The FTSE 100 rebounded from early losses on Thursday as strong results from Tesco and a broker upgrade for 3i helped offset weakness in Experian.
London’s leading index was 7 points at the time of writing and was tiptoeing towards another all-time record closing high.
Thursday’s trading was dominated by stock-specific stories as investors waited for the next economic data point to move the dial for stocks. This will likely come tomorrow in the form of the Non-Farm Payrolls, providing the latest insight into slowing US job creation.
Weakness in utility and tobacco stocks led to a softer start for the FTSE 100 index on Thursday, as Experian sank amid concerns about competition.
“Experian’s shares tumbled after the emergence of a new competitive threat.” said Russ Mould, investment director at AJ Bell.
“Analytics software group FICO launched a new service that it believes could make US mortgage brokers and lenders less reliant on credit agencies such as Experian to calculate consumer credit risk.”
Investors baulked at the news, and Experian shares were down 5% at the time of writing.
SSE shares fell 2% after the renewable energy group said unfavourable weather conditions weighed on output.
By lunchtime, the FTSE 100 index had turned positive, driven by gains from 3i and Tesco. UBS analysts bumped their price target on UBS up to 4,700p, helping shares rise by 3.7%.
Tesco was the standout corporate update story on Thursday as the supermarket released interim results revealing a 5.1% increase in sales. Strong sales gave Tesco the confidence to upgrade its profit guidance for the year, and investors cheered the news, with Tesco shares higher by 3%.
“Tesco’s interim results demonstrate impressive market leadership in what remains an exceptionally competitive UK grocery sector,” said Adam Vettese, market analyst for eToro.
“Sales showed notable momentum driven in part by an unusually hot summer which spurred volume growth across fresh foods and summer ranges, helping Tesco capture the fastest market share gains among major grocers. The emphasis on value through price matching and promotional Clubcard discounts proved effective with customers which in turn has supported continued share buybacks and a healthy dividend uplift.”