London close: Stocks weaker as investors look to central banks

London markets closed lower on Thursday as investors reacted to lacklustre Chinese trade data and the latest UK house price figures.

The FTSE 100 index edged down by 0.02% to 7,513.72 points, while the FTSE 250 fell by 0.26% to 18,618.74 points.

In currency markets, sterling was last up 0.11% on the dollar at $1.2574, while it weakened 0.1% against the euro to change hands at €1.1656.

"There was a brief bout of weakness in European stocks today, reflecting some nervousness ahead of next week's central bank meetings," said IG chief market analyst Chris Beauchamp.

"Having shot higher since late October, closing some of the gap in performance versus US indices, a lot of good news looks priced in for the Dax and others.

"It will be a tall order to avoid a post-Fed/Bank of England/European Central Bank hangover descending on markets just as investors turn their thoughts towards Christmas."

UK house prices rise again, US jobless claims tick higher

In economic news, UK house prices continued their upward trend for the second consecutive month in November, driven by a shortage of available properties, according to lender Halifax.

Following a substantial 1.2% rise in October, house prices saw a more modest 0.5% increase, bringing the average home price to £283,615.

However, on a yearly basis, prices remained down by 1% in November, following a steeper 3.1% decline in October.

"The resilience seen in house prices during 2023 continues to be underpinned by a shortage of properties available, rather than any significant strengthening of buyer demand," said Kim Kinnaird, director of Halifax Mortgages.

"That said, recent figures for mortgage approvals suggest a slight uptick in activity levels, which is likely as a result of an improving picture on affordability for homebuyers.

"With mortgage rates starting to ease slightly, this may be leading to increased buyer confidence, seeing people more inclined to push ahead with their home purchases."

Across the pond, there was a slight uptick in initial jobless claims in the IS for the week ended 2 December.

The Labor Department reported a rise of 1,000 claims, reaching a seasonally adjusted total of 220,000, slightly below economists' expectations of 222,000.

Continuing claims, however, decreased by 64,000 to 1.86 million, while the four-week moving average, designed to smooth out weekly fluctuations, increased by 500 to 220,750.

Notably, states like California, New York, and Texas experienced significant increases in jobless claims.

Turning to Europe, official data revealed that the eurozone economy stagnated in the third quarter, raising concerns of a potential recession.

Eurostat, the statistical office of the European Union, reported a 0.1% decrease in GDP compared to a meagre 0.1% growth in the second quarter.

The final figure aligned with Eurostat's initial estimate and market consensus.

In Germany, industrial production took an unexpected downturn in October, contrary to expectations of a 0.2% increase.

Official data pointed to a 0.4% decline, attributed mainly to a 0.6% drop in output within the mechanical engineering sector.

The data followed a surprising 3.7% decrease in German industrial orders in October, adding to concerns about the country's economic performance.

Finally on data, China's trade data for November exceeded expectations, with the trade balance widening substantially.

Exports unexpectedly increased by 0.5% year-on-year, rebounding from a 6.4% decline in the previous month, defying analysts' projections of a further decline.

Meanwhile, imports unexpectedly fell by 0.6%, following a 3% rise, catching analysts off guard.

The trade balance reached $68.4bn in November, up from $56.5bn in October, surpassing the consensus forecast of $58.1bn.

IAG descends, AJ Bell and Coats Group leap

On London's equity markets, International Consolidated Airlines Group (IAG) had descended 2.35% by the close.

The owner of British Airways and Iberia faced downward pressure following a downgrade to 'underweight' from 'neutral' by JPMorgan.

Elsewhere, Vodafone Group was off 3.02%, while Burberry Group fell 1.98%.

Vodafone's shares were downgraded to 'underperform' by Exane BNP, while Deutsche Bank reduced its price target on Burberry's 'hold' rated shares from 1,950p to 1,600p.

Media group Future tumbled 16.62% after it reported a decrease in full-year profits and announced the departure of chief financial and strategy officer Penny Ladkin-Brand.

Games Workshop Group slipped by 13.68% as the miniature wargames manufacturer flagged higher profits and revenue for the six months ended 26 November but noted an anticipated decline in licensing revenue.

Energean saw a 3.54% decrease in its share price after announcing its entry into a new venture offshore Morocco.

The venture would involve acquiring a 45% stake in the Lixus licence with an option to increase to 55% and 37.5% of the Rissana licence.

On the upside, Sports Direct owner Frasers Group managed gains of 0.66% on the back of an 8% rise in interim profits, primarily attributed to strong sales at its international division.

Investment platform AJ Bell surged 15.58% as it celebrated a record full-year performance, with pre-tax profit showing a remarkable 50% increase.

Industrial thread manufacturer Coats Group jumped 12.76% after it decided to halt pension deficit repair payments and opted to make a one-off lump sum payment of £10m to move its UK pension scheme into a surplus.

The decision was expected to result in a free cash flow benefit of £2m per month.

Packaging giant DS Smith reversed earlier losses to close with a 1.83% increase after announcing that CEO Miles Roberts would be retiring no later than the end of November next year and revealing a fall in interim profit.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 7,513.72 -0.02%
FTSE 250 (MCX) 18,618.74 -0.26%
techMARK (TASX) 4,085.09 -0.42%

FTSE 100 - Risers

Severn Trent (SVT) 2,721.00p 2.45%
InterContinental Hotels Group (IHG) 6,590.00p 2.33%
Pershing Square Holdings Ltd NPV (PSH) 3,240.00p 2.02%
Barratt Developments (BDEV) 540.60p 1.92%
Taylor Wimpey (TW.) 137.10p 1.82%
Phoenix Group Holdings (PHNX) 489.60p 1.72%
Legal & General Group (LGEN) 239.70p 1.70%
Glencore (GLEN) 453.55p 1.58%
Smith (DS) (SMDS) 305.00p 1.53%
Rightmove (RMV) 572.20p 1.49%

FTSE 100 - Fallers

Vodafone Group (VOD) 69.80p -3.31%
International Consolidated Airlines Group SA (CDI) (IAG) 158.10p -2.35%
Burberry Group (BRBY) 1,481.00p -2.18%
Standard Chartered (STAN) 652.00p -2.02%
JD Sports Fashion (JD.) 165.80p -1.69%
Rentokil Initial (RTO) 414.60p -1.66%
BT Group (BT.A) 134.40p -1.65%
Endeavour Mining (EDV) 1,784.00p -1.60%
Next (NXT) 8,010.00p -1.40%
Entain (ENT) 797.20p -1.39%

FTSE 250 - Risers

AJ Bell (AJB) 299.20p 15.97%
Coats Group (COA) 75.40p 11.87%
Paragon Banking Group (PAG) 554.00p 4.14%
Ibstock (IBST) 137.50p 4.09%
TUI AG Reg Shs (DI) (TUI) 609.50p 3.66%
Johnson Matthey (JMAT) 1,614.00p 2.77%
Senior (SNR) 167.40p 2.70%
Workspace Group (WKP) 539.50p 2.27%
Vesuvius (VSVS) 452.20p 2.26%
Bytes Technology Group (BYIT) 551.00p 2.23%

FTSE 250 - Fallers

Future (FUTR) 631.00p -16.09%
Games Workshop Group (GAW) 9,150.00p -13.68%
IP Group (IPO) 46.65p -6.23%
CAB Payments Holdings (CABP) 53.00p -5.86%
Moonpig Group (MOON) 149.30p -5.09%
Baltic Classifieds Group (BCG) 208.50p -3.92%
Energean (ENOG) 993.75p -3.64%
Dr. Martens (DOCS) 90.70p -3.51%
Assura (AGR) 44.06p -3.21%
Investec (INVP) 497.90p -3.02%