MARKET REPORT: Sun shines on Footsie as losing streak ends

The sun has finally come out for the FTSE 100 after a dismal start to the summer.

Britain’s blue-chip share index logged a weekly gain yesterday – its first in six weeks.

Investors have been encouraged in recent days by news of inflation falling back to the Bank of England’s 2 per cent target rate and enhanced hopes of a UK interest rate cut in August.

The weekly gain was only a modest one of 1.1 per cent, or 91 points, as the rally ran out of steam on the fifth day. 

The FTSE 100 closed 0.4 per cent, or 34.74 points lower at 8237.72.

The FTSE 250 index, however, managed to notch up a more impressive weekly advance of 1.6 per cent, even though the mid cap index ended down 0.3 per cent, or 56.37 points on the final session of the week, at 20,442.35.

JP Morgan Cazenove is now turning more positive on the UK water sector, having been cautious since 2022. 

Analysts at the US firm said that they believe that the share prices of the listed water companies now reflect the sector headwinds, and suggest the market under-appreciates certain positives.

United Utilities shares gained 1.6 per cent, or 16.1p, to 1009p as JP Morgan upgraded its rating to overweight, while Severn Trent added 0.9 per cent, or 23p at 2464p after its rating was raised to neutral.

Positive comment and a target price hike from JP Morgan were also the spur for gains by ITV, up 4.7 per cent, or 3.6p, to 80.3p. But a rating downgrade by Morgan Stanley dragged FTSE 100-listed value retailer B&M down 1.7 per cent, or 8.1p, to 469p.

Royal Mail owner International Distribution Services (IDS) saw its shares drift 1.4 per cent, or 4p lower to 319p, below Daniel Kretinsky’s agreed takeover offer of 370p a share, as government clearance remains pending.

Informa edged 0.02 per cent or 0.2p higher to 860p as the information publisher and events organiser hailed double-digit year-to-date revenue growth, and said it is on track to deliver 2024 results at the upper end of guidance.

Ocado rose 0.4 per cent, or 1.4p, to 311.4p. 

Recent market debutant Raspberry Pi continued to attract interest following it fizzy debut, adding 0.4 per cent or 1.4p, at 373.5p. 

And JLEN Environmental rose 1.7 per cent, or, 1.5p to 88.2p after the firm lifted its dividend outlook, despite its net asset value declining in a tricky year for the renewable investment sector.

Among the small caps, Crimson Tide surged 49.3 per cent, or 87.5p higher to 265p, after revealing that Ideagen has proposed a possible £21million cash offer for the enterprise software company. 

The news came as Crimson Tide also said it has rejected a revised all-share bid proposal from Checkit, which announced a first offer at the start of June.

Gulf Keystone gained 6.4 per cent, or 9.1p, to 150.9p as it told investors it will pay out £12million, as an interim dividend, in an upbeat annual general meeting statement. But on the downside, Strategic Minerals dropped 16.7 per cent. or 0.03p, to 0.15p after reporting a big loss for the year to the end of 2023.