© Reuters. FILE PHOTO: The London Stock Exchange Group offices are seen in the City of London, Britain, December 29, 2017. REUTERS/Toby Melville
By Shivani Kumaresan
(Reuters) -London’s FTSE 100 was flat on Friday, posting a weekly loss, as weakness in mining stocks countered a bigger-than-expected jump in retail sales and business activity.
Retail sales surged by 9.2% in April, when non-essential shops reopened after months of closure due to COVID-19 restrictions, official data showed, with the UK Composite Purchasing Managers’ Index (PMI) hitting its highest level on record.
“The rise in the UK PMIs are the latest indicator to suggest the economy is already in a better place than after the first wave last summer,” said James Smith, developed markets economist at ING.
“We expect around 5% growth in the second quarter and think the economy will be just shy of, or maybe even back to, pre-virus levels by the end of the year.”
The domestically focussed mid-cap FTSE 250 index was also flat.
The FTSE 100 has gained 8.2% year-to-date on optimism about economic recovery. But the index has been trading in a tight range recently as higher inflation has stoked fears that central banks might pare back their support sooner than expected.
A Reuters poll found that the UK economy will expand 5.9% this year, much stronger than the 5.0% forecast last month, as a fast-moving coronavirus vaccine programme allows businesses to reopen and lifts confidence.
Biffa rose 6.0% to the top of mid-cap index after its proposal to buy the collections business and certain recycling assets from Viridor Waste Management (NYSE:WM) Ltd for 126 million pounds ($178.87 million).
Card Factory slid 15.1% after reporting a marginal drop in like-for-like store sales, compared with 2019, after the UK began reopening stores and eased restrictions in April.
UK stocks flat as miners stymie strong retail sales, business activity data
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