London open: Stocks flat as investors take pause after nine-day win streak
A nine-day winning streak for the FTSE 100 came to an end on Friday morning, with markets flatlining following a near-10% surge over the past two weeks on the back of optimism regarding US trade talks and Federal Reserve interest-rate cuts.
The FTSE 100 was trading down 0.1% at 8,403 in early deals, after closing at its highest since 3 April on Thursday.
"Stocks have enjoyed a much better week overall as talk of firing Powell has receded and the US strikes a more conciliatory tone with China," said Chris Beauchamp, chief market analyst at IG.
"But with so many companies warning of tougher times to come, the current bounce could be just one of those famed 'bear market rallies', which stage a huge rebound before giving way to bigger losses as bad news begins to bite."
Helping recent gains were rumours that China is considering suspending its 125% retaliatory tariffs on select US imports, raising hopes that the two nations could come to a deal, while US-Japan trade talks were said to be promising.
However, reports from Xinhua News Agency early on Friday suggested that China was preparing contingency plans – such as monetary and policy tools to boost the economy amid the deepening trade war – as Beijing continues to dismiss US reports that the two sides were closing in on a trade deal.
Nevertheless, Fed rate-cut chatter has lifted sentiment in recent days after policymakers Christopher Waller and Beth Hammack both indicated that they would be happy to loosen monetary policy earlier than anticipated if economic data worsens – with market pricing for a June rate cut increasing.
"The rally isn’t just about the Fed blinking. Asia is waking up to a possible ceasefire in the trade war, and that’s adding fuel to the fire. For the first time in weeks, traders have something real to price into the tape," said Stephen Innes, managing partner at SPI Asset Management.
Back on home shores, economic data out on Friday showed that UK consumer confidence softened notably in April as concerns about the health of the economy mounted. The latest GfK Consumer Confidence Barometer was -23, down four points on both March and on April 2024, and the lowest level since November 2023. Within that, all-sub measures were lower, although the sharpest falls related to the economy. Expectations for the general economic situation over the next 12 months fell eight points to -37.
Mobico tanks
Transport company Mobico dropped 16% after saying annual earnings would be at the lower end of guidance following the sale of its North America school bus business to global infrastructure investment manager I Squared Capital for up to $608m (£457m).
Precious metals miners Fresnillo, Endeavour and Hochschild fell as gold prices continued to retreat from recent record highs.
Companies with heavy exposure to the US were performing well early on, including building materials group CRH, gambling outfit Entain, and pest control giant Rentokil Initial.
Meanwhile, Shell edged higher on the news that it is to exit three offshore gas projects in Colombia.
Market Movers
FTSE 100 (UKX) 8,402.69 -0.06%
FTSE 250 (MCX) 19,567.29 0.32%
techMARK (TASX) 4,454.04 -0.04%
FTSE 100 - Risers
CRH (CDI) (CRH) 6,932.00p 2.57%
Entain (ENT) 581.80p 2.25%
Melrose Industries (MRO) 422.20p 2.03%
Mondi (MNDI) 1,146.00p 1.82%
Smurfit Westrock (DI) (SWR) 3,203.00p 1.68%
Rentokil Initial (RTO) 343.30p 1.60%
InterContinental Hotels Group (IHG) 7,898.00p 1.52%
Scottish Mortgage Inv Trust (SMT) 901.80p 1.46%
Croda International (CRDA) 3,012.00p 1.41%
Pershing Square Holdings Ltd NPV (PSH) 3,556.00p 1.20%
FTSE 100 - Fallers
Unilever (ULVR) 4,706.00p -1.77%
Diageo (DGE) 2,067.00p -1.38%
Rightmove (RMV) 721.40p -1.15%
Severn Trent (SVT) 2,691.00p -1.07%
Fresnillo (FRES) 994.00p -1.00%
Hiscox Limited (DI) (HSX) 1,115.00p -0.98%
National Grid (NG.) 1,066.50p -0.88%
Imperial Brands (IMB) 2,994.00p -0.86%
British American Tobacco (BATS) 3,150.00p -0.85%
Marks & Spencer Group (MKS) 391.30p -0.81%
FTSE 250 - Risers
Wizz Air Holdings (WIZZ) 1,617.00p 2.86%
Indivior (INDV) 792.50p 2.66%
Target Healthcare Reit Ltd (THRL) 101.20p 2.64%
Carnival (CCL) 1,285.00p 2.43%
Bridgepoint Group (Reg S) (BPT) 265.00p 2.16%
Allianz Technology Trust (ATT) 352.00p 2.03%
Diversified Energy Company (DEC) 933.50p 1.91%
Inchcape (INCH) 656.50p 1.78%
Polar Capital Technology Trust (PCT) 289.00p 1.76%
Ibstock (IBST) 178.40p 1.48%
FTSE 250 - Fallers
Mobico Group (MCG) 49.64p -15.79%
JPMorgan Indian Investment Trust (JII) 982.00p -2.00%
Endeavour Mining (EDV) 2,018.00p -1.85%
Hochschild Mining (HOC) 267.00p -1.77%
Ocado Group (OCDO) 277.70p -1.59%
Lancashire Holdings Limited (LRE) 576.00p -1.20%
Premier Foods (PFD) 195.80p -1.01%
FirstGroup (FGP) 163.00p -0.97%
Tate & Lyle (TATE) 546.50p -0.91%
Renishaw (RSW) 2,255.00p -0.88%