- FTSE 100 closes 11 points ahead
- Wall Street weaker as data and earnings eyed
- March UK retail sales fall; UK composite PMI hits 12-month high
4.40pm: FTSE finishes strongly
At the close of trading, the FTSE 100 was ahead around 0.2% to finish the week at 7,914 points.
The week ended with US markets edging lower, though in Europe a "more optimistic tone prevails," according to IG's Chris Beauchamp.
"Risk appetite was shaken by the prospect of a fresh standoff between the US and China, which hit Chinese tech stocks early on this morning, but the afternoon session has seen Europe stabilise," Beauchamp noted.
"Overall stocks are still unable to establish a clear direction – having rebounded from the March lows there is a sense of caution about where we go from here.”
3.55pm: US activity back higher
The FTSE 100 consolidated above the 7,900 level with just over half of an hour of the London trading week to go as the mood on Wall Street remains cautious, with US interest rate hike worries compounded after two surveys showed economic activity reaccelerated unexpectedly in April.
S&P Global's composite output index for both the manufacturing and services sectors improved to a reading of 53.5 in April - an 11-month high - up from a reading of 52.3 for March.
The PMI for services rose to 53.7 from 52.6, above the 51.5 consensus estimate, while that for factory activity went to 50.4 from 49.2, better than the consensus forecast of 48.0.
Commenting on the latest survey results, Chris Williamson, chief business economist at S&P Global, said the latest reading was consistent with an annualised rate of growth of just above 2.0%, following the contraction seen over the seven months to January.
He also described the pattern of growth as "reassuringly" broad-based, further noting that price pressures had been rekindled.
3.30pm: Dowlais take a bow
Dowlais Group PLC, the engineering group focused on the automotive sector which was spun off from Melrose Industries, will become a FTSE 250 constituent from next Tuesday, index operator FTSE Russell has said, sending its shares 4% higher to 121.88p.
Melrose completed the demerger of its former GKN Automotive, GKN Powder Metallurgy and GKN Hydrogen businesses into Dowlais on Thursday when the stock began trading on the London Stock Exchange's Main Market.
The new company was named after a South Wales ironworks built in 1759 from which the former GKN engineering group originated, a business Melrose controversially took over for £8.1bn in 2018.
FTSE Russell also said that, as a result, NCC Group Ltd will be downgraded from the FTSE 250 index to the FTSE SmallCap Index on the same day.
3.10pm: All change
Politics is such fun. We've had a mini-Cabinet reshuffle after Dominic Raab earlier today resigned from his dual roles as Deputy Prime Minister and Justice Secretary after an inquiry by barrister Adam Tolley found the politician acted in an intimidating and aggressive way with officials in behaviour that could have amounted to bullying.
Oliver Dowden, previously the Chancellor of the Duchy of Lancaster, a close ally of Prime Minister Rishi Sunak who has been an MP since 2015, has been appointed as Deputy Prime Minister to replace Raab.
Meanwhile, Alex Chalk, another longstanding ally of the Prime Minister, and a current junior defence minister who has also been an MP since 2015, has been announced as the new Justice Secretary.
2.50pm: Breather needed
The FTSE 100 stayed just modestly higher as Wall Street made a cautious start on Friday with US investors taking a breather after a slew of quarterly reports ahead of the start of Big Tech earnings next week.
Around 20 minutes after the market opened, the Dow Jones was flat at 33,787, while the S&P 500 was down 0.1%, and the Nasdaq Composite shed 0.3%.
In terms of major movers, Procter & Gamble shares were trading 4.2% higher after the company raised its full-year outlook and higher prices fuelled a quarterly earnings beat.
Tesla shares were up 0.3% at US$162.46 after the electric vehicle maker’s share price plunged by almost 10% on Thursday, the sell-off sparked by its 1Q results which showed the impact of its vehicle price cuts on margins.
2.30pm: Best of rivals
AJ Bell PLC on Friday named Fiona Clutterbuck, previously a non-executive director of its rival Hargreaves Lansdown PLC, as its incoming non-executive chair, effective from May 1, 2023.
The investment platform company said it believes Cutterbuck will be "the ideal person to lead the board and help AJ Bell capitalise on the growth opportunities that exist in the investment platform market".
Cutterbuck was chair of Paragon Banking Group PLC until September 2022 and is currently a non-executive director of Sampo PLC and Co-operative Bank PLC. She also is the senior independent director of M&G PLC but intends to step down from that role at the company's annual general meeting on May 24.
Back in September, AJ Bell's current chair, Helena Morrissey, announced plans to step down once her successor was appointed. Morrissey had joined the Manchester-based firm in July 2021.
2.15pm: Broken business model
UK insurance brokers face pressure from the Financial Conduct Authority(FCA) to cancel commission payments to landlords after policy costs have soared in recent years.
According to the FCA, 16 sampled brokers passed on over £80mln worth of commission to the likes of property managing agents, landlords and freeholds between 2019 and 2022, with the costs being footed by leaseholders who often had no choice to switch policies.
Most were unable to justify the payments, which coincided with a 40% rise in remuneration since the Grenfell Tower disaster prompted insurers to charge more.
Leaseholders will now be defined as customers under building insurance, the FCA explained, and firms barred from recommending policies based on commission or remuneration levels.
“We expect brokers to immediately stop paying commissions to third parties where they do not have appropriate justification and evidence for doing so,” the FCA said in a statement. “The rule changes would explicitly require insurance firms to act in leaseholders’ best interests."
1.30pm: A few notable risers and falls on the junior market today
Unicorn Mineral Resources PLC (LSE:UMR) saw its share price soar more than 20% higher on the news that it has been granted a permit to drill at its Kilmallock project, in Ireland’s Limerick basin, which is located in the vicinity of Glencore’s Pallas Green project. The explorer said it is now in talks with drill contractors with a view to beginning drilling operations within the next few weeks.
Sureserve Group PLC (AIM:SUR) added nearly 40% to head above 123p after the board agreed to an all-cash takeover offer from private equity firm Cap10 Partners. At 125p per share, valuing the compliance and energy services group at £214.1mln, the offer price is a 38.9% premium to the last closing price of 90p.
UK Oil & Gas PLC (AIM:UKOG) shares advanced in Friday’s deals after it reported oil shows in the Pinarova-1 well, in Turkey, where drilling will continue following a phase of testing,
iEnergizer (LSE:IBPO) shares collapsed 75% to 77p after the outsourcing group announced plans to de-list from AIM. It said the cancellation was in the best interest of the company and its shareholders, citing reasons such as costs, management time, legal and regulatory burdens, limited free float and liquidity, and limited access to capital.
1.05pm: US stocks set for weak open
Wall Street is likely to open lower as mixed earnings reports and economic data that increasingly suggest the US is headed for a recession leave investors reluctant to take a position ahead of the weekend.
Futures for the Dow Jones Industrial Average (DJIA) fell 0.1% in Friday pre-market trading, while those for the broader S&P 500 index shed 0.2%, and contracts for the Nasdaq-100 declined 0.4%.
The main US benchmarks ended lower Thursday on weaker-than-expected earnings from Tesla and AT&T, while the Philadelphia Fed manufacturing index dropped to its lowest level since May 2020 and jobless claims continued to rise. The DJIA lost 0.3% to 33,787, while the S&P 500 declined 0.6% to 4,130, and the tech-heavy Nasdaq Composite shed 0.8% to 12,060.
“Mixed company earnings and softening economic data are keeping a lid on sentiment, as investors ponder the timing and depth of a potential recession,” commented Richard Hunter, head of markets at interactive investor.
“Disappointing Tesla earnings dragged on a Nasdaq index which has otherwise been the star of the show in US markets this year. Profit margins at the electric vehicle maker are under pressure as car prices have been cut, and a net income decline of over 20% from the previous year sent the shares sharply lower.”
Hunter noted that the lack of concrete forecasts from corporates has been another concern, and a general earnings decline is still expected.
Against extremely low expectations, he said most companies have beaten earnings estimates, although next week will provide another acid test. A whole raft of earnings is expected from the likes of Amazon, Alphabet, Meta, Microsoft, McDonald’s, General Motors, Exxon Mobil and Chevron, Hunter added.
12.41pm: Mike Lynch loses extradition battle
Mike Lynch, the founder of Autonomy, has lost a High Court fight to appeal against his extradition to the US, where he faces trial linked to the US$11bn takeover of the software company by Hewlett Packard Enterprise more than a decade ago.
Lynch had applied to the UK court as part of his fight to overturn a 2021 ruling in relation to the extradition, which has already been approved by the home secretary. However, two judges on Friday upheld the earlier decision.
The ruling will come as a blow to Lynch who now faces a criminal trial in California over the 17 allegations, which include conspiracy to commit wire fraud. He strongly contests the allegations.
12.34pm: SSE names new finance chief
SSE PLC (LSE:SSE) has named Barry O'Regan as Chief Financial Officer and an Executive Director effective 1 December 2023.
Outgoing incumbent Finance Director Gregor Alexander will step down from the board on the same date, before retiring and leaving SSE at the end of March 2024 after an orderly transition.
12.19pm: Phoenix follows Aviva out of CBI, Asda pauses engagement - reports
Phoenix Group, the FTSE 100 life insurer, has cancelled its membership of the CBI with immediate effect, according to The Sun.
Phoenix says it took the decision following this morning’s report in the Guardian that a second woman has claimed she was the victim of rape at the CBI.
New: Phoenix Group - UK's biggest savings and retirement business - is cancelling its CBI membership.
PR says: "Further to the allegations reported this morning, we have taken the decision to resign our membership of the CBI with immediate effect."
— Ashley Armstrong (@AArmstrong_says) April 21, 2023
A spokesperson for Phoenix Group said: “Further to the additional allegations reported this morning, we have taken the decision to resign our membership of the CBI with immediate effect,”
Meanhile, The Times is reporting Asda has paused its engagement with the business lobbying group.
*NEW *Asda pauses its engagement with the CBI via @fish_bella : “We are aware that further allegations have been made against the CBI and have decided to pause our engagement with them while these are investigated.”
— Katie Prescott (@kprescott) April 21, 2023
11.56am: Royal Mail workers get 10% pay rise as part of pay deal
International Distributions Services, the owner of Royal Mail has given further detail on the agreement reached between Royal Mail and the Communication Workers Union (CWU).
The pay settlement includes a 10% salary increase and a one-off lump sum of £500 for CWU-grade employees in Royal Mail and Parcelforce.
In addition to the pay increases, agreement has been reached on a profit share scheme over the life of this agreement.
In a statement, IDS said the agreement provides a platform for the next phase of stabilising the business whilst continuing to drive efficiency and change.
“The operational changes in the agreement are designed to improve competitiveness, particularly in next-day parcels, reduce cost and environmental impact, and improve quality of service for our customers,” it claimed.
“A three-year pay deal will provide certainty for our employees and ensure Royal Mail remains the industry leader on pay, terms and conditions,” it added.
Key initiatives in the agreement include later start times to help Royal Mail respond to the market demand for more next-day parcel, seasonal working patterns with more hours worked in the Christmas season, optimised single parcel network for larger parcels, more efficient indoor mail preparation and Sunday working.
The agreement includes a commitment to no compulsory redundancies for the life of the agreement.
Shares in IDS which were trading lower in early exchanges bounced into positive territory, now up 0.8%.
11.19am: Nearly 40% of consumers expect financial situation to deteriorate - UBS
Nearly 4 in 10 people expect their financial situation to worsen in the next 12 months according to a survey of UK consumers by UBS.
The Swiss bank said the 38% figure was a series high and contributed to the overall pullback in purchase intentions for low and high ticket categories.
The survey showed consumers across all income groups are cutting down on discretionary spend.
As a result, UBS sees a drop in low-ticket leisure and vacation spending intentions for low-mid income brackets (below £40,000).
Further, high ticket categories such as cars, kitchens and renovations have subsequently seen a drop in purchase intentions for the next year whilst the likelihood of starting a new savings plan in the £40,000-59,000 income bracket has increased.
In terms of what the survey means for individual stocks, UBS noted DIY spend expectations are trending down which is a negative for Kingfisher PLC (LSE:KGF) given that DIY accounts for c50% of UK revenue.
But is was more positive for Dunelm where UBS noted the firm has seen a revival in purchase intentions for the coming year with high-income consumers continuing to prefer Dunelm to Argos.
As with DIY, spend on Homewares is likely to decline in the coming year. Similar to the last wave, affordability and convenience are likely causing consumers to purchase homewares from supermarkets such as Tesco, Asda and B&M, UBS suggested.
UBS reiterated a buy on Howden Group and a sell on Kingfisher while keeping neutral ratings on Dunelm and DFS.
10.44am: Aviva quits CBI after further allegations
Aviva PLC (LSE:AV.) has quit the CBI following a second allegation of rape from a woman working at the business lobby group.
The Financial Times reported Aviva had cancelled its membership after the latest allegations were published by the Guardian.
The FTSE 100 insurer said it had informed the CBI in writing.
“In light of the very serious allegations made, and the CBI’s handling of the process and response, we believe the CBI is no longer able to fulfil its core function — to be a representative voice of business in the UK,” said Aviva.
“We have therefore regrettably terminated our membership with immediate effect.”
Earlier, the Guardian reported a woman alleged that she was raped by two male colleagues when she worked at the Confederation of British Industry.
The woman told the Guardian the incident took place when she was employed at an overseas office of Britain’s most prominent business lobby group.
She said she blamed the culture at the CBI for having no support after what she claims happened to her.
Separately, Sky Business reported that abrdn, the major fund manager, was also considering its position with the organisation.
10.35am: PMIs suggest UK economy proving resilient
April’s flash PMIs suggest the economy is still proving resilient to the dual drags of high inflation and high-interest rates going into the second quarter, according to Capital Economics UK Economist, Ashley Webb.
Webb said that, and the uptick in the services output prices balance, "gives us greater confidence in our view that the Bank of England will need to raise interest rates from 4.25% to 4.50% in May."
The increase in the flash UK composite PMI from 52.2 in March to 53.9 in April (consensus forecast 52.5, CE forecast 52.0) provides further evidence that the recent concerns over the health of global banks still haven’t weighed on activity, Webb noted.
Like the flash composite PMI in the euro-zone, the UK composite flash PMI suggests the economy grew at the start of the second quarter suggesting "the risks to our forecast of a 0.2% q/q drop in Q2 lie to the upside."
Samuel Tombs at Pantheon Macroeconomics said the figures confirmed that the recovery in the private sector is "gradually gaining momentum."
He estimated the rise in the composite PMI to its highest level in a year was consistent with quarter-on-quarter growth in GDP of about 0.4% in the second quarter.
But explained the PMI does not include construction while ongoing strikes and the extra public holiday for the Coronation will hit GDP in the quarter meaning the overall figure is likely to be flat before then rising by about 0.4% quarter-on-quarter in quarter three.
Tombs stressed the MPC "needn’t stamp on the nascent recovery."
He doubts that the MPC will raise Bank Rate all the way to 5%, as markets currently anticipate; "a 4.50% peak looks more likely to us."
Investors have certainly taken heart from the figures lifting the lead index up 30 points, comfortably 7,900, at 7,932.
10.10am: Man Group advances after UBS upgrade
Over in the FTSE 250, a prominent riser is Man Group PLC (LSE:EMG), where shares rose 3.0% to 212.40p boosted by an upgrade by UBS.
The Swiss bank has moved the stock to ‘buy’ from ‘neutral’ and increased its price target to 255p from 220p, implying around 20% upside from current levels.
“While Man Group's performance fee expectations have fallen sharply following a difficult March at its AHL strategies, we think the 30% share price decline more than reflects this,” analysts at the bank said.
UBS pointed out Man Group is currently trading at just 13.5x 2024E management fee earnings, which implies investors are buying the future performance fee potential at the firm for free.
Unsurprisingly, UBS said “We like that risk-reward.”
On the group’s core franchise UBS is also upbeat noting its technological leadership is an important (and unique, among the listed asset managers) competitive advantage.
“Combined with a unique and increasingly in-demand product set, we think Man Group will continue to generate best-in-class client inflows in the coming years,” the bank added.
Meanwhile, the strong PMI readings have given investors a boost raising hopes of a soft economic landing.
The FTSE 100 is now at session highs, up 27 points, to 7.930, continuing its steady progress back towards 8,000 once more.
9.42am: UK PMI hits 12-month high
Growth in the service sector growth underpinned the fastest rise in UK private sector output for one year in April, according to the S&P Global/CIPS Flash UK PMI.
At 53.9 in April, the headline seasonally adjusted figure was up from 52.2 in March and above the crucial 50.0 no-change threshold for the third month running. The reading was above analysts’ consensus forecasts of 52.5.
Moreover, it signalled the strongest rate of output growth since April 2022.
#UK private sector firms signalled a further increase in business activity with the rate of expansion accelerating to its fastest in a year (#PMI at 53.9; Mar: 52.2). The rate of input cost inflation slowed, but output charges increased steeply. Read more: https://t.co/lByqsf9t6N pic.twitter.com/eU9raeLl9R
— S&P Global PMI™ (@SPGlobalPMI) April 21, 2023
Rising volumes of private sector business activity contrasted with a modest downturn throughout most of the second half of last year.
The latest survey indicated a robust and accelerated increase in service sector output (index at 54.9), with growth the highest for one year.
In contrast, manufacturing production (index at 48.5) decreased for the second month running and at the fastest pace since January.
The contrasting trends for business performance in April largely reflected divergent demand patterns. New order growth hit a 13-month high in the service economy amid rising spending on travel, leisure and entertainment.
Meanwhile, manufacturers attributed a renewed fall in new work to customer destocking, elevated energy costs and subdued demand for big-ticket consumer goods.
Commenting on the flash PMI data, Chris Williamson, Chief Business Economist at S&P Global Market Intelligence said: “Flash PMI surveys signalled an acceleration of economic growth to the fastest for a year in April, building on a modest return to growth in the first quarter of the year.
“Growth is lopsided, however, with surging demand for services contrasting with an ongoing downturn in demand for goods.”
The PMI readings in the UK and the eurozone has given a lift to the FTSE 100, now up 13 points.
9.15am: Eurozone PMI hits 11-month high
The Eurozone flash composite PMI soared to an 11-month high in April, reaching 54.4 (Mar: 53.7) amid a resurgent service sector. Inflation levels moderated, but manufacturing output fell back into decline.
#Eurozone flash #PMI soared to an 11-month high in April, reaching 54.4 (Mar: 53.7) amid a resurgent service sector. #Inflation levels moderated, but manufacturing output fell back into decline. Read more: https://t.co/tXGuQfP3GR pic.twitter.com/JBGoZFmHdz
— S&P Global PMI™ (@SPGlobalPMI) April 21, 2023
The rise was driven by strong growth in the service sector where the flash PMI rose to 56.6 in April from 55.0 in March, a 12-month high.
But it was not such a bright picture in manufacturing where the PMI hit a 35-month low at 45.5.
The news helped push the FTSE 100 into positive territory, up 9 points. In Europe, the Dax has bounced off early lows to trade down 15 points while the CAC 40 moved into the green after opening lower.
ING Economics said: "Overall, it looks like the economy is rebounding from a feeble winter at the moment, but manufacturing weakness remains a concern and dampens the upturn."
8.56am: FirstGroup looking at Arriva bid - Reuters
British transport company FirstGroup and infrastructure fund I Squared are weighing competing bids for parts of Deutsche Bahn's international transport business Arriva, according to a number of people familiar with the matter, according to Reuters.
FirstGroup would likely bid for Arriva's activities outside the UK because of regulatory hurdles associated with further expansion in the country, two of the people said.
The British transport company may also consider partnering with another bidder for the UK operations, the two added.
Infrastructure fund I Squared, which considered making an offer for FirstGroup last year, is now mulling a bid for Arriva, one of the two and another person said.
The German state-owned railway operator has said it aims to close the transaction next year.
Shares in FirstGroup were flat in London in early trading.
8.49am: Sureserve bid "looks cheap" - Peel Hunt
The FTSE 100 has edged lower now, down 6 points, at 7,897 with the fall in retail sales hitting the mood with the sixth wettest March since 1836 blamed for keeping shoppers away.
Danni Hewson at AJ Bell noted: "“No one wants to hit the high street during a downpour and even the most enthusiastic gardeners were probably holed up in their sheds rather than perusing the plant aisles in what was a ridiculously wet March."
“But the British weather can’t take all the blame for falling retail sales. Inflation-weary shoppers have got used to cutting back or cutting out entirely and with prices of essential items like bread and cereal shooting up, some budgets aren’t just feeling the strain, they’re buckling under the weight," she added.
Elsewhere Peel Hunt thinks the 125p per share offer for Sureserve Group PLC (AIM:SUR) “looks cheap” for a “market leader with attractive, defensive positions and a strong management team.”
The bid from private equity firm Cap10 Partners valued compliance and energy services firm at £214.1mln.
Shares in the company soared 33% to 123.18p on news of the approach.
Peel Hunt thinks a competing bid “seems remote,” although it would not discount it.
The broker suggested others have looked at the firm in the past and there may be concerns regarding the outlook for gas boiler maintenance and legacy.
It also pointed out the high level of acceptances for the offer already secured.
Peel Hunt said there was no immediate sector read through, but “would see investors turning their attention to Mears.”
Mears Group shares were 1% to the good in early trading.
8.13am: FTSE muted at the open after weak retail sales
The FTSE 100 made a tentative start to proceedings on Friday with weak retail sales figures adding to the subdued mood as concerns over economic growth rise.
At 8.15am, London’s lead index stood at 7,901.63, down 0.98 points, or 0.012%, while the FTSE 250 edged lower to 19,122.99, down 12.88 points, or 0.067%.
Deutsche Bank said: “The last 24 hours have seen a stronger risk-off move in markets, thanks to another round of weak data releases that strengthened fears of a US recession once again.”
Richard Hunter, head of markets at interactive investor, agreed: “Mixed company earnings and softening economic data are keeping a lid on sentiment, as investors ponder the timing and depth of a potential recession.
Denting the mood in London were UK retail sales figures for March which showed a 0.9% decline, more than the 0.5% fall the City had expected.
But more encouragingly, sales volumes rose by 0.6% in the three months to March when compared with the previous three months; the first three-month-on-three-month rise since August 2021.
Gabriella Dickens at Pantheon Macroeconomics said: “The renewed decline in retail sales in March proves the recovery in January and February was a false dawn and suggests that consumers still are grappling with very high CPI inflation and mortgage rates.”
She expects retail sales to benefit from the 10.1% increase in most benefits in April and the likely fall of households’ energy bills in July but predicts only a gradual recovery over the coming months.
The EY Item Club was a little more optimistic pointing out March's weakness was probably partly driven by unseasonably wet weather, and that more fundamental drivers of retail performance are looking healthier.
The economic forecaster pointed out the jobs market remains resilient, household energy bills are set to fall from the summer, and consumer confidence has picked up.
Martin Beck, chief economic advisor to the EY ITEM Club, said: “2023 should prove a better year for retailers than 2022, when the sector felt the effects of the energy price shock and a post-pandemic shift in spending from goods back to services.”
ING Economics agreed. “Pressure on real wages is set to ease over coming months and consumer confidence has risen from its lows. That suggests the worst is behind us for the UK high street, despite a fall in March sales,” it commented.
The improving confidence referred to was shown in figures from market research firm, GfK.
GfK's Consumer Confidence Index rose for the third month in a row to -30 in April, up six points from March and the highest reading since February last year, just before Russia invaded Ukraine and spurred a surge in energy costs in most of Europe.
April's reading was also above the -35 reading forecast by economists.
Joe Staton, GfK's client strategy director, said there had been a "sudden flowering of optimism" among households.
In company news, and news of a competing bid for Network International Holdings PLC (LSE:NETW) pushed shares in the payments company 11% higher to 400.40p.
The firm revealed it had received a 400p per share approach from Canada’s
Brookfield Asset Management (TSX:BAM.A) only days after a 387p per share proposal from a consortium comprising CVC Advisers and Francisco Partners Management.
With the share price sitting above the level of the latest approach investors are expecting this battle to hot up.
Mining companies were in focus. Glencore PLC (LSE:GLEN) fell 1% despite reporting first-quarter figures in line with its forecasts and holding full-year production guidance.
Shares in Sureserve Group PLC (AIM:SUR) soared 37% after it reached an agreement with Cap10 4NetZero Bidco, a company indirectly owned by Cap10 Partners, on an all-cash takeover for the energy services provider.
Cap10 will pay 125p for each Sureserve share valuing the firm at £214.1mln.
7.50am: Consumer confidence picks up - GfK
While retail sales may be falling a survey of consumer confidence in the UK suggests people are more upbeat than before.
GfK's long-running consumer confidence survey showed consumers were their most upbeat in more than a year this month, despite the surging cost of living, as they took a more positive view of their finances and the health of the wider economy.
GfK's Consumer Confidence Index rose for the third month in a row to -30 in April, up six points from March and the highest reading since February last year, just before Russia invaded Ukraine and spurred a surge in energy costs in most of Europe.
April's reading was also above the -35 reading forecast by economists.
All measures were up over March, with consumers' expectations for Britain's economy in the next 12 months at a 15-month high and they saw the prospects for their personal finances as the brightest since February 2022.
While the country's economy is expected to avoid a recession this year, the broader picture remains weak with double-digit inflation proving harder to tame.
However, Joe Staton, GfK's client strategy director, said there had been a "sudden flowering of optimism" among households.
"The brighter views on what the general economy has in store for us ... could even be seen as the proverbial 'green shoots of recovery'," Staton said.
7.30am: Rival approach for Network International
A battle for Network International Holdings PLC (LSE:NETW) has broken after the payments company revealed a second bid approach.
The company confirmed it has received a “highly preliminary” 400p a share cash offer from Canada's Brookfield Asset Management (TSX:BAM.A).
The offer for the FTSE 250 firm trumps a proposal from a consortium comprising CVC Advisers and Francisco Partners Management worth 387p per share announced on Monday.
“The board of Network is currently evaluating the Brookfield Proposal with its financial advisers and a further statement will be made in due course,” the company said in a statement.
7.10am: Retail sales fall more than expected
Retail sales fell in March by more than City commentators expected after the bounce back in February, according to the Office for National Statistics.
The fall of 0.9% in March, compared to consensus expectations of a 0.5% decline, and followed February’s rise of 1.1% (revised from a rise of 1.2%).
More encouragingly, sales volumes rose by 0.6% in the three months to March when compared with the previous three months; the first three-month on three-month rise since August 2021.
Non-food stores sales volumes fell by 1.3% in March following a rise of 2.4% in February, with feedback from retailers that poor weather conditions throughout most of March affected sales.
Food store sales volumes fell by 0.7% in March following a rise of 0.6% in February.
Non-store retailing (predominantly online retailers) sales volumes fell by 0.8% in March, following a rise of 0.3% in February.
Automotive fuel sales volumes rose by 0.2% in March, following a fall of 1.2% in February; sales remain 8.5% below their pre-coronavirus (COVID-19) February 2020 levels.
7.00am: Subdued start seen in London
FTSE 100 is expected to open flat ahead of retail sales figures which will give a further indicator as to the confidence levels of UK consumers.
Spread betting companies are calling London’s lead index down by around 2 points.
On Wall Street, stocks ended lower as disappointing earnings from AT&T and heavy falls in Tesla weighed on equities.
The Dow Jones Industrial Average closed down 110.46 points, or 0.3%, at 33,786.55. The S&P 500 declined 24.71 points, or 0.6%, at 4,129.81, while the Nasdaq Composite slipped 97.67 points, or 0.8%, to 12,059.56.
In Asia, markets fell. The Nikkei 225 index was down 0.3%. the Shanghai Composite was down 1.4%, while the Hang Seng index in Hong Kong was down 1.2%.
Back in London the early focus will be retail sales figures while a slew of PMI prints are due later today in the UK, EU and US.