London midday: FTSE maintains gains as investors wade through earnings

The FTSE 100 was up 0.2% at 7,691.84.

Russ Mould, investment director at AJ Bell, said: “The FTSE 100 shrugged off a weak showing from index heavyweight Shell (LON:RDSa) to trade higher as the narrative of the rate hiking cycle being close to its peak continued to hold sway.

“As expected, the US Federal Reserve increased rates by 25 basis points overnight but there was no indication of a definite hike when the central bank next meets in September and there is hope inflation can be brought under control without inflicting too much economic damage across the Atlantic.

“Whether the same is true on this side of the pond remains to be seen- with the European Central Bank, and its counterparts at the Bank of England, facing a more stubborn challenge on inflation.”

The latest policy announcement from the ECB is due at 1315 BST.

On home shores, the Distributive Trades survey from the Confederation of British Industry showed that retail sales fell in the year to July at the fastest pace since April 2022, with the downturn only expected to get worse.

The CBI’s monthly balance of retail sales fell to -25 from -9 in June. Meanwhile, the balance of expectations for the month ahead slumped to -32 from zero.

The gauge for orders placed upon suppliers fell at the fastest pace since January 2021, to -39% from -10% in June.

CBI principal economist Martin Sartorius said: “Firms remain cautious about the retail sector’s near-term outlook as they pare back on orders and brace themselves for another sales contraction in the year to August.

“Cost pressures, a tight labour market, and rising interest rates, alongside uncertain demand conditions, make the current environment difficult to navigate for retailers. Now more than ever, business rates reform would go a long way to alleviate cost pressures in the retail sector, which burden them disproportionately compared to other businesses.”

In equity markets, Centrica (LON:CNA) was sitting pretty at the top of the FTSE 100 after it posted a jump in interim profit as profits at British Gas surged amid rising energy prices.

In the six months to 30 June, adjusted operating profit rose to £2.1bn from £1.3bn in the same period a year earlier, while earnings per share rose to 25.8p from 11p. The group made a statutory operating profit of £6.5bn, versus a £1.1bn loss a year earlier.

Adjusted operating profits at British Gas Energy rocketed 889% to £969m amid changes to the energy price cap, which meant it was able to recover more costs.

Informa, Relx, Airtel Africa, Jupiter Fund Management, Inchcape, Elementis (LON:ELM) and ITV (LON:ITV) also gained after results.

On the downside, St James’s Place tumbled after the asset manager said interim profits fell amid market volatility, but still managed £3.4bn in net inflows.

Barclays (LON:BARC) was in the red even as it became the second bank to post surging profits on the back of higher interest rates and lift its provisions for bad loans. The bank posted a 22% rise in pre-tax profit for the six months to June 30 to £4.5bn. Bad loan charges increased to £900m from £341m.

Shell was weaker as it posted a sharp fall in second-quarter profits as oil and gas prices declined a year after Russia’s invasion of Ukraine sparked a surge in energy costs.

Mobico, Indivior and Drax also fell on results.

Market Movers

FTSE 100 (UKX) 7,691.84 0.19%

FTSE 250 (MCX) 19,329.02 0.74%

techMARK (TASX) 4,464.02 0.50%

FTSE 100 – Risers

Centrica (CNA) 133.20p 7.42%

Informa (INF) 778.00p 4.35%

Relx plc (REL) 2,624.00p 3.23%

Airtel Africa (AAF) 113.20p 3.19%

CRH (CDI) (LON:CRH) 4,694.00p 3.01%

Melrose Industries (LON:MRON) (MRO) 527.20p 2.65%

Frasers Group (FRAS) 796.00p 2.18%

Smith (DS) (SMDS) 307.20p 2.06%

Rentokil Initial (LON:RTO) 651.60p 2.00%

Smurfit Kappa Group (CDI) (SKG) 3,090.00p 1.98%

FTSE 100 – Fallers

St James’s Place (STJ) 1,009.50p -14.67%

SSE (LON:SSE) 1,720.50p -4.79%

Barclays (BARC) 157.88p -3.77%

BT Group (LON:BT.A) 123.35p -2.49%

Persimmon (LON:PSN) 1,179.50p -1.99%

Vodafone Group (LON:VOD) 76.27p -1.63%

M&G (MNG) 202.20p -1.12%

NATWEST GROUP (NWG) 239.20p -1.08%

Aviva (LON:AV.) 398.10p -0.97%

Shell (SHEL) 2,374.50p -0.92%

FTSE 250 – Risers

Jupiter Fund Management (JUP) 122.70p 13.51%

Inchcape (INCH) 859.50p 10.19%

Elementis (ELM) 115.60p 6.45%

Aston Martin Lagonda Global Holdings (AML) 370.40p 5.83%

ITV (ITV) 73.58p 5.78%

Mitchells & Butlers (MAB) 225.80p 4.93%

Vesuvius (VSVS) 456.20p 4.49%

Future (FUTR (LON:FUTR)) 796.00p 3.38%

Ferrexpo (LON:FXPO) 94.05p 3.35%

Grainger (GRI) 260.20p 2.93%

FTSE 250 – Fallers

Mobico Group (MCG) 99.25p -7.16%

Indivior (INDV) 1,805.00p -3.68%

Man Group (EMG) 232.90p -2.63%

RHI Magnesita N.V. (DI) (RHIM) 3,010.00p -1.63%

CMC Markets (CMCX) 146.00p -1.62%

Drax Group (LON:DRX) 611.00p -1.42%

Bellevue Healthcare Trust (Red) (BBH) 149.40p -1.32%

HICL Infrastructure (HICL) 130.80p -1.21%

FirstGroup (LON:FGP) 147.40p -1.21%

Quilter (QLT) 81.60p -1.09%