(Alliance News) - Stock prices in London were higher at midday on Wednesday with investors opting to focus on positive company earnings against a backdrop of rising inflation, with US consumer prices due later in the afternoon.
China released a report showing the prices paid at factory gates jumped by 14% in October from a year before, the highest rate of produce price inflation in more than two decades, owing to soaring energy prices and as supplies were hit by coronavirus lockdowns in parts of the country.
China's consumer price index, meanwhile, rose by more than expected in October after four months of slower rises. CPI inflation hit 1.5%, up from 0.7% in September.
Wednesday's US CPI reading is released at 1330 GMT, with numbers forecast to show an easing of the annual inflation rate to 5.3% in October from 5.4% in September, according to FXStreet cited consensus.
The FTSE 100 was up 34.90 points, or 0.5%, at 7,308.94. The FTSE 250 index was up 44.38 points, or 0.2%, at 23,411.52. The AIM All-Share index was flat at 1,241.32.
The Cboe UK 100 index was up 0.5% at 724.40. The Cboe 250 was up 0.1% at 20,922.10 and the Cboe Small Companies up 0.3% at 15,668.49.
In mainland Europe, the CAC 40 stock index in Paris was down 0.2% and the DAX 40 in Frankfurt was down 0.1%.
"Some strong corporate updates helped outweigh continued concerns about inflation as the FTSE 100 made a positive start on Wednesday. China continued to offer evidence of mounting inflationary pressures as factory gate prices saw their biggest increase since 1995," said AJ Bell's Russ Mould.
"Given Chinese goods are widely exported around the globe, there is a risk that inflation gets exported too. There will be significant focus on US inflation figures when they are released later today," Mould added.
US stock market futures were pointed to a lower start ahead of the inflation data. The Dow Jones Industrial Average and S&P 500 both were called down 0.2% and the Nasdaq Composite down 0.3%.
On the corporate front, the EU's second-highest court upheld a EUR2.4 billion fine on Alphabet's Google by anti-trust authorities in Brussels for search engine dominance.
The fine was handed down in 2017 by the European Commission. The court rejected an appeal by the US technology firm against a European Commission position that it "abused its dominant position" by favouring its own Google Shopping service in search results.
Wednesday's ruling - a boost for EU ambitions to rein in Google's market dominance - can still be challenged at the bloc's highest court, the European Court of Justice.
More positively for Alphabet, Britain's highest court on Wednesday blocked a class action against Google, accused of illegally tracking millions of Apple iPhone users.
The Supreme Court said in a statement that it "unanimously dismisses" the legal action brought by campaigners against the US-based tech giant on behalf of 4.4 million people in England and Wales.
Alphabet C shares were down 0.8% and A shares down 1.0% in New York pre-market trade, while Apple was down 0.4%.
A US judge rejected Apple's request to delay letting App Store offerings bypass its payment system as ordered by the court, saying it had 30 days to comply in a case brought by Epic Games, the creator of Fortnite.
In Tuesday's ruling, judge Gonzalez Rogers ordered Apple to loosen control of its App Store payment options, but said Epic had failed to prove that antitrust violations had taken place.
In London, ITV was the best performer in the FTSE 100, up 12%, after the broadcaster said it saw an "outstanding" nine months with strong performances from its Studios and Media & Entertainment businesses driving revenue growth.
For the nine months to September 30, revenue was GBP2.79 billion, up 29% from GBP2.17 billion at the same time last year. Total advertising revenue came in at GBP1.36 billion, rising 31% from GBP1.04 billion.
Studios revenue was up 32% to GBP1.19 billion, while M&E revenue was 26% higher at GBP1.59 billion.
Looking ahead, ITV said total advertising revenue for 2021 is expected to be the highest in the company's 66-year history.
Shares in oil majors BP, Royal Dutch Shell 'A' and Shell 'B' were up 2.2%, 1.1% and 0.9% respectively, tracking spot oil prices higher.
Brent oil was quoted at USD84.65 a barrel Wednesday at midday, up from USD84.08 late Tuesday.
In the FTSE 250, Marks & Spencer was the standout performer, up 12%. The food, clothing and homewares retailer raised its annual profit outlook for the second time in less than three months after a sales rebound.
M&S reported pretax profit of GBP187.3 million in the six months to October 2, swung from a loss of GBP87.6 million a year earlier at the height of the pandemic, and up 18% on two years ago before Covid-19 struck.
M&S said it expects full-year underlying profit to beat expectations, now guiding for around GBP500 million - having already upgraded its guidance in late August to above GBP350 million.
For the half year to October 2, revenue rose to GBP5.11 billion from GBP4.09 billion last year as the retailer swung to a pretax profit GBP187.3 million from a pandemic-driven loss of GBP87.6 million.
Food sales rose 10% in the first half of the year, but clothing and home sales continued to trail, slipping by 1%.
At the other end of the midcaps, JD Wetherspoon was the worst performer, down 6.3%, after the pub operator said it is struggling to hit pre-pandemic levels as trends show that older customers are still staying home.
For the 15 weeks to November 7, like-for-like sales were 8.9% lower than the record sales achieved in the same period in 2019. Wetherspoon said supply chain issues have occurred from "time to time" but have usually related to a minority of items.
The pub chain said problems have eased in recent weeks, but the busy Christmas period is yet to come.
"Wetherspoons remains the alpha dog in the sector, however it is not immune from the repositioning of UK drinking habits and its historically low margin structure and price elasticity. We continue to see better value elsewhere," said Shore Capital.
Indivior was down 6.1% at 245.40 pence after the opioid addiction treatment maker's largest shareholder Scopia Capital Management sold 20.0 million shares at 250p, worth GBP50.0 million, in a placing run by Jefferies International.
Babcock International was down 2.9% after Barclays downgraded the defence contractor to Equal Weight from Overweight.
The dollar was higher across the board. The pound was quoted at USD1.3506 at midday on Wednesday, slipping from USD1.3530 at the London equities close Tuesday.
The euro was priced at USD1.1555, down from USD1.1577. Against the Japanese yen, the dollar was trading at JPY113.17, up from JPY112.94.
Gold stood at USD1,823.35 an ounce, marginally lower against USD1,825.74 late Tuesday.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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