Hot Features
Premium
Trade smarter, not harder: Unleash your inner pro with our toolkit and live discussions.
London open: Stocks, sterling gain after UK GDP data
London stocks rose in early trade on Friday as investors mulled upbeat UK growth data.
At 0840 BST, the FTSE 100 was 0.8% firmer at 7,659.93 , while sterling was up 0.4% against the dollar at 1.2248 after figures from the Office for National Statistics showed that the economy grew more than initial estimated in the first quarter.
GDP rose by 0.3% between January and March, up from the 0.1% growth previously estimated. This means that GDP is now estimated to be 1.8% above pre- pandemic 2019 levels.
ONS chief economist Grant Fitzner said: “Today’s latest figures show the GDP growth rate is almost unrevised over the last 18 months.
“Our new estimates indicate a stronger performance for professional and scientific businesses due to improved data sources.
“Meanwhile, healthcare grew less because of new near real-time information showing the cost of delivering services.”
GDP growth for 2022 as a whole was also revised up, to 4.3% from a first estimate of 4.1%, while second-quarter growth was unrevised at 0.2%.
In equity markets, JD Sports shot to the top of the FTSE 100 following well-received first-quarter results from Nike across the pond.
Severn Trent advanced after saying it was seeking to raise £1bn for a transformation plan expected to create 7,000 jobs across the Midlands.
Specialist media firm Future surged as it held annual earnings guidance despite volatile markets, but warned that trading conditions remain mixed.
Aston Martin also racked up strong gains after it said chairman Lawrence Stroll’s Yew Tree Consortium has upped its stake in the company to by 3.27% to 26.23%.
Stroll said: “This additional investment demonstrates the Yew Tree Consortium’s continuing confidence and belief in the future of Aston Martin. The company has delivered a major turnaround since the Yew Tree Consortium’s initial investment three years ago.
“We have rebuilt this iconic company, transforming it into an ultra-luxury brand, with a portfolio of highly desirable, performance-driven cars.”
Ascential rallied following a report that buyout firm Apax Partners is in talks to buy its consumer data business, WGSN.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Ocado Group Plc | +5.82% | +33.80 | 614.80 |
| 2 |  |
Croda International Plc | +4.03% | +190.00 | 4,902.00 |
| 3 |  |
British Land Company Plc | +3.73% | +11.50 | 320.20 |
| 4 |  |
Severn Trent Plc | +3.27% | +74.00 | 2,339.00 |
| 5 |  |
Segro Plc | +3.04% | +21.40 | 725.20 |
| 6 |  |
Persimmon Plc | +2.90% | +30.50 | 1,082.50 |
| 7 |  |
Glencore Plc | +2.73% | +12.60 | 473.60 |
| 8 |  |
Land Securities Group Plc | +2.71% | +15.60 | 590.40 |
| 9 |  |
Halma Plc | +2.64% | +50.50 | 1,964.50 |
| 10 |  |
Johnson Matthey Plc | +2.54% | +40.50 | 1,634.50 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Crh Plc | -0.76% | -35.00 | 4,589.00 |
| 2 |  |
Vodafone Group Plc | -0.58% | -0.45 | 77.30 |
| 3 |  |
Bp Plc | -0.57% | -3.10 | 538.00 |
| 4 |  |
Shell Plc | -0.39% | -10.50 | 2,650.00 |
| 5 |  |
Gsk Plc | -0.24% | -3.60 | 1,490.40 |
| 6 |  |
Melrose Industries Plc | -0.19% | -0.90 | 474.00 |
| 7 |  |
Ferguson Plc | -0.14% | -20.00 | 13,785.00 |
| 8 |  |
Rolls-royce Holdings Plc | -0.14% | -0.30 | 221.20 |
| 9 |  |
Bae Systems Plc | -0.10% | -1.00 | 1,017.50 |
| 10 |  |
Nmc Health Plc | -0.00% | -0.00 | 938.40 |
US close: Stocks put in decent gains as bond yields ease
US stocks put in decent gains on Thursday despite a mixed bag of economic data, as bond yields fell back from their recent highs.
The Dow Jones Industrial Average rose 0.4%, while the S&P 500 gained 0.6% and the Nasdaq increased 0.8%.
The 10-year US Treasury yield eased to 4.596% on Thursday, down from an earlier high of 4.647% – a fresh 16-year high on the back of recent resilient economic data and expectations that inflation may remain sticky for some time yet.
A sell-off in government bonds has weighed heavily on stocks in recent weeks – the S&P 500 has fallen by 5% so far this month – as yield levels come worryingly close to forward earnings yields on equity markets.
The forward earnings yield on the S&P 500 is around 5.5%, which leaves just 0.9 percentage points between that and current 10-year Treasury yields – the lowest spread since the early-2000s.
Meanwhile, the very real prospect of a government shutdown next week was also looming large. If no funding bill is agreed on in the next couple of days, a shutdown could begin on Sunday.
“Signs of progress on avoiding a US government shutdown were apparent overnight, but the day has seen opposing plans gain momentum, a sign of the wide split between the two parties,” said Chris Beauchamp, chief market analyst at IG. “Government shutdowns of themselves don’t tend to spark bouts of risk aversion, but as part of a cocktail of other concerns like higher oil prices it could put more pressure on stocks as September gives way to October.”
Economic data comes in thick and fast
US GDP expanded at an annual rate of 2.1% in the second quarter, according to the final estimate from the Bureau of Economic Analysis, in line with the previous estimate and analysts’ estimates.
However, household spending growth was revised down to just 0.8% from an earlier level of 1.7%, though this was offset by upward revisions to non-residential fixed investment, exports, and inventory investment.
Pending home sales dropped by 7.1% in August after 0.9% growth in July, well below the 0.8% decline expected by analysts.
Initial jobless claims increased by just 2,000 to 204,000 in the week to 22 September, coming in under the 215,000 consensus forecast.
Friday will see the release of the personal consumption expenditures price index, the Federal Reserve’s preferred gauge of inflation, which is expected to show that the annual rate of price growth picked u to 3.5% in August, from 3.3% in July. Core inflation however, is forecast to have dipped to 3.9% from 4.2%.
Peloton races ahead
Shares in exercise bike group Peloton jumped after the fitness company announced a five-year strategic partnership with Lululemon.
Micron Technology shares were down after the chipmaker guided to a worse-than-expected loss in its first quarter, despite beating forecasts in the fourth.
Citigroup rose on reports that it was looking to sell its China retail wealth unit to HSBC.
After a shaky start, General Motors, Ford and Stellantis all finished higher on rumours that striking United Auto Workers union members could be pulling back on their pay demands as industrial action entered its 11th day.
Friday newspaper round-up: Deloitte, Apple, BNP Paribas
UK households are facing an average tax rise of £3,500 a year by the next election, the country’s leading economics thinktank has said – the biggest increase over a parliament on records dating back more than 70 years. The Institute for Fiscal Studies (IFS) said that on current forecasts the Conservatives were on track to raise £100bn more annually by 2024 than if taxes as a share of national income had stayed the same as in 2019. – Guardian
The average income of Deloitte’s more than 640 equity partners in the UK rose to £1.1m this year, despite a recent slowdown in spending and company deals. Deloitte UK said revenue grew 14% to £5.6bn in the year to May, as buoyant markets in the first six months of its financial year bolstered demand for audit and advisory work. It helped offset the “increased caution” among more cash-strapped clients and a slowdown in merger and acquisition activity in the months that followed. – Guardian
Thousands of Apple customers have complained the company’s “aerospace grade” titanium-clad iPhone 15 Pro handsets are overheating, just days after they bought them. Buyers of Apple’s iPhone 15 Pro, which starts at £999, and the larger iPhone 15 Pro Max, which costs £1,119, have complained on customer forums, Twitter and Reddit that the devices are getting too hot to hold when conducting video calls, playing games or listening to music. – Telegraph
BNP Paribas has told staff that it is using data from entry-gate swipes and logins to its computer network to track whether they are hitting targets on working from the office. The French bank told its staff in London that the policy was “not a question of trust”, but that changes would allow it to identify and support workers who were finding it difficult to meet on-site working requirements. – The Times
The chairman of Hipgnosis Songs Fund is to step down as the music investment company seeks to shore up shareholder support ahead of critical votes to determine its future. Andrew Sutch, the chairman since 2018, plans to retire amid attempts to win investor backing to continue the company. Another non-executive also intends to go. – The Times
