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LONDON (Alliance News) - UK stocks are higher Wednesday mid-morning, along with the pound, amid solid corporate earnings and UK economic data
By mid morning Wednesday, the FTSE 100 is up 0.1% at 6,756.20, the FTSE 250 is up 0.4% at 15,436.30, and the AIM All-Share is up 0.3% at 813.75.
British industrial production bounced back in September after two consecutive declines, according to the latest figures from the Office for National Statistics. Total production rose 2.2% year-on-year in September following a 1.5% fall in August and a 1.1% decline in July. The reading beat the consensus expectation for an increase of 1.8%.
Manufacturing output also grew annually in September, by 0.8%. This comes after a 0.2% fall in August and a 0.4% drop in July. On a monthly basis, industrial production increased 0.9% compared with forecast for a 0.5% rise and manufacturing output increased 1.2%, faster than the 1.1% expected.
In further positive UK economic news, data from the Society of Motor Manufacturers and Traders has shown that new car registrations increased by 4% in October. The SMMT raised its forecast for total 2013 new car sales to 2.25 million, from 2.22 million.
UK house prices are continuing to rise, but slightly slower than economists expected, according to the latest Halifax house price index. The house price index grew 6.9% on an annual basis in the three months to October, following a 6.2% gain in September. Economists were looking for a 7% increase. On a monthly basis, prices rose by 0.7% in October, the ninth consecutive monthly rise. The latest rise has increase the value of the average UK home to GBP171,991.
The latest raft of positive UK data had pushed the pound higher against the dollar and the euro. Against the dollar, the pound has pushed back above USD1.61 for the first time in over a week, making a high so far of USD1.6118. The cross between the euro and the pound has made a low of GBP0.8376.
Poor eurozone retail sales numbers have abetted the euro's slide. Retail sales in the region were down 0.6% month-on-month, worse than the 0.4% decline expected by economists. The disappointing reading will add to speculation of a possible base rate cut by the ECB at its policy meeting which starts Wednesday. Mario Draghi will give his usual policy statement and press conference on Thursday.
The EU Markit Composite PMI showed a small slow down in growth month-on-month to 51.9, from 52.2 previously, although slightly ahead of economists forecasts of 51.5. Germany's Service PMI also came out slightly softer, at 52.9, from 53.7 previously, but also ahead of forecasts of 52.3.
With a PMI reading above 50 indicating growth, the numbers are health and have helped European equities rally back to the near five-year highs seen recently. The CAC40 is up 0.8% and the DAX is up 0.4%
Within UK equities, the strong UK production, car sales and house price data has led the Automobiles and Parts sector to the top of the FTSE 350 gainers, up 1.5%. The Construction and Materials sector is up just over 1.0%, and the Travel and Leisure Sector is up just shy of 1%.
Easyjet is one of the biggest blue chip gainers, up 2.5%, after it released its latest traffic statistics that showed a 5.4% increase in passenger numbers on the year in October. The airline also filled more seats on its planes, even though cancellations were up due to air traffic control strikes in France and Italy. The load factor, a measure of how full its planes are, rose to 89.1%, from 88.4% a year earlier. Easyjet shares are rebounding from a drop in the airline sector after Ryanair released a profit warning on Monday. International Consolidated Airlines is also a big blue chip gainer, up 2.2%.
In the FTSE 250, Moneysupermarket.com shares have risen 17% after the group said significant numbers of people switching UK energy suppliers because of price hikes boosted its revenues. The price-comparison website now is expecting its full-year earnings to come in ahead of forecasts. In October, major UK energy suppliers, such as RWE npower, Centrica PLC's British Gas and SSE PLC, increased prices by eight to ten percent, prompting a surge in visitors the the site.
Experian are the heaviest blue -hip faller, down 6.4% despite reporting strong first-half results. Experian announced that it has signed an agreement to acquire US-based Passport Health Communications, Inc., a specialist in the fast growing US healthcare payments market. Shore Capital expects the company's share buy-back programme, which has been supporting the share price, to be curtailed as a result of the cost of the acquisition.
Still to come Wednesday, German factory orders at 1100 GMT and US MBA mortgage applications at 1200 GMT.
By Jon Darby; jondarby@alliancenews.com; @jondarby100
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