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London open: Stocks steady as investors mull central bank announcements
London stocks were steady in early trade on Friday as investors paused for breath after a slew of central bank policy announcements this week.
At 0840 GMT, the FTSE 100 was flat at 7,645.67.
Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said: “Investors are chewing through an enormous amount of data from central banks in recent days, with the pause button for interest rates still the go-to.
“The pressure could be mounting though, as markets are still largely behaving as though these pauses are pivots, but it’s likely that cuts are further away than investors are expecting. The huge resilience of economies so far has been a pleasant surprise, but that doesn’t mean challenges aren’t coming down the tracks, and recessions, and earnings shocks, can’t be ruled out just yet.”
On home shores, a survey out earlier showed that consumer confidence edged higher in December as people became more optimistic for the year ahead.
GfK’s consumer confidence index, which has been running since 1974, rose two points this month to -22.
Within that, all five measures showed modest improvement. The personal finance situation for the coming year ticked up 1 point at -2, while the outlook for the general economic situation also improved by 1 point, to -25.
The major purchase index rose one point to -23.
Joe Staton, client strategy director at GfK, said: “Against the backdrop of flattening economic growth, interest rates at a 15-year high and price rises potentially eroding disposable income for years to come, the index shows a modest improvement this month.
“Although the headline figure of -22 means the nation’s confidence is still firmly in negative territory, optimism for our personal finances for the next 12 months shows a notable recovery from the depressed -29 this time last year.
“Recovery in this number is importanta, as it best reflects household financial optimism and control over personal budgets.”
The survey of 2,003 individuals aged 16 and over was carried about between 29 November and 8 December.
Still to come, the S&P Global/CIPS flash manufacturing PMI for December is due at 0930 GMT.
In equity markets, Trainline surged after the government scrapped plans to develop a ticketing website and app under its Great British Railways proposals. JPMorgan said the news was a “clear positive” for the booking platform.
“The proposed withdrawal removes a key overhang to Trainline’s investment case, where building investor concerns have been around changes in UK rail regulation (a new GBR app) which drove a de-rating relative to classified peers, and overshadowed strong passenger momentum and improved operational delivery, in our view,” the bank said.
Outside the FTSE 350, Naked Wines rallied as it reiterated plans to turn the business around, despite falling deeper into the red and posting a slump in half-year revenues.
The AIM-listed online retailer said total revenues in the 26 weeks to 2 October had fallen 20% to £132.3m, while pre-tax losses widened to £9.7m from £0.2m a year previously.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Smith (ds) Plc | +4.33% | +13.10 | 315.40 |
| 2 |  |
Glencore Plc | +3.13% | +14.20 | 467.95 |
| 3 |  |
Anglo American Plc | +2.38% | +42.80 | 1,838.20 |
| 4 |  |
Antofagasta Plc | +1.75% | +28.50 | 1,660.00 |
| 5 |  |
Persimmon Plc | +1.69% | +23.00 | 1,381.00 |
| 6 |  |
Scottish Mortgage Investment Trust Plc | +1.57% | +12.20 | 788.20 |
| 7 |  |
Bhp Group Limited | +1.54% | +39.50 | 2,598.50 |
| 8 |  |
British Land Company Plc | +1.40% | +5.80 | 418.90 |
| 9 |  |
Flutter Entertainment Plc | +1.39% | +185.00 | 13,480.00 |
| 10 |  |
Land Securities Group Plc | +1.38% | +9.80 | 718.00 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
St. James’s Place Plc | -1.86% | -13.20 | 697.80 |
| 2 |  |
Tui Ag | -1.85% | -11.50 | 609.50 |
| 3 |  |
Croda International Plc | -1.83% | -94.00 | 5,038.00 |
| 4 |  |
Astrazeneca Plc | -1.82% | -190.00 | 10,278.00 |
| 5 |  |
Auto Trader Group Plc | -1.56% | -11.40 | 719.20 |
| 6 |  |
Smith & Nephew Plc | -1.48% | -16.00 | 1,066.00 |
| 7 |  |
Rolls-royce Holdings Plc | -1.43% | -4.30 | 295.70 |
| 8 |  |
Standard Chartered Plc | -1.25% | -8.20 | 646.80 |
| 9 |  |
Burberry Group Plc | -1.24% | -19.50 | 1,549.50 |
| 10 |  |
Hikma Pharmaceuticals Plc | -1.10% | -19.50 | 1,761.00 |
US close: Stocks extend FOMC-fuelled rally
Wall Street stocks added to the previous session’s gains triggered by more dovish than expected interest rate forecasts from the Federal Reserve.
At the close, the Dow Jones Industrials was up 0.43% at 37,248.35, while the S&P 500 advanced 0.26% to 4,719.55 and the Nasdaq Composite saw out the session 0.19% to 14,761.56.
In parallel, the yield on the benchmark 10-year US Treasury note was roughly ten basis points lower at 3.923%, while its two-year counterpart was trading hands at 4.403%.
Thursday’s gains come after the blue-chip Dow index jumped more than 1% on Wednesday to hit a fresh record high of more than 37,000 on the back of hints from the Federal Open Market Committee that rates will be cut up to three times in 2024, instead of two.
Also in focus throughout the session was a spate of economic data all came in ahead of forecasts. Retail sales volumes for November were reported by the Department of Commerce, up 0.3% month-on-month, ahead of consensus for a -0.1% drop, while the Labor Department revealed initial jobless claims for the week ending on 9 December fell by 19,000 to 202,000. So too, import prices declined at a month-on-month clip of 0.4% in November, better than consensus estimates for a -0.8% drop.
In the corporate space, shares of Adobe were down by 7% following somewhat muted guidance for both earnings and revenue in 2024.
Friday newspaper round-up: Coal, Walt Disney, auditors
Almost 200 homes in London have been sold for £10m in the past year as the super-rich’s pandemic-inspired desire for a place in the country wanes compared to their wish for swish bolt-holes in the capital. A total of 175 homes were sold for £10m-plus in the 12 months to November 2023, the highest number for eight-years, according to research by the estate agent Knight Frank. – Guardian
New direct high-speed train routes from London to Cologne, Frankfurt, Geneva and Zurich could be up and running within five years, according to the Eurotunnel owner, Getlink, after work to double the capacity of UK rail links to Europe. While the Channel tunnel, which celebrates its 30th anniversary in May 2024, has struggled to extend its passenger offerings beyond Eurostar’s original London to Paris and Brussels services, Getlink said new entrants and destinations could now arrive swiftly. – Guardian
Global demand for coal will hit a record high of 8.5bn tonnes in 2023 despite the worldwide push for net zero, the International Energy Agency has warned. Rising usage of coal in China and India has driven an increase in demand, which comes just days after the Cop28 climate summit agreed to “transition away” from fossil fuels to help hit net zero targets by 2050. – Telegraph
Walt Disney is bracing itself for a bitter proxy battle as the activist investor Nelson Peltz is seeking two seats on its board, pressing ahead with his second such challenge this year. His firm, Trian Fund Management, which owns roughly $3 billion worth of Disney shares, abandoned an earlier bid for one board seat in February. Yesterday it nominated Peltz and James Rasulo, former Disney chief financial officer. – The Times
The accounting watchdog has pledged to address the lack of competition in the industry next year amid concerns that the four largest audit firms continue to dominate the market. The Financial Reporting Council warned that the audit market “remains highly concentrated” as the so-called Big Four firms — KPMG, Deloitte, EY and PwC — still earn the lion’s share of fees from large listed companies. – The Times
