- FTSE 100 drops six points
- Retail sales, consumer confidence improve
- Standard Chartered hikes dividend, buybacks
3.58pm: FTSE 100 gives up gain late on
London’s blue chips failed to hold onto a gain come the back end of Friday’s session, heading towards the close off six points at 8,656.
NatWest Group PLC led the risers late on, up 4.0% and just ahead of Standard Chartered PLC after well-received results from the latter earlier in the day.
However, a string of blue chips slipped into the red, with Endeavour Mining PLC and Fresnillo PLC heading the drop on a decline in the price of gold from Thursday’s record.
BAE Systems PLC was also among the fallers, including after a downgrade by Panmure Liberum analysts on looming cuts to the United States defence budget… Read more
Mixed fortunes swept across London in the meantime, as the FTSE 250 remained in the green alongside the AIM all-share, but the FTSE 350 slipped.
Among the small-cap winners was Europa Metals Ltd, which clutched onto a 29% rise after addressing recent share price declines… Read more
The FTSE 100’s drop meant the index had shed 75 points, or 0.9%, for the week.
3.33pm: US business activity growth slows as tariff fears weigh
Friday’s declines on Wall Street were fuelled by figures showing business activity across the states almost stalled in February.
According to S&P Global, the composite purchasing managers index dropped from 52.7 to 50.4 between January and February, signalling slowing growth.
Talk of stagflation had already been stoked by sweeping tariffs under Donald Trump.
“The upbeat mood seen among US businesses at the start of the year has evaporated, replaced with a darkening picture of heightened uncertainty, stalling business activity and rising prices,” S&P economist Chris Williamson said.
“Optimism about the year ahead has slumped from the near-three-year highs seen at the turn of the year to one of the gloomiest since the pandemic.
“Companies report widespread concerns about the impact of federal government policies, ranging from spending cuts to tariffs and geopolitical developments.
“Sales are reportedly being hit by the uncertainty caused by the changing political landscape, and prices are rising amid tariff-related price hikes from suppliers.”
The Dow Jons was down 0.9%, while the S&P 500 and Nasdaq dropped 0.6% and 0.7% respectively.
3.07pm: Dow Jones tumbles again as tariff fears hang over Wall Street
Wall Street got off to a mixed start on Friday, with the Dow Jones falling even further as concerns around the impact of president Donald Trump’s tariffs continued to weigh.
Dow shed 0.9% after the bell, on the back of a 1.0% drop in Thursday’s session, after fears of inflationary pressure on the tariffs sparked talk of stagflation.
The S&P 500 also fell by 0.4%, while the Nasdaq slipped 0.2% after an initial rise.
For the Dow, Walmart Inc continued to weigh after unwhelming with figures on Thursday, while Unitedhealth Group Inc sank 8% on news of a Department of Justice probe.
MercadoLibre Inc topped the Nasdaq’s risers in the meantime, gaining almost 10% after the online marketplace operator posted expectation-beating fourth-quarter figures.
2.28pm: Strikes by oil workers 'on table' in response to green transition job threat
Industrial action among oil workers is said to be under consideration in response to job threats on the back of the UK’s shift to green energy.
Unite union general secretary Sharon Graham on told a rally of workers from the Grangemouth refinery near Edinburgh that action could be escalated “if necessary”.
“We are not going to allow oil and gas workers to be the coal miners of our generation,” she said at the rally at Scottish Labour’s annual conference in Glasgow.
“I have already been meeting with refinery reps up and down the countries in Britain, and we will escalate this action if necessary.
“We will push back hard to save UK jobs. If the pumps run dry in Britain [...] the public will know who to blame.
“It will be the Scottish government and the UK government for allowing the sale of our jobs. If politicians do not act, we will.”
She also told the Guardian that industrial action among oil workers was “on the table”.
1.33pm: Rate cut bets pushed as firms prepare to hike prices
Bets for rate cuts this year have been pushed back after figures showing UK companies had ramped up staff cuts and were preparing to hike prices before Budget tax increases.
Money markets, despite still pricing in another two Bank of England reductions this year, forecast a second 0.25% cut in December as of Friday, against November prior.
S&P earlier in the day had reported firms were cutting jobs at the fastest pace since November 2020 and had recorded a fourth straight month of cost increases in February as prices rose before April’s national insurance hike, unveiled in last October’s Budget.
The FTSE 100 remained on the front foot into the afternoon, however, as Standard Chartered PLC’s results lifted banks and after news of a rebound in retail sales last month.
The index was up four points at 8,667, while London’s mid and small caps also enjoyed gains, with AIM all-share up three points, or 0.6%, at 720.
Europa Metals Ltd remained among the small-cap winners, up 47.5% after flagging a valuation disconnect earlier on… Read more
12.44pm: UK house prices, US inflation tee up week ahead
Macroeconomic headlines next week are set to be dominated by the US and the Federal Reserve’s preferred measure of inflation.
Nationwide house price data should offer UK traders with something to mull over though, alongside car production and further retail sales figures.
Ahead of April’s looming stamp duty hike, expectations are for house price figures on Friday to show a 0.6% or 3.9% increase on an annual basis in February.
CBI distributive trade and SMMT data sets earlier in the week are also anticipated to show ongoing declines among both UK retail sales and car output respectively.
Over the Atlantic, personal expenditures and the all-important core measure later on Friday promise to dominate proceedings.
Given tariffs under president Donald Trump have prompted renewed inflationary pressure and clouded scope for rate cuts ahead, the Fed has flagged caution most recently.
“Fed officials this week have expressed a keen interest in seeing more progress on inflation before considering further rate cuts while also recognising potential risks from changes in trade policy,” IG analysts noted.
“They will likely see that next week,” IG added, with headline PCE for January seen easing to 2.5% year on year and the core rate subsiding to 2.6% in the meantime from 2.8%.
Next week is also set to bring a second estimate for fourth-quarter US gross domestic product growth, alongside the likes of European inflation figures.
11.57am: Slight gains seen on Wall Street as tariff jitters go on
Wall Street looked on course for a brighter start to Friday’s session after lingering fears around stagflation on Donald Trump’s sweeping tariffs hit stocks the day before.
The Dow Jones, having shed 1.0% on Thursday, was seen climbing 0.1% ahead of the opening bell.
Futures had the Nasdaq rising by 0.1% in the meantime, as the S&P 500 looked to move just above the mark in a slight reverse on Thursday’s decline.
Markets have been mulling the impact of sweeping tariffs under Trump, sparking fears of renewed inflationary pressure.
Alongside measures against Chinese goods, steel and aluminum imports, delayed levies against Canada and Mexico, plans have been unveiled for reciprocal taxes on countries with those on US goods, as well as tariffs on autos, semiconductors and pharma imports.
Brandywine Global portfolio manager Jack McIntyre told Reuters concerns now lingered around “stagflation”.
He said: “We have these policies that could hurt consumer demand even while persistent inflation limits the Federal Reserve's ability to manoeuvre.
“It's not a zero-possibility scenario any more, by a long shot.”
11.08am: FTSE 100 holds gain as NetWest, Centrica, retailers tick up
London’s blue chips remained in positive spirits come mid-morning on Friday, with the FTSE 100 up 18 points at 8,681.
NatWest Group PLC emerged as the day’s biggest winner, adding 3.3% after Standard Chartered PLC closed off reporting season for UK banks with news of stronger profit.
“In 2024, Barclays, HSBC, Lloyds, NatWest and Standard Chartered generated aggregate pre-tax profits of £50.3 billion, a new all-time high,” AJ Bell’s Russ Mould noted.
Standard itself gained 3.2%, after figures also showed a ramped-up dividend and new share buyback, while Barclays PLC rose too.
Centrica PLC was also among risers thanks to commentary from Citi analysts hailing its “stellar” full-year figures on Thursday… Read more
Retailers enjoyed gains too, on the back of ONS data showing sales across the sector rebounded from negative territory to sit 1.7% higher last month, driven by food.
JD Sports Fashion PLC, J Sainsbury PLC, Primark owner Associated British Foods PLC, B&Q parent Kingfisher PLC and Marks and Spencer Group PLC were all up as a result.
10.17am: Private sector jobs cut at fastest pace since mid-pandemic
UK companies offloaded employees at the fastest pace since the midst of the global pandemic this month, figures showed on Friday.
According to S&P Global, staffing numbers had dropped at the quickest pace since November 2020 in February as employers braced for higher payroll costs and muted demand.
This coincided with a fall in the flash composite purchasing managers index from 50.6 to 50.5 between January and February, signalling slowing output growth.
The services index increased though, while manufacturing output growth was shown to have fallen further into negative territory.
“Business activity remained largely stalled for a fourth successive month, with job losses mounting amid falling sales and rising costs,” S&P economist Chris Williamson said.
“The lack of growth alongside rising price pressures points to a stagflationary environment which will present a growing dilemma for the Bank of England.
“A key factor behind the upturn in inflationary pressures is the growing number of firms reporting the need to raise prices in order to help offset the impending rise in staff costs associated with the National insurance hike and uplift to the minimum wage announced in the autumn Budget.
“However, companies also reported that the Budget changes also played a major role in driving intensifying job cuts.”
9.33am: Tesla reportedly lined up by Japanese group for Nissan investment
Tesla Inc is said to have emerged at the centre of plans by a high-level Japanese group for an investment in Nissan after the latter’s merger talks with Honda fell through.
According to Financial Times-cited sources, hopes were that Elon Musk’s electric vehicle giant could take a strategic stake in Nissan.
Including former Tesla board member Hiro Mizuno and ex-prime minister Yoshihide Suga, the group was said to believe Tesla may be interested in Nissan’s US plants.
Nissan had been in talks for a potential US$58 billion tie-up with peer Honda, though these subsequently ground to a halt.
For Tesla, such investment could boost domestic production as president Donald Trump threatens sweeping tariffs, including on foreign autos.
Tesla head Musk appeared to bat off the suggestion in response to the Financial Times report though.
“The Tesla factory IS the product,” he wrote on X, “the Cybercab production line is like nothing else in the automotive industry.”
Nissan shares surged 9.5% on Friday on the back of the report.
8.45am: Budget surplus at record but heightened expectations leave chancellor in lurch
January's usual surge in tax receipts saw Britain rack up a record budget surplus, though heightened expectations left the figure underwhelming.
According to Office for National Statistics estimates, the public sector was in surplus by £15.4 billion last month, marking the highest for January since records began in 1993.
This marked a £0.8 billion increase year over year, as a usual increase in receipts over the month on its self-assessed tax deadline exceeded spending.
However, the figure was £5.1 billion off the Office for Budget Responsibility’s forecast, leaving questions around chancellor Rachel Reeves’ ability to keep within fiscal rules.
“January’s disappointing public finances figures [...] continue the run of bad news for the chancellor in 2025 and underline the difficult choices she faces,” Capital Economics’ Alex Kerr said.
“While there is increasing pressure on the government to commit to higher defence spending, the OBR is likely to conclude that the chancellor’s headroom against her fiscal rules has been wiped out and she will probably need to tighten fiscal policy as a result.”
8.24am: Standard Chartered leads FTSE 100 higher
Standard Chartered PLC surged on Friday to lead the FTSE 100 into positive territory as trading got underway.
Shares in the bank jumped 4.6% early on, after Standard hiked its dividend and unveiled a new buyback on news of a one-fifth jump in underlying profit last year.
Overall, the FTSE 100 added 10 points to sit at 8,671 after the open, with miners and banks among other risers.
Primark owner Associated British Foods PLC, JD Sports Fashion PLC and B&Q parent Kingfisher PLC were also among those in the green after figures showing a resurgence in sales across the retail sector last month.
London’s mid and small caps enjoyed a positive start too, with the FTSE 250 adding 62 points to reach 20,674 and AIM all-share up two points at 719.
Europa Metals Ltd was among junior stocks surging, climbing 58% after updating… Read more
8.11am: Consumer confidence nudges higher in February
Consumer confidence picked up in February in spite of ongoing concerns around the UK economy.
According to GfK, its consumer confidence barometer picked up two points between January and February to sit at -20.
All core measures improved, it said, signalling better sentiment towards the likes of personal finances and the general economic situation.
For personal finances over the coming year, the index crept into positive territory to sit at two points, against January’s -2.
“The Bank of England interest rate cut on February 6th will have brightened the mood for some people,” consumer insight director Neil Bellamy said.
“But the majority are still struggling with a cost-of-living crisis that is far from over.”
Inflation, which hit 3% in January, was still above the Bank of England’s 2% target, he flagged, while the like of gas and electricity prices continued to pressure many.
“It’s no surprise that consumer views on the general economic situation are still lower than 12 months ago,” he added, with February’s index reading at -44, against -43 a year ago.
“People don’t expect the economy to show any dramatic signs of improvement soon.”
7.54am: Standard Chartered hikes dividend, sets new buyback on stronger annual profit
Standard Chartered PLC has hiked its dividend and unveiled a further US$1.5 billion buyback after profit jumped by a fifth last year on record income.
Underlying pre-tax profit surged 20% to US$6.8 billion in the year to December 31, the bank reported Friday, on a 13% increase in operating income to US$19.7 billion.
Wealth solution income jumped 29% over the year, and increased by 15% in both its global markets and global banking divisions.
Profit tumbled by 30% to US$800 million on a reported basis in the final quarter though, on the likes of higher impairment and restructuring costs.
Under such restructuring, Standard said it would cut chief executive Bill Winters’ salary by 40% but potentially award higher bonuses, possibly taking his pay to US$13.1 million.
Guidance was laid out for operating income growth to track towards the high end of a 5% to 7% range between 2023 and 2026, but for 2025’s increase to be below this.
A final US$0.28 per share dividend was also proposed to leave the final figure at US$0.37 and up 37% year on year.
7.14am: FTSE 100 to extend decline; Retail sales bounce back
London’s blue chips were on course to fall yet again ahead of Friday’s session, following two consecutive days of decline to take the FTSE 100 into negative territory for the week.
Futures had the index off seven points prior to the open, after the FTSE 100 had shed 49 points to close out Tuesday’s session at 8,662.
A further decline came as data showed sales across Britain’s retail sector returned to growth in January.
According to the Office for National Statistics, retail sales climbed by 1.7% over the month, against a downwardly revised 0.6% drop in December.
Renewed growth at food stores, where sales jumped by 5.6%, offset declines for the likes of household, clothing and textile goods, alongside automotive fuel.
The overall uptick trounced analyst expectations, which had been for a 0.2% increase in retail sales in January.
Elsewhere, Asian markets faced a largely positive session overnight, after a declines on Wall Street, where the Dow Jones dropped 1%, due to Trump tariff fears.
What to watch on Friday
Full-year results from Standard Chartered PLC (LSE:STAN) are the only major corporate event in the diary for Friday, with refreshed guidance likely to be the main focus, according to analysts.
Late last year, StanChart said it was planning to look at offloading some of its non-core African businesses to fit in with its new strategic priorities and aim of accelerating income growth and returns.
The upturn in optimism around China will also be an area about which investors in the bank are likely to be keen to hear commentary.
In macroeconomic news, government borrowing will be under the microscope, while retail figures from the Office of National Statistics and the consumer confidence reading from GfK have both had their thunder stolen somewhat by recent research from the British Retail Consortium.
Friday 21 February
Finals: Standard Chartered PLC
Economic news: GfK Consumer Confidence (UK), Public Sector Net Borrowing (UK), Retail Sales (UK), Existing Home Sales (US), Uni of Michigan Confidence (US)