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London open: FTSE edges lower as investors eye US inflation data
London stocks edged lower in early trade on Tuesday as investors eyed the latest US inflation reading, a policy announcement from the European Central Bank and the start of earnings season across the pond later in the week.
At 0825 BST, the FTSE 100 was down 0.2% at 7,930.05.
Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said equity markets were entering “a holding-pattern scenario ahead of tomorrow’s US inflation data”.
She continued: “With relatively limited corporate news to change the tide, investors are more concerned with macro events this week. Expectations for how much the Federal Reserve will cut rates this year have fallen to their lowest level since October, following unprecedented labour market figures last week.
“Interest rate-sensitive treasury yields have edged higher as a result, and the overall mood across US and European markets is very much a cautious wait-and-see approach today.”
The European Central Bank’s rate decision is due on Thursday, while US earnings season will kick off on Friday.
On home shores, data out earlier showed that the unusually early Easter holidays gave the retail sector a big boost in March.
According to the British Retail Consortium-KPMG Retail Sales Monitor, total retail sales rose by 3.5% year-on-year last month, accelerating from the 1.1% annual rise registered in February, above the three-month average growth rate of 2.1% and the 12-month average growth of 2.9%.
March also saw the strongest growth rate since August 2023, with sales rising at a faster rate than inflation for the first time in more than two years, according to Linda Ellett, UK head of consumer markets at KPMG’s Leisure & Retail division.
Over the three months to March, food sales were 6.8% higher than a year before, while non-food sales were down 1.9% – both in-store and online non-food sales registered a decline.
“High street sales growth was driven by food and drink, health and beauty and keen gardeners who headed outside to enjoy the first days of spring. There were also some signs of improvement with more categories starting to see positive sales growth in March for the first time in months,” Ellett said.
However, Ellett said the UK retail remains a challenging environment, despite a recent improvement in macro conditions. “As April signals big increases in the sector’s cost base – through the rise in minimum wage rates and business rate hikes for the larger high street brands – retailers will be hoping that the bounce back of March sales is more than just an Easter blip,” she said.
“Economic indicators are heading in the right direction with inflationary pressures easing and interest rates having potentially peaked, however consumer confidence remains fragile, and households continue to keep a close eye on where their tight budgets are being spent.”
In equity markets, Halma was the standout gainer on the FTSE 100 after an upgrade to ‘overweight’ from ‘equalweight’ at Barclays.
Oil giant BP ticked up after saying it expects first-quarter upstream production to be higher than the previous three months.
Elsewhere, HSBC Holdings advanced after saying it was selling its Argentina business to Grupo Financiero Galicia for $550m and will take a $1bn pre-tax loss in the process as it continues to pivot its operations towards Asia.
Fund, corporate and private client services group JTC rallied as it raised its growth guidance for the next three years after smashing its targets in 2023, helped by a record amount of new business wins.
Imperial Brands was trading down even as it said it was on track to meet its half-year and full-year financial guidance.
Student accommodation manager and developer Unite was also in the red despite saying it was still confident of hitting rental growth targets for the next academic year while property values held more or less stable in the first quarter.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Fresnillo Plc | +5.13% | +28.50 | 584.50 |
| 2 |  |
Rio Tinto Plc | +2.30% | +119.00 | 5,303.00 |
| 3 |  |
Anglo American Plc | +1.88% | +40.50 | 2,195.50 |
| 4 |  |
Bp Plc | +1.82% | +9.30 | 519.20 |
| 5 |  |
Antofagasta Plc | +1.63% | +36.00 | 2,251.00 |
| 6 |  |
Halma Plc | +1.60% | +36.00 | 2,285.00 |
| 7 |  |
Tui Ag | +1.33% | +9.00 | 684.00 |
| 8 |  |
Johnson Matthey Plc | +1.19% | +21.00 | 1,791.00 |
| 9 |  |
Legal & General Group Plc | +1.15% | +2.90 | 255.60 |
| 10 |  |
Glencore Plc | +1.14% | +5.30 | 472.10 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Ocado Group Plc | -2.67% | -10.00 | 365.10 |
| 2 |  |
Bae Systems Plc | -2.32% | -31.00 | 1,306.50 |
| 3 |  |
Standard Chartered Plc | -2.23% | -15.60 | 683.40 |
| 4 |  |
Rolls-royce Holdings Plc | -2.00% | -8.60 | 420.50 |
| 5 |  |
Marks And Spencer Group Plc | -1.13% | -2.90 | 253.60 |
| 6 |  |
Kingfisher Plc | -1.10% | -2.70 | 241.90 |
| 7 |  |
Whitbread Plc | -1.05% | -34.00 | 3,217.00 |
| 8 |  |
Auto Trader Group Plc | -1.04% | -7.20 | 686.00 |
| 9 |  |
Taylor Wimpey Plc | -0.97% | -1.30 | 132.05 |
| 10 |  |
Next Plc | -0.97% | -86.00 | 8,744.00 |
US close: Stocks mixed as traders await inflation data, Q1 earnings
Wall Street stocks were little changed at the close of trading on Monday as major indices stalled ahead of key inflation data and first-quarter corporate earnings later in the week.
At the close, the Dow Jones Industrial Average was down 0.03% at 38,892.80, while the S&P 500 lost 0.04% to 5,202.39 and the Nasdaq Composite saw out the session 0.03% firmer at 16,253.96.
The Dow closed 11.24 points lower on Monday, taking a small bite out of gains recorded on Friday after a stronger-than-expected jobs report left market participants hopeful that a strong US economy may remain supportive of corporate earnings growth.
Scope Markets’ Joshua Mahony said: “Today represents the calm before the storm, with a largely empty economic calendar giving way to a week that sees US inflation, three monetary policy decisions, and the commencement of the third first quarter US earnings season.
“The impressive strength of the US jobs market may be good news for those hoping to see another set of strong earnings for Q1, yet we could be in for a rude awakening when the US CPI inflation gauge is reported on Wednesday.”
No major data points were released on Monday but traders were patiently waiting for the publication of March’s consumer and producer price indexes, due out on Wednesday and Thursday, respectively.
Investors also continued to navigate rising bond yields and oil prices, with the yield on the benchmark 10-year Treasury note surging to 4.430% on Monday, while US crude oil briefly touched $87.00 per barrel last week amid ongoing geopolitical tensions.
In the corporate space, Tesla shares closed 4.90% higher after chief executive Elon Musk revealed the group’s robotaxi would be unveiled in August.
Tuesday newspaper round-up: Pharma companies, Puig, Thames Water
Rachel Reeves has said an incoming Labour government would launch a £5bn crackdown on tax avoiders to close a gap in its spending plans exposed by Jeremy Hunt scrapping the non-dom regime to finance tax cuts. Warning households and businesses that Labour was prepared to adopt tough measures to tackle tax fraud and non-compliance, Reeves said the funding would be used to pay for free school breakfast clubs and additional NHS appointments. – Guardian
Pharmaceuticals companies were told to make fewer drugs for the sake of the environment, in new draft guidelines for businesses in the Government’s latest net zero drive. The suggestion was among a vast array of proposals which Britain’s biggest businesses have been told to consider as they are ordered to publish lengthy reports every year to show how they plan to meet their net zero targets. – Telegraph
Russia has reportedly asked Kazakhstan to supply it with petrol as Ukrainian attacks on its refineries force it to import gasoline. Kazakhstan has been asked to set up a reserve of 100,000 tonnes of gasoline, equivalent to 845,000 barrels, to supply Russia should shortages arise, Reuters reported. It is unclear if a deal has been reached. The Kremlin has also been seeking supplies from Belarus. – Telegraph
The Spanish family-owned cosmetics group Puig, which owns brands such as Charlotte Tilbury, Paco Rabanne and Carolina Herrera, is preparing an initial public offering, the biggest stock market listing in the beauty sector in years. The Barcelona-based company announced the move to go public on Monday with plans to sell €1.25 billion (£1.07 billion) of new shares and an even larger amount of existing stock through the IPO, taking the total sum raised to more than €2.5 billion. – The Times
The Australian financial group Macquarie is one of the consortium of lenders to Thames Water’s parent company Kemble Water Finance, The Times can reveal. Last week it emerged that the lenders, which also include two Chinese state-owned banks, the Dutch bank ING and Allied Irish Bank, could determine the fate of the troubled utility. – The Times
