London midday: Stocks maintain gains after UK inflation; Playtech surges

(Sharecast News) - London stocks were still firmer by midday on Wednesday as the latest UK inflation data boosted rate cut expectations. The FTSE 100 was up 0.4% at 8,264.11, while sterling was down 0.2% against the dollar at 1.2843.

Figures released earlier by the Office for National Statistics showed that consumer price inflation rose in July for the first time since December, but less than expected.

CPI rose by 2.2%, up from 2% in June and May but coming in below expectations of 2.3%. It is now back above the Bank of England's 2% target.

The ONS said the largest upward contribution came from housing and household services where prices of gas and electricity fell by less than they did last year. The largest downward contribution came from restaurants and hotels, where prices of hotels fell this year having risen last year.

The data also showed that core CPI - which strips out food, energy, alcohol and tobacco - fell to 3.3% in July from 3.5% in June.

Meanwhile, the CPI services annual rate fell to 5.2% in July from 5.7% a month earlier.

Grant Fitzner, chief economist at the ONS, said: "Inflation ticked up a little in July as although domestic energy costs fell, they fell by less than a year ago.

"This was partially offset by hotel costs, which fell in July after strong growth in June."

Danni Hewson, head of financial analysis at AJ Bell, said: "A lower-than-expected jump in UK inflation has boosted market expectation that the Bank of England could deliver another rate cut next month.

"Though what investors are really waiting to hear is whether today's US inflation number is cool enough to push the Fed to act more aggressively, with expectation of a half percentage point cut next month currently finely balanced according to the CME's FedWatch tool.

"Concerns about the resilience of the US economy resulted in last week's market meltdown and nerves have lingered, something US central bankers will be acutely aware of even if placating markets isn't top of their agenda."

The US consumer price index for July is due at 1330 BST.

In equity markets, Flutter Entertainment jumped to the top of the FTSE 100, having said late on Tuesday that it was lifting full-year guidance after a better-than-expected second-quarter performance.

The company now expects US revenue of between $6.05bn and $6.35bn and adjusted EBITDA of $680m to $800m. This is up from previous guidance of $5.8bn to $6.2bn revenue and adjusted EBITDA of $635m to $785m.

Revenue outside the US is expected to be between $7.85bn and $8.15bn, while adjusted EBITDA is set to be $1.69bn to $1.85bn. This is up from previous guidance of $7.65bn to $8.05bn and $1.63bn to $1.83bn, respectively.

Playtech surged after confirming it was in talks with Flutter Entertainment about the possible sale of its Italian business, Snaitech.

The statement followed a Sky News report that Flutter was in talks with Playtech over a deal that could be worth about £2bn.

Housebuilders were boosted by rate cut expectations, with Persimmon, Barratt, Berkeley, Vistry and Redrow among the best performers.

Jupiter Fund Management rallied after an upgrade to 'neutral' from 'sell' at UBS.

Aviva nudged up as it reported a 14% jump in interim operating profits.

Infrastructure company Balfour Beatty edged down even as it lifted its dividend by 9% and said it expected annual earnings to grow after a jump in half-year profit.

Market Movers

FTSE 100 (UKX) 8,264.11 0.35% FTSE 250 (MCX) 20,859.06 0.55% techMARK (TASX) 4,882.14 0.94%

FTSE 100 - Risers

Flutter Entertainment (DI) (FLTR) 15,790.00p 7.98% Entain (ENT) 608.20p 4.40% Persimmon (PSN) 1,654.00p 2.70% Smurfit Westrock (DI) (SWR) 3,154.00p 2.30% Barratt Developments (BDEV) 541.20p 2.19% Berkeley Group Holdings (The) (BKG) 5,240.00p 2.14% Taylor Wimpey (TW.) 161.65p 2.02% BAE Systems (BA.) 1,349.00p 1.93% BT Group (BT.A) 143.75p 1.66% M&G (MNG) 209.00p 1.61%

FTSE 100 - Fallers

Beazley (BEZ) 720.50p -1.77% Rio Tinto (RIO) 4,849.00p -1.62% Anglo American (AAL) 2,196.50p -1.43% Pearson (PSON) 1,028.00p -0.77% Spirax Group (SPX) 7,600.00p -0.65% AstraZeneca (AZN) 12,860.00p -0.46% Antofagasta (ANTO) 1,830.00p -0.46% Standard Chartered (STAN) 729.00p -0.44% Haleon (HLN) 373.10p -0.37% Weir Group (WEIR) 1,891.00p -0.32%

FTSE 250 - Risers

Playtech (PTEC) 649.00p 20.63% Crest Nicholson Holdings (CRST) 219.60p 5.17% Aston Martin Lagonda Global Holdings (AML) 144.80p 4.55% Jupiter Fund Management (JUP) 81.30p 4.10% TBC Bank Group (TBCG) 2,865.00p 3.06% IP Group (IPO) 40.35p 2.67% Ocado Group (OCDO) 387.10p 2.33% Redrow (RDW) 768.00p 2.27% Essentra (ESNT) 164.80p 2.23% Elementis (ELM) 160.00p 2.17%

FTSE 250 - Fallers

Target Healthcare Reit Ltd (THRL) 80.00p -2.68% Balfour Beatty (BBY) 400.80p -2.15% Genus (GNS) 1,716.00p -1.94% BH Macro Ltd. GBP Shares (BHMG) 390.50p -1.64% Auction Technology Group (ATG) 426.00p -1.39% Diversified Energy Company (DEC) 1,057.00p -1.12% Primary Health Properties (PHP) 95.60p -1.04% Fidelity China Special Situations (FCSS) 188.20p -0.95% Harbour Energy (HBR) 287.80p -0.76% Premier Foods (PFD) 169.80p -0.70%