London stocks make gains after drop in inflation

The FTSE 100 was in positive territory on Wednesday as traders welcomed easing inflation and digested the Chancellor’s spring statement.

Equity markets and the pound were largely untouched by the spring statement, which focused on departmental spending cuts.

Trading in London started with gains and remained in the green throughout the session after fresh Office for National Statistics (ONS) data showed that inflation dipped below expectations.

Consumer Price Index (CPI) inflation for February came in at 2.8%, dropping from 3% in the previous month, on the back of a fall in clothing and footwear prices for the month.

A number of major retailers, including Next and Kingfisher, were higher at the close.

The FTSE 100 finished 25.79 points, or 0.3%, higher to end the day at 8,689.59.

Elsewhere in Europe, it was much less positive on the other side of the Channel as tariff concerns once again pressed down on sentiment.

The Cac 40 ended 0.96% lower for the day and the Dax index was down 1.14%.

Stateside, the key technology sector had a weak start to trading over concerns related to efforts from China’s government to boost its chip-making companies.

Chris Beauchamp, chief market analyst at IG, said: “The more positive tone for US markets was not likely to last, and tariff reports and chip worries have driven Wall Street firmly into the red.

“Measures in China designed to improve energy efficiency for data centres seem squarely aimed at Nvidia, and the news has dragged the stock, and tech stocks generally, sharply lower.”

Meanwhile, sterling dropped to its lowest against the dollar for two weeks as lower-than-expected inflation suggested there could be more capacity for interest rate cuts soon by the Bank of England.

The pound was down 0.37% at 1.289 US dollars and was down 0.31% at 1.195 euros when London’s markets closed.

In company news, William Hill gambling group Evoke slumped in value during the session after it cautioned over slower sales growth at the start of 2025.

The firm, which also owns 888, also revealed aims to slash costs further over the year ahead to offset soaring wage costs, saying it would strip out between £15 million and £25 million in 2025.

Shares in the business slid by 19.5% to 321.1p at the close.

Ocado was among the day’s top performers after analysts at JP Morgan upgraded the online grocer, suggesting it was now “at an inflection point”.

The brokerage pointed towards improving market share after recent sales growth, helping to drive a jump in demand for the stock.

Ocado shares finished up 16.3% at 2,083.09p as a result.

Virgin Wines UK was 2% lower at 48p despite the retail business reporting that its customer base surged in the second half of last year.

Elsewhere, the price of oil recovered further as reports of tight supplies helped offset recent concerns over demand.

A barrel of Brent crude oil was up by 1.1% to 73.82 dollars (£56.18) as markets were closing in London.

The biggest risers on the FTSE 100 were Shell, up 66p at 2,831p, Next, up 190p at 9,986p, Babcock, up 13.5p at 746p, Kingfisher, up 4.2p at 244.5p, and National Grid, up 14.4p at 979.6p.

The biggest fallers were Admiral Group, down 74p to 2,818p, Smiths Group, down 46p to 1,974p, Schroders, down 7.6p to 374.6p, Polar Capital Technology Trust, down 6p to 312.5p, and Antofagasta, down 36p to 1,890p.