The FTSE Finish Line: May 20 - 2025
Patrick Munnelly, Partner: Market Strategy, Tickmill Group.
The FTSE 100 in the UK surged to a two-month high on Tuesday, driven by Diploma shares reaching a record peak following an upbeat forecast. Positive earnings reports from other companies further bolstered market sentiment. The result marks the fourth consecutive day of gains for the FTSE 100, as global markets regained stability after Monday's shock from Moody's unexpected U.S. credit rating downgrade. On the same day, Britain secured a wide-ranging agreement with the EU, encompassing a security and defence pact, eased restrictions for British food exporters and tourists, and a controversial new fishing accord. Meanwhile, Huw Pill, Chief Economist at the Bank of England, expressed concerns over the central bank's pace of interest rate cuts, deeming it too rapid given persistent wage pressures fuelling inflation. Earlier this month, the Bank of England reduced interest rates by a quarter point to 4.25% in a split decision, with Pill advocating for holding rates steady. Looking ahead, Britain's inflation data, set for release on Wednesday, is anticipated to show a sharp rise in consumer prices for April, largely driven by soaring energy costs.
Single Stock Stories & Broker Updates:
Shares of Greggs rise 8.6% to 2,174p, making it the top gainer on the FTSE mid cap index, which is up 0.1%. The company reports a 2.9% year-on-year like-for-like sales growth in the first 20 weeks, up from 1.7% in the first 9 weeks, and maintains its full-year forecast. Jefferies notes the improved LFLs indicate easing volume pressures, suggesting potential growth in 2025. Despite the gain, the stock is down 28.3% year-to-date.
Renold shares rose nearly 37% to 75p, the highest since September 2015, and are on track for their largest one-day percentage gain since April 2020. The company is considering two non-binding cash takeover offers, with a market value of about £169 million ($225.95 million). The latest bid from Buckthorn Partners and One Equity Partners is at 81p per share, while Webster Industries offered 77p. Year-to-date, the stock has gained nearly 63%.
Shares of Smiths Group rise 4.4% to 2,144p as the company projects FY organic revenue growth at the high end of its 6–8% forecast, with Q3 sales up 10.6%. They expect limited tariff impact on U.S. operations due to their local-for-local model. JPMorgan analysts suggest a cautious Q4 organic growth forecast of ~3%. Of 15 brokerages, 10 rate the stock "buy" or higher, with a median price target of 2,430 pence. The stock has gained 24.7% this year.
Vodafone shares rose 1.5% to 73.54 pence. The company expects Germany, its largest market, to contribute to revenue growth this year, which will boost cash flow. Vodafone reported 2025 adjusted core earnings of 10.9 billion euros and anticipates 2023 earnings between 11 billion and 11.3 billion euros, alongside a 2 billion euros buyback programme. CEO Margherita Della Valle stated they expect overall momentum in Europe and Africa. VOD stock is down 6.1% year-to-date.
Centrica is up 1.7% at 154.6p after announcing Spirit Energy will sell a 46.25% stake in the Cygnus gas field to Ithaca Energy for about £116 million. Ithaca Energy is up 1.2% at 134.6p. Centrica expects to receive 69% of the headline consideration, totalling £80 million. Spirit Energy will gain £215 million from the deal, including £116 million and £99 million in decommissioning liabilities. Ithaca anticipates a production increase of 12.5 to 13.5 kboe/d in 2025. Year-to-date, Centrica is up 15.63% and Ithaca Energy is up 22.28%.
Technical & Trade View
FTSE Bias: Bullish Above Bearish below 8700
Primary support 8500
Below 8500 opens 8250
Primary objective 8900
Daily VWAP Bullish
Weekly VWAP Bullish
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Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!