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12 Mar 2021 | 11:39

London midday: Stocks maintain mild losses as investors mull GDP

(Sharecast News) - London stocks were still a touch lower by midday on Friday as investors mulled the latest UK GDP reading. The FTSE 100 was down 0.2% at 6,721.97 after figures from the Office for National Statistics showed Britain's economy contracted by a less-than-expected 2.9% in January as the third national lockdown came into force.

Economists had forecast a month-on-month decline of 4.9%. The figure comes after a 1.2% expansion of gross domestic product (GDP) in December. Britain was forced back into lockdown at the start of January to counter a rising number of Covid-19 cases, with schools and non-essential businesses shut. GDP remained 9% below pre-pandemic levels in January.

Joshua Mahony, senior market analyst at IG, said: "UK GDP data highlighted the difficulties experienced by businesses in January, with the country struggling to overcome the effect of both Brexit and fresh lockdown measures at the same time.

"While the January contraction figure was less significant than markets had been expecting, the -2.9% reading coupled with negative industrial and manufacturing production figures did highlight recent troubles. Fortunately, the rise in yields does highlight the expectations that we are moving in the right direction, with an impressive vaccination effort likely to spur a sharp economic expansion in the coming months."

In equity markets, Berkeley Group fell after saying it was on track to report annual pre-tax profit similar to the £504m achieved the year before based on "robust" trading in the four months to the end of February. The housebuilder also said it expects the value of reservations for the current financial year to be around 20% lower than last year.

Other housebuilders followed suit, with Persimmon, Barratt and Taylor Wimpey all weaker.

On the upside, luxury goods brand Burberry surged to the top of the FTSE 100 after it lifted full-year guidance and reported a "strong rebound" in trading since December. In an unscheduled trading update, Burberry said fourth-quarter comparable retail sales were now expected to be 28% - 32% higher year-on-year.

Shopping centre owner Hammerson rallied even after it posted a loss for 2020 as it took a hit from the pandemic.

Tullow Oil was boosted by an upgrade to 'overweight' from 'equalweight' at Morgan Stanley, which hiked the price target to 75p from 38p.

Market Movers

FTSE 100 (UKX) 6,721.97 -0.22% FTSE 250 (MCX) 21,408.41 -0.58% techMARK (TASX) 4,133.51 -0.31%

FTSE 100 - Risers

Burberry Group (BRBY) 2,097.00p 5.56% Barclays (BARC) 179.04p 2.74% M&G (MNG) 222.70p 1.55% Morrison (Wm) Supermarkets (MRW) 177.70p 1.40% Legal & General Group (LGEN) 289.90p 1.12% Lloyds Banking Group (LLOY) 40.94p 1.10% Tesco (TSCO) 222.10p 0.95% NATWEST GROUP PLC ORD 100P (NWG) 188.50p 0.86% Flutter Entertainment (FLTR) 15,935.00p 0.76% Schroders (SDR) 3,384.00p 0.71%

FTSE 100 - Fallers

Berkeley Group Holdings (The) (BKG) 4,264.00p -6.74% Fresnillo (FRES) 924.60p -3.35% WPP (WPP) 891.20p -2.52% Scottish Mortgage Inv Trust (SMT) 1,139.00p -2.48% Experian (EXPN) 2,410.00p -1.87% Antofagasta (ANTO) 1,699.50p -1.82% Polymetal International (POLY) 1,474.50p -1.80% Rightmove (RMV) 563.60p -1.71% Barratt Developments (BDEV) 748.20p -1.58% InterContinental Hotels Group (IHG) 5,086.00p -1.55%

FTSE 250 - Risers

Tullow Oil (TLW) 59.58p 7.93% Hammerson (HMSO) 33.96p 4.08% Rank Group (RNK) 184.80p 4.05% Vectura Group (VEC) 116.00p 3.57% Centrica (CNA) 53.36p 3.29% CMC Markets (CMCX) 425.50p 2.78% Ultra Electronics Holdings (ULE) 2,098.00p 2.14% RIT Capital Partners (RCP) 2,330.00p 1.75% Premier Foods (PFD) 99.10p 1.75% Plus500 Ltd (DI) (PLUS) 1,321.00p 1.69%

FTSE 250 - Fallers

Playtech (PTEC) 468.20p -5.66% Baillie Gifford US Growth Trust (USA) 317.00p -3.94% Ibstock (IBST) 226.40p -3.90% Allianz Technology Trust (ATT) 2,730.00p -3.53% Marshalls (MSLH) 730.00p -3.38% Polar Capital Technology Trust (PCT) 2,145.00p -3.16% Centamin (DI) (CEY) 103.75p -2.76% AO World (AO.) 306.50p -2.70% Oxford Instruments (OXIG) 1,806.00p -2.69% Ascential (ASCL) 360.60p -2.54%
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