London’s blue chip index outperformed its peers in Paris and Frankfurt on Friday morning as data showed that UK retail sales climbed sharper than expected in January; meanwhile investors await flash UK composite PMI data for February.
Initial estimates show that the public sector recorded a £30.37 billion surplus in January, ‘the highest surplus in any month since records began in 1993’ and above the £23.1 billion surplus projected by FXStreet-cited consensus, although the ONS noted that ‘tax receipts are?always?higher’ at this time of year.
Also, retail sales increased 1.8% on-month in January, outstripping the consensus forecast for a 0.2% rise, and rose 4.5% on an annual basis, beating consensus for a 2.8% rise.
‘Last to the party as always on reporting, ONS have announced a good print for the first month of 2026, reporting 6.5% sales growth and 5.6% volume growth versus last year (note: seasonally adjusted, ex-fuel, figures),’ Shore Capital’s David Hughes commented. ‘This marks a notable step up from what was a weaker December for shopkeepers and an encouraging start to 2026...While we are wary of getting ahead of ourselves, the macro-economic drivers are present for an improving consumer outlook, and we remain cautiously optimistic on the sector for the year ahead.
‘If we can avoid any big surprises in the Spring Statement, then we hope to see further steady improvements in consumer confidence as the reality of rising household incomes comes into effect.’
The FTSE 100 index was up 26.80 points, 0.3%, at 10,653.84. The FTSE 250 was up 48.14 points, 0.2%, at 23,621.63, and the AIM all-share was up 1.62 points, 0.2%, at 812.76.
The Cboe UK 100 was up 0.4% at 1,062.07, the Cboe UK 250 was up 0.3% at 20,953.07, and the Cboe small companies was up marginally at 18,574.04.
Burberry led the FTSE 100, up 2.3%. BP led the laggers, down 1.5%, while fellow oil major Shell lost 0.3%.
Anglo American was up 0.1%, despite cutting its final dividend by 27% to $0.16 from a restated $0.22 for the prior year. It had been expected to cut the final payout to $0.22 from the originally stated $0.25.
At the same time, the miner delivered a pretax profit from continuing operations of $883 million in 2025, swung from a loss of $1.36 billion. Revenue from continuing operations was $18.55 billion, up 5% from $17.75 billion.
Anglo American expects copper production to rise to between 700,000 tonnes and 760,000 tonnes in 2026, and projects iron ore production at between 55 million tonnes and 59 million tonnes in 2026, revised up from 54 million to 58 million tonnes predicted previously.
Segro lost 0.3% after reporting its 2025 results, despite revenue rising 7.6% to £726 million, beating the Financial Times-cited analyst consensus average of £698.5 million, and up from £675 million in 2024.
Pretax profit decreased to £560 million from £636 million, with earnings per share down to 40.7p from 44.7p, but adjusted pretax profit rose 8.3% to £509 million from £470 million.
On the FTSE 250, Blackrock Smaller Cos led with a 4.2% rise, and Blackrock Throgmorton rose 0.2%, after the two agreed to merge.
Throgmorton said this will bring together two similar investment companies with significant portfolio overlap and create the largest growth-focused trust in the AIC’s UK smaller companies sector, with net assets of approximately £780 million.
Brent oil was quoted lower at $71.49 a barrel early in London on Friday from $71.71 late Thursday.
In European equities on Friday, the CAC 40 in Paris was down 0.7%, while the DAX 40 in Frankfurt was up marginally.
Germany’s manufacturing activity solidly re-entered growth territory in February, however companies ‘remain very cautious in their personnel planning,’ flash data published by S&P Global showed.
The Hamburg Commercial Bank flash Germany composite purchasing managers’ output index rose to 53.1 points in February from 52.1 points in January, beating the FXStreet-cited consensus of a softer improvement to 52.2 points in February.
The flash services PMI business activity index climbed to 53.4 points in February from 52.4 points in January, beating the consensus of 52.2 points, which would have meant decelerated growth.
The flash manufacturing PMI surged to a 44-month high of 50.7 points in February from 49.1 points in January, beating the consensus of 49.6 points.
The pound was quoted at $1.3449 early on Friday in London, down compared to $1.3455 at the equities close on Thursday. The euro stood at $1.1754, down against $1.1768. Against the yen, the dollar was trading higher at JP¥155.39 compared to JP¥154.90.
In Asia on Friday, the Nikkei 225 index in Tokyo was down 1.1%. In China, the Shanghai Composite remains closed for New Year celebrations, while the Hang Seng index in Hong Kong was down 1.0%. The S&P/ASX 200 in Sydney closed down 0.1%.
In the US on Thursday, Wall Street ended lower, with the Dow Jones Industrial Average down 0.5%, the S&P 500 down 0.3% and the Nasdaq Composite down 0.3%.
The yield on the US 10-year Treasury was quoted at 4.07%, narrowing from 4.08%. The yield on the US 30-year Treasury was quoted at 4.70%, narrowing from 4.71%.
Gold was quoted higher at $5,020.79 an ounce against $5,003.14.
Still to come on Friday’s economic calendar, the UK and US have flash purchasing managers’ index releases.
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