Stock markets were attempting a new rally on Friday, after prices were knocked on Thursday by failed peace talks between Ukraine and Russia and another hot inflation reading from the US.
Helping to improve sentiment in London as a difficult week drew to a close was a report of better-than-expected economic growth in the UK at the start of 2022.
The FTSE 100 index was up 59.55 points, or 0.8%, at 7,158.64 early Friday. At this level, the index is on pace to end the week 2.1% higher.
The mid-cap FTSE 250 index was up 183.50 points, or 0.9%, at 20,139.05. The AIM All-Share index was up 6.79 points, or 0.7%, at 990.34.
The Cboe UK 100 index was up 1.0% at 712.39. The Cboe 250 was up 1.1% at 17,730.69, and the Cboe Small Companies was up 0.5% at 14,399.91.
In mainland Europe, the CAC 40 in Paris was marginally higher, while the DAX 40 in Frankfurt was up 0.6%.
The UK economy returned to growth in January, data from the Office of National Statistics showed. Gross domestic product expanded 0.8% from the previous month in January, rebounding from December's 0.2% drop, and was ahead of market consensus - provided by FXStreet - of 0.2% growth.
The ONS data showed industrial production growth was 0.7% in January versus the previous month, primarily driven by 0.8% growth in manufacturing. This follows industrial production growth of 0.3% in December 2021.
The market had predicted a measly 0.1% rise in industrial production, while manufacturing was guided to rise by 0.2%.
Services output grew by 0.8% in January and is 1.3% above its pre-coronavirus pandemic level, the ONS noted. This followed a 0.5% fall in December 2021.
‘The cost of living crisis and the influence of the war in Ukraine probably means that the 0.8% month-on-month leap in GDP in January is as good as it gets for this year,’ Paul Dales, chief UK economist for Capital Economics.
The pound was quoted at $1.3055 early Friday, down on $1.3125.
In London, Ocado was sitting pretty atop the FTSE 100, gaining 4.2%, after it landed a ‘conclusive victory’ in a legal dispute, as judges once again ruled the online grocer did not infringe on AutoStore patents.
The International Trade Commission rejected every patent infringement claim made by AutoStore, a warehouse technology systems provider.
In October 2020, Autostore had said it sued and filed complaints in the US and the UK, accusing Ocado's Smart Platform of infringing Autostore's patented technology.
In response, Ocado said it is continuing to pursue claims of its own against AutoStore, for infringing on the FTSE 100 company's IP rights in both the US and Europe.
Russian-linked metals miner Polymetal International was down 5.5% after peer Evraz was shut out of the London Stock Exchange on Thursday.
On Friday morning, Evraz said all 10 remaining non-executives have left the Russian steel maker's board, with its recently appointed chief executive the last director standing.
Alexander Abramov, Alexander Frolov, Alexander Izosimov, Deborah Gudgeon, Eugene Shvidler, Eugene Tenenbaum, Karl Gruber, Maria Gordon, Michael Peat and Stephen Odell have left their non-executive posts, Evraz said.
Only CEO Aleksey Ivanov remains. Ivanov assumed the role from September 1, replacing Frolov who moved to a non-executive post at the end of August.
Friday's mass exodus comes after the UK Financial Conduct Authority on Thursday suspended the listing of Evraz. The FCA said it suspended the FTSE 100-listed shares of the steel maker and miner ‘in order to protect investors pending clarification of the impact of UK sanctions’. Roman Abramovich, a major shareholder in Evraz, on Thursday was sanctioned by the UK for his links to Russian President Vladimir Putin.
Evraz shares are down 80% over the past month.
Evraz was forced to deny that it was involved in providing any financial or economic contribution towards the destabilisation of Ukraine, including the potential supply of steel to Russia for the production of tanks.
Housebuilder Berkeley was up 1.4% as it remains on track to meet its earnings guidance for this year.
The Cobham, Surrey-based property developer said trading has continued ‘robustly’ in the period to February 28 from November 1.
Berkeley stated that the value of underlying sales reservations remains ‘slightly’ ahead of pre-pandemic levels. Cancellations are also at normal rates and sales pricing is ‘sufficiently’ ahead of its business plan to absorb construction cost increases, it continued.
As a result, the company continues to be on track to meet its earnings guidance and deliver pretax profit growth of around 5% per annum for the next three financial years. Further, this would see Berkeley on the path to achieving a pretax profit of £625 million for the year ending April 30, 2025. In financial 2021, the company reported a pretax profit of £518.1 million.
The company anticipates forward sales - cash due under exchanged private sales - to be above £1.70 billion at year-end. This was the amount of forward sales recorded as of the end of its half-year on October 31.
Blue-chip peers Taylor Wimpey, Barratt Developments and Persimmon advanced 2.4%, 1.3% and 1.0%, respectively.
In Asia on Friday, the Japanese Nikkei 225 index closed down 2.1%. In China, the Shanghai Composite ended 0.4% higher, while the Hang Seng index in Hong Kong closed down 1.6% in late trade. The S&P/ASX 200 in Sydney closed down 0.9%.
Brent oil was quoted at $112.46 a barrel on Friday morning in London, flat from $112.45 late Thursday.
Gold stood at $1,994.60 an ounce early Friday, down from $1,995.65 late Thursday.
The euro was priced at $1.0979, soft from $1.1007 at the London equities close Thursday, after the European Central Bank kept interest rates on hold.
Notably, however, the ECB signalled that it may give itself a little more time before rising interest rates, as the war in Ukraine and surging inflation cloud the economic outlook.
Against the yen, the dollar was trading at JP¥116.96, up from JP¥116.05.
Annual consumer price inflation in the US in February rose to its highest level since January 1982, the Bureau of Labor Statistics reported on Thursday.
On an annual basis, the US consumer price index increased 7.9% in February, surpassing January's increase of 7.5%. Month-on-month, US CPI rose 0.8% in February after rising 0.6% in January.
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