(Alliance News) - London's FTSE 100 ended a winning week on the back foot, but it was a brighter picture for sterling, while gold leapt again, hitting a new record high.
The FTSE 100 index closed down 35.94 points, 0.4%, at 8,311.41. The FTSE 250 ended down 45.25 points, 0.2%, at 21,048.91, and the AIM All-Share closed down 0.52 of a point, 0.1%, at 774.27.
For the week, the FTSE 100 ended 1.8% higher, the FTSE 250 gained 2.1% and the AIM-All Share firmed 1.0%.
The Cboe UK 100 ended down 0.4% at 830.56, the Cboe UK 250 closed down 0.2% at 18,433.98, and the Cboe Small Companies ended down 0.1% at 16,847.21.
It was a brighter picture in Europe on Friday. The CAC 40 in Paris ended up 0.4%, while the DAX 40 in Frankfurt closed up 0.8%.
In New York at the time of the London close, the DJIA, the S&P 500 and the Nasdaq Composite were all little changed.
The pound was boosted by strong retail sales figures which ended a week of strong domestic economic data.
Retail sales volumes rose 0.5% monthly in July after a decline of 0.9% in June from May, the Office for National Statistics reported. The June estimate was upwardly revised from a previously reported 1.2% fall.
On-year, retail sales growth was 1.4% in July, as the ONS noted that comparably poor weather hurt sales in July 2023.
Matt Jeffers, retail strategy & consulting managing director for Accenture in the UK & Ireland said: "A hat-trick of the Euros, Wimbledon and Olympics has brought a moderate boost to retail sales in July, helped along by the warmer weather. With holiday season well underway, retailers benefited from a strong performance in department stores and sports equipment."
Pantheon Macroeconomics Chief UK Economist Rob Wood said the figures showed retail sales growth is "steadily, if unspectacularly", trending up as UK consumers' real income growth improves.
The retail sales figures followed numbers on Thursday which showed the UK's economic recovery remains intact. Gross domestic product rose 0.6% in the quarter to June, little changed from 0.7% in the first three months of 2024.
In response, the pound made ground against the dollar.
Sterling was quoted at USD1.2899 at the London equities close Friday, up from USD1.2866 at the close on Thursday. The euro stood at USD1.0995, up slightly against USD1.0988. Against the yen, the dollar was trading at JPY148.24, down compared to JPY148.89.
The weaker US currency helped push gold to a new record high.
Gold was quoted at USD2,486.76 an ounce, higher against USD2,456.75 at the close on Thursday. It earlier hit a new high of USD2,492.55 an ounce, AFP reported, as investors snapped up the safe haven investment in the face of a likely US interest rate cut and heightened geopolitical risks.
Gold surpassed its previous record, set in July, after lacklustre US housing construction data reinforced expectations that the US Federal Reserve will cut interest rates in September.
"The underlying trend remains bullish [...] there are little fundamental justifications for short selling gold," City Index analyst Fawad Razaqzada commented.
"In fact, some would argue that gold remains undervalued given the big devaluation and loss of purchasing power fiat currencies have suffered across the world in recent years owing to high inflation," he added.
In the FTSE 100, housebuilders were prominent among the fallers. The strong GDP and retail sales data were viewed as lessening the chances of a September interest rate by the Bank of England.
Rate-sensitive housing stocks such as property portal Rightmove fell 2.6%, while housebuilders Berkeley Group, Persimmon and Taylor Wimpey declined 2.6%, 1.5% and 1.2% respectively. Property firm Segro slipped 1.4%.
GSK fell 0.3% despite a favourable US court ruling regarding Zantac.
The London-based pharmaceutical company said the Florida state court excluded the plaintiff's experts' general and specific causation testimony that ranitidine, known as Zantac, was a significant risk for Wilson's prostate cancer.
GSK said it welcomed the Daubert's ruling and will now seek dismissal of the upcoming Wilson case in Florida, whereby plaintiffs alleged a causal link between ranitidine and prostate cancer.
The Daubert standard in the US provides criteria for evaluating whether expert testimony is admissible.
Zantac was a heartburn drug that was pulled off the market in 2020 at the request of the US Food & Drug Administration, after low levels of a "probable carcinogen" were found in samples.
The carcinogen, known as NDMA, is not harmful in very small amounts. However, tests showed that there were excessive quantities of NDMA in ranitidine, otherwise known as Zantac.
Sean Conroy at Shore Capital said this is another positive outcome for GSK and continues to support the view that there is no reliable evidence that Zantac caused certain cancers and that GSK has strong grounds to continue defending itself in ongoing litigation.
Among London's small caps, Evoke jumped 11% after management, including the chief executive, picked up stock in the Gibraltar-based betting and gaming company.
Evoke, formerly known as 888 Holdings, owns the William Hill betting chain.
On Thursday, CEO Per Widerstrom bought 900,000 shares at 55.1 pence each, totalling GBP495,900. Non-Executive Chair Jon Mendelsohn bought 250,000 shares at 55.2p worth GBP138,000.
Gaming stocks also benefited from a positive read-across from this week's news that Playtech is holding talks with Flutter Entertainment regarding the possible sale of its Snaitech business.
Flutter Entertainment also issued a bullish trading update on Wednesday, raising guidance after reporting strong financial results for the second quarter, partly thanks to favourable results for the company from betting on the Euros.
On Friday, Playtech rose a further 3.5%, adding 24% this week. Entain, which owns Ladbrokes and Coral, climbed 2.7%, rising 14% this week.
Flutter, itself was flat on Friday, but has risen 6.3% this week.
On AIM, Biome Technologies plunged 35% after a profit warning.
The Southampton, England-based bioplastics and radio frequency technology business said revenue fell 36% to GBP2.3 million in the half year that ended June 30 from GBP3.6 million a year previous. Looking ahead, full-year revenue is expected to be "significantly below" expectations, albeit still ahead of GBP7.0 million reported in the previous year.
In addition, Biome proposes a fundraise of GBP1.0 million for working capital purposes.
Brent oil was quoted at USD79.91 a barrel at the London equities close Friday, down from USD81.30 late Thursday.
By Jeremy Cutler, Alliance News reporter
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