- FTSE 100 down 12 points
- House prices to surge
- Mortgage approvals jump
3.54pm: FTSE 100 heads towards weekend lower
The FTSE 100 headed towards the weekend on the back foot, but appeared on course to rack up a gain for the month.
Blue chips were down 12 points at 8,269 come late trading on Friday, setting up stocks for a 1.2% increase since the start of November.
BAE Systems PLC (LSE:BA.) led Friday’s decline, following a downgrade by Bank of America analysts which sent shares in the defence firm tumbling 6%.
Prudential PLC (LSE:PRU) followed with a 2.5% drop, as JD Sports Fashion PLC (LSE:JD.) and Vodafone Group PLC (LSE:VOD) also sat among the day’s losers.
Anglo American PLC (LSE:AAL) surged 5% to top the risers in the meantime, having been granted a ‘buy’ rating by Jefferies analysts.
Peers Antofagasta PLC (LSE:ANTO) and Glencore PLC (LSE:GLEN) also climbed throughout the day, with Rolls-Royce Holdings PLC (LSE:RR.), IMI PLC (LSE:IMI) and Next PLC (LSE:NXT) among the risers too.
2.55pm: Wall Street kicks off short day on front foot
Wall Street enjoyed a positive start to the shortened trading day on Friday, placing each the Nasdaq, Dow Jones and S&P 500 on course for weekly gains.
The Nasdaq and Dow Jones headed 0.3% higher as trading got underway, while the S&P 500 added 0.2%.
Among companies, Super Micro Computer Inc (NASDAQ:SMCI) was the day’s big mover early on, dropping 11%.
The technology firm has been grappling to ward of concerns of a delisting from the Nasdaq, prompting volatility recently.
Elsewhere, Nvidia Corp and Boeing Co (NYSE:BA, ETR:BCO) were among early risers, while Microsoft Corp (NASDAQ:MSFT) moved lower as trading got underway.
2.30pm: Fresnillo among risers as gold ticks up
Gold saw a slight rebound on Friday after facing pressure through the week on the likes of lower demand on easing tensions in the Middle East.
Spot gold was trading at US$2,656 an ounce on Friday, marking a 0.36% increase for the day.
This remained off the US$2,716 price seen as trading kicked off on Monday though, but marked its highest level since.
Mexican-based gold miner Fresnillo PLC (LSE:FRES) emerged among the FTSE 100’s risers in the meantime, with shares ticking up 1.3%.
1.55pm: Klarna, Nationwide continue to flag strong Black Friday
Buy-now-pay-later firm Klarna and Nationwide have signalled this year’s Black Friday continues to be stronger for shops than last year’s.
According to figures from the former, total sales surged 30% over the first six hours of this Black Friday, before slowing to a 26% increase come noon.
Nationwide reported 3.59 million transactions in the meantime, marking an 11% increase on 2023’s Black Friday.
Mark Nalder, payment strategy director at the lender, noted Black Friday trading tended to intensify around the lunchtime period.
1.38pm: Arabica coffee prices soar to multi-generational high
Futures contracts on Arabica coffee futures have risen by 32% in a month and 70% year to date amid mounting supply chain pressures.
Brazil, the world’s biggest coffee producer, faced severe drought earlier this year, raising doubts about the next season's crop size.
The USDA's Foreign Agricultural Service predicts Brazil's 2024/25 coffee production at 66.4 million metric tonne (MMT), below the USDA's previous forecast of 69.9 MMT.
The FAS estimates Brazil's coffee inventories at 1.2 million bags at the end of the 2024/25 season in June, down 26% over the previous season.
Weather disruptions have also hit Vietnam, which is a key producer of the robusta bean variety.
"The price trend is now very similar to that of cocoa at the beginning of the year. The reasons are also comparable," said Commerzbank analysts.
"In the case of cocoa, it was poor harvests in the two most important producer countries, Ivory Coast and Ghana. In the case of arabica coffee, it is concern about a poor crop in Brazil, the most important producer country, next year due to drought.”
At the time of writing, Arabica coffee futures were priced at $3.25 a pound, the highest on record.
Arabica futures prices over the past 50 years – Source: tradingeconomics.com
1.08pm: Oil prices recover from weekly lows
Oil futures have rebounded after falling to a weekly low this morning on news that the OPEC+ cartel has delayed its committee meeting from Sunday until next Thursday.
The delay, attributed to a scheduling conflict, added a layer of uncertainty about OPEC+’s planned output cuts.
It is expected to extend current output cuts through to the new year to keep prices buoyed, but members will have to wait until Thursday for more information.
However, these output cuts face a wash as president-elect Donald Trump prepares to take office.
As a reminder, the US is not an OPEC member, meaning it can drill as much oil as it pleases. Trump can therefore make good on his promises to “drill, baby, drill”.
Crude Oil WTI futures fell as low as $68.24 a barrel this morning before surging back up to $69.27 at the time of writing.
12.40pm: Mortgage rates drop as Barclays among banks to cut
Mortgage rates declined over the course of this week as Barclays PLC (LSE:BARC) was among lenders to reduce interest in response to easing swap rates.
According to Moneyfacts, interest on the average two-year fixed-rate mortgage sat at 5.5197% come Friday, against 5.5352% a week earlier.
Barclays on Wednesday became the first major lender to cut rates following a string of hikes in recent weeks, despite the Bank of England’s interest rate cut earlier in the month.
Rates on selected products were to be cut by up to 0.2%, the bank signalled, following a “volatile” period on the swap market, which is used to price mortgages.
“Barclays has made a bold move as the first high street lender to cut mortgage rates in response to recent market changes,” Nicholas Mendes, of broker John Charcol, commented.
“With swap rates easing over the past couple of days, it’s great to see a lender acting quickly to reflect the slightly improving conditions.”
Despite the short-term decline, the Bank of England separately warned on Friday that millions of households were set to remortgage at higher rates over the coming years.
Some 4.4 million homes were in line to refinance ahead, following a jump in rates in recent years, the bank said in its latest financial stability report.
12.00pm: Pound gives up gains on BoE debt warning
Sterling largely gave up a gain against the dollar on Friday after the Bank of England flagged up concerns over growing debt on geopolitical tensions.
The pound was up 0.5% against the greenback earlier, but fell back to US$1.2693 later on, equating to a 0.05% increase for the day.
In its latest Financial Stability Report, the bank pointed to pressure on government debt from the likes of global tensions and fragmentation.
“Uncertainty around, and risks to, the global economic outlook have increased,” it said.
“As the UK is an economy with a large financial sector and in which trade is significant, these risks are particularly relevant to UK financial stability.”
11.40am: US stocks seen higher on shortened day
Wall Street appeared on course to climb ahead of a shortened trading session on Friday after Thursday’s Thanksgiving break.
Futures had the Nasdaq, Dow Jones and S&P 500 each adding 0.3% respectively ahead of the opening bell.
This would take the Dow Jones and S&P 500 toward gains for the week, with the Nasdaq looking to overcome flat trading so far.
Thursday’s shortened trading week had provided a brief pause ahead of a busy coming week, set to bring a string of unemployment data, including non-farm payroll figures, interactive investor analyst Richard Hunter noted.
11.12am: BAE Systems leads stocks lower
BAE Systems PLC (LSE:BA.) led the FTSE 100 lower into late morning, having shed 4.2% to sit at 1,236p.
The drop followed a downgrade by Bank of America analysts to ‘underperform’, according to MarketScreener, with a lower 1,240p price target being set.
Spirax Group PLC also sat among the losers, having reversed slightly on a gain through Thursday.
Anglo American PLC (LSE:AAL) continued to lead risers in the meantime, following an upgrade by Jefferies analysts, followed by IMI PLC (LSE:IMI).
Overall, the FTSE 100 slipped 6 points to 8,274.
10.58am: Black Friday spending jumps - Nationwide
Nationwide has said today’s Black Friday spending is up against last year so far.
Some 1.66 million transactions had been made by nine this morning by Nationwide customers, the lender reported, marking an 11% uptick against last year’s Black Friday.
“Black Friday 2023 was the busiest shopping day on record for Nationwide customers and this year’s Black Friday is shaping up to be even busier,” payment strategy director Mark Nalder said.
“Transactions are 21 per cent higher than a typical Friday as many people use the day to kick start their Christmas shopping.”
10.50am: Clearing houses face some concentration risks in stress test - BoE
The Bank of England has found some vulnerabilities within major clearing houses in a stress test of the UK’s financial system.
ICE Clear Europe Ltd, LCH Ltd and LME Clear Ltd were studied in the latest routine test and showed larger losses than in last year’s simulation.
Though the clearing houses, which facilitate payments between banks, remained resilient, some issues were seen in highly concentrated positions, the Bank of England said.
“The stress test results do not suggest that this is a cause for concern,” deputy governor for financial stability Sarah Breeden said
“But, we continue to monitor CCPs’ (central counterparties’) resources through ongoing data collection and supervision.”
“When we extend the stress test to include the cost of liquidating highly concentrated positions and more conservative assumptions, we identify some potential areas of vulnerability, which we will explore with CCPs as part of our ongoing supervision.”
10.21am: Mortgage approvals at highest in over two years
The number of prospective buyers who had mortgages approved hit its highest level since August 2022 last month thanks to the likes of lower borrowing costs.
According to the Bank of England, some 68,300 mortgages for house buying were approved in October, increasing by 2,200 month on month.
This coincided with a drop in the effective, or actual, interest rate paid on newly drawn mortgages by 15 basis points to 4.61% - its lowest since May 2023.
Net borrowing for mortgages climbed by £0.9 billion to £3.4 billion in the meantime, while overall consumer credit borrowing across the UK slipped from £1.2 billion to £1.1 billion.
“Buyers and sellers are now on tenterhooks to see when the next interest rate cut might materialise,” Bestinvest analyst Alice Haine said.
“Two quarter-point interest rate cuts have eased borrowing costs to some degree, but the chancellor’s spending, borrowing and tax plans are expected to prove inflationary, something that could slow the pace of further interest rate cuts.”
10.05am: Euro inflation as expected
Euro area inflation hit forecasts by increasing to 2.3% in November from a flat 2% in October, according to a flash estimate by Eurostat, the European Union's statistical office.
Services registered the highest inflation rate among components at 3.9%, marginally lower than October’s 4%, while food, alcohol, and tobacco saw a decrease to 2.8% from 2.9% the previous month.
Energy prices showed notable improvement, recording a less negative inflation rate of 1.9%, up from a negative 4.6% rate in October.
Germany and France both experienced a 2.4% inflation rate, while Italy registered 1.6%.
9.24am: Bitcoin levels out after whipsaw start to week
Bitcoin remained relatively unbudged on Thursday and throughout this morning after encountering a sharp whipsaw session earlier in the week.
The world’s largest cryptocurrency fell a full 6% between Monday and Tuesday before changing course with a 4.2% rally at the mid-week point.
However, after this classic bout of volatility, the BTC/USD pair has settled down at the sub-$96,000 price point.
At the time of writing, the pair was trading at $95,956.
Bitcoin’s levelled performance follows a mammoth post-election bull run for the digital currency.
As president-elect Donald Trump secured a sweeping victory in the US elections on a pro-crypto policy platform, it rocketed to a fresh all-time high of $96,600.
The bulls fell just shy of smashing $100,000 as a bout of profit taking put an end to these jumbo gains.
Back to stocks, the FTSE 100 blue-chip index is currently trading 14 points lower at 8,268.
8.58am: Hopes pinned on Black Friday after retail footfall drop
Retailers have faced a drop in footfall this month, leaving hopes pinned on Black Friday to “jump-start” this year’s seasonal shopping.
Footfall across the sector dropped by 4.5% between October 27 and November 23, the British Retail Consortium reported on Friday.
High streets faced a 3.7% decline, while footfall at retail parks and shopping centres dropped by 1.1% and 6.1% respectively.
BRC head Helen Dickinson noted this year’s later-than-usual Black Friday and low consumer confidence had weighed on the figures.
“This lacklustre footfall performance will have come as a blow for many retailers, who would have been counting on getting early Christmas trading results under their belts before the start of advent,” Andy Sumpter, of analytics firm Sensormatic, added.
“Tipped as one of the top busiest days for store shopping during peak trading [Black Friday] will hopefully jump-start seasonal shopping.”
8.41am: Anglo American jumps on Jefferies upgrade
Anglo American PLC (LSE:AAL) topped risers on the FTSE 100 on Friday morning after being granted a ‘buy’ rating by Jefferies analysts.
Though there were still risks around its restructuring, which has seen Anglo sell off coal and platinum assets, Jefferies said a drop in the shares left good value.
“The company will be well positioned to benefit from a rising copper price and a resilient iron ore price after its restructuring is complete,” analysts said in a note.
“It should have a strong balance sheet and robust cash flow, enabling it to deliver large capital returns.”
Shares were down around 15% since the restructuring was unveiled in May, Jefferies pointed out, but progress since had “been very good”.
Anglo was upgraded from a ‘hold’ as a result, with Jefferies also lifting its share price target from 2,500p to 2,850p.
Shares climbed 2.6% to 2,452p on Friday.
8.23am: Peel Hunt drops as Budget anxieties weigh on results
Peel Hunt Ltd (AIM:PEEL) fell over 2% as trading got underway after signalling uncertainty in the wake of last month’s Budget in interim results.
Performance in its core equity capital markets business improved in the first half, but anxieties surrounding Labour’s Budget stymied progress in the tail end of the period.
“Volumes reduced towards the end of the period given uncertainty around the UK Budget and US election”, said the group.
Revenues grew by 26% year on year to £53.8n million over the half, trickling down to a £1.2 million profit before tax compared to an £800,000 loss previously... Read more
Shares fell 2.1% as trading got underway.
8.10am: Index on front foot early on
London’s blue-chip index moved higher in early trading, overcoming an initial drop as the market opened.
The FTSE 100 was trading up 9 points at 8,291 as a quiet Friday session got underway.
Anglo American PLC (LSE:AAL) led the early risers, up 3.1%, as other miners also gained in line with an increase in commodity prices.
BAE Systems PLC (LSE:BA.) topped the fallers in the meantime, down 1.9%.
8.01am: House prices predicted to surge over coming years - Zoopla
House prices are expected to surge over the coming years on the back of higher-than-expected income growth, property firm Zoopla has reported.
Following growth of 1.5% in the year to October, Zoopla forecast on Friday that prices would increase by 2.5% in 2025 and by 7.5% over the coming three years.
“The housing market has been resilient in the face of higher borrowing costs over the last two years,” Zoopla executive director Richard Donnell commented.
“Higher income growth and lower mortgage rates have helped reset housing affordability faster than many expected over 2024.”
The average house cost £267,200 in October, up by £3,900 year on year, as prices grew across every region of the UK.
The sales pipeline had surged 30% in the meantime, which Zoopla said would translate to a jump in activity early next year, over which 1.15 million completions were anticipated.
“As we are approaching the end of the year, we are already seeing more buyers entering the market which is not typical for this time of year,” Matt Thompson, sales head at estate agency Chestertons, said.
He added an uplift to stamp duty due next April had in part driven activity, while falling mortgage rates had helped to boost buyer confidence.
7.47am: Hybrid car ban could be delayed as EV demand underwhelms
Britain's ban on hybrid car sales may be pushed back as ministers and carmakers clash over rules designed to phase out petrol and diesel models in the coming years.
Britain’s Labour government has previously pledged to restore the deadline for polluting car sales, including hybrids, to 2030 after the Conservatives delayed the date to 2035.
However, following pressure as the industry grapples to meet electric vehicle sales targets against lacklustre demand, ministers are reportedly mulling re-delaying the ban on hybrids.
“That would be our preference,” a government source told LBC when quizzed on the move, “there is going to be a need for us to take some political risks to make this work”.
Business secretary Jonathan Reynolds earlier this week said a “fast track” consultation would be held on Britain’s EV mandate, which means 22% of cars sold this year have to be electrics, before the figure increases annually.
It comes after industry figures on Thursday showed car production slumped by over 15% last month as firms grappled to avoid fines by missing the target... Read more
Trade body the Society of Motor Manufacturers and Traders (SMMT) reported on Thursday that car production in the UK had slumped by over 15% last month.
New zero emission products were “under intense pressure,” boss Mike Hawes had said, as British manufacturers struggled with “the toughest [EV] targets”.
One option reportedly under consideration by the government is to freeze the 22% EV sales target into next year, when carmakers are set to risk fines if 28% of volumes are not electrics.
7.12am: Stocks to fall back
Futures had the FTSE 100 moving 18 points lower to 8,291 on Friday morning, following a six-point gain in a quiet session on Thursday.
Spirax Group PLC had led gains on Thursday, followed by the likes of Admiral PLC on read across from Aviva PLC (LSE:AV.)’s rejected £3.3 billion bid for Direct Line Insurance Group PLC (LSE:DLG).
Overnight, Asian markets faced a mixed showing, with China’s Shenzhen up 1.7% and the biggest riser as a result.
Back in London, consumer credit figures from the Bank of England were among releases due on Friday, while a string of inflation data was expected from Europe.
5.00am: Consumer credit, mortgage approvals and Peel Hunt in focus
Bank of England consumer credit data is due on Friday, alongside mortgage approvals figures, while Peel Hunt will report interim figures.
Announcements due:
Interim results: Northern Bear PLC, Peel Hunt Ltd (AIM:PEEL)
AGMs: Aptamer Group PLC, Arc Minerals Ltd, Atlantic Lithium Ltd, Europa Oil & Gas Holdings, Mosman Oil & Gas Ltd, Sylvania Platinum Ltd
Economic announcements: BoE Consumer Credit (UK), Mortgage Approvals (UK), Inflation (EU)