(Alliance News) - European equities recovered from a slow start to achieve solid gains by Friday afternoon, despite poor economic data, while New York-listed technology shares were lower after a grim quarter for social media app Snap.
Conversely, takeaway food delivery shares were on the up, boosted by the read-across of a positive update from Germany's Delivery Hero.
In London, the FTSE 100 index was up 26.40 points, or 0.4%, at 7,296.91 midday Friday. The FTSE 250 index rose 184.73 points, or 0.9%, at 19,893.97. The AIM All-Share index added 3.08 points, or 0.3%, at 905.41.
The Cboe UK 100 index was up 0.4% at 726.64. The Cboe 250 was 1.0% higher at 17,301.56. The Cboe Small Companies, however, edged 0.1% lower to 13,529.51.
In mainland Europe, the CAC 40 stock index in Paris was up 0.3%, while the DAX 40 in Frankfurt was 0.2% higher.
"The FTSE 100 eked out some gains on Friday to provide hope it may finish in positive territory for the week," AJ Bell analyst Russ Mould commented.
"A drop in the pound as retail sales disappointed probably helped since it boosted the relative value of the overseas earnings that dominate the stock index."
The pound was quoted at USD1.1945 midday Friday, slightly lower than USD1.1958 at the London equities close on Thursday.
Sterling was pulled in two directions on Friday morning, falling as low as USD1.1917 following a poor UK retail sales print, but recovering back to near the USD1.1960 mark after a PMI reading came in better-than-feared.
According to the Office for National Statistics, UK retail sales volumes fell 5.8% annually in June, accelerating from a 4.7% decline in May. The figure was worse than the FXStreet-cited market consensus of a smaller 5.3% fall.
On a monthly basis, sales fell 0.1% in June from May. In May, they had fallen 0.8% from April, and that figure was downwardly revised from a 0.5% fall.
Excluding fuel, retail sales fell 5.9% yearly in June, following a 5.5% decline in May. June's figure, though worse than May's, beat an FXStreet-cited forecast of a 6.3% decline.
On monthly basis, fuel-excluded retail sales were 0.4% higher, defying expectations of a 0.4% decline, and swinging from a 1% fall in May.
London-listed retail shares struggled. Even JD Sports - which on Friday reported a decent first five months of its financial year - suffered selling pressure.
JD was down 0.7%, furniture retailer Made.com lost 5.3%, and electrical goods seller AO World gave back 0.2%.
More promisingly, the UK's private sector remained in expansion territory in July, preliminary survey results showed, though growth was the slowest since February 2021.
The latest S&P Global composite flash purchasing managers' index fell to 52.8 points in July from June's final score of 53.7. July's figure remained above the 50.0 no change mark but still set a 17-month low.
While the UK remained in growth territory, the eurozone went into reverse in July. There, the composite PMI fell to 49.4 points in July, according to the flash result, from June's final tally of 52.0.
Analysts at Dutch bank ING said the data will have caught the eye of the ECB, which had surprised with a 50 basis point rate hike on Thursday.
"The sharp decline in the composite PMI from 52 to 49.4 indicates that recessionary pressures are becoming more widespread in the eurozone economy. For the European Central Bank, this confirms our view that it will only hike another 50 basis points in total this year," ING explained.
The euro stood at USD1.0158 on Friday afternoon, down with USD1.0195 at the European equities close on Thursday. Against the yen, the dollar was trading at JPY137.46, down from JPY137.93.
Still to come on Friday is a PMI score for the US, due at 1445 BST.
Ahead of the release, stocks in New York were called lower. The Dow Jones Industrial Average was pointed slightly lower, the S&P 500 down 0.3% and the Nasdaq Composite down 0.5%.
Major US tech names were lower in pre-market dealings.
Facebook-owner Meta Platforms was 4.7% lower. Twitter, which reports quarterly results before the opening bell in New York, was down 2.6%.
The duo were dragged lower by social media peer Snap, which was down 30% in pre-market dealings.
After the New York close on Thursday, the owner of Snapchat said its second-quarter net loss widened to USD422.1 million from USD151.7 million a year before. Snap decided against forward guidance due to "uncertainties". It also warned of advertising spend, which would hit revenue.
"Snap's problems aren't restricted to advertising spend. TikTok is commanding the attention of millions of people and that means less engagement with other social media platforms. Snapchat might be fun for a while as users muck about with the photo filters, but TikTok has become the dominant force and so consumers – and most likely advertisers – are focusing their main attention on that platform," AJ Bell's Mould commented.
In London, Beazley was among the standout performers in the FTSE 250 index, adding 7.9%. The insurer reported an interim pretax profit fall, though its combined ratio - signifying underwriting profit - was at its best level in seven years.
Beazley said it "maintained the momentum of the second half of 2021" during the first six months of 2022.
Gross written premiums increased 26% yearly to USD2.55 billion from USD2.04 billion. However, pretax profit declined 87% to USD22.3 million from USD167.3 million.
Expenses increased 23% to USD1.59 billion. That number includes a 22% rise in net insurance claims to USD969.6 million.
"A challenging investment environment has impacted profit; however I'm delighted that we have achieved our best combined ratio at a half year since 2015," Chief Executive Officer Adrian Cox said.
The combined ratio improved to 87% from 94% a year prior. Any ratio below 100% signifies an underwriting profit, so the lower the better.
Peer Lancashire Holdings rose 7.4%.
Meanwhile, London-listed motor insurers were in better shape than earlier in the week.
On Monday, Direct Line had cautioned on "heightened volatility across the UK motor insurance market", hitting its own shares and dragging down those of peers Admiral and Sabre. The latter had issued its own profit last week.
Direct Line shares were up 1.5% at midday on Friday and Admiral added 0.4%, though Sabre Insurance inched up a more modest 0.1%.
Elsewhere in London, Mirriad Advertising lost 40% as the in-content advertising technology firm said it expects revenue in 2022 to be "flat year-on-year", at roughly GBP2 million, due to weaker market conditions in China.
First half revenue halved to GBP577,000 from GBP1.1 million.
"Revenue is not currently where we would like it to be, but company plans always assumed a significantly backloaded revenue profile and, factoring the elements outlined above, we anticipate H2 will show substantially higher revenues than H1," Mirriad said.
On the up, meanwhile, were food delivery shares. Deliveroo climbed 2.8% while Just Eat Takeaway.com surged 14%.
The stocks were benefited from a well-received quarterly update from Frankfurt-listed peer Delivery Hero.
Delivery Hero on Friday lowered its full-year guidance despite posting increases in gross merchandise value and revenue in the second quarter of 2022. However, it said its platform business broke even in May and June. The segment includes Delivery Hero operations in the Americas, Asia, Europe and the Middle East & North Africa.
Delivery Hero shares jumped 13% in Frankfurt.
Brent oil was quoted at USD102.75 a barrel midday Friday UK time, down from USD103.48 at the London equities close on Thursday. Gold stood at USD1,722.94 an ounce, up from USD1,710.60.
By Eric Cunha; ericcunha@alliancenews.com
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