economic climate, concerns about future conditions led to a slight dip in the Expectations Index to 73.8 from 76.3.

"Consumers remained concerned with elevated price levels, which predominated write-in responses," said Dana Peterson, chief economist at the Conference Board.

"March's write-in responses showed an uptick in concerns about food and gas prices, but in general complaints about gas prices have been trending downward."

Meanwhile, durable goods orders in the US beat expectations, rising 1.4% from the previous month, according to the Department of Commerce.

Core capital goods orders, excluding transportation, also saw growth, indicating positive momentum in business investment.

On the US housing front, house-price growth in major US cities accelerated in January, marking its fastest pace in 14 months according to S&P/Case-Shiller data.

The 20-city composite index showed a 6.6% increase in residential real estate prices compared to January 2023, albeit with slight month-on-month declines across 17 of the 20 markets, attributed to persistent high borrowing costs.

Ocado rises on first-quarter performance, Auto Trader slumps

On London's equity markets, Ocado Group jumped 2.74% following its announcement of a strong performance in its Ocado Retail operation during the first quarter.

With an 8.1% increase in total item volumes and a 10.6% rise in revenue to £645.3m, Ocado Retail - a joint venture with Marks and Spencer - saw its online market share climb to 13.5%.

Engineering group Smiths Group rose of 3.01%, driven by the reaffirmation of its annual guidance after reporting a rise in half-year earnings and order growth.

Similarly, Petershill Partners leapt 9.76% after announcing adjusted profit after tax of $200m in its preliminary results.

Softcat and AG Barr also saw positive movements after respective results, with Softcat rising 4.37% and AG Barr by 9.34%.

On the downside, Auto Trader Group slumped 4.83% after JPMorgan Cazenove placed its shares on 'negative catalyst watch' ahead of full-year results.

John Wood Group fell 6.95% despite an upgrade to its current-year outlook, reporting wider-than-expected losses and increased debt levels for 2023.

Dr Martens decreased 2.9% following a downgrade to 'sell' at Goldman Sachs, while Mobico Group, formerly National Express, declined 5.71% after a downgrade to 'sector perform' from 'outperform' at RBC Capital Markets.

Flutter Entertainment reversed earlier gains to close 0.96% lower after reporting a widening of full-year losses, although revenue surged.

Ferrexpo declined 6.18% after announcing a court prohibition on the transfer of ownership and other shares-related corporate rights of its subsidiaries in Ukraine, though the miner clarified the restrictions were part of legal proceedings against Kostyantin Zhevago and not related to the Ferrexpo Group.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 7,930.96 0.17%

FTSE 250 (MCX) 19,777.64 0.84%

techMARK (TASX) 4,519.22 0.39%

FTSE 100 - Risers

Kingfisher (KGF) 249.80p 4.26%

Marks & Spencer Group (MKS) 263.90p 3.86%

JD Sports Fashion (JD.) 114.20p 3.72%

Ocado Group (OCDO) 467.10p 3.25%

Standard Chartered (STAN) 695.00p 2.90%

Smith (DS) (SMDS) 359.80p 2.51%

easyJet (EZJ) 552.00p 2.41%

Smiths Group (SMIN) 1,691.50p 2.18%

International Consolidated Airlines Group SA (CDI) (IAG) 166.00p 2.15%

Sainsbury (J) (SBRY) 262.50p 2.14%

FTSE 100 - Fallers

Auto Trader Group (AUTO) 705.60p -4.93%

Rio Tinto (RIO) 4,918.50p -1.89%

Croda International (CRDA) 4,848.00p -1.86%

Beazley (BEZ) 669.50p -1.83%

Experian (EXPN) 3,442.00p -1.71%

Prudential (PRU) 764.80p -1.70%

M&G (MNG) 235.10p -1.47%

St James's Place (STJ) 464.40p -1.45%

Fresnillo (FRES) 444.60p -1.37%

BP (BP.) 499.80p -1.21%

FTSE 250 - Risers

Petershill Partners (PHLL) 189.00p 9.50%

Barr (A.G.) (BAG) 562.00p 9.34%

Close Brothers Group (CBG) 409.20p 7.51%

Trustpilot Group (TRST) 189.60p 6.10%

TUI AG Reg Shs (DI) (TUI) 640.00p 5.26%

Softcat (SCT) 1,551.00p 4.37%

Direct Line Insurance Group (DLG) 192.70p 3.94%

Bakkavor Group (BAKK) 107.00p 3.88%

Babcock International Group (BAB) 533.00p 3.70%

Playtech (PTEC) 472.00p 3.60%

FTSE 250 - Fallers

Wood Group (John) (WG.) 137.90p -6.95%

W.A.G Payment Solutions (WPS) 66.00p -6.78%

Ferrexpo (FXPO) 44.00p -6.18%

Mobico Group (MCG) 66.85p -5.71%

Dr. Martens (DOCS) 84.70p -2.90%

Me Group International (MEGP) 167.00p -2.68%

PureTech Health (PRTC) 223.00p -2.62%

Diversified Energy Company (DEC) 854.00p -2.51%

Bridgepoint Group (Reg S) (BPT) 260.00p -1.74%

Ithaca Energy (ITH) 142.20p -1.66%