FTSE closes up as S&P 500 hits new record following inflation beat

London’s FTSE 100 index remained off its recent highs on Thursday as the US hit new highs following a quiet week stateside.

Having flirted with a half-percent rise earlier in the day, the top index in the capital ended up only 0.1%.

The 7.17 point rise meant that the FTSE goes into Friday at 7,088.18, led by Auto Trader, which said it had invested in its digital offering, and BT, which has a shiny new investor.

“The UK index has been helped by outperformance in the telecoms sector with BT Group shares surging higher after French multinational telecoms company Altice announced it had taken a 12.1% stake in the business,” said CMC Markets analyst Michael Hewson.

“The company which owns a range of assets including French mobile phone operator SFR said it doesn’t intend to make a bid for the business, with the UK stake being run as a separate business, Altice UK.”

In the US, eyes have been firmly on an inflation report all week, which in the end blasted through expectations.

The 5% rise in the consumer price index was significantly ahead of a 4.7% consensus forecast by analysts who spoke to Dow Jones.

“Initial reaction was for yields to push higher however there appears to have been enough in the report to suggest that the numbers may well start to come down from current levels even if there is some persistence in the wider numbers,” Mr Hewson said.

It pushed New York’s S&P 500 index to a new record high during the day. The index was up 0.5% when markets closed in Europe. Its cousin, the Dow Jones, had risen 0.4% at the same point.

Germany’s Dax index closed flat, while the Cac in Paris fell 0.2%.

As traders went home for the day, sterling had made gains of 0.1% against two major rivals. One pound can now buy 1.4155 dollars or 1.1629.

In company news, model train company Hornby turned a profit for the first time in nine years, but investors were unimpressed, sending shares down 2.7%.

From small trains to large ones, and shares in rail group Go-Ahead rose 0.7% following an update showing a rise in passenger numbers.

Staying in transport. Auto Trader’s shares were close to the top of the FTSE 100 with a 6.5% jump as it looks set to gain from a rise in online car shopping.

From cars to cards, and Card Factory swung to a loss for the past year. Shares fell by 0.5%.

BT’s shares finished up 6.6% after Altice took a multi-billion pound stake.

Shares were up 9.9% at sofa company DFS after it reported a surge in orders when showrooms reopened in April.

Lekoil shares collapsed a further 8.2% after the company provided an update on why it fired its chief executive, who has since refused to leave one of its affiliates.

And finally, shareholders in supermarket chain Morrisons overwhelmingly voted against a bonus for its chief executive which was calculated before accounting for the £290 million cost of dealing with Covid-19.

Shares fell 0.6%, but the vote is not binding on the company, so will not change anything.

The biggest risers on the FTSE 100 were BT Group, up 12p at 195.15p; Auto Trader, up 37.8p at 615.6p; Smith & Nephew, up 36.5p at 1,542.5p; AstraZeneca, up 152p at 8,282p; and Rightmove, up 11.6p at 634.2p.

The biggest fallers on the FTSE 100 were Thungela, down 4.18p at 126p; Compass, down 51.5p at 1,594.5p; Sainsbury’s, down 7.8p at 254.3p; IHG, down 120p at 5,090p; and Taylor Wimpey, down 3.75p at 163.45p.