The FTSE 100 closed down 0.6% at 8,662.97, pressured by a weak Wall Street open and declines in major firms adjusting for dividend payouts. AstraZeneca and BP were among those slipping as their shares traded ex-dividend.

The FTSE 250 declined 0.5% to 20,612.77, while the AIM All-Share lost 0.4%, closing at 716.54.

Lloyds Banking Surges on Earnings Outlook

Lloyds Banking Group jumped 4.9%, approaching a 12-month high, as it projected steady earnings growth in 2025 with further acceleration expected in 2026, despite uncertainty surrounding the car finance investigation.

CEO Charlie Nunn acknowledged the ongoing regulatory probe, with the bank taking an additional £700 million provision in Q4 for potential remediation costs, bringing the total charge to £1.15 billion.

Lloyds reported:

  • 2024 pre-tax profit: £5.97 billion (down 20% from £7.50 billion in 2023)
  • Total income: £34.28 billion (down 3.2%)
  • Net interest margin: 2.95% (down from 3.11% in 2023)

CFO William Chalmers highlighted a significant income boost from the structural hedge, expecting an increase of £1.2 billion in 2025 and a further £1.5 billion in 2026.

Centrica Rises Despite Profit Slump

Centrica climbed 5.6%, buoyed by a surprise £500 million share buyback and an upbeat outlook, despite a sharp decline in profits.

  • 2024 pre-tax profit: £1.68 billion (down 74% from £6.47 billion in 2023)
  • Revenue: £19.91 billion (down 25%)
  • Retail (British Gas) adjusted operating profit: £297 million (down 60%)

The company raised its full-year dividend by 13% to 4.5p, with plans to lift it to 5.5p in 2025.

US Markets Weigh on Sentiment

At the London close:

  • Dow Jones: Down 1.3%
  • S&P 500: Down 0.8%
  • Nasdaq Composite: Down 0.8%

Walmart slid 6.1% as it issued weaker-than-expected earnings guidance for 2025, forecasting $2.50 to $2.60 per share, missing Wall Street’s projection of $2.78.

BAE Systems Slides on US Defence Cuts

BAE Systems fell 3.6% after reports surfaced that US Defence Secretary Pete Hegseth plans to reduce military spending by 8% annually for five years starting in 2026. The US is a critical market for BAE, accounting for nearly half its revenue.

Ithaca Energy and John Wood Gain on Positive Updates

Ithaca Energy surged 9.3% after reporting 2024 oil production at 80,200 barrels per day, exceeding expectations and marking a 14% increase from 2023.

John Wood Group rose 4.3% after securing a $120 million contract extension with Shell UK. This came amid leadership turmoil, as CFO Arvind Balan resigned abruptly following inaccuracies in his professional qualifications.

Ferrexpo Tumbles Amid Ukraine Asset Seizure

Ferrexpo slumped 28% after reports that Ukraine has moved to nationalise its Poltava mining and processing plant, the company’s largest asset, citing an investigation into alleged misappropriation of funds.

Friday’s Key Events

  • Standard Chartered reports full-year results.
  • UK retail sales figures (07:00 GMT).
  • Composite PMI readings in Europe, the UK, and the US.
  • US existing home sales data (15:00 GMT).

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