London midday: Stocks stay up amid US rate cut hopes

(Sharecast News) - London stocks were still in the black by midday on Friday, with sentiment underpinned by US rate cut hopes, although gains were unspectacular in quiet trade. The FTSE 100 was up 0.2% at 8,258.52.

Expectations of a potentially bigger-than-expected rate cut by the US central bank were raised after former New York Fed President Bill Dudley said on Thursday that there was a strong case for a 50 basis point reduction.

Speaking at the Bretton Woods Committee's annual Future of Finance Forum in Singapore, he said: "I know what I'd be pushing for."

In addition, both the Financial Times and the Wall Street Journal referred to the Fed's rate choice of between 25 and 50 basis points as a "close call".

Rabobank said: "The rate slashers are back from hibernation. Inflation has kept them away for a few years, but now that central banks have their inflation targets in sight they are back to cutting. Yesterday, they struck in Europe. Next week, they'll initiate the cutting cycle in the US."

Still to come, investors were eyeing the University of Michigan's preliminary consumer sentiment survey for September at 1500 BST.

In equity markets, Fresnillo and Endeavour were the top gainers on the FTSE 100 and 250, respectively, as gold prices reached new record highs of over $2,500 per ounce.

Derren Nathan, head of equity research at Hargreaves Lansdown, said: "The glittering performance has been buoyed by sustained high levels of purchases by central banks in the face of a weakening dollar, geopolitical uncertainty and the downward looking trajectory for interest rates.

"These conditions could persist for a while so there's potential for the high-water mark to rise further in the coming months."

West Africa-based gold producer Endeavour was also lifted by news that it had achieved commercial production at its mines in Senegal and Côte d'Ivoire.

Vodafone rose despite the Competition and Markets Authority saying that its planned merger with Three may be expected to result in a "substantial" lessening of competition and higher prices for consumers.

The competition watchdog cited the supply of mobile telecommunications services to end customers and the supply of wholesale as two areas of concern.

Paddy Power owner Flutter Entertainment fell as it announced the acquisition of a a 56% stake in NSX Group, a Brazilian operator of the Betnacional brand, for around $350m.

Infrastructure group Balfour Beatty edged up after it was awarded a £363m contract by National Grid to deliver the Bramford to Twinstead Reinforcement project.

In broker note action, AstraZeneca was knocked lower by a downgrade to 'sell' at Deutsche Bank, while Rio Tinto ticked up after an upgrade to 'outperform' at Macquarie.

Market Movers

FTSE 100 (UKX) 8,258.52 0.21% FTSE 250 (MCX) 20,835.07 0.67% techMARK (TASX) 4,880.46 0.05%

FTSE 100 - Risers

Fresnillo (FRES) 565.00p 5.12% Burberry Group (BRBY) 596.20p 2.02% JD Sports Fashion (JD.) 147.70p 1.93% Airtel Africa (AAF) 117.80p 1.82% Intermediate Capital Group (ICG) 2,286.00p 1.69% Entain (ENT) 726.20p 1.68% Intertek Group (ITRK) 5,040.00p 1.57% Rentokil Initial (RTO) 377.70p 1.53% Land Securities Group (LAND) 681.00p 1.49% WPP (WPP) 750.60p 1.43%

FTSE 100 - Fallers

Sainsbury (J) (SBRY) 288.80p -2.37% AstraZeneca (AZN) 11,814.00p -1.96% Flutter Entertainment (DI) (FLTR) 16,590.00p -1.48% Marks & Spencer Group (MKS) 348.20p -1.02% Rightmove (RMV) 661.80p -0.84% Compass Group (CPG) 2,436.00p -0.65% Sage Group (SGE) 1,032.00p -0.58% Tesco (TSCO) 366.90p -0.57% GSK (GSK) 1,630.00p -0.52% Rolls-Royce Holdings (RR.) 491.70p -0.43%

FTSE 250 - Risers

Endeavour Mining (EDV) 1,744.00p 5.00% TI Fluid Systems (TIFS) 141.00p 3.83% Bridgepoint Group (Reg S) (BPT) 358.40p 3.70% Watches of Switzerland Group (WOSG) 386.00p 3.65% Hochschild Mining (HOC) 181.60p 3.53% Wizz Air Holdings (WIZZ) 1,199.00p 3.27% Discoverie Group (DSCV) 595.00p 3.12% Spectris (SXS) 2,890.00p 2.99% Wood Group (John) (WG.) 127.80p 2.98% Future (FUTR) 1,083.00p 2.75%

FTSE 250 - Fallers

Tritax Eurobox (GBP) (EBOX) 72.40p -2.16% TBC Bank Group (TBCG) 2,810.00p -1.06% Carnival (CCL) 1,156.00p -0.90% Ithaca Energy (ITH) 101.50p -0.88% Vietnam Enterprise Investments (DI) (VEIL) 571.00p -0.87% Hilton Food Group (HFG) 880.00p -0.79% NCC Group (NCC) 166.40p -0.72% Kier Group (KIE) 139.00p -0.57% Pacific Horizon Inv Trust (PHI) 560.00p -0.53% Impax Environmental Markets (IEM) 377.50p -0.53%