LONDON MARKET OPEN: FTSE 100 gets boost from Haleon and Ocado results

(Alliance News) - Stock prices in London opened mostly higher on Thursday, despite some nerves ahead of a key US inflation reading.

Meanwhile, there was a slew of earnings for FTSE 100 companies, with Haleon and Ocado getting a boost from their own results.

The FTSE 100 index opened up 19.31 points, 0.3%, at 7,644.29. The FTSE 250 was up 53.29 points, 0.3%, at 19,066.87, and the AIM All-Share was down 0.68 of a point, 0.1%, at 737.36.

The Cboe UK 100 was up 0.4% at 766.62, the Cboe UK 250 was up 0.3% at 16,429.67, and the Cboe Small Companies was down 0.3% at 14,415.66.

In European equities on Thursday, the CAC 40 in Paris was [up/down] %, while the DAX 40 in Frankfurt was [up/down] %.

Eyes are firmly on a key US inflation reading on Thursday, which will be released at 1330 GMT.

According to FXStreet-cited consensus, the headline annual personal consumption expenditures inflation rate is to ease to 2.4% in January, from 2.6% in December. The core reading, the Fed's preferred inflationary gauge, is to ebb to 2.8% from 2.9%.

"The Fed will probably cut the rates this year, yet a cut before summer won't be on the agenda if inflation doesn't continue to ease. Three Fed members repeated yesterday that the timing and the pace of policy easing will depend on data. Activity on Fed funds futures gives around 64% chance for a June cut before the data. Bets could go either way. A figure in line or ideally softer than expected should keep the Fed doves betting for the first rate cut to happen in June, whereas a stronger-than-expected figure could strengthen the hawks' hand and push the expectation of the first cut to… July," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.

On Wednesday, data showed that the US economy grew at a slightly weaker pace than previously expected in the final quarter of 2023.

According to a second estimate from the Bureau of Economic Analysis, real gross domestic product increased by 3.2% quarter-on-quarter on an annualised basis in the three months to December 31.

In the US on Wednesday, stocks closed lower after the data. The Dow Jones Industrial Average lost 0.1%, S&P 500 lost 0.2%, and Nasdaq Composite lost 0.6%.

The pound was quoted at USD1.2667 early on Thursday in London, up compared to USD1.2656 at the equities close on Wednesday. The euro stood at USD1.0846, higher against USD1.0835. Against the yen, the dollar was trading at JPY149.67, lower compared to JPY150.73.

It has been a busy morning on the FTSE 100 index, with a slew of companies announcing full year results.

Haleon rose 6.9%.

In 2023, the Surrey, England-based consumer healthcare company said revenue climbed to GBP11.30 billion from GBP10.86 billion a year earlier. Pretax profit edged up to GBP1.63 billion from GBP1.62 billion.

CEO Brian McNamara said: "In 2024, we expect the operating environment to remain challenging. We are confident however, that we are well positioned to deliver on both guidance for 2024 and over the medium term."

Ocado rose 6.2%.

The Hatfield, England-based grocer and warehouse technology firm reported a pretax loss of GBP403.2 million in the 53 weeks ended December 3. This narrowed from GBP500.8 million a year ago, and was slightly better than the GBP410 million loss predicted by a company-compiled consensus.

The comparative period is for the 52 weeks to November to 27.

Less positively, London Stock Exchange Group lost 2.0%.

The owner of FTSE Russell and data and analytics provider LSEG, formerly known as Refinitiv, said total income in 2023 climbed 8.2% to GBP8.38 billion from GBP7.74 billion a year earlier. Pretax profit fell 3.7% to GBP1.20 billion from GBP1.24 billion.

On the back of the results, LSEG upped its dividend by 7.5% to 115.0p from 107.0p.

It also said it plans to execute up to GBP1 billion of buybacks in 2024. In 2023, the company returned GBP1.2 billion through buybacks.

In the FTSE 250, Drax Group rose 8.6%.

In 2023, the Yorkshire, England-based electricity company said revenue climbed to GBP8.13 billion from GBP7.78 billion a year earlier. Pretax profit surged to GBP796.4 million from GBP78.1 million.

On the back of the results, Drax upped its full-year dividend to 23.1p from 21.0p.

CEO Will Gardiner said: "Drax performed strongly in 2023 and we remained the single largest provider of renewable power by output in the UK. We have created a business which plays an essential role in supporting energy security, providing dispatchable, renewable power for millions of homes and businesses, particularly during periods of peak demand when there is low wind and solar power."

In Asia on Thursday, the Nikkei 225 index in Tokyo was down 0.1%. In China, the Shanghai Composite was up 1.9%, while the Hang Seng index in Hong Kong was down 0.2%. The S&P/ASX 200 in Sydney closed up 0.5%

Brent oil was quoted at USD81.64 a barrel early in London on Thursday, down from USD81.78 late Wednesday. Gold was quoted at USD2,037.09 an ounce, up against USD2,033.68.

As well as the US PCE index reading later on Thursday, there is an inflation reading from Germany at 1300 GMT.

By Sophie Rose, Alliance News senior reporter

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