- FTSE 100 up 16 points
- NatWest and Shell lead risers
- House prices near record
4.02pm: Blue chips head toward positive finish
The FTSE 100 appeared on course to end Monday in positive territory, having gained 16 points to reach 8,297 come late trading.
NatWest Group PLC (LSE:NWG) remained the index’s biggest winner following news house prices ticked up for a third successive month in September, in turn spelling good news for mortgage lenders.
Shell PLC (LSE:SHEL, NYSE:SHEL) followed after a cut to third quarter guidance did not appear to deter investors as oil prices continued to edge up throughout Monday on persisting fears around escalations in the Middle East.
Come the afternoon, benchmark Brent crude was trading at US$79.69 a barrel for a 2.9% gain for the day, with BP PLC (LSE:BP.) also among the day’s risers.
Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) was the day’s biggest faller in the meantime, with its drop coinciding with a further decline in the price of gold.
After coming under pressure on scaled back expectations for interest rate cuts in the US following strong job market data late last week, the yellow metal fell by 0.38% to US$2,644 on Monday.
3.44pm: Online shopping firm Very Group gears up for £2.5bn sale
Very Group, an online shopping firm owned by former Telegraph proprietors the Barclay family, is reportedly gearing up to be sold.
According to Sky News, Barclays, JP Morgan and Morgan Stanley (NYSE:MS) are in line to manage a review of the group ahead of an auction.
This could result in a sale of the business for around £2.5 billion, Sky reported, with the investment banks set to be appointed in the coming days.
Ex-chancellor Nadhim Zahawi has chaired Very Group since earlier this year, with the firm boasting annual sales of £2.15 billion.
3.31pm: Industry ramped up lobbying prior to UK’s £22bn carbon capture pledge - report
Oil and gas firms reportedly ramped up efforts to lobby the government before £22 billion was pledged last week to support Britain’s carbon capture sector over the next 25 years.
Environmental journalism site DeSmog reported the likes of ExxonMobil, Equinor and BP PLC (LSE:BP.) attended far more ministerial meetings to discuss the technology in 2023 than previously.
Oil and gas firms attended 24 of 44 such meetings last year, against around seven to 10 annually between 2020 and 2022, when roughly half the number were held.
Britain’s government firmed up the plans to inject £21.7 billion into the sector last Friday, opening the door for subsidies to be offered to firms to fit carbon capture technology at industrial sites... Read more
DeSmog, through freedom of information requests, found researchers, climate groups and local councils were less well represented at meetings than firms and the likes of lobby groups.
“Fossil fuel companies often have the engineering knowhow to build these projects, so the government naturally has to meet with them,” Institute for Public Policy Research environmental policy researcher Laurie Laybourn said.
“But that might create a risk whereby these companies unduly influence policy and rollout in a way that benefits them.”
2.55pm: US stocks drop at open
Wall Street suffered a negative start as trading got underway on a quiet Monday ahead of the start of the third-quarter earnings season later in the week.
The Nasdaq dipped 0.4% following the bell, while the Dow Jones and S&P 500 each fell by 0.3%.
This follows a strong showing across the board last Friday on better-than-expected non-farm payroll data, which prompted bets over further steep rate cuts to be scaled back.
Attention this week is set to be on Thursday’s inflation data before third-quarter earnings season gets underway at the end of the week.
“Investors might be holding out for more data points to support the suggestion that an economic downturn can be avoided,” AJ Bell analyst Russ Mould commented, after Friday’s figures showed 254,000 jobs were added across the US economy in September.
2.36pm: GDP uptick forecast by Deutsche
Deutsche Bank analysts have set out expectations for an uptick in UK gross domestic product ahead of figures later this week.
Following two flat readings in June and July, Deutsche said on Monday that GDP was expected to have increased by 0.3% month on month in August.
This would be driven by a 0.6% increase in construction output, Deutsche forecast, alongside 0.2% upticks across the service and industrial sectors respectively.
“Risks are skewed to the upside, we think,” Deutsche added, with the figures due from the Office for National Statistics on Friday.
These could also see July’s reading revised up to 0.1%, analysts said, following the initial weaker-than-expected 0.0% print.
2.07pm: Jaguar Land Rover sales drop as production constrained
Jaguar Land Rover has said sales fell over the second quarter as supply issues restricted production and demand faltered in Europe and China.
Sales fell by 3% year on year to 103,108 units, the Tata Motors-owned carmaker reported on Tuesday.
Sales across the UK and North America climbed by 29% and 9% over the quarter, but were down by 22% across Europe and 17% in China.
This coincided with a 7% drop in production to around 86,000 units, which had been constrained due to disrupted aluminium supplies, according to the company.
Jaguar Land Rover noted the issue was caused by disruption at one “key high-grade aluminium supplier,” which was said to have affected multiple original equipment manufacturers.
“We expect both production and wholesale volumes to pick up strongly in the second half of the financial year as the aluminium supply situation normalises,” the company added.
Over the half year, sales increased by 3% to 214,288 units.
1.44pm: Index holds gains as NatWest tops risers
The FTSE 100 held onto gains into Monday afternoon, having climbed by 34 points to 8,315 after bouncing between positive and negative territory earlier.
NatWest Group PLC (LSE:NWG) topped the day’s risers with a 2.8% gain, following Halifax’s report in the morning that house prices had climbed for a third successive month in September.
“A pick-up in housing market activity should drive more business to mortgage lenders,” AJ Bell analyst Russ Mould noted, with demand fuelling a 4.7% increase in prices over the month, marking the fastest growth since November 2022.
Shell PLC (LSE:SHEL, NYSE:SHEL) followed, having risen by 1.8%, while BP PLC (LSE:BP.) was also among risers as oil prices continued to tick up on Monday fuelled by fears over escalations in the Middle East.
Both had made headlines earlier on, with Shell cutting third-quarter guidance on lower refining margins, while reports emerged that BP was to ditch plans to reduce oil and gas output by 2030.
Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) and Fresnillo PLC (LSE:FRES) sat among the FTSE 100’s biggest fallers in the meantime, as the price of gold moved lower into the afternoon after coming under pressure last week on reduced expectations for US base rate cuts ahead.
Come the afternoon, the yellow metal was trading at US$2,644 an ounce, marking a 0.35% decline for the day.
12.55pm: John Lewis boss steps back as chief executive role scrapped
John Lewis Partnership chief executive Nish Kankiwala is to step back into the role of a non-executive after new chairman Jason Tarry joined the company last month.
Kankiwala had taken the helm in 2023 to assist former chair Sharon White and will step down next March following two years in the role.
“I was delighted to agree to take on the role for a two-year period during this time of pivotal change,” he said on Monday.
“Since then we’ve refreshed our partnership strategy to be rooted in retail; significantly improved our cash flows to enable record investment for growth; and returned [...] to full-year profit.”
John Lewis, which incorporates the department store and supermarket Waitrose, cut pre-tax losses from £59 million to £30 million over the first half of the year.
Profits were on course to come in “significantly higher” over the full year, it added at the time.
Kankiwala added he had been brought in as chief executive to “accelerate [...] the transformation” of the partnership, following a tough period post-pandemic.
12.29pm: Wall Street set to fall back as third-quarter earnings season looms
Futures showed Wall Street facing a tough start to the week as third-quarter earnings season rapidly approached and after strong jobs data late last week saw stocks rally.
The Nasdaq was seen shedding 0.6% ahead of Monday’s opening bell, with the S&P 500 and Dow Jones set to fall by around 0.5% each.
Better than expected non-farm payroll data on Friday had shown the US economy added far more jobs than expected in September, in turn driving stocks higher late in the week.
Attention on Monday turned to third-quarter earnings season though, with Wall Street banks JPMorgan Chase & Co (NYSE:JPM, ETR:CMC), Wells Fargo & Co (NYSE:WFC, ETR:NWT) and BlackRock Inc (NYSE:BLK) set to kick off proceedings with updates on Friday.
Ahead of what looked to be a cautious start prior to the busier reporting period, Deutsche Bank analysts noted S&P 500 earnings growth was expected to slow from 11.8% to 9% between the second and third quarters.
This is set to be “driven by a narrow group of sectors such as energy, mega-cap growth and tech,” Deutsche said.
Goldman Sachs analysts raised expectations for S&P 500 earnings growth for 2025 in the meantime, forecasting a collective 11% increase to US$268 per share.
12.06pm: Centrica mulling Hinkley Point C investment
Centrica PLC (LSE:CNA) is reportedly mulling a £1 billion investment in the Hinkley Point C nuclear power plant.
Talks, though at an early stage, have been held with owner EDF over the potential injection in recent months, according to The Telegraph.
French state-owned EDF has reportedly been scrambling to raise £5 billion in order to complete the Somerset-based plant, which has faced years of delay and rising costs.
British Gas owner Centrica’s investment would see it take a share in Hinkley Point’s power output, similar to deals the FTSE 100-listed firm already has with EDF, through which it owns 20% of the UK’s nuclear power portfolio... Read more
11.18am: Pound loses further ground to dollar
Sterling lost more ground to the dollar on Monday, after stronger-than-expected jobs data last week saw expectations for further steep rate cuts by the Federal Reserve reduced.
The pound was trading at US$1.3068 as of late morning, having lost 0.43% for the day after hitting its lowest against the greenback in three weeks earlier on.
Friday’s non-farm payroll figures showed far more jobs were added across the US economy last month than expected.
Markets slashed expectations for another 50 basis point cut by the Fed in November as a result, in turn buoying the dollar.
This came after conflicting comments from Bank of England governor Andrew Bailey and chief economist Huw Pill last week over the pace of future rate cuts in the UK.
Bailey had said the bank could become “more aggressive” in cutting rates last Thursday, before Pill cautioned against reducing interest “too far or too fast” on Friday... Read more
10.57am: Shell, BP among risers as oil continues climb
Shell PLC (LSE:SHEL, NYSE:SHEL) and BP PLC (LSE:BP.) emerged among the FTSE 100’s biggest risers on Monday morning, aiding the index to a 16-point increase.
The heavyweights added 1.5% and 1.3% respectively to sit behind NatWest Group PLC (LSE:NWG) among the biggest winners on London’s blue-chip index by late morning.
Both had made headlines earlier on, with Shell cutting third-quarter guidance on lower refining margins due to lacklustre global demand, while reports emerged that BP was to ditch plans to reduce oil and gas output by 2030.
This coincided with an uptick in oil prices throughout the morning as benchmark Brent crude gained a further 2.6% to reach US$79.48 a barrel as tensions in the Middle East continued to brew.
10.44am: Eurozone investor confidence up despite German economic struggles
Investor sentiment across the Eurozone has picked up this month in spite of issues within the continent’s largest economy, Germany.
Sentix’s investor morale index came in at -13.8 in October, against -15.4 previously, with the rise coming after three consecutive declines.
This was as the current situation reading slipped to a four-month low, but future expectations indicators picked up.
“The downward trend in the economy has stopped for the time being,” Sentix said, “there are signs of easing in all regions of the world”.
The improvement came despite Germany’s economic woes, which were reflected through news on Monday of a 3.9% drop in factory orders in August, with Sentix noting the country remained “in recession mode for the time being”.
9.45am: Gold regains after US rate cut bet pressure
Gold regained ground throughout Monday morning, after taking a knock early on as traders cut bets for further steep interest rate reductions in the US.
Come mid-morning gold was trading flat for the day at US$2,654 an ounce, having dropped as low as US$2,640 earlier on.
This followed last Friday’s non-farm payroll reading from across the Atlantic, which showed the US economy added 254,000 jobs in September, against the 147,000 expected.
Bets for another 50 basis point cut to base interest by the Federal Reserve in November, following September’s reduction, were subsequently slashed as recession concerns were further dialled down.
Gold appeared to come under pressure as a result, after its recent rally has seen record highs repeatedly topped this year.
Miners dropped on Monday on the back of gold’s earlier fall, with Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) leading the day’s FTSE 100 losers, followed by Fresnillo PLC (LSE:FRES).
9.23am: Markets across Europe in the red as German factory orders drop
Markets across Europe got off to a tough start on Monday morning, with Portugal's PSI20 and Denmark's OMXC 25 among the only indices in positive territory.
Germany’s DAX was among the biggest fallers, dropping by 92 points, or 0.5%, early on following a further bout of poor economic data.
Factory orders across Europe’s largest economy tumbled by 3.9% in August, statistics body Destatis reported on Monday.
This was worse than markets had been expecting, with the figure falling by 3.8% month on month after a string of large orders for the likes of aircraft, ships and trains in July, Destatis said.
The figures add to a gloomy picture forming around the German economy, which shrank between April and June ahead of an anticipated contraction over the full year.
“This suggests that the German economy will at best stagnate in the second half of the year,” Commerzbank’s economist Ralph Solveen noted.
9.01am: Oil prices remain volatile on geopolitical tensions
Oil prices bounced on Monday as fears over escalations in the Middle East persisted while news of a Ukrainian strike on a Russian oil terminal emerged.
Benchmark Brent crude was up at US$78.62 a barrel on Monday morning, having dropped as low as US$77.45 earlier on.
This comes after oil looked on course to hit the US$80 mark last week, as fears over a return strike by Israel against Iran mounted, offsetting downward pressure on expectations of sluggish demand ahead.
Oil had climbed by 9% over the course of the week for the biggest gain since March 2023, with fears over tensions in the Middle East appearing to continue into Monday.
This coincided with confirmation of a Ukrainian strike against an oil terminal in Russian-occupied Feodosia, Crimea overnight, following reports of a fire at the site.
8.44am: Wage growth slows as Budget fears loom
Wage growth slowed to a three-and-a-half-year low last month as firms placed recruitment plans on hold ahead of October’s Autumn Budget.
KPMG and REC’s permanent salary index came in at 52.8 for September, against 54.4 previously, marking the third successive monthly drop.
Though this remained above the 50-point mark, which signals wages are growing, KPMG senior partner Jon Holt noted companies were holding off on recruitment ahead of the Budget on October 30.
“The slowing of hiring activity seen in September is to be expected as businesses [...] wait for clarity on future taxation, business, and economic policy,” he said.
REC chief executive Neil Carberry added: “This is a picture of a jobs market waiting for a signal.
“Recruiters report that projects in client businesses are ready to go, but confidence is not yet high enough to push the button.”
Britain’s new Labour government has alluded to tax hikes in the Budget, having cited a £22 billion “black hole” in public finances, though these are not expected to affect national insurance, VAT, income or corporation tax in line with manifesto pledges.
8.26am: Blue chips struggle for direction
London’s blue chips bounced between positive and negative territory on Monday morning, having reversed on gains seen as the market opened.
A quiet day on the reporting front saw Experian (LSE:EXPN) PLC top the early risers with a 2.3% gain, while Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) headed the fallers.
Shell PLC (LSE:SHEL, NYSE:SHEL) avoided a drop despite cutting third-quarter guidance on sluggish global demand, climbing 0.2%.
Rival oil heavyweight BP PLC (LSE:BP.) also sat above the mark following reports it was set to further scale back green pledges and ditch targets to reduce oil and gas production by 2030… Read more
Overall, the FTSE 100 fell 7 points to 8,273.
8.17am: Shell winds down guidance on sluggish global demand
Shell PLC (LSE:SHEL, NYSE:SHEL) has scaled back third-quarter guidance on the back of a sharp drop in refining profit margins due to weaker global demand.
In a trading update ahead of its quarterly results, Shell noted that indicative refining margins fell by nearly 30%, dropping to $5.5 per barrel from $7.7 in the previous quarter.
The company also stated that its oil products and chemicals trading earnings would likely be lower than in the second quarter... Read more
Shares ticked up 0.4% on the back of the update.
8.12am: House market ‘firmly back on track’ - analysts
News that house prices ticked up yet again in September shows the market is “firmly back on track,” industry members have said.
Halifax reported earlier on that prices ticked up by 4.7% in September to £293,399 in a third successive month of growth.
This marked the fastest uptick since November 2022 and left prices around £1,000 off record highs.
“The recovery is real but not rocket-fuelled,” Garrington Property Finders chief executive Jonathan Hopper commented.
“Prices are rising fastest in more affordable locations as buyers who are fed up with waiting seek more home for their money.
“Nevertheless the market is firmly back on track and on course to end the year on a high.”
Anticipations are for the Bank of England to cut base interest at least once more this year, further fuelling reductions to mortgage rates.
“The prospect of cheaper mortgages and the sense that now is the time to strike before house prices climb too high has spurred many would-be buyers into action,” Hopper said.
Bestinvest analyst Alice Haine added: “Provided inflation remains in check and interest rates continue to ease, housing market activity is expected to continue strengthening in line with easing affordability levels.
"For now, optimism is back with the housing market in better health than a year ago when mortgage rates were still alarmingly high.”
7.57am: Rio Tinto swoops for $3bn lithium firm
Rio Tinto Ltd (LSE:RIO, ASX:RIO, OTC:RTNTF) has launched a takeover bid for Arcadium Lithium PLC, a US$3.31 billion vertically integrated lithium chemicals producer.
The FTSE 100-listed miner said its approach is non-binding for the New York- and Syney-listed outfit, which has facilities and projects in UK, the US, Canada, Australia, China, Japan and Argentina from mining to delivering chemicals to battery companies... Read more
7.50am: New York Sun owner closes in on Telegraph takeover
Dovid Efune, owner of the New York Sun, is reportedly nearing a deal to buy the Telegraph for £550 million.
Efune is due to enter exclusive talks to buy the newspaper, with an agreement expected over the next week, according to the Financial Times.
Talks between Efune and RedBird IMI were said to have reached an advanced stage over the weekend, with a deal set to bring an end to 16 months' worth of bidding.
A takeover by Efune would see competition from the likes of National World owner David Montgomery, hedge fund head Paul Marshall and ex-UK chancellor Nadhim Zahawi staved off... Read more
7.27am: House prices climb at fastest rate in almost two years
House prices across the UK climbed at the fastest pace in almost two years last month, lender Halifax has reported.
A third successive month of increases saw prices jump by 4.7% to an average £293,399, marking the fastest growth since November 2022.
This also meant average house prices were around £1,000 off the record set in June 2022.
“Market conditions have steadily improved over the summer and into early autumn,” Halifax mortgage head Amanda Bryden commented.
Falling interest rates and strong wage growth have supported buyers, she added, driven by the Bank of England’s initial base rate cut in August and coinciding reductions in mortgages.
“While improved mortgage affordability should continue to support buyer activity - boosted by anticipated further cuts to interest rates - housing costs remain a challenge for many,” Bryden said.
“As a result we expect property price growth over the rest of this year and into next to remain modest.”
Month-on-month, prices increased by 0.3%, led by growth in Northern Ireland, while property costs in Scotland ticked up at the slowest rate.
7.13am: FTSE 100 seen lower
Futures had the FTSE 100 starting Monday just off the mark and in line to fall further on last week’s 40-point decline.
Fears of further escalations in the Middle East had pushed oil prices higher and toward the US$80 last week, with benchmark Brent crude scaling back as trading got underway on Monday to US$77.79 a barrel.
Gold also fell by 0.5% to US$2,641 an ounce on Monday morning, having been put under pressure by Friday’s better-than-expected non-farm payroll data from across the Atlantic.
Asian markets largely enjoyed a positive showing overnight, with India’s Nifty Fifty slightly below the mark and among those having fallen.
Monday is set to be a quiet day across London on the company front as Ferrexpo PLC (LSE:FXPO) marks one of few to report, while house price data is also due from Halifax.