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(Alliance News) - Stocks in London moved higher at the open on Friday, looking to regain some of the steep losses incurred on Thursday, but worries about 'stagflation' still were keeping a lid on buying.
"Investors are continuing to wrestling with worries over inflation as the oil price climbs back up again and supply concerns resurface amid ongoing geo-political tensions. As the era of cheap money has hurtled to an end, lowering liquidity in the markets, trading in the sessions ahead is set to stay volatile," Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said.
Markets looked to have calmed, however, after US Federal Reserve Chair Jerome Powell - confirmed Thursday by the Senate for a second term - expressed confidence that the US economy is strong enough to withstand tighter monetary policies.
According to Bloomberg, Powell reaffirmed that the Fed was likely to raise rates by a half point but isn't "actively considering" a 75-basis point move.
The FTSE 100 index was up 77.98 points, or 1.1%, at 7,311.32 early Friday. The mid-cap FTSE 250 index was up 251.27 points, or 1.3%, at 19,732.15. The AIM All-Share index was up 8.17 points, or 0.9%, at 947.24.
Victoria Scholar, head of Investment at interactive investor, added: "The FTSE 100 is trading higher, inching closer to resistance at 7,300 reclaiming some lost ground after tumbling more than 1.5% as higher-than-expected US inflation figures this week and softer UK growth figures raised concerns about an economic slowdown."
The Cboe UK 100 index was 1.0% at 728.81. The Cboe 250 was up 1.2% at 17,439.64, and the Cboe Small Companies up 0.2% at 14,487.64.
In Paris, the CAC 40 stock index was up 0.6% and the DAX 40 in Frankfurt was 0.5% higher.
In Asia on Friday, the Japanese Nikkei 225 index closed up 2.6%. In China, the Shanghai Composite ended 1.0% higher, while the Hang Seng index in Hong Kong was up 2.7% in late trade. The S&P/ASX 200 in Sydney ended up 1.9%.
Oil prices were moving tentatively higher on Friday, as traders weigh up the balance between supply restriction stemming from the war in Ukraine and demand reduction cause by China's zero-Covid policy.
Brent oil was quoted at USD108.75 a barrel Friday morning, higher from USD108.55 late Thursday. London's oil majors Shell and BP were 1.3% and 2.0% higher, respectively.
Scholar continued: "Worries about supply disruptions in Russia have propped up oil prices in recent months, particularly as the EU mulls a ban on Russian oil. However at the start of the week these fears were more than offset by demand concerns stemming from hot inflation data, China's zero-tolerance Covid approach and growing calls for a global recession, sparking OPEC to cut its forecast for 2022 world oil demand for a second month in a row.
"Now the market appears to be in wait-and-see mode amid thin volumes as traders weigh up pressures from tight supply against a softening demand outlook with oil attempting to regain some of the brutal drop from earlier in the week."
In London, Sage was up 1.7% in the FTSE 100. The accounting software firm left its full-year outlook unchanged, after what it called a strong first-half performance, with its Business Cloud offering leading a rise in recurring revenue.
In the six months to March 31, Sage recorded pretax profit of GBP189 million, down slightly from GBP190 million in the same period a year prior.
Revenue also was broadly flat, slipping to GBP934 million from GBP937 million. Sage noted, however, that organic revenue was up 5%, driven by Sage Business Cloud growth of 21%.
Meanwhile, annualised recurring revenue rose by 10% to GBP1.78 billion from GBP1.63 billion a year before. "Cloud native" ARR growth was 43%, Sage said.
Sage upped its interim dividend by 5.0% to 6.30 pence from 6.05p.
For financial 2022, Sage continues to expect organic recurring revenue growth in the region of 8% to 9%.
ii's Scholar said Sage's report was "decent".
"Although the stock enjoyed a very strong ten-month share price performance from March last year, since the highs, shares have given back more than 60% of those gains and could be on track to re-test the March lows if the recent downside pressure persists. However today's report has lifted the stock to the top of the FTSE 100 with investors hoping that this could be the start of a more positive trend ahead," she added.
Amigo Holdings rose 5% in early trading after its creditors voted to push forward with its new business scheme.
The scheme - which is being proposed to settle customer claims following probes from UK regulators into mis-sold loans - required at least 75% of the claims of all creditors vote for it. Amigo noted, at a meeting held on Thursday, over 88% of creditors approved the scheme.
It also said, however, that 83% voted for Amigo's wind down scheme.
Now, the guarantor loans provider will ask the courts to approve the new business scheme, but should it be turned down, will ask for the wind down scheme to be approved.
Amigo said its shares will be suspended while the court decides what scheme to approve.
Chief Executive Gary Jennison said: "Our customers have voted in favour of the New Business Scheme, which the board of Amigo believes offers the maximum possible redress to creditors. This is an important step to address the liabilities that arose from historic lending practices under previous management."
The pound was quoted at USD1.2230 early Friday, unchanged from USD1.2229 at the London equities close on Thursday. The euro was priced at USD1.0410, soft against USD1.0417.
Against the yen, the dollar was trading at JPY128.74, up from JPY128.25.
Gold stood at USD1,825.90 an ounce, down against USD1,838.71.
The economic events calendar on Friday has eurozone industrial production at 1000 BST and US import & export prices at 1330 BST.
By Paul McGowan; paulmcgowan@alliancenews.com
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