Hot Features
Premium
Register for streaming realtime charts, analysis tools, and prices.
London open: Retail stocks lift FTSE 100 higher early on
UK stocks were on the rise on Tuesday as markets across Europe started the new year in an optimistic mood.
London’s FTSE 100 was up 0.3% at 7,757 after an hour’s trade, after hitting a seven-month high the previous session. Gains were much more pronounced in Europe, however, with indices in Germany, Italy and Spain all up over 1%.
Investors will likely keep a close eye on rising tensions in the Middle East, though sentiment is continuing to be lifted by hopes that the Federal Reserve could soon make a move to loosen monetary policy. Leading indicators from the US will be in focus over the coming days, with minutes of the latest Federal Open Market Committee meeting due on Wednesday, the ADP Employment Report on Thursday and the all-important non-farm payrolls figure on Friday.
“Outside of year-end dynamics and sparsely covered Wall Street trading desks, there remains an increasing belief that Fed rate cuts, which have bullishly marked all capital market trends in the last eight weeks, are still fully ingrained in stock market sentiment,” said Stephen Innes, managing partner at API Asset Management.
“While a stronger-than-expected US jobs report could shake this conviction, a reversal would require a resurgence in realised inflation, triggering a significantly more assertive hawkish stance from Chair Powell and other key figures to discourage March or May rate cuts bets.”
In other news, oil prices were higher after an Iranian warship entered the Red Sea, a channel that handles around one eighth of global commerce, as nations continue to take action against Yemen’s Houthi rebels who have attacked ships bound for Israel. Brent crude futures were up 1.9% at $78.50 a barrel in morning trade.
A barrage of manufacturing purchasing managers’ indices (PMIs) came in mixed on Tuesday, with surveys from a host of eurozone nations beating expectations but remaining firmly in negative territory, with no end to the downturn in sight.
The HCOB manufacturing PMI for the entire eurozone improved from 44.2 to 44.4 in December – its highest in seven months but still well below the 50-point level which separates growth from contraction.
In China, official government figures pointed to a continued contraction in manufacturing while a Caixin Global report indicating a pick-up in growth. The manufacturing purchasing managers’ index (PMI) from the National Bureau of Statistics declined to 49 last month, from 49.4 in November. In contrast, the Caixin manufacturing PMI rose to 50.8 from 50.7 in November, ahead of the consensus estimate pointing to a slowdown to 50.4. While growth remains marginal, this was the fourth positive reading in the past five months.
Retail stocks provide a lift
Retailers were on the rise in London, with M&S, B&M, Next and Tesco among the best performers in early deals. The corporate earnings calendar will be relatively quiet again for the whole week, but trading updates from UK high street retailers Next and B&M will be monitored on Thursday for signs of consumer buying behaviour over the key festive shopping season.
Diversified Energy Company was higher after completing the sale of producing assets in Appalachia to a special purpose vehicle, DP Lion Equity Holdco, while retaining a 20% minority interest and operational control. The transaction generated around $200m in proceeds, allowing the company to reduce its debt by 12%.
Travel stocks were alos in demand, with airlines IAG and Wizz Air, travel agent TUI and hotels giant IHG all putting in decent gains.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Tui Ag | +2.37% | +14.50 | 627.50 |
| 2 |  |
Marks And Spencer Group Plc | +1.95% | +5.30 | 277.70 |
| 3 |  |
International Consolidated Airlines Group S.a. | +1.84% | +2.85 | 157.85 |
| 4 |  |
Land Securities Group Plc | +1.65% | +11.60 | 716.40 |
| 5 |  |
Rolls-royce Holdings Plc | +1.33% | +4.00 | 303.70 |
| 6 |  |
Bae Systems Plc | +1.26% | +14.00 | 1,124.50 |
| 7 |  |
Sage Group Plc | +1.15% | +13.50 | 1,186.00 |
| 8 |  |
Tesco Plc | +1.03% | +3.00 | 293.50 |
| 9 |  |
Centrica Plc | +0.92% | +1.30 | 141.95 |
| 10 |  |
Carnival Plc | +0.88% | +11.50 | 1,324.50 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Fresnillo Plc | -2.02% | -12.00 | 582.40 |
| 2 |  |
Prudential Plc | -2.01% | -17.80 | 869.40 |
| 3 |  |
Taylor Wimpey Plc | -1.22% | -1.80 | 145.25 |
| 4 |  |
Hargreaves Lansdown Plc | -1.17% | -8.60 | 725.40 |
| 5 |  |
Smurfit Kappa Group Plc | -1.09% | -34.00 | 3,086.00 |
| 6 |  |
Scottish Mortgage Investment Trust Plc | -1.06% | -8.60 | 799.40 |
| 7 |  |
Auto Trader Group Plc | -0.83% | -6.00 | 715.40 |
| 8 |  |
Easyjet Plc | -0.78% | -4.00 | 506.00 |
| 9 |  |
Halma Plc | -0.70% | -16.00 | 2,268.00 |
| 10 |  |
Smith & Nephew Plc | -0.70% | -7.50 | 1,071.00 |
US close: Stocks round out banner year with losses
Wall Street stocks registered modest losses in the final session of 2023, ending a banner month, quarter, and year for stocks on a somewhat sour note.
At the close, the Dow Jones Industrial Average was down 0.05% at 37,689.54, while the S&P 500 lost 0.28% at 4,769.83 and the Nasdaq Composite was 0.56% weaker at 15,011.35.
The Dow closed 20.56 points lower on Friday, taking a bite out of gains recorded in the previous session and failing to stretch its Santa Clause rally another session.
Despite losses in the previous session, all three major indices delivered their ninth winning week in a row on Friday, driven by a late-year rally and a bounce back from a disappointing third quarter for stocks.
The S&P 500 had entered the session less than 0.5% from its record high and wrapped up 2023 with a 24.2% gain. The Dow Jones and Nasdaq Composite notched a 13.7% and 43.4% gain for the year, respectively.
On the macro front, the Chicago purchasing managers’ index fell to 46.9 in December, according to the Institute for Supply Management, well below market expectations for a reading of 51. The latest reading seems to show that Chicago’s economy returned to contraction this month after having seen growth in November for the first time in 15 months.
No major corporate earnings were slated for release on Friday.
Tuesday newspaper round-up: Interest rates, NHS strikes, rental crisis, Ford, shop prices
The Bank of England is poised to cut interest rates at least twice in 2024, economists polled by The Times have said, as inflation slides to within touching distance of the official 2 per cent target and as economic growth stalls. A majority of the 41 economists who took part in The Times’s seventh annual economists’ survey said that the Bank of England would partly reverse its aggressive tightening of monetary policy amid downtrodden economic growth and weaker price pressures. – The Times
Britain experienced a record number of excess deaths last year amid repeated NHS strikes and the continued cost of the Covid pandemic. Nearly 53,000 more people died in 2023 than normal – the highest figure recorded in a non-pandemic year since the Second World War, Telegraph analysis shows. Doctors went on strike for 38 days last year, and experts fear the disruption contributed to the high number of excess deaths. – Telegraph
More than 70,000 lone-parent households are facing eviction this winter amid warnings that they are “bearing the brunt” of the housing crisis in England, figures reveal. A survey by Shelter has found that one in seven lone parents who rent privately – more than 74,000 people – and their children are facing homelessness within weeks. – Guardian
Months after production of the multi-decade bestselling Ford Fiesta was ended, the American motor group has retaken the top spot in Britain’s car sales league table with its successor model. Despite being about 15 per cent more expensive than the Fiesta, the bulkier Ford Puma is on course to reclaim Ford’s long-held title as the seller of Britain’s favourite car. – The Times
Shop prices continued to rise at 4.3% in December as a price rise on non-food items offset easing costs on food. The increase in the price of goods in stores compared with a year ago was the same rate of inflation as in November and came after several months of easing. Retailers warned that new border checks on EU goods entering the UK, which are due to begin from April, could further push up prices. – Telegraph
