FTSE 100 Live: Stocks to hold steady, retail sales smash forecasts

• Blue chips add six points to 7,949
• Retail sales enjoy Easter bump
• Aviva closes AIGLife purchase

8.55am: The morning so far

Tuesday got off on the right foot with the BRC Retail Sales Monitor showing exceptional March consumption trends as early Easter sales helped to drive sales up 3.6% year on year.

This smashed the 1.8% forecast, though Rob Wood, chief UK economist at Pantheon Macroeconomic, warned that “we expect the BRC measure of retail sales growth to drop back in April as the boost to year-over-year growth from the early Easter turns into a drag”.

There’s nothing further on the UK macroeconomic calendar, with attention shifting to this morning’s company news.

HSBC said it is exiting the Argentina market through a US$550 million (£435 million) sale of its subsidiary to Grupo Financiero Galicia. Galicia is the largest private financial group in Latin America’s second-largest country.

HSBS boss Noel Quinn said the Argentina market “generates substantial earnings volatility for the group when its results are translated into US dollars. Galicia is better placed to invest in and grow the business”. Shares were relatively unbudged, adding 0.2% to 645.8p.

On the small-cap market, Gresham Technologies plc (LSE:GHT) will add to London's raft of stock market delistings after accepting a 163p per share bid from STG Partners.

It marks a 27% premium to last night’s closing price; shares duly rallied by a quarter.

BP said it anticipates higher production results in the first quarter, though also warned of adverse financial impacts due to declines in natural gas marker prices, the devaluation of the Egyptian pound and price lags in BP’s production areas.

The oil major’s shares were up nearly 2% in opening exchanges.

Natural resources stocks were up across the board, with Fresnillo PLC (LSE:FRES) adding 3.8%, Rio Tinto plc 2.2%, Anglo American PLC (LSE:AAL) 1.9% and Antofagasta plc 1.5%.

This is likely due to a surge in precious metals prices after gold hit an all-time high on Monday.

The FTSE 100 reversed early losses to post a six-point gain to 7,949 at the time of writing.

8.28am: BP anticipates higher production but warns on gas prices

BP plc anticipates higher upstream production in the first quarter compared to the previous quarter, per a trading update released on Tuesday.

The oil production and operations segment is expected to be particularly strong, with a slight rise in the gas and low carbon energy segment.

However, BP warned of adverse financial impacts in both segments due to declines in natural gas marker prices, the devaluation of the Egyptian pound and price lags in BP’s production areas.

A combined financial impact of between US$500 million and US$1 billion is predicted for both segments.

The customers and products segment is predicted to benefit from improved refining margins, expected to contribute an additional US$100-200 million.

However, this is offset by a significant reduction in turnaround activity compared to the previous quarter, and impacts from a power outage at the Whiting refinery.

Oil trading results are anticipated to be strong, recovering from weaker performance in the last quarter of 2023, although fuel margins are expected to be weaker.

BP shares added 1.3 in early exchanges In response to the mixed trading update.

The FTSE 100 was last seen six points lower at 7,939.

7.59am: HSBC exits volatile Argentina market

HSBC is exiting the Argentina market through a US$550 million (£435 million) sale of its subsidiary to Grupo Financiero Galicia.

Galicia is the largest private financial group in Latin America’s second-largest country.

HSBS boss Noel Quinn said: This transaction is another important step in the execution of our strategy and enables us to focus our resources on higher value opportunities across our international network.

“HSBC Argentina is largely a domestically focused business, with limited connectivity to the rest of our international network.

“Furthermore, given its size, it also generates substantial earnings volatility for the group when its results are translated into US dollars. Galicia is better placed to invest in and grow the business.”

7.45am: Aviva completes AIG acquisition

Aviva plc has formally completed the £453 million acquisition of AIG Life Limited from Corebridge Financial.

The deal was first announced in September, with Aviva touting “significant capital and expense synergies”.

“It strengthens our prospects in the highly attractive UK protection market and continues our progress in repositioning the group towards capital-light growth,” chief executive Amanda Blanc said at the time.

Blanc was appointed to Aviva’s top position on a mandate to turn the FTSE 100 insurance giant’s fortunes around; acquisitions have played a star role in Blanc’s strategy, including last month’s acquisition of Probitas, which saw Aviva enter the Lloyd’s market.

Aviva itself has been a rumoured takeover target, with the likes of Allianz of Germany, Intact Financial (TSX:IFC) of Canada and the Scandinavian group Tryg reportedly eyeing up a bid.

Aviva’s shares are currently 18% higher year to date.

7.18am: retail sales surge in March

Retail sales in the UK spiked 3.2% year-on-year in March, marking the strongest month since last August and smashing the 1.8% forecast.

Early Easter sales helped to drive up food sales ahead of the long weekend, with analysts also suggesting a rebound in spending points to an easing in cost-of-living pressures.

Helen Dickinson, chief executive at the BRC, said: “After a difficult start to the year, retailers are hopeful that with warmer weather around the corner, consumer confidence will spring back up.

“A strong retail industry can boost investment across our towns and cities, and as we gear up for a general election, it is essential the next government recognises this and rethinks the burdensome costs imposed on retailers."

7.08am: Stocks to open sideways

The blue-chip index is expected to hold onto yesterday’s 32 points of gains, with futures contracts suggesting a flat opening at 7,944.

While the FTSE 100 slipped lower in early Monday trading, the index was able to regain momentum, helped by a surge in mining stocks and strong performances from the likes of Ladbrokes owner Entain, easyJet and Scottish Mortgage.

Some bullish news emerged from the macroeconomic calendar this morning, with the BRC Retail Sales Monitor showing a 3.2% year-on-year spike in March, trouncing the 1.8% forecast.

On the company news front, CMC Markets PLC (LSE:CMCX), Imperial Brands PLC (LSE:IMB) and BP plc will shortly provide some trading updates.