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(Alliance News) - Stock prices in London were higher at midday on Wednesday as investor sentiment remained buoyed, despite some mixed economic data, as traders look ahead to meeting minutes from the US Federal Reserve.
"Risk appetite stays on the rise today, despite mixed macro data from the old continent [Europe], as investors cheered positive news from China after Beijing is said to be considering extended support measures towards property developers," said Pierre Veyret at ActivTrades.
"That news has helped lift market sentiment, while most traders are slowly switching their focus towards the US, with today's release of the minutes of the last FOMC meeting."
The US Federal Open Market Committee will release its meeting minutes at 1900 GMT.
The FTSE 100 index was up 49.22 points, or 0.7%, at 7,603.31. The FTSE 250 was up 173.48 points, or 0.9%, at 19,307.82, and the AIM All-Share was up 3.76 points, or 0.5%, at 842.39.
The Cboe UK 100 was up 0.6% at 760.28, the Cboe UK 250 was up 1.1% at 16,763.25, and the Cboe Small Companies was up 0.6% at 13,321.28.
The rate of grocery price inflation in the UK has dropped for the second time in a row, the latest market survey from Kantar revealed.
The grocery price inflation rate faded to 14.4% in December, from 14.6%. UK shop price inflation also faded ever-so-slightly last month.
Meanwhile, according to the latest British Retail Consortium-NielsenIQ tracker, shop price annual inflation decelerated to 7.3% in December, from 7.4% in November.
Food inflation, however, quickened to 13.3% in December, from 12.4% a month earlier.
"This is above the 3-month average rate of 12.5%. This is the highest inflation rate in the food category on record," the BRC added.
In London, online grocer Ocado jumped 7.3% at midday in London. It was the best performer in the FTSE 100.
Data from Kantar showed Ocado sales increased by 8.2% year-on-year in the 12 weeks to Christmas Day, as it maintained a market share of 1.7%.
Tesco sales, meanwhile, grew by 6.0%. It remained the UK's most popular supermarket though its market share slipped to 27.5% from 27.9%. Peer Sainsbury saw sales growth of 6.2%, though its market share fell to 15.5% from 15.7%.
Shares in Sainsbury's and Tesco were up 3.6% and 2.3%, respectively, at midday.
Elsewhere on the FTSE 100, BT was up 2.9% as Bloomberg reported that the telecommunications firm will take a stake in drone startup Altitude Angel.
BT will provide "network infrastructure and its scalability experience to deploy and maintain Altitude Angel's ARROW tower network," Altitude Angel said on its website.
In the FTSE 250, Wizz Air climbed 5.8%. The airline received a boost from positive passenger numbers from low-cost peer Ryanair.
The Dublin-based firm said passenger numbers grew 21% to 11.5 million in December from 9.5 million the previous year.
Ryanair said it operated over 65,500 flights in December with a load factor of 92%, compared to 81% a year prior.
On AIM, Corcel soared 17% after it announced it had entered into a farm-out and joint venture agreement with Riversgold, covering its recently acquired rare earth elements project in Laverton, Australia.
Under the agreement, Riversgold will make an immediate payment to Corcel of AUD30,000, around GBP17,089, and will also commit to funding 100% of an initial exploration programme of AUD500,000.
Gold was quoted at USD1,858.59 an ounce at midday on Wednesday, sharply higher against USD1,829.14 late Tuesday. Brent oil was quoted at USD79.89 a barrel, down significantly from USD83.03.
BP and Shell fell 2.3% and 2.0%, respectively, at midday, tracking the lower Brent price.
Investors are becoming increasingly concerned about the current Covid situation in China, where a relaxation of restrictions is leading to a surge in cases, suggesting negative implications for global growth and supply chains.
The pound was quoted at USD1.2050 at midday on Wednesday in London, higher compared to USD1.1980 at the local close on Tuesday.
UK consumers borrowed an additional GBP1.5 billion in consumer credit during November, according to data from the Bank of England.
Driven by an additional GBP1.2 billion of credit card borrowing, consumers borrowed an additional GBP1.5 billion in consumer credit in November, well above the GBP700 million borrowed in October.
This was also higher than the previous six-month average of GBP1.1 billion and came in well above market expectations, as cited by FXStreet, of GBP900 million.
In European equities on Wednesday, the CAC 40 in Paris was up 1.7%, while the DAX 40 in Frankfurt was up 1.5%.
The eurozone economy remained in a downturn at the end of 2022, though displayed some signs of improvement, data from S&P Global showed.
The seasonally adjusted S&P Global eurozone composite purchasing managers' index output index was 49.3 in December, up from 47.8 in November. Market consensus, as cited by FXStreet, had expected a reading of 48.8.
Though remaining below the 50.0 mark that separates growth from contraction, December's decline was the slowest since July, when activity levels in the eurozone first started shrinking. The decrease has now softened in the past two survey periods.
Joe Hayes, senior economist at S&P Global Market Intelligence, noted that cooling price pressures have helped temper the decline in economic activity levels.
Hayes added there was "little evidence" to suggest the eurozone economy may return to "meaningful and stable growth any time soon", however.
"Demand conditions remained fragile as clients have retrenched, while business confidence remains bogged down by recession concerns, energy cost uncertainty and persistently high inflation and a tightening of financial conditions," he explained.
The euro stood at USD1.0606 at midday on Wednesday, higher against USD1.0550 at the London equities close on Tuesday. Against the yen, the dollar was trading at JPY130.57, lower compared to JPY130.89.
Stocks in New York were called higher. The Dow Jones Industrial Average is called up 0.3%, the S&P 500 index up 0.5%, and the Nasdaq Composite up 0.7%.
On Tuesday, data showed the US manufacturing sector rounded off 2022 with another decline in activity, though inflationary pressure eased.
The S&P Global manufacturing purchasing managers' index faded to 46.2 points in December from 47.7 in November, in line with the flash estimate.
"The latest data signalled the fastest decline in operating conditions since May 2020, and was among the sharpest since 2009," S&P Global said. "The downturn stemmed from weak client demand which drove faster contractions in output and new orders. Muted domestic and foreign customer demand led to a slower rise in employment."
Still to come on Wednesday's economic calendar, there is an ISM US PMI print at 1500 GMT alongside job openings and labour turnover data.
By Heather Rydings, Alliance News senior economics reporter
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