By Pranav Kashyap
(Reuters) – The UK’s main stock indexes were steady on Thursday as investors braced for the European Central Bank’s interest rate decision, while Rentokil kept losses from ex-dividend stocks in check.
The blue-chip FTSE 100 was little changed at 8,328.70 by 0746 GMT, and the mid-cap FTSE 250 index also traded flat at 20,969.57.
Industrial metal miners, weighed heavily on the benchmark, losing 1.3%, following a drop in base metal prices. [MET/L]
Smiths Group (OTC:SMGZY) lost 2.1%, Persimmon (LON:PSN) fell 2.3% while Howden Joinery dropped 1.5% as they traded without entitlement to their latest dividend pay-out.
The euphoria of Britain’s inflation falling below the Bank of England target driving both indexes to multi-week highs in the previous session was short-lived.
Investors awaited the ECB’s rate decision, due at 1215 GMT, where it is expected to lower rates by 25 basis points. Traders will also focus on commentary from ECB’s President Christine Lagarde.
The spotlight is also shifting from macroeconomic data to the upcoming earnings season, as companies begin reporting their third-quarter results.
“What is missing at the moment for British equities to start performing better and start an uptrend, is really earnings to start delivering better. That has been the missing link,” said Lilian Chovin, head of asset allocation at the British private bank Coutts.
Mondi (LON:MNDI) lost 6.9% after the packaging company reported a lower core profit compared with the previous three-month period.
Entain rose 3.6% after the Gambling group raised its 2024 net gaming revenue outlook.
Rentokil Initial jumped 7.8% after the pest control company gave its latest trading update and was the top boost on the FTSE 100.
“On the Macroeconomic backdrop, the UK has been doing better than Europe in terms of economic surprises, indices or economic momentum. We can see a more healthier environment in the UK at the moment,” Chovin said.