London midday: FTSE touch firmer ahead of US inflation print

(Sharecast News) - London stocks had pared earlier gains to trade just a smidgen higher by midday, as investors eyed a key US inflation reading.

The FTSE 100 was up 0.1% at 9,721.27.

Russ Mould, investment director at AJ Bell, said: "The FTSE 100 made a steady start on Friday morning as investors await a key release on US inflation.

"The market is increasingly betting on an interest rate cut when the Federal Reserve meets on 10 December and mixed employment data this week has done little to dampen those expectations which, in turn, have helped drive recent gains for equities.

"The core PCE measure of inflation, out later, is one of the most closely followed by the Fed when making its decisions on rates because it excludes more volatile items like food and energy.

"A higher-than-expected reading could give the Fed pause for thought about a pre-Christmas cut, while an in line or lower number would likely give markets further confidence about such a move."

The PCE reading for September is due at 1330 GMT.

On home shores, the latest figures from Halifax showed that house price growth stalled in November in the run-up to the Budget.

House prices were flat on the month, having risen 0.5% in October. On the year, meanwhile, growth slowed to 0.7% last month from 1.9% in October. This was the weakest rate of growth since March 2024.

The average price of a house was �299,892 last month, versus �299,754 in October.

Amanda Bryden, head of mortgages at Halifax, said the slowdown in annual growth "largely reflects the base effect of much stronger price growth this time last year".

"This consistency in average prices reflects what has been one of the most stable years for the housing market over the last decade. Even with the changes to Stamp Duty back in spring and some uncertainty ahead of the Autumn Budget, property values have remained steady," she said.

"While slower growth may disappoint some existing homeowners, it's welcome news for first-time buyers. Comparing property prices to average incomes, affordability is now at its strongest since late 2015. Taking into account today's higher interest rates, mortgage costs as a share of income are at their lowest level in around three years.

"Looking ahead, with market activity steady and expectations of further interest rate reductions to come, we anticipate property prices will continue to grow gradually into 2026."

In equity markets, Ocado rallied as it said US supermarket chain Kroger will pay it $350m in compensation for the closure of three warehouses, the UK online grocer and technology business said.

The payment also reflects Kroger's decision not to proceed with another customer fulfilment centre in Charlotte, North Carolina, one of the two planned CFCs due to go live in 2026.

Ocado earlier this month said Kroger's decision to fulfil online orders from its own stores in highly populated areas would cost it $50m in lost licensing fees.

Greggs shot higher as JPMorgan initiated coverage of the stock at 'overweight', highlighting significant re-rating potential.

Safety equipment and technology group Halma gained as it announced the �230m acquisition of E2S Group, a London-based manufacturer of industrial hazard detection devices.

On the downside, Big Yellow slumped after it said late on Thursday that it had ended takeover talks with Blackstone.

Blackstone announced in October that it was considering a potential takeover offer for the London-listed self-storage firm. Under UK takeover rules, it had until 8 December to either make a firm offer or walk away.