Lunchtime market roundup: FTSE 100 up as BoE's Pill eases rate worry

Stock prices in Europe were higher on Wednesday midday, following dovish remarks from central bankers, as investors await US inflation data for September which could all but ensure that the Federal Reserve stands pat later this month.

The FTSE 100 index rose 26.12 points, 0.3%, at 10,676.45. The FTSE 250 in London was up 171.70 points, 0.7%, at 24,510.89, and the AIM All-Share was up 2.51 points, 0.3%, at 773.67.

The Cboe UK 100 was up 0.3% at 1,060.41, the Cboe UK 250 added 1.1% at 21,442.99, and the Cboe Small Companies fell 0.1% at 18,825.60.

But the CAC 40 in Paris shot up 0.5%, and Frankfurt's DAX 40 rose 0.6%.

In New York, the Dow Jones Industrial Average is called up 0.4%, the S&P 500 up 0.2% and the Nasdaq Composite flat.

"The countdown is on for US inflation, which is scheduled for release later today. In the lead up, stock indices in Europe are rallying," XTB analyst Kathleen Brooks commented.

In an interview with Bloomberg News, New York Fed President Williams said he still believes it "may be appropriate to have one more rate hike".

"I don't think at this time I have any reason to believe that we would need to do more," he added.

Wednesday's US consumer price inflation reading at 1330 BST could test that notion, however.

According to consensus cited by FXStreet, the pace of US consumer price inflation is expected to have accelerated to 3.6% in September, from 3.4% in August.

The yield on the US 10-year Treasury was quoted at 5.20% early Wednesday afternoon, narrowing from 5.22% at the time of the London equities close on Tuesday. The yield on the US 30-year Treasury was quoted at 5.55%, slimming from 5.56%.

In an interview with CNN, Bank of England Governor Andrew Bailey has warned that it is becoming increasingly difficult to avoid raising interest rates as the energy shock from the Iran war persists.

"We are seeing greater resilience in UK economic activity, which is good - we will obviously factor that in," Bailey said.

However, Bloomberg reported BoE Chief Economist Huw Pill, one of the central bank's more hawkish policymakers, expressed scepticism over expectations for four rate increases totalling 100 basis points.

"Is it obvious that we will need to follow market pricing to four 25 basis point hikes and so forth? There I would be a little bit more sceptical," Pill said at an event in Bangkok.

"To get to 100 basis points, then I do think we probably need to see some more concrete manifestation of these risks."

Despite Bailey sounding somewhat hawkish, "traders are pouncing on Pill's comments", XTB analyst Brooks said.

"In general, comments from the world's most senior central bankers have been moderately dovish this week. Huw Pill and the ECB's Christine Lagarde have both said that second round effects from the energy price spike are not a problem at this stage. This reduces the need for central banks to hike rates as aggressively as the market currently expects," the analyst added.

Boosted by hope that the BoE will enact fewer hikes than the market once expected, shares in the rate-sensitive housebuilding and property sectors were higher.

Barratt Redrow rose 2.8%, British Land was up 2.6% and estate agent Savills traded 2.2% higher.

The pound was quoted at USD1.3268 midday Wednesday, rising from USD1.3249 at the time of the London equities close on Tuesday. Against the euro, sterling climbed to EUR1.1850 from EUR1.1834.

The euro eased slightly to USD1.1191 from USD1.1194. Against the yen, the dollar was trading at JPY158.43 flat from JPY158.42.

Brent oil was quoted at USD106.41 midday Wednesday, up from USD105.83 late Tuesday afternoon. Gold traded at USD4,140.85 an ounce, down from USD4,163.06.

Back in London, Big Yellow shares shot up 6.6%. Ancora Holdings Group called on the self storage provider to launch a comprehensive strategic review, including a sale process.

In a statement, Cleveland, Ohio-based wealth management and advisory firm Ancora said it believes that a sale of Big Yellow represents the best risk-adjusted outcome for shareholders.

Robert Walters shares shot up 7.7%. The recruitment firm said net fees increased 1% at constant currency in the third quarter of the year, improving from a 3% decline in the first half.

"We delivered a good trading performance in the third quarter - made possible by great contributions from all our people. Among our largest specialist recruitment markets, the UK delivered another strong performance, while Japan, Spain and New Zealand were also up on the prior year. Over half of our specialist recruitment portfolio grew on the prior year and recruitment outsourcing also delivered another very good quarter," Chief Executive Toby Fowlston said.

On Tuesday, Ancora said it has taken a more than 4% stake in Big Yellow.

On AIM, Thor Explorations fell 2.9%. It cut its 2026 gold production guidance after "exceptionally heavy" rainfall disrupted operations at its Segilola mine in Nigeria as the company posted its quarterly results.

Thor cut its guidance to between 70,000 and 72,000 ounces from 75,000 to 85,000 ounces.

Airtel Mobile Commerce shares moved closer to its initial public offering price as unconditional dealings of its shares kicked off on Wednesday.

The company, which operates as Airtel Money, priced its initial public offering at 196p per share, but the stock fell to 176p on Tuesday, down 10% from the float price.

But it rose 6.3% on Wednesday to trade at 187.06p.

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