London midday: Stocks tick higher as investors mull bond auction

(Sharecast News) - London stocks were a touch firmer by midday on Tuesday as investors mulled the latest UK government bond auction and looked ahead to key inflation readings on both sides of the pond.

The FTSE 100 was up 0.1% at 8,234.22.

Earlier, a closely-watched auction of government debt was three times over-subscribed, according to the Debt Management Office.

The DMO received bids totalling �3.06bn in an auction of �1bn of 1.25% Index-linked Treasury Gilt 2054.

The auction came amid turmoil across the UK and US government bond markets.

A number of issues have coalesced, including concerns about the impact of incoming US president Donald Trump, growing pessimism about the strength of the UK economy, sticky inflation and interest rates likely staying higher for longer.

Gilt yields have risen as investors become more nervous about lending. As a result, UK government borrowing costs have risen, leaving chancellor Rachel Reeves at risk of breaking her own fiscal rules. The pound has also weakened in recent days.

However, the latest auction suggests interest from investors remains robust.

On the macro front, there are no major UK data points due, but the US producer price index for December is scheduled for release at 1330 GMT.

ING said: "The US releases PPI figures for January today, where the core measure is expected to accelerate at an unwelcoming 0.3% month-on-month. That should cast more doubts about further Fed easing and give the dollar extra support into tomorrow's CPI."

In the UK, inflation data for December is due out on Wednesday.

In equity markets, Persimmon jumped as the housebuilder said full-year underlying pre-tax profit was set to be around the upper end of market expectations as completions were ahead of market forecasts.

Barratt Redrow and Taylor Wimpey also gained.

Ocado surged as Ocado Retail delivered a strong finish to its financial year, with sales growth accelerating in the fourth quarter as weekly orders reached a milestone of 500,000 for the first time.

The company, which is the grocery joint venture between Ocado Group and Marks & Spencer, reported retail revenues of �715.8m for the 13 weeks to 1 December, up 17.5% year-on-year and a pick-up from the 15.5% growth seen in the third quarter. That was followed by a record performance over the key Christmas trading period, Ocado Retail said.

IntegraFin gained as it reported a record quarter end for funds under direction on the Transact platform of �65.9bn, up 3% during the quarter and 14% over the past year.

On the downside, JD Sports tumbled as it downgraded its full-year profit forecast, posting a drop in revenue for November in December in challenging markets. The group now expects full-year pre-tax profit of between �915m and �935m, down from previous guidance of �955m to �1.035bn.

BP was in the red as the energy major said it now expects to report lower upstream production for the fourth quarter, while tax charges and foreign exchange losses for the full year will be greater than previously expected.

British American Tobacco retreated after Reinet Investments said that its indirect subsidiary, Reinet Jersey Holdings, had sold just over 43.3m shares in the company in a placing, exiting its investment completely.

The shares were sold to institutional investors at 2,820p each, raising gross proceeds of about �1.2bn.

Crest Nicholson lost ground as the housebuilder delayed publication of its full-year results amid a hike in fire safety provisions. It now expects the total fire remediation provision to be between �245m and �255m, an overall jump of between �120m and �130m.

Market Movers

FTSE 100 (UKX) 8,234.22 0.12%

FTSE 250 (MCX) 19,842.75 0.63%

techMARK (TASX) 4,561.86 0.26%

FTSE 100 - Risers

Persimmon (PSN) 1,109.50p 5.07%

St James's Place (STJ) 832.00p 2.97%

Barratt Redrow (BTRW) 407.90p 2.56%

Taylor Wimpey (TW.) 111.10p 2.54%

Convatec Group (CTEC) 232.20p 2.38%

Airtel Africa (AAF) 118.60p 2.15%

Hikma Pharmaceuticals (HIK) 2,046.00p 1.89%

Informa (INF) 801.20p 1.83%

Rolls-Royce Holdings (RR.) 577.60p 1.80%

Glencore (GLEN) 370.25p 1.73%

FTSE 100 - Fallers

JD Sports Fashion (JD.) 88.00p -8.62%

Games Workshop Group (GAW) 12,820.00p -3.10%

Intermediate Capital Group (ICG) 2,012.00p -2.90%

BP (BP.) 419.95p -2.61%

British American Tobacco (BATS) 2,881.00p -1.77%

GSK (GSK) 1,313.00p -1.35%

Centrica (CNA) 134.05p -1.32%

Next (NXT) 9,254.00p -1.03%

Diageo (DGE) 2,367.50p -1.00%

Unite Group (UTG) 787.00p -0.88%

FTSE 250 - Risers

Ocado Group (OCDO) 299.00p 10.74%

Wizz Air Holdings (WIZZ) 1,274.00p 5.99%

IntegraFin Holding (IHP) 340.50p 5.91%

Oxford Nanopore Technologies (ONT) 151.00p 5.82%

Bellway (BWY) 2,240.00p 3.23%

International Workplace Group (IWG) 152.70p 2.76%

Chemring Group (CHG) 328.50p 2.66%

IP Group (IPO) 52.20p 2.55%

Ibstock (IBST) 162.80p 2.52%

Petershill Partners (PHLL) 253.00p 2.43%

FTSE 250 - Fallers

Jupiter Fund Management (JUP) 76.70p -4.01%

Aston Martin Lagonda Global Holdings (AML) 103.20p -2.18%

Discoverie Group (DSCV) 621.00p -1.90%

Pennon Group (PNN) 502.00p -1.57%

Burberry Group (BRBY) 953.20p -1.53%

OSB Group (OSB) 362.00p -1.20%

AO World (AO.) 97.50p -1.02%

Kier Group (KIE) 129.20p -0.92%

Foresight Environmental Infrastructure Limited (FGEN) 67.90p -0.88%

Vietnam Enterprise Investments (DI) (VEIL) 590.00p -0.84%