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(Alliance News) - Stocks in London lacked direction at the open on Friday as investors cautiously await a key speech at the Jackson Hole symposium later in the day for potential clues over the Federal Reserve's policy intentions.
The FTSE 100 index was down 6.23 points, or 0.1%, at 7,118.75. The mid-cap FTSE 250 index was up 20.74 points, or 0.1%, at 23,973.13. The AIM All-Share index was flat at 1,278.89.
The Cboe UK 100 index was down 0.1% at 708.41. The Cboe 250 was up 0.1% at 21,782.52, and the Cboe Small Companies was up 0.1% at 15,473.81.
In mainland Europe, the CAC 40 stock index in Paris was down 0.2%, while the DAX 30 in Frankfurt was down 0.4%.
With the US economy recovered from the worst of the pandemic crisis, there is much anticipation in global financial markets around Federal Reserve Chair Jerome Powell's speech on Friday to see if he will detail plans to roll back the central bank's massive stimulus measures.
But concerns about the impact of the fast-spreading Delta variant of the coronavirus on the economy could make expectations of an announcement at the annual Jackson Hole central banking symposium premature.
The Fed has said it will slow the pace of its massive bond buying programme then raise the benchmark lending rate - though no action on the latter is anticipated anytime soon, potentially for years, while the former is viewed as a delicate task.
Richard Hunter, head of Markets at interactive investor, commented: "Investors succumbed to a bout of nervousness ahead of the Jackson Hole symposium after a week of several record highs across markets. The jury remains out on whether Federal Reserve Chair Powell will specifically address the taper timetable, especially ahead of next week’s non-farm payroll numbers.
"On this side of the pond, investors also remain skittish, with the global persistence of the Delta variant and uncertainty in Asia both threatening to derail what was becoming a strong recovery. With blockages still remaining in general supply chains and a stuttering return to international travel, there remains some light between the current backdrop and a return to relative normality."
In the FTSE 100, shares in oil majors BP, Royal Dutch Shell 'A' and 'B' shares were up 1.0%, 0.8% and 0.7% respectively, tracking spot oil prices higher.
Brent oil was quoted at USD72.24 a barrel Friday morning, up from USD71.40 late Thursday.
"Geopolitical tensions have also pushed the oil price higher, which has given a fillip to the oil majors in early trade, with both BP and Shell marginally ahead. Elsewhere, some strength in mining stocks has offset the sectors under pressure as the economic fog fails to clear," Hunter noted.
At the other end of the large-caps, Just Eat Takeaway was the worst performer, down 3.1%, rounding off a grim week for the food delivery platform.
On Tuesday, FTSE Russell indicated that Just Eat would be ejected from the FTSE 100 index next month when the index review changes take effect. The index manager reclassified the company as Dutch not British, thereby making it ineligible for inclusion in UK indices.
In the FTSE 250, Babcock International was up 0.8% after Barclays upgraded the aerospace and defence contractor to Overweight from Equal Weight.
Elsewhere, Amigo Holdings was up 2.1% after the guarantor loans provider reported a better than expected first quarter.
Amigo's revenue in the three months to June 30 dropped 33% year-on-year to GBP32.5 million from GBP48.8 million. However, pretax profit surged to GBP15.0 million from GBP1.4 million.
The Bournemouth, England-based firm said its pause in lending, which continued throughout the three-month period, led to a 41% decline in customer numbers and a 48% reduction in the net loan book. As such, revenue fell compared to the prior year period, primarily driven by the reduction in the loan book, it explained.
Complaints provisions stood at GBP338.0 million, largely unchanged from its year end.
The Japanese Nikkei 225 index closed down 0.4%. In China, the Shanghai Composite finished up 0.5%, while the Hang Seng index in Hong Kong was up 0.1%. The S&P/ASX 200 in Sydney ended marginally lower.
The pound was quoted at USD1.3707 early Friday, down from USD1.3723 at the London equities close Thursday.
The euro stood at USD1.1770, marginally higher from USD1.1760. Against the Japanese yen, the dollar was trading at JPY109.95, down from JPY110.04.
Gold was priced at USD1,804.40 an ounce, higher against USD1,794.77.
Friday's economic calendar is headlined by Powell's speech at 1500 BST. Before this is Irish retail sales at 1100 BST. In the afternoon, there are US personal consumption expenditure figures at 1330 BST - the core reading is the Fed's preferred gauge of inflation.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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