London open: Stocks fall as investors mull GDP data

(Sharecast News) - London stocks fell in early trade on Thursday as investors mulled the latest UK GDP data, which showed the economy unexpectedly grew in the fourth quarter of last year, but only just.

At 0845 GMT, the FTSE 100 was down 0.5% at 8,760.61, underperforming European peers, with the benchmark Stoxx 600 index up 0.4% amid Ukraine peace hopes.

Figures released earlier by the Office for National Statistics showed that gross domestic product rose 0.1% in the three months to December, beating expectations for a 0.1% contraction.

ONS director of economic statistics Liz McKeown said: "The economy picked up in December after several weak months, meaning, overall, the economy grew a little in the fourth quarter of last year.

"Across the quarter, growth in services and construction were partially offset by a fall in production. GDP per head, in contrast, fell back slightly in the quarter.

"In December wholesale, film distribution and pubs and bars all had a strong month, as did manufacturing of machinery and the often-erratic pharmaceutical industry. However, these were partially offset by weak months for computer programming, publishing and car sales."

Paul Dales, chief UK economist at Capital Economics, said the 0.1% quarter-on-quarter rise in GDP in Q4 "leaves the economy all-but stagnating" as businesses adjust to higher taxes and more uncertainty from overseas.

"We aren't expecting the economy grow much at all in the coming quarters," he said. "After stagnating in Q3, the economy was saved from the same fate in Q4 (or worse) by a 0.4% m/m rise in GDP in December (consensus +0.1%, CE -0.1%).

"That's pretty much the only growth there's been for a while as it explains all of the 0.4% rise in GDP since Labour came to power in July and the 0.3% gain since last April."

In equity markets, British American Tobacco slumped as it posted a 5.2% drop in full-year revenue, driven by the sale of its businesses in Russia and Belarus last year and translational FX headwinds, but said it swung to a profit.

Imperial Brands also fell.

Unilever lost ground as the consumer goods company said it expects a slow start to the current financial year with "subdued" market growth in the near term and announced a �1.5bn share buyback after a 12.6% rise in annual profit to �11.2bn.

Barclays was weaker even as it reported a 24% jump in full-year pre-tax profit to �8.11bn and announced the launch of a �1bn share buyback.

Richard Hunter, head of markets at Interactive Investor, said: "A stable, dependable and progressive set of numbers such as these would normally fire the share price ahead, but given Barclays' recent run the height of expectation has turned into a temporary headwind."

Renishaw tumbled after interim results, while Tate & Lyle also retreated on the back of a trading statement.

Lancashire Holdings was in the red as the insurer said it expects to incur net ultimate losses of between $145m and $165m related to the California wildfires.

On the upside, Coca-Cola rallied after saying it expects organic operating profit to rise by 7% to 11% this year amid a "challenging" macroeconomic environment.

The bottling company, 20% owned by the drinks brand of the same name, also said organic revenue was forecast to grow 6% - 8% in the year, compared with average market expectations of 7.3% in a company-compiled poll.

Average analyst forecasts tipped 10.7% average growth in 2025 organic earnings before interest and taxes (EBIT).

Ferrexpo surged amid hopes of a potential peace deal between Ukraine and Russia after Donald Trump and Vladimir Putin agreed to start negotiations "immediately" with a view to ending the war.

Wizz Air was also sharply. The airline's chief executive told Reuters on Tuesday that it was aiming to restart flights to Ukraine shortly after the announcement of any ceasefire with Russia, reinstating about 30 inbound routes within six weeks.

Market Movers

FTSE 100 (UKX) 8,760.61 -0.53%

FTSE 250 (MCX) 20,919.76 0.19%

techMARK (TASX) 4,765.68 -0.04%

FTSE 100 - Risers

Coca-Cola HBC AG (CDI) (CCH) 3,140.00p 5.72%

JD Sports Fashion (JD.) 89.80p 3.10%

Smurfit Westrock (DI) (SWR) 4,127.00p 2.99%

Convatec Group (CTEC) 244.60p 2.43%

Entain (ENT) 712.80p 2.41%

Fresnillo (FRES) 810.50p 2.40%

Croda International (CRDA) 3,201.00p 2.24%

Flutter Entertainment (DI) (FLTR) 22,280.00p 2.11%

Ashtead Group (AHT) 5,102.00p 2.06%

Mondi (MNDI) 1,275.50p 2.04%

FTSE 100 - Fallers

British American Tobacco (BATS) 3,114.00p -8.25%

Unilever (ULVR) 4,465.00p -6.02%

Barclays (BARC) 292.15p -5.07%

Imperial Brands (IMB) 2,791.00p -3.22%

Beazley (BEZ) 830.00p -2.30%

Centrica (CNA) 134.05p -2.19%

Shell (SHEL) 2,653.00p -1.80%

Hiscox Limited (DI) (HSX) 1,067.00p -1.66%

Standard Chartered (STAN) 1,111.00p -1.33%

NATWEST GROUP (NWG) 444.10p -1.31%

FTSE 250 - Risers

Ferrexpo (FXPO) 107.40p 18.28%

Wizz Air Holdings (WIZZ) 1,738.00p 9.17%

Deliveroo Class (ROO) 140.20p 2.56%

Ocado Group (OCDO) 320.00p 2.40%

Watches of Switzerland Group (WOSG) 561.00p 2.00%

Vistry Group (VTY) 611.00p 1.83%

Burberry Group (BRBY) 1,176.00p 1.73%

Domino's Pizza Group (DOM) 295.00p 1.72%

Investec (INVP) 542.50p 1.69%

Mobico Group (MCG) 71.95p 1.62%

FTSE 250 - Fallers

Renishaw (RSW) 3,235.00p -9.64%

Tate & Lyle (TATE) 587.00p -7.12%

Lancashire Holdings Limited (LRE) 605.00p -3.82%

NextEnergy Solar Fund Limited Red (NESF) 66.60p -3.20%

Greencoat UK Wind (UKW) 116.00p -2.11%

The Renewables Infrastructure Group Limited (TRIG) 78.30p -1.88%

Barr (A.G.) (BAG) 636.00p -1.85%

Plus500 Ltd (DI) (PLUS) 2,806.00p -1.82%

Diversified Energy Company (DEC) 1,352.00p -1.60%

Lion Finance Group (BGEO) 5,100.00p -1.35%