UK stocks were struggling higher on Friday as mixed economic data and weakness in the heavyweight banking sector kept a lid on gains.
The FTSE 100 was up just 0.1% at 9,236 by the midday mark in London, marking its third straight day of tepid gains, though upside was limited after statistics showed that government borrowing figures had soared while consumer confidence weakened.
“European equities opened higher on Friday, although the FTSE 100 has started to fade as we close out a hugely busy week for the UK that included inflation, jobs, a BoE rate decision, and historic investment pledges from the US,” said Joshua Mahony, chief market analyst at Scope Markets.
In economic news, consumer confidence tracked lower in September, a long-running survey showed on Friday, as concerns about day-to-day costs mounted. The latest consumer confidence index from GfK came in at -19. That was two points down on August, and one point higher than September 2024. Within that, all sub-measures were lower.
Meanwhile, UK retail sales volumes rose 0.5% in August, the Office for National Statistics reported. This was in line with the prior month’s gain and ahead of the 0.3% increase expected by analysts. Excluding fuel, retail sales growth picked up to 0.8% from 0.4% the previous month.
Lastly, UK public sector net borrowing surged to £17.96bn in August, up from a revised £2.82bn in July and the highest August borrowing figure for five years.
“Alarm bells are ringing in the Treasury after new figures showed public finances to be in a worse state than expected. That’s saying something, given expectations were already rock bottom,” said AJ Bell investment director Russ Mould.
“It makes Chancellor Rachel Reeves’ job of plugging the black hole even harder and raises the likelihood of a swathe of uncomfortable decisions at November’s Budget. A drop in the pound and a spike in gilt yields was the financial markets’ way of saying that the latest government borrowing figures make for grim reading.”
Spire jumps
Spire Healthcare was a high riser across the FTSE 350, surging 17% after responding to recent media speculation and confirming that it is undertaking a strategic review that could potentially lead to a sale. “This process is highly preliminary and no decision has been made regarding whether any such option will be pursued at this stage,” the private healthcare provider said in a statement.
Banking stocks were providing a drag on the FTSE 100, with NatWest and Lloyds among the worst performers following the mixed economic data. Barclays was also in the red, while Standard Chartered and HSBC were broadly flat.
In contrast, mining stocks were performing well with Fresnillo, Anglo American and Antofagasta as gold, silver and copper prices advanced.
Next was also rising as the stock rebounded after heavy falls on Thursday following a cautious outlook from the high street retailer, with sales growth expected to slow in the coming months.
Kainos Group fell after the news it had bought Canadian IT specialist consultancy Davis Pierrynowski for an undisclosed sum. The two companies have partnered since 2022 to drive digital transformation in the Canadian public and healthcare sectors, and the acquisition is “a natural next step in the relationship”, Kainos’s CEO said.
Banking and wealth management firm Investec also slipped after saying interim results should be broadly in line with the prior period, as a solid performance across its core banking and wealth operations as met with a volatile macro backdrop.
Market Movers
FTSE 100 (UKX) 9,235.54 0.08%
FTSE 250 (MCX) 21,620.90 -0.48%
techMARK (TASX) 5,438.75 0.49%
FTSE 100 – Risers
Croda International (CRDA) 2,783.00p 3.04%
Fresnillo (FRES) 2,218.00p 2.50%
Next (NXT) 11,780.00p 1.77%
GSK (GSK) 1,497.50p 1.66%
Vodafone Group (VOD) 85.92p 1.56%
Land Securities Group (LAND) 561.00p 1.26%
Imperial Brands (IMB) 3,104.00p 1.21%
InterContinental Hotels Group (IHG) 8,800.00p 1.20%
Kingfisher (KGF) 251.90p 1.16%
Rolls-Royce Holdings (RR.) 1,142.00p 1.11%
FTSE 100 – Fallers
London Stock Exchange Group (LSEG) 8,266.00p -4.28%
WPP (WPP) 370.90p -2.50%
NATWEST GROUP (NWG) 512.80p -2.47%
JD Sports Fashion (JD.) 89.76p -2.39%
Lloyds Banking Group (LLOY) 82.22p -1.89%
Airtel Africa (AAF) 222.20p -1.86%
Ashtead Group (AHT) 5,264.00p -1.83%
Auto Trader Group (AUTO) 771.20p -1.51%
Pearson (PSON) 1,032.50p -1.38%
Diploma (DPLM) 5,390.00p -1.28%
FTSE 250 – Risers
Spire Healthcare Group (SPI) 253.50p 17.09%
Man Group (EMG) 175.40p 5.28%
Wickes Group (WIX) 210.50p 3.69%
Endeavour Mining (EDV) 2,766.00p 2.75%
International Workplace Group (IWG) 204.20p 2.15%
Kier Group (KIE) 219.50p 1.86%
Trainline (TRN) 287.40p 1.84%
Oxford Instruments (OXIG) 1,872.00p 1.63%
Renishaw (RSW) 3,570.00p 1.56%
Pollen Street Group Limited (POLN) 944.00p 1.29%
FTSE 250 – Fallers
Close Brothers Group (CBG) 465.60p -6.32%
Lion Finance Group (BGEO) 7,380.00p -5.38%
Raspberry PI Holdings (RPI) 389.30p -4.72%
Bloomsbury Publishing (BMY) 471.00p -4.46%
Ocado Group (OCDO) 221.20p -4.20%
4Imprint Group (FOUR) 3,150.00p -3.08%
TBC Bank Group (TBCG) 4,430.00p -2.96%
Avon Technologies (AVON) 2,010.00p -2.90%
Future (FUTR) 709.50p -2.87%
Rank Group (RNK) 130.40p -2.83%