Major UK stocks e FTSE 100 made a quiet start to trading on Thursday as inflation fears kept a lid on equity markets. The FTSE 100 was largely flat at 9am as heavyweight energy stocks tracked weak oil prices, while a steady rise in inflation coupled with higher local coronavirus infections stoked concerns of slowing the pace of economic recovery.

The benchmark index was 0.02% higher at 7,092.77 with Royal Dutch Shell (RDSB) and BP (BP.) the main drags as the wider energy sector fell more than 2%.

Mid-caps traded weaker, the FTSE 250 down 0.4% to 22,662.40 as fears over rising inflation weighed on the more domestically focused stocks.

Bank of England Governor Andrew Bailey said the central bank would assess inflation data for things that could be temporary, before taking a call on raising rates, while a roaring jobs market in June also showed growing inflation pressures from rising wages.

Across the pond, Jay Powell denied the Federal Reserve was being complacent about the issue as he addressed the House financial services committee Wednesday. Concerns mounted after official figures revealed the cost of living jumped by an annualised 5.4% as the world’s largest economy continued to recover from the pandemic.

Overnight, the S&P 500 and Dow Jones rose modestly, adding 0.12% and 0.13% respectively, but the Nasdaq Composite lost 0.22%.

COMPANIES MOVING ON THE MARKET

In corporate news, UK-based cybersecurity firm Avast (AVST) surged 12% to 565p, topping the FTSE 100 leaderboard, after it said it was in advanced talks over a merger with peer NortonLifeLock.

Shares in the world’s largest credit data company Experian (EXPN) jumped nearly 6% as it raised its annual outlook after posting a 31% jump in its first-quarter revenue.

Online food delivery platform Just Eat Takeaway.com (JET) upgraded its annual outlook on performance, driven by the removal of fee caps in the US and Canada, improved operational performance.

Order growth forecast for 2021 was lifted to more than 45% from previous guidance of more than 42% order growth, with gross transaction value expected to be in a range of €28 billion to €30 billion.

Shares in Just Eat Takeaway.com dipped 1.2% to £63.45 with investors still showing concerns for longer-run growth amid intense competition.

Online fashion retailer ASOS (ASC:AIM) said it expected annual adjusted profit to be in line with expectations amid continued social restrictions and global supply chain pressures.

For the four months to 30 June 2021, revenue was up 31% to £1.29 billion, with UK revenue rising 60% to £526.4 million. Its share price, however, plummeted by almost 9% to £42.89.

ELSEWHERE ON THE MARKET

Recruitment company Hays (HAS) upgraded its outlook on profit after reporting a 39% rise in fees in the fourth quarter of its fiscal year following a sharp rebound in permanent placements.

The company said it now expect FY21 operating profit of about £95 million, ahead of market expectations of about £90.9 million, yet the stock reversed 1.5% to 165.20p.

Water supply operator Severn Trent (SVT) is ‘confident’ is can achieve at least £40 million positive net outperformance on customer outcome deliver incentives after a strong start to the year.

The announcement boosted its share price by 0.7% to £26.94.

The company also said it is on track to invest up to £650 million during the year, including its Green Recovery projects, and is processing as planned to deliver on its Net Zero ambitions by 2030.

Shopping centre owner Hammerson (HMSO) said rent collection was 68% in in the first half of the year, as footfall trends in all territories remained encouraging. Its share price was down 1.47% to 35.57p.

Gene and cell therapy group Oxford Biomedica (OXB) has named Dr Michael Hayden as a non-executive director, effective from July 15. The shares rose 0.3% at £13.34.

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Issue Date: 15 Jul 2021