FTSE flat as inflation hits three-year low

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UK stocks traded almost flat by midday on Wednesday after inflation fell to its lowest for more than three years in December.

UK inflation dropped to 1.3% last month, down from 1.5% in November. It raises the prospect of an interest rate cut by the Bank of England on 30 January.

At 1155, the UK's benchmark FTSE 100 index was up 6.16 points, or 0.08%, to 7,628.53.

LARGE AND MID CAP RISERS AND FALLERS

House builder Persimmon firmed 0.9% to £28.22, despite its annual revenue falling 2.4%, as the company curbed its rate of home completions to improve customer service and build quality.

Vistry, the house builder formally known as Bovis Homes, dipped 1% to £13.29 despite announcing that it expected to deliver record annual profits slightly ahead of market consensus.

Technical products supplier Diploma was having a tougher day, reversing 2.3% to £18.57, despite its first-quarter revenue rising 9% on-year.

Strong growth at Diploma's seals sector was offset by a more subdued performance at its life sciences business.

Tullow Oil gained 0.7% to 59.59p, even as it foreshadowed impairment charges and exploration write-offs of around $1.5bn, after it lowered its oil price assumptions and reserves estimates.

The company also stuck to its recently-downgraded production and cash flow forecasts.

Rival oil company Cairn Energy gained 0.5% to 196.4p as it and joint venture partners Woodside and FAR made a final investment decision to develop the Sangomar oil field in Senegal.

Power utility SSE rose 1.3% to £14.77 having completed the sale of its retail unit to OVO Energy, for £500m including debt, following receipt of regulatory approvals.

Precious metals miner Hochschild gained 3% to 169p after it beat its annual production forecast, following stronger-than-expected output in the final quarter.

Emerging markets fund manager Ashmore firmed 1.7% to 556p after its assets under management was boosted in the fourth quarter by positive investment returns and fresh fund inflows.

Builders merchant Travis Perkins traded virtually flat at £16.20 as it appointed Christopher Rogers as chairman designate of soon-to-be separated DIY chain Wickes.

Subprime lender Provident Financial gained 6% to 447.1p on flagging full-year results in line with market forecasts, as a better-than-expected performance at its Vanquis Bank unit offset a weaker showing at Moneybarn.

SMALL CAP RISERS AND FALLERS

Online fashion retailer Quiz slumped 11.9% to 16.55p as its sales dropped 9.3% over the crucial Christmas trading period.

Bowling alley operator Ten Entertainment added 1% to 313p on growing its annual sales by 10.2% after refurbishing some of its sites.

Legal and professional services firm Ince plunged 46% to 47.5p after it launched a cash call at a huge discount to the prevailing price, looking for up to £16m at 45p per share to slash debt and bolster working capital resources.