LONDON MARKET CLOSE: Stocks edge higher in cautious end to busy week

(Alliance News) - European equities closed slightly higher on Friday, ending a stacked week in slightly muted fashion, though stocks grew in confidence over the course of the afternoon after Chinese leader Xi Jinping condemned Russia's invasion of Ukraine.

Equities have faced two major central bank decisions this week, as well as ongoing geopolitical tensions. Recent developments concerning the latter have done little to lift hopes that a resolution is near. However, stocks still made decent gains over the course of this week.

The FTSE 100 index ended up 19.39 points, or 0.3%, at 7,404.73 on Friday. The mid-cap FTSE 250 index closed up 180.93 points, or 0.9%, at 21,156.62. The AIM All-Share index rose 9.72 points, or 1.0%, at 1,035.05.

For the week, the blue-chip index has risen 3.5%. The FTSE 250 has added 4.7% and the AIM All-Share has advanced 4.0%.

The Cboe UK 100 index ended up 0.3% at 735.70. The Cboe 250 closed up 0.6% at 18,645.88, and the Cboe Small Companies rose 0.7% at 14,773.20.

In mainland Europe, the CAC 40 stock index in Paris rose 0.1%, while the DAX 40 in Frankfurt rose 0.2%.

The FTSE 100, CAC and DAX were all lower for much of the day, but found their groove in afternoon trade.

Equities in New York were mixed at the time of the European close.

The Dow Jones Industrial Average was down 0.2%, while the S&P 500 was up 0.3% and the Nasdaq Composite advanced 1.1%.

"European and US stocks have continued to recover more of their lost ground this week, despite there being little prospect of a ceasefire, or imminent cessation of hostilities between Russia and Ukraine," CMC Markets analyst Michael Hewson commented.

"As we head into the weekend, we have retreated from the highs of the week on rising scepticism that Russia's interest in a negotiated agreement is in any way serious, although the FTSE 100 is proving to be slightly more resilient."

Chinese leader Xi Jinping said war is "in no one's interest" during a phone call Friday with Joe Biden in which the US president aimed to pressure Beijing into joining Western condemnation of Russia's invasion of Ukraine.

The 1:50 hour-long phone call ended at 1453 GMT in Washington, the White House said.

State broadcaster CCTV reported Xi saying during the call that "state-to-state relations cannot go to the stage of military hostilities."

China and the US should "shoulder international responsibilities," Xi was quoted as saying, as well as declaring that "peace and security are the most valued treasures of the international community."

It was not immediately clear if Xi made any direct criticism of Russian President Vladimir Putin's onslaught against Ukraine or expressed willingness to assist the US-led pressure campaign on the Kremlin.

The call came after rescue workers searched desperately for any survivors buried beneath the rubble of Mariupol's bombed-out theatre Friday, as Russia's forces pounded residential areas across Ukraine, stoking allegations of war crimes.

In the wake of the attack, US Secretary of State Antony Blinken also said it was "difficult to conclude" that Vladimir Putin's regime had not engaged in war crimes by targeting civilians.

Russia has routinely denied that it is targeting civilians, claiming without evidence that hardline Ukrainian nationalists blew up the theatre in Mariupol.

The dollar was mixed at the end of the week.

The pound rose to USD1.3178 late on Friday, from USD1.3155 at the London equities close Thursday. The euro was priced at USD1.1061, lower against USD1.1113.

Against the Japanese yen, the dollar quoted at JPY119.15 in London, up from JPY118.44. The dollar hit JPY119.39, its best level since 2016.

In London, Ted Baker shares rose 17%. Sycamore Partners Management confirmed a Sky News press report that it was in early stages of considering making a possible cash offer for the fashion retailer.

Sycamore Partners said it was considering a possible cash offer for Ted Baker but noted there was no certainty any offer would be made.

In response, Ted Baker confirmed that it had not received any approach from Sycamore. Further, the retailer said it was confident in its independent prospects and would evaluate any offer against the shareholder value creation which it believes can be delivered as a standalone company.

In a positive read-across, Mulberry rose 8.5%.

AJ Bell analyst Russ Mould commented: "It looks like someone might bring an end to Ted Baker's horrific time as a listed company. US private equity group Sycamore is weighing up an offer, perhaps drawn to the fact the clothing retailer’s share price had halved between September 2021 and February this year.

"Ted Baker's fortunes have collapsed in recent years. First came the hugging incident where founder Ray Kelvin was accused of inappropriate behaviour towards staff. Then the company was besieged by a series of profit warnings, a new chief executive who lasted less than a year, and accounting errors where it overstated the value of its inventory. It was forced to slash prices to compete in a heavily discounted market, which really hurt profit margins. Sycamore appears to have spotted an opportunity to step in and buy the company while its valuation remains low and to help with the recovery efforts."

JD Wetherspoon overcame share price weakness in early trade to close up 1.9%.

It reported a narrowed interim loss, but the pub chain is yet to return to the business seen in pre-pandemic times.

Revenue for the half-year that ended January 23 came in at GBP807.4 million, nearly double the GBP431.1 million posted a year before. However, sales remain below the GBP933.0 million achieved two years ago, a pre-pandemic period.

The company posted a pretax loss of GBP21.3 million, narrowed from GBP46.2 million a year ago, but the bottom line remains far off the profit of GBP57.9 million registered two years ago.

On AIM, Simigon shares more than doubled to 3.52 pence from 1.55p on Thursday. The Israel-based software company on Thursday said Gal Erez, a 4% shareholder in the company, eventually backed the firm's acquisition by Power Breezer Sub and Maxify Solutions.

Erez withdrew a restraining order against the firm's merger and share cancellation. The last day of trading of Simigon shares will now be next week Friday. The company agreed to a USD8.5 million takeover back in Janaury.

Genedrive shares more than doubled to 33p from 16.25p on Thursday. The Manchester-based molecular diagnostics company said six installations of its MT-RNR1 Antibiotic Induced Hearing Loss system have been deployed to the Manchester University NHS Foundation Trust.

The system screens infants for a genetic mutation which can cause lifelong hearing loss if carriers are given antibiotics.

"MFT will become the first NHS trust to implement the technology into routine clinical care," Genedrive said.

Brent oil was quoted at USD107.51 a barrel at the London equities close on Friday, up from USD106.62 on Thursday. Gold stood at USD1,938.46 an ounce, lower against USD1,942.97.

Monday's UK corporate calendar has annual results from photobooth operator Photo-Me International PLC, while recruiter SThree posts a trading statement.

The economic events calendar has the latest interest rate announcement from the People's Bank of China overnight, before producer price data from Germany at 0700 GMT. Financial markets in Japan are closed to mark Vernal Equinox Day.

The week picks up pace with UK inflation data on Wednesday, and a deluge of flash PMIs on Thursday.

By Eric Cunha; ericcunha@alliancenews.com

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