LONDON (Alliance News) - London's main stock indices closed mixed again Thursday as investors reacted to US fiscal worries, balanced by strong US jobless claims and GDP results, while individual UK companies also grabbed their share of attention.
The FTSE 100 closed up 0.2% at 6,565.59, whilst the FTSE 250 closed down 0.1% at 15,009.41, as the indices reflected the movements of their reporting travel-sector constituents.
Blue-chip equity TUI Travel closed up 3.9% at 370.376 pence. The travel company led the winners on the FTSE 100 after it announced it had increased its underlying operating-profit growth forecast and said that it expects to achieve full-year profit growth of at least 11% on a constant currency basis. The company also reported strong high-season summer trading in the UK and Nordics. It said that it had already sold approximately 31% of its winter programme 2013-14.
In the FTSE 250, Thomas Cook Group also reported results, but sentiment was far from positive. The travel operator closed the day as one of the biggest fallers on the index, down 6.2% at 145.90p. Despite reporting positive conditions, the market reacted badly to the company as it left its profit forecasts unchanged compared to the upgrade at rival TUI Travel.
The AIM All-Share index closed up 0.4% at 792.73p.
AIM-listed Atlantic Coal closed up fully 100% at 0.25p. The company jumped after it said it swung to a pretax profit in its first half as it increased production. The company posted a pretax profit of USD2.5 million for the six months ended June 30 compared to a pretax loss of USD1.4 million the previous year. Sales were up 15% to USD10.5 million from USD8.9 million, as the company increased its clean-coal production by 37% to 81,965 tonnes.
Electricity and gas, water and multi-utilities were amongst the heaviest falling stocks. Centrica, down 2.1% at 367.65936p, and SSE, down 1.7% at 1,463.1487p, closed the day as two of the worst losers on the blue-chip index. Both energy companies suffered on the back of UK opposition leader Ed Miliband's speech on Wednesday in which he said he would freeze electricity and gas prices if the Labour Party is voted into power in 2015.
UK markets traded in a tight range for the majority of Thursday as investors remained wary of a potential US government shut down. A stalemate in federal budget talks means that the US government will run out of money to operate unless the Senate and House of Representatives can come to an agreement by Tuesday, Oct. 1.
Combined with the budget deadline, the ongoing discussions to negotiate a higher US debt ceiling has weighed on trader sentiment. Jack Lew, Treasury Secretary, has notified Congress that unless the limit is expanded, the Treasury will exhaust its emergency borrowing measures by October 17 at the latest.
Strong US economic data caused an increase in both UK and US investor confidence.
US jobless claims decreased by 4,000 to 305,000, beating the consensus forecasts cited by FXstreet.com of an increase to 325,000.
Economic activity in the US increased at an un-revised rate of 2.5% in the second quarter, according to the Commerce Department's final estimate on GDP.
Wall Street was making significant gains at the UK equities market close. The S&P was up 0.2% at 1,696.13, the DJIA was up 0.3% at 15,311.41, and the Nasdaq was up 0.5% at 3,780.84.
Having strengthened in the aftermath of the strong US jobless and GDP data, the dollar ticked down after a weak US pending home sales report. Pending home sales dropped 1.6% in August from the previous month, more than the consensus forecast of a 1% drop, according to FXstreet.com.
The dollar is now trading at 1.3481 against the euro, 1.6011 against the pound, and 98.961 against the yen.
Friday brings with it a busy data calendar. UK GfK consumer confidence is released overnight at 0005 BST, alongside a raft of Japanese data. Japanese CPI figures are released at 0030, with foreign investment data at 0050. Chinese MNI business sentiment is at 0245.
Nationwide housing price data for the UK is scheduled for 0700 BST.
French consumer spending and GDP information is announced at 0745, with Italian business confidence at 0900. A raft of EU data is anticipated at 1000 BST, including business climate figures, consumer and industrial confidence, and services sentiment. German CPI figures are set for 1300 BST.
Later in the day is a series of US data releases. US personal spending, personal consumption expenditure and personal income data will be released at 1330 BST. Michigan consumer sentiment is scheduled for 1455 BST.
By James Kemp; jameskemp@alliancenews.com
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