London midday: Stocks flat after OECD growth projections, China data
By Michele Maatouk
Date: Tuesday 03 Jun 2025
(Sharecast News) - London stocks were steady by midday on Tuesday as miners took a hit from disappointing Chinese data, while an OECD downgrade to global and UK growth forecasts dented sentiment.
The FTSE 100 was flat at 8,766.56.
Russ Mould, investment director at AJ Bell, said: "European equity markets struggled to find direction early on Tuesday, with investors still showing signs of nervousness around tariffs and the economic outlook.
"The OECD has downgraded its forecast for global economic growth as the effects of the trade war start to be felt. It's only a small revision - from 3.1% to 2.9% for 2025 - but it's still enough to cause investors some indigestion as they consume their morning news. The downgrade weighed on the mining sector as the market fears it could mean reduced demand for commodities, and therefore a potential knock to the price of metals and minerals.
"The 90-day pause on tariffs has just over a month before expiration, meaning the pressure is on countries to do deals with the Trump administration. Reports suggest that Trump wants best offers on trade negotiations by Wednesday, perhaps to avoid any last-minute rush or stalemate situations."
The OECD also trimmed its forecast for UK growth, from 1.4% to 1.3% this year, and to just 1.0% in 2026.
Heavily-weighted miners were the worst performers after the release of weaker-than-expected Chinese manufacturing data, with Glencore, Antofagasta, Anglo American and Rio Tinto all down.
A survey released earlier showed that activity in China's manufacturing sector unexpectedly contracted in May. The Caixin/S&P Global manufacturing purchasing managers' index fell to 48.3 from 50.4 in April, missing expectations for a reading of 50.7. It marked the lowest level since September 2022.
A reading above 50.0 indicates growth, while a reading below signals contraction.
Wang Zhe, senior economist at Caixin Insight Group, said: "Overall, in May, manufacturing supply and demand declined, dragged by overseas demand. Employment continued to shrink, while prices remained weak. Logistics were delayed moderately, with manufacturing stocks remaining stable. Business optimism recovered slightly from April's low.
"Currently, unfavourable factors affecting China's economic development remain relatively prevalent. Uncertainty in the external trade environment has increased, adding to domestic economic headwinds
"Major macroeconomic indicators showed a marked weakening at the start of the second quarter. The downward pressure on the economy has significantly intensified compared to preceding periods."
Educational publisher Pearson was the biggest loser on the top-flight index after Australia's IDP Education warned of a big drop in testing volumes.
Housebuilders Persimmon, Taylor Wimpey, Barratt Redrow, Vistry and Crest Nicholson were also in the red after a profit warning from MJ Gleeson.
Water company Pennon lost ground after saying it swung to a full-year underlying pre-tax loss of £35.1m from a profit of £16.8m a year earlier.
On the upside, defence and aerospace company Chemring surged to the top of the FSTE 250 as it held annual guidance after it reported a jump in interim profits and record order book amid global geopolitical tensions.
Kier rallied as the construction and property group lifted its operating profit margin target and said it continued to trade well and in line with the board's expectations in the period to 30 April.
British American Tobacco reversed earlier losses to nudge up after it lifted its full-year revenue outlook, saying it now expects growth of 1% to 2%, up from previous guidance of 1%.
Market Movers
FTSE 100 (UKX) 8,771.33 -0.03%
FTSE 250 (MCX) 21,014.49 -0.07%
techMARK (TASX) 4,872.96 0.15%
FTSE 100 - Risers
Centrica (CNA) 162.60p 3.47%
Airtel Africa (AAF) 183.40p 3.15%
Babcock International Group (BAB) 1,039.00p 2.57%
BAE Systems (BA.) 1,965.50p 2.40%
Auto Trader Group (AUTO) 813.00p 2.21%
Rolls-Royce Holdings (RR.) 882.80p 1.61%
The Sage Group (SGE) 1,236.00p 1.39%
Pershing Square Holdings Ltd NPV (PSH) 3,932.00p 1.39%
Fresnillo (FRES) 1,250.00p 1.38%
Coca-Cola Europacific Partners (DI) (CCEP) 6,800.00p 1.34%
FTSE 100 - Fallers
Pearson (PSON) 1,106.00p -4.86%
Anglo American (AAL) 2,163.50p -2.55%
JD Sports Fashion (JD.) 80.58p -2.40%
Rentokil Initial (RTO) 354.60p -2.37%
Antofagasta (ANTO) 1,766.00p -2.16%
Rio Tinto (RIO) 4,295.00p -1.91%
Persimmon (PSN) 1,295.50p -1.89%
Entain (ENT) 736.20p -1.76%
Barratt Redrow (BTRW) 446.30p -1.76%
Glencore (GLEN) 279.80p -1.76%
FTSE 250 - Risers
Chemring Group (CHG) 524.00p 7.71%
Harworth Group (HWG) 174.00p 3.26%
Kier Group (KIE) 173.80p 3.21%
Helios Towers (HTWS) 124.60p 2.98%
The European Smaller Companies Trust (ESCT) 195.60p 2.62%
Petershill Partners (PHLL) 216.00p 2.13%
W.A.G Payment Solutions (WPS) 71.40p 2.00%
AO World (AO.) 105.40p 1.93%
Bloomsbury Publishing (BMY) 528.00p 1.93%
QinetiQ Group (QQ.) 529.00p 1.83%
FTSE 250 - Fallers
Vistry Group (VTY) 587.60p -5.56%
Pennon Group (PNN) 491.80p -3.28%
Ocado Group (OCDO) 245.20p -3.12%
Crest Nicholson Holdings (CRST) 174.20p -2.95%
B&M European Value Retail S.A. (DI) (BME) 329.70p -2.66%
Raspberry PI Holdings (RPI) 464.70p -2.58%
Ibstock (IBST) 192.40p -2.24%
Ferrexpo (FXPO) 50.50p -1.94%
Oxford Nanopore Technologies (ONT) 119.20p -1.89%
Coats Group (COA) 74.30p -1.85%
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