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London open: Stocks nudge up ahead of BoE announcement
London stocks were just a touch firmer in early trade on Thursday as investors eyed the latest policy announcement from the Bank of England, which is widely expected to stand pat on interest rates at 5.25%.
At 0825 BST, the FTSE 100 was up 0.1% at 8,212.70.
Policy announcements are also due from the Swiss National Bank and Norges Bank.
Richard Hunter, head of markets at Interactive Investor, said: “Without doubt, the highlight of the day in the UK will come as the Bank of England announces its latest decision on interest rates. The market has ruled out a cut today, but the accompanying comments will be scrutinized for any signs that the Bank is preparing to ease its current grip.
“The decision follows the announcement yesterday that headline inflation fell to 2%, in line with the Bank’s target for the first time in almost three years. However, underneath the bonnet core service prices remained elevated at 5.7%, ahead of estimates, which is likely to consolidate the no-change decision.
“It is believed that the Bank of England considers this measure to be a more relevant measure of inflation risk, and in any event the headline number will likely need to stay at current levels over the coming months before the Bank feels comfortable in pulling the trigger.
“As such, the jury remains out on the timing of such a reduction in rates. In terms of consensus, August is currently a reasonably strong candidate, although there is a growing belief that such a move will not happen until September, or perhaps even later should the current price pressures persist. In any event, there is only one cut being priced in this year, in an echo of the likely path of the ECB and according to its most recent outlook, the Fed also.”
In equity markets, United Utilities, Airtel Africa, Persimmon, Experian, Tate & Lyle and British Land all fell as they traded without entitlement to the dividend.
Tate & Lyle was also in focus after saying it had agreed to buy ingredients company CP Kelco from JM Huber for $1.8bn.
Sainsbury’s was the top gainer on the FTSE 100 as NatWest announced it was buying the core banking business of Sainsbury’s Bank, taking over £2.5bn of outstanding credit card, unsecured personal loan and saving accounts.
CMC Markets shot higher as it posted a 15% jump in full-year net operating income to £332.8m – a new record-high outside of the pandemic.
Energean was up after saying it had signed a deal to sell its portfolio in Egypt, Italy and Croatia to Carlyle International Energy Partners for an enterprise value of up to $945m.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Land Securities Group Plc | +2.21% | +13.50 | 623.00 |
| 2 |  |
Rolls-royce Holdings Plc | +2.14% | +10.10 | 482.60 |
| 3 |  |
Fresnillo Plc | +1.85% | +10.00 | 551.00 |
| 4 |  |
Bt Group Plc | +1.73% | +2.45 | 143.70 |
| 5 |  |
Spirax Group Plc | +1.61% | +135.00 | 8,540.00 |
| 6 |  |
Wpp Plc | +1.60% | +11.80 | 747.60 |
| 7 |  |
Barratt Developments Plc | +1.56% | +7.30 | 476.00 |
| 8 |  |
Antofagasta Plc | +1.36% | +28.00 | 2,085.00 |
| 9 |  |
Melrose Industries Plc | +1.29% | +7.40 | 582.40 |
| 10 |  |
Halma Plc | +1.22% | +32.00 | 2,648.00 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Tui Ag | -2.26% | -13.00 | 561.00 |
| 2 |  |
British Land Company Plc | -2.22% | -9.40 | 414.80 |
| 3 |  |
United Utilities Group Plc | -2.10% | -21.20 | 988.80 |
| 4 |  |
Berkeley Group Holdings (the) Plc | -1.28% | -60.00 | 4,634.00 |
| 5 |  |
Easyjet Plc | -1.21% | -5.50 | 449.60 |
| 6 |  |
Persimmon Plc | -0.84% | -11.50 | 1,353.50 |
| 7 |  |
Tesco Plc | -0.65% | -2.00 | 306.90 |
| 8 |  |
Marks And Spencer Group Plc | -0.59% | -1.80 | 300.80 |
| 9 |  |
Bae Systems Plc | -0.59% | -8.00 | 1,342.50 |
| 10 |  |
Unilever Plc | -0.59% | -26.00 | 4,407.00 |
US close: Nvidia lifts S&P 500 and Nasdaq to new heights
US stock inched higher on Tuesday with the S&P 500 and Nasdaq eking out new record highs on the back of yet more gains from Nvidia, which surpassed Microsoft as the world’s most valuable listed company.
Nvidia was up 3.5% at yet another record closing high of $135.58, having risen 24% so far in June alone. The rise pushed its market cap to $3.34trn, topping Microsoft’s $3.32trn and Apple’s $3.29trn.
Nvidia’s gains helped push the S&P 500 up 0.25% to a new high of 5,487.03, while the Nasdaq edged just 0.03% higher to a fresh record of 17,862.23. The Dow, meanwhile, rose 0.15% to 38,834.86.
However, gains were limited ahead of the Juneteenth US public holiday on Wednesday, with comments from a number of Federal Reserve policymakers likely also weighing on sentiment.
The head of the Richmond Federal Reserve, Tom Barkin, said it wasn’t useful for the central bank to give forward guidance to the markets over interest rates. Barkin acknowledged that May’s inflation report was “very encouraging”, but said more data is needed before the Fed makes any decisions.
In a separate speech, St Louis Fed president Alberto Musalem said rates should only be cut after “months, and more likely quarters” of falling inflation.
Investors were having to contend with scheduled speeches from six members of the Fed on Tuesday, along with a mixed batch of economic data from May.
US retail sales rose by just 0.1% last month, missing the 0.2% growth expected, while April’s change was revised to -0.2% from 0%. Michael Pearce, deputy chief US economist at Oxford Economics, said the figures “leave real consumer spending on track for a gradual slowdown in Q2”.
Meanwhile, US industrial production increased by 0.9% last month, following no change in April and beating the 0.3% reading expected.
Market movers
Chip stocks were continuing to outperform, with Nvidia, Micron Technology and Qualcomm all putting in gains.
Micron was being lifted by comments from Bank of America, which added the stock to its US 1 List – the collection of the bank’s best investment ideas.
“While everyone is still talking about Nvidia being the superstar stock to own, Micron has been putting up a great fight,” said Dan Coatsworth, investment analyst at AJ Bell. “A 133% advance in its share price over the past 12 months might be slightly less than Nvidia’s 204% return over the same period, but it has put Micron on the map of big stock market success stories.”
Banks were also in demand, with Bank of America, Wells Fargo, Citigroup and JPMorgan Chase all on the rise.
Meanwhile, electric car stocks like Tesla and Nikola were in reverse after the bankruptcy of Fisker prompted a sell-off across the sector.
Apple was inching lower after the news that the tech giant is ending its buy now, pay later service which it launched in March 2023.
Adobe rebounded slightly following falls on Monday after the software group was accused by Justice Department on Monday of making it too difficult for customers to cancel their subscriptions.
McDonald’s was lower after the fast food giant ended a two-year experiment to use automated order taking at its drive-through stations.
Thursday newspaper round-up: Amazon, Chinese carmakers, Asos
Labour’s plans for ending Britain’s long-term economic stagnation have been backed by a group of leading economists, including three Nobel prize winners and a former Bank of England deputy governor. In a boost to the shadow chancellor, Rachel Reeves, the 16 UK and internationally based economists said change was “desperately needed” after the policy mistakes and failures of the past 14 years since the Conservatives took power. – Guardian
Officials from the GMB are urging staff at Amazon’s Coventry warehouse to “together, vote yes”, at the start of a month-long ballot process that could trigger a historic union recognition deal. Officials from the union began visiting the West Midlands site on Wednesday after the GMB was granted the right to hold the legally binding ballot by the independent Central Arbitration Committee. Amazon had rejected a request for voluntary recognition. – Guardian
Chinese carmakers have urged Beijing to hit back against European Union tariffs on electric vehicles (EVs) with the “most severe measures” in the latest sign of global trade tensions. At a private meeting organised by China’s ministry of commerce car manufacturers reportedly called on their government to retaliate by imposing tariffs on imported European vehicles with high-powered engines. – Telegraph
The number of children receiving disability benefits has doubled in the past decade amid a rise in learning difficulties, ADHD and autism, the Resolution Foundation has found. In total, there are now 328,000 more children receiving financial support for disability than there were in 2013, the think tank said, taking this year’s tally to 658,000. – Telegraph
Asos has warned staff that virtual meetings have a “detrimental” impact on company performance as it urged staff to adhere to its return-to-office policy. The online fashion retailer has told employees that it will start to take disciplinary action if they do not abide by its flexible working rules. Each department at Asos has different measures, with some teams required to work in the office at least three days a week. – The Times
Consumers are cutting back on eating out, takeaway food, and clothing purchases to save on non-essential spending even as inflation has fallen back to 2 per cent this year. New figures from KPMG show that four in ten British households are saving around £77 a month by reducing expenditure on discretionary items after two years of a cost of living squeeze caused by rising prices. Just under half of those surveyed said their non-essential spending was unchanged this year. – The Times
