British stocks subdued ahead of U.S. data

Britain's main share indexes were broadly unchanged on Thursday ahead of U.S. economic data that could offer cues on the path of interest rates, while lender OSB tanked after a profit margin warning. The exporter-heavy FTSE 100 hovered near nine-month highs hit on Wednesday, while the domestically oriented FTSE 250 edged up 0.1%.

Britain's main share indexes were broadly unchanged on Thursday ahead of U.S. economic data that could offer cues on the path of interest rates, while lender OSB tanked after a profit margin warning.

The exporter-heavy FTSE 100 hovered near nine-month highs hit on Wednesday, while the domestically oriented FTSE 250 edged up 0.1%. Most global markets were in a wait-and-watch mode ahead of U.S. producer price data that could dictate expectations on when the Federal Reserve will start easing monetary policy.

"The market is going to struggle to gain direction until this (U.S. data) is out because it is quite important as far as inflation goes and what the Fed could do as a result," said Lilian Chovin, head of asset allocation at British private bank Coutts. "But, overall, we don't think the largest risk for equities is about inflation, but recessionary data and we don't see any signs of that at the moment."

Despite recent gains on expectations of a soft landing, UK equities have lagged global peers on worries of a slowing economy and uncertainty on the timeline for interest rate cuts. Among big movers, OSB Group slumped 16.5%, on track for its worst day in more than eight months, after the bank said that its 2024 profit margins would broadly be flat year-on-year due to rising funding costs and a subdued mortgage market.

The stock led declines in the midcap index. On the flip side, Trainline Plc jumped nearly 12% after the rail ticketing company raised its adjusted EBITDA forecast for the full year.

Vistry rose 3% after the housebuilder said it would build more homes this year, encouraged by resilient demand for its affordable homes after its 2023 profit beat market expectations. Britain's housing market picked up in February but property surveyors said uncertainty over the Bank of England's interest rates path could temper demand, a closely watched industry survey showed.

Shares of Anglo American fell 4%, while those of NatWest Group dropped 4.5% as they traded without entitlement for dividends. Deliveroo edged up 1% after the meal delivery firm reported better-than-expected core earnings and said it expects to generate positive cash flow.

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