The FTSE 100 ended Friday’s session slightly lower, despite a strong performance from banking stocks, as losses in the mining sector offset gains elsewhere. Investors also digested fresh data showing that the UK had a record surplus in public sector finances for January.
The capital’s leading equity index closed down 3.6 points, or 0.04%, at 8,659.37, reflecting a muted day of trading.
Bank stocks lead the charge
Several major UK banks saw their shares rise following recent full-year financial results. NatWest, Standard Chartered, Lloyds, and Barclays were among the biggest risers, helping to cushion broader market losses.
Standard Chartered led the way, climbing 3.8% after reporting a record annual income, buoyed by stronger activity in its wealth and global markets divisions. The bank revealed that its pre-tax profit for 2024 had surged to six billion US dollars (£4.7 billion), an 18% increase on the previous year.
Meanwhile, NatWest’s shares gained 15.7p to close at 451.8p, following a positive market reaction to its financial update earlier in the week.
Mining stocks drag the market lower
Despite banking stocks enjoying a strong session, weakness in the mining sector weighed on the FTSE 100. Fresnillo and Endeavour Mining saw significant losses, contributing to the index’s marginal decline.
Endeavour Mining was the biggest faller, dropping 65p to 1,740p, while other resource-heavy stocks also struggled. The dip in mining shares came as commodity prices softened, with concerns over global demand dampening investor sentiment.
UK reports record public sector surplus
Investors also analysed fresh economic data, which showed that the UK recorded a public sector net borrowing surplus of £15.4 billion in January, the highest since monthly records began.
The figures suggest a stronger-than-expected fiscal position, although government spending exceeded official forecasts, raising concerns over the potential need for tax hikes or spending cuts in the Chancellor’s upcoming March fiscal statement.
European markets see mixed sentiment
Across the continent, stock markets delivered a mixed performance.
- Paris’s CAC 40 rose 0.39%, buoyed by strong earnings reports from French companies.
- Germany’s DAX fell 0.23%, as investors digested disappointing economic data from the eurozone’s largest economy.
In the United States, Wall Street opened lower, with investors showing caution amid inflationary concerns and trade policy uncertainty. By the time European markets closed:
- The S&P 500 was down 0.6%
- The Dow Jones had dropped 0.9%
Pound struggles against the dollar
Currency markets saw modest fluctuations, with the pound slipping 0.2% against the US dollar to 1.265. However, it gained 0.3% against the euro, reaching 1.21.
Market analysts attributed the pound’s decline against the dollar to expectations of further interest rate hikes in the US, while the euro’s relative weakness provided some support to sterling.
Company news: Time out sees revenue drop
In corporate updates, Time Out magazine reported a 20% drop in revenues for the second half of last year, citing economic uncertainty as a key factor in its struggle to secure advertising deals.
Despite the setback, the company expressed optimism about a stronger start to 2025, noting that advertising activity had picked up since the US election in November.
Shares in Time Out fluctuated throughout the session before closing 1.2% lower.
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FTSE 100: Top risers and fallers
The best-performing stocks on the FTSE 100 on Friday were:
🔼 Standard Chartered, up 43p to 1,183p
🔼 NatWest Group, up 15.7p to 451.8p
🔼 Diageo, up 66.5p to 2,190p
🔼 ConvaTec, up 6.2p to 247.4p
🔼 BT, up 3.6p to 150.6p
Meanwhile, the biggest fallers included:
🔽 Endeavour Mining, down 65p to 1,740p
🔽 British American Tobacco, down 70p to 2,965p
🔽 BAE Systems, down 28.5p to 1,255.5p
🔽 Imperial Brands, down 57p to 2,684p
🔽 Mondi, down 26p to 1,239p
Market outlook: A ‘lacklustre’ day
Market experts described Friday’s session as lacklustre, with investors appearing cautious amid ongoing economic and geopolitical uncertainty.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, commented:
“Investors look set to take cues from Wall Street, with the S&P 500 set to fall back further as optimism takes a back seat. The prospect of US trade policy reigniting inflation is front of mind, and the unpredictable state of geopolitics is also causing uncertainty.”
As global markets continue to react to shifting economic trends, traders will be closely watching upcoming corporate earnings reports and central bank decisions in the coming weeks.
The FTSE 100’s performance remains largely stagnant, with banking gains countered by losses in mining and other sectors. Meanwhile, economic data points to a stronger UK fiscal position, but spending concerns persist ahead of the March Budget. Investors now turn their focus to Wall Street and global economic developments for further direction.
