London midday: Stocks pop higher ahead of US PPI

London stocks had popped higher by midday on Thursday, helped along by well-received updates from the likes of Aviva and Spirax, but gains were muted as investors eyed another US inflation reading.

The FTSE 100 was up 0.2% at 8,049.80.

The US producer price index for October is due for release at 1330 GMT.

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said: "The figures are expected to point at an uptick in factory-gate prices in October. The headline PPI is seen rebounding from 1.8% to 2.3% in October, and core PPI from 2.8% to 3%. And don’t forget that there are components in these figures that feed into the Fed’s PCE index.

"Therefore, even if these numbers are in line with expectations, they should be warning that a 25bp cut from the Fed is probably not the right thing to do. I am not saying that the Fed won’t do it. I am just saying that it’s probably not the right thing to do."

Market participants were also looking ahead to the release of third-quarter UK GDP data on Friday.

In equity markets, Aviva rose as it hailed a "very strong" performance in the third quarter, with double-digit gains in general insurance premiums, life insurance and retirement sales, and wealth net flows.

Spirax was also up as it left its full-year outlook unchanged after increasing organic sales across all three of its businesses in the third quarter, but warned of a slight impact on results from currency movements.

3i Group pushed higher as it highlighted a "good" financial performance in the first half, with a total return of £2.05bn, or 10% on opening shareholders' funds.

B&M European Value Retail also gained as it reiterated its full-year outlook after half-year sales ticked higher.

United Utilities advanced as it said revenues topped the £1bn mark in its first half after a "robust" performance, though headline profits dropped due to a higher net finance expense.

Burberry surged to the top of the FTSE 250 as the luxury goods brand launched a review of the business in an "urgent" effort to turnaround its struggling fortunes after slumping to a £80m half-year loss driven by plunging sales in its key Chinese market.

New chief executive Joshua Schulman said "Burberry forward" would target £40m in savings and focus on "reconnecting our brand with its original purpose", mainly by targeting the outerwear market.

FirstGroup jumped as the bus and rail operator said it was buying back an extra £50m in shares and lifted its full-year forecast after a strong performance in the first half of the year.

On the downside, Keller Group slumped as the geotechnical specialist contractor said it remained on track to deliver a full-year performance in line with expectations but pointed to weak activity levels in Europe.

WH Smith was in the red even as the retailer reported a jump in full-year profit and revenue, hailing a particularly strong performance from the UK travel business and over the summer.

Russ Mould, investment director at AJ Bell, said: "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.

"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. There continues to be a focus on making efficiencies.

"Selling travel essentials to captive audiences at airports and rail stations has been a highly lucrative activity for WH Smith, except during the pandemic, but today’s numbers are a reminder the company is not immune to a bit of turbulence along the way."

Elsewhere, Lancashire Holdings, Sainsbury’s and Bunzl were all in the red as they traded without entitlement to the dividend.

Market Movers

FTSE 100 (UKX) 8,049.80 0.24%
FTSE 250 (MCX) 20,422.81 0.31%
techMARK (TASX) 4,615.39 -0.03%

FTSE 100 - Risers

Aviva (AV.) 476.70p 4.84%
Spirax Group (SPX) 6,640.00p 4.24%
3i Group (III) 3,469.00p 4.17%
B&M European Value Retail S.A. (DI) (BME) 393.80p 3.69%
United Utilities Group (UU.) 1,083.50p 3.34%
Centrica (CNA) 122.20p 3.12%
Informa (INF) 849.80p 2.76%
BP (BP.) 377.60p 2.04%
Severn Trent (SVT) 2,627.00p 1.66%
SEGRO (SGRO) 766.60p 1.56%

FTSE 100 - Fallers

Convatec Group (CTEC) 246.80p -3.74%
Fresnillo (FRES) 614.50p -3.00%
Weir Group (WEIR) 2,108.00p -2.50%
Experian (EXPN) 3,703.00p -1.65%
Sainsbury (J) (SBRY) 239.20p -1.64%
Anglo American (AAL) 2,196.00p -1.61%
DCC (CDI) (DCC) 5,370.00p -1.56%
Croda International (CRDA) 3,527.00p -1.48%
Glencore (GLEN) 371.20p -1.41%
Intermediate Capital Group (ICG) 2,050.00p -1.35%

FTSE 250 - Risers

Burberry Group (BRBY) 854.40p 16.82%
Kier Group (KIE) 145.20p 4.46%
Wizz Air Holdings (WIZZ) 1,478.00p 4.16%
FirstGroup (FGP) 142.10p 3.87%
4Imprint Group (FOUR) 5,320.00p 3.30%
Raspberry PI Holdings (RPI) 339.10p 2.63%
Dr. Martens (DOCS) 55.65p 2.39%
Pennon Group (PNN) 539.50p 2.08%
Just Group (JUST) 138.40p 2.06%
Grainger (GRI) 225.50p 2.04%

FTSE 250 - Fallers

Keller Group (KLR) 1,432.00p -12.47%
Lancashire Holdings Limited (LRE) 598.00p -9.67%
Hochschild Mining (HOC) 203.00p -5.36%
Centamin (DI) (CEY) 136.70p -3.39%
Wood Group (John) (WG.) 51.85p -3.36%
WH Smith (SMWH) 1,264.00p -2.84%
Endeavour Mining (EDV) 1,494.00p -2.80%
Fidelity Emerging Markets Limited Ptg NPV (FEML) 675.00p -2.47%
NextEnergy Solar Fund Limited Red (NESF) 72.10p -2.04%
The Renewables Infrastructure Group Limited (TRIG) 91.20p -1.94%