Hot Features
Premium
Register for streaming realtime charts, analysis tools, and prices.
London open: Airlines, financial stocks provide a lift
London’s FTSE 100 advanced on Thursday morning with strong gains from airline and financial stocks providing a big lift, as the index continues to recover from hitting a four-week low on Tuesday.
The UK benchmark index was 0.6% higher at 7,892 by the 0900 BST mark. The Footsie fell sharply on Tuesday (-1.8%) to its lowest since mid-March on the back of escalating tensions in the Middle East and fading hopes of rate cuts by the Federal Reserve.
Things look relatively quiet on the economic data front for Thursday, with US jobless claims, the Philadelphia manufacturing index and national existing home sales being the only major releases of the day.
However, speeches from a number of central bank members will likely garner a lot of attention as financial leaders meet at the International Monetary Fund and World Bank Spring events in Washington.
Airlines and financials rise
Budget airline easyJet was a high riser, gaining 4% after reporting that its winter losses narrowed by more than £50m over the six months through March. The company said that despite challenges like fuel cost inflation and Middle East tensions impacting results, targeted capacity growth, productivity gains and flat year-on-year unit costs excluding fuel contributed to its improvement.
Sector peers Wizz Air and IAG were also in demand early on.
Meanwhile, financial stocks such as Prudential, Phoenix and Standard Chartered were also among the best performers on the FTSE 100.
Leading the fallers was Rentokil Initial reported a 4.9% increase in group revenue for the first three months of 2024, with 3.1% attributed to organic revenue growth and continued pricing momentum. The FTSE 100 firm said growth in North America stabilised, with organic revenue up 1.5%, driven by early initiatives of its growth plan. It saw a positive performance across all regions and categories, with particular progress in technician sales leads participation rates, customer retention, and successful pricing strategies.
On the FTSE 250, shares in Hipgnosis Songs Fund rocketed by more than 30% after the music rights investor said it had agreed a $1.4bn takeover by US-based Concord Chorus, a music and theatrical rights firm. Hipgnosis Songs investors will get $1.16 a share in cash, a 32% premium based on current exchange rates from Wednesday’s closing price.
Dunelm shares dropped 4% after the homewares retailer reported a slowdown in sales growth in its third quarter due to “volatile” trading conditions. The company said total sales in the three months to 30 March were up 3% year-on-year at £435m, compared with 4.5% growth seen in the first half.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
International Consolidated Airlines Group S.a. | +3.95% | +6.35 | 167.05 |
| 2 |  |
Easyjet Plc | +3.36% | +17.40 | 535.60 |
| 3 |  |
Standard Chartered Plc | +2.92% | +18.80 | 662.00 |
| 4 |  |
Tui Ag | +2.49% | +14.00 | 576.50 |
| 5 |  |
Prudential Plc | +2.43% | +16.80 | 709.00 |
| 6 |  |
British Land Company Plc | +1.90% | +7.00 | 376.00 |
| 7 |  |
Hargreaves Lansdown Plc | +1.86% | +13.40 | 735.20 |
| 8 |  |
National Grid Plc | +1.73% | +17.50 | 1,030.50 |
| 9 |  |
Diageo Plc | +1.64% | +46.00 | 2,845.00 |
| 10 |  |
Phoenix Group Holdings Plc | +1.55% | +7.40 | 483.40 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Rentokil Initial Plc | -2.93% | -13.10 | 433.80 |
| 2 |  |
Croda International Plc | -2.16% | -106.00 | 4,801.00 |
| 3 |  |
Bae Systems Plc | -1.67% | -22.00 | 1,298.00 |
| 4 |  |
Spirax-sarco Engineering Plc | -1.32% | -125.00 | 9,325.00 |
| 5 |  |
Bp Plc | -1.32% | -6.80 | 510.00 |
| 6 |  |
Burberry Group Plc | -1.09% | -12.50 | 1,133.50 |
| 7 |  |
Experian Plc | -1.07% | -35.00 | 3,246.00 |
| 8 |  |
Scottish Mortgage Investment Trust Plc | -0.99% | -8.20 | 819.20 |
| 9 |  |
Ocado Group Plc | -0.95% | -3.30 | 344.90 |
| 10 |  |
Ferguson Plc | -0.68% | -115.00 | 16,905.00 |
US close: S&P 500, Nasdaq hit two-month lows as rate-cut hopes sink
US stocks declined on Wednesday, with the S&P 500 and Nasdaq both hitting two-month lows, as investors significantly scaled back their projections for interest-rate cuts.
The S&P 500 and Nasdaq fell for the fourth straight session, dropping 0.58% and 1.15% respectively, with both indices hitting their lowest levels since 21 February.
The Dow, which had snapped a six-day losing streak on Tuesday, was back in the red, falling 0.12% to 37,753.31.
Weighing on sentiment were comments made on Tuesday by Federal Reserve chair Jerome Powell, who said that recent economic data – such as three straight months of stronger-than-forecast inflation – had “clearly not” given the central bank confidence to start easing monetary policy.
Powell pushed back on market expectations for two or three rate cuts in 2024 – projections that were discussed by Fed officials at their latest meeting. “Right now, given the strength of the labour market and progress on inflation so far, it’s appropriate to allow restrictive policy further time to work,” he said.
According to the CME Group’s FedWatch tool, the market is now pricing in a 16% likelihood of an interest-rate cut at its June meeting, compared with 55% just a month ago.
Nancy Vanden Houten, lead US economist at Oxford Economics, said the economic forecasting agency was dialling back its expectations for the first rate cut from June to September, and cutting its prediction for the number of cuts this year from three to two.
“We think the Fed can be relatively confident that wage growth will slow, but as Fed Chair Powell made clear on Tuesday, officials have become less certain about the path for overall inflation,” she said.
In other news, things were relatively quiet on the economic data front, with mortgage applications figures the only major release of the day. Applications rose 3.3% in the week to 12 April, according to the Mortgage Bankers Association of America. This was the sharpest increase in one month, following four consecutive weeks of muted applications. Applications to purchase a new home rose by 5%, while applications to refinance a home ticked up by 0.5%.
Market movers
United Airlines shares were soaring on Wednesday after the carrier beat forecasts with its first-quarter numbers and second-quarter guidance, and finalised a compensation deal with Boeing for damages incurred for grounded jets – though financial details were not given. The stock jumped 17%.
Also surging was Zuora, the enterprise software outfit, which was up 12% on the back of reports that it had received takeover offers.
JB Hunt shares headed south after the transportation services company fell short of expectations on both the top and bottom lines in the first quarter.
Regional bank US Bancorp posted disappointing quarterly earnings and trimmed its lending income outlook on the back of deposit pressures.
Meanwhile Travelers shares suffered their biggest selloff in four years after missing quarterly profit estimates.
Thursday newspaper round-up: Royal Mail, welfare bill, Boeing, Alstom, Federal Reserve
The Labour Party is open to the prospect of a takeover of the owner of Royal Mail by the struggling postal group’s Czech billionaire investor, which is considering a renewed approach. EP Group, a conglomerate controlled by Daniel Kretinsky, revealed on Tuesday that it had made a “non-binding indicative proposal” to the board of International Distributions Services (IDS), Royal Mail’s parent company, on April 9 seeking its recommendation for a possible cash offer for the remainder of the shares it does not already own. – The Times
Jeremy Hunt has vowed to go “further and faster” to slash the welfare bill as he warned of an unsustainable rise in the cost of workless benefits. In an interview with the Telegraph, the Chancellor also said he wanted to cut National Insurance by another 2p before the election but stressed that he would only reduce taxes in a “responsible” way. Hunt said getting more people back to work and slashing the benefits bill would form a key part of the Conservative manifesto as he sought to draw a dividing line between the Tories and Labour on welfare. – Telegraph
Hundreds of people could lose their lives if Boeing fails to address quality issues, a whistleblower warned the US Congress on Wednesday. Sam Salehpour, an engineer at the planemaker, told a high-profile hearing on Capitol Hill that he feared “physical violence” after going public with his concerns. There is “no safety culture” at Boeing, he claimed, alleging that employees who raise the alarm are “ignored, marginalized, threatened, sidelined and worse”. – Guardian
The government has launched a last-ditch effort to keep a historic train factory in Derby open in an effort to ensure it can assemble the rolling stock it has been contracted to deliver for HS2. After more than a year during which Alstom, the owners of the Litchurch Lane works, have been warning ministers that it does not have enough work to remain open, the transport secretary last night agreed to a new commitment to build ten more trains for London’s Elizabeth Line. It is understood that a contract for the extra rolling stock for the metro line that runs across the capital will be signed as early as next month. – The Times
The Federal Reserve chair, Jerome Powell, cautioned on Tuesday that persistently elevated inflation will probably delay any Fed interest rate cuts until later this year, opening the door to a period of higher-for-longer rates. “Recent data have clearly not given us greater confidence” that inflation is coming fully under control and “instead indicate that it’s likely to take longer than expected to achieve that confidence”, Powell said during a panel discussion at the Wilson Center. “If higher inflation does persist,” he said, “we can maintain the current level of [interest rates] for as long as needed.” – Guardian
