London midday: Stocks extend gains; Rentokil, Computacenter rally

(Sharecast News) - London stocks had extended gains by midday on Tuesday as investors shrugged off the tech selloff on Wall Street. The FTSE 100 was up 0.6% at 8,552.02 .

Russ Mould, investment director at AJ Bell, said: "Panic on Wall Street sent US tech stocks into a deep slump yesterday and prompted a big debate about whether the AI infrastructure winners will now be dethroned.

"Nvidia crashed by nearly 17% which sounds dramatic but only pulled the stock back to October 2024 levels. Someone who has owned Nvidia shares since before summer last year should still be sitting on decent gains, even after yesterday's pullback.

"It looks like the Wall Street bloodbath was short-lived as Nvidia's shares are trading 1.4% higher in pre-market trading and futures prices point to small gains for both the Nasdaq and S&P 500 today.

"The DeepSeek shock has reminded investors they cannot be complacent when trying to play the AI trend. Stocks do not travel in unison and neither do they always travel upwards. Sometimes it's good to be reminded of this. Valuations have been getting lofty in the tech space and investors need to appreciate that richly priced stocks can fall hard on the slightest bit of bad news.

"The FTSE 100 continued to be an island of calm, pushing ahead by 0.3% as investors lapped up its plethora of defensive stocks. Utilities and healthcare were in demand, implying that investors were keen to ensure portfolios had some support in case of another tech-related wobble."

On home shores, investors were mulling the latest data from the British Retail Consortium, which showed that prices at tills decreased in January as retailers offered "deep discounts" on things like furniture and fashion.

Still, upcoming increases to labour-market bills could reignite inflationary pressures in the spring.

According to the BRC-NeilsenIQ shop price index for January, shop prices fell 0.4% month-on-month following a flat reading in December.

While food prices rose 0.5%, up from 0.1% the month before, non-food prices reduced by 0.9% after a 0.1% decline previously.

This meant that shop prices were 0.7% lower than they were in January 2024, following a 1.0% year-on-year fall in December.

The annual rate of food inflation, in particular, eased to 1.6% from 1.8%, coming in at its lowest rate since November 2021.

"Extensive January sales was good news for bargain hunters, with non-food products showing significant discounts, particularly for furniture and fashion, but less good news for retailers needing to shift excess stock," said the BRC's chief executive Helen Dickinson.

"Price cuts and deflation may not last much longer as retailers will soon feel the full impact of £7bn of new costs announced at the last Budget. Higher employer NICs, increased National Living Wage, and a new packaging levy mean that prices are expected to rise across the board."

In equity markets, Rentokil Initial gained as the pest control firm said it expects to meet expectations with its 2024 results, helped by a pick-up in organic growth in North America.

SSP Group was in the black as the travel food outlet operator held annual guidance after like-for-like sales grew 6% in the first quarter driven by continued structural growth across the travel industry around the world.

Computacenter rose as it hailed a record second-half performance but also said pre-tax profit for 2024 was set to be at the low end of the range of analysts' forecasts.

Pets at Home was up as it backed its full-year guidance but reported a dip in third-quarter revenue as it pointed to a softer performance from its retail business.

Irn-Bru maker AG Barr was also higher as it reported a jump in full-year sales and profits.

Outside the FTSE 350, Halfords surged as it lifted its full-year profit expectations.

On the downside, engineering firm Smiths Group fell after saying it had been hit by a cyber security incident.

Industrial and electrical products distributor RS Group slumped as it said full-year profit would be at the bottom end of guidance after third-quarter revenues fell 3% due to declining output and falling business confidence among European customers.

SThree lost ground as the recruiter posted a slide in fees and earnings and warned of a tough year to come, as it continued to battle a weakened jobs market.

Market Movers

FTSE 100 (UKX) 8,552.02 0.57% FTSE 250 (MCX) 20,559.83 0.93% techMARK (TASX) 4,763.75 1.05%

FTSE 100 - Risers

Spirax Group (SPX) 8,005.00p 4.30% JD Sports Fashion (JD.) 84.84p 4.25% Centrica (CNA) 137.00p 3.63% Kingfisher (KGF) 246.90p 3.57% Associated British Foods (ABF) 1,924.50p 2.94% Rentokil Initial (RTO) 398.20p 2.92% Halma (HLMA) 2,920.00p 2.85% Whitbread (WTB) 2,889.00p 2.81% Barratt Redrow (BTRW) 448.70p 2.72% Marks & Spencer Group (MKS) 327.40p 2.54%

FTSE 100 - Fallers

Smiths Group (SMIN) 1,846.00p -1.96% Smurfit Westrock (DI) (SWR) 4,356.00p -1.74% Melrose Industries (MRO) 589.40p -1.17% Beazley (BEZ) 823.00p -1.14% Fresnillo (FRES) 664.50p -1.04% Glencore (GLEN) 358.80p -0.75% Standard Chartered (STAN) 1,059.50p -0.61% CRH (CDI) (CRH) 7,874.00p -0.56% Hiscox Limited (DI) (HSX) 1,078.00p -0.55% Imperial Brands (IMB) 2,651.00p -0.53%

FTSE 250 - Risers

Oxford Nanopore Technologies (ONT) 146.30p 6.63% Computacenter (CCC) 2,238.00p 5.97% Pets at Home Group (PETS) 222.60p 5.80% Barr (A.G.) (BAG) 614.00p 5.32% Foresight Group Holdings Limited NPV (FSG) 383.00p 4.36% WH Smith (SMWH) 1,191.00p 3.84% SSP Group (SSPG) 177.70p 3.68% C&C Group (CDI) (CCR) 149.00p 3.33% Raspberry PI Holdings (RPI) 726.50p 3.27% Ashmore Group (ASHM) 167.60p 3.08%

FTSE 250 - Fallers

Ferrexpo (FXPO) 102.80p -2.65% Burberry Group (BRBY) 1,105.00p -2.47% RS Group (RS1) 660.50p -1.86% Pacific Horizon Inv Trust (PHI) 575.00p -1.71% Softcat (SCT) 1,497.00p -1.64% Wood Group (John) (WG.) 66.00p -1.64% Harbour Energy (HBR) 238.10p -1.41% SThree (STEM) 281.50p -1.23% Schroder Asia Pacific Fund (SDP) 528.00p -0.75% Asia Dragon Trust (DGN) 416.00p -0.72%fts