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On Wednesday, UK stocks initially remained calm as an uptick in homebuilder stocks due to rising house prices was balanced out by a decline in precious mining stocks. The leading FTSE 100 index showed further signs of weakness shedding 0.75% on the session. On the fundamental front the data indicated that British house prices experienced the highest annual growth rate in a year in January, contributing to early indications of a positive trend in the housing market and boosting the homebuilders' index by 0.7%.

Barratt, the largest homebuilder in the UK, saw a decrease in its shares by 5.7%, while Redrow, a smaller rival, experienced a significant increase of 13.4% to 682.3p following a deal worth approximately 2.52 billion pounds. The deal involves Barratt acquiring Redrow in an all-share agreement in order to enhance the production and delivery of homes. The terms of the deal, which has been approved by the board of directors, entail that each Redrow shareholder will receive 1.44 new Barratt shares. Despite the challenging economic conditions, BDEV CEO David Thomas expressed confidence in the strong underlying demand for their homes. Following the acquisition, BDEV shareholders will own approximately 67.2% of the combined group, with RDW shareholders holding about 32.8%. In 2023, BDEV's stock has risen by approximately 42%, while RDW's stock has increased by about 36%. Hot on the heels of the poor performance seen by BDEV was Sainsurbry’s, Sainsbury's shares fell by 3.6% after announcing a new cost savings target of 1 billion pounds over three years. The company also plans to increase capital expenditure to 800-850 million pounds per year and expects cash costs of around 150 million pounds for the cost-saving program. Shareholders may be disappointed with the rise in capital expenditure and the unchanged forecast for free cash flow. Despite this, the update is expected to meet investors' expectations, but further investment in the business will be required. Sainsbury's stock had gained 39% in 2023, while rival Tesco's shares were down by 2.6% to 282.3p.

On the positive side of the ledger Shares of Smurfit Kappa, Europe's largest paper packaging producer, listed on the London stock exchange, surged by 4.1% to 2,988p following the release of positive Q4 results. The company saw an increase in volumes during the quarter, marking a turnaround from three consecutive quarterly declines that resulted in a 12% drop in core profit for the full year. Q4 core profit came in at 455 million euros, surpassing the consensus estimate of 435 million euros by Barclays. Additionally, the company announced a 10% increase in the final dividend to 118.4 cents per share. CEO Tony Smurfit noted on CNBC that the trend of improving demand has continued into January and early February. Smurfit Kappa's shares have already risen by 2% in 2023.

FTSE Bias: Bullish Above Bearish below 7600

• Below 7580 opens 7510
• Primary support at 7382
• Primary objective 7827
• 5 Day VWAP bearish
• 20 Day VWAP bullish 

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