- FTSE 100 falls 1.5 points to 8,706
- Bank of England keeps base rate at 4.50%
- European stocks tumble as tariff fears renewed
- Shaftesbury Capital sells 25% stake in Covent Garden to Norway
4.20pm: FTSE winning run set to end?
As we near the closing bell, the FTSE 100 it is heading for a nailbiter, will it end its winning run after six days. Currnetly the index is down just a point and a half.
It's relatively stable compared to broader declines across European markets.
The Germany's DAX and Italy's FTSE MIB both down more than 1%, while France's CAC 40 and Spain's IBEX falling 0.9% and 0.7%.
US stocks are mixed, with mostly green, with the Dow Jones up 0.3%, while the S&P 500 and Nasdaq are both just above flat, while the Russell 2000 has climbed to 0.1%.
3.36pm: Asos jumps
Shares in ASOS PLC have jumped 11% today after the online fashion group's largest shareholder, Denmark's Polvsen family, upped their stake to over 28%.
Earlier this week the shares had slumped to their lowest in over 15 years, not helped by a Exane Paribis downgrade.
In an RNS update after yesterday's close, the enlarged shareholding was revealed for Danish billionaire Anders Holch Povlsen, CEO of the Bestseller retail chain, and his 75-year-old father, Troels Holch Povlsen, Bestseller's founder.
This remains one to watch, as Mike Ashely's Frasers Group PLC is also a major shareholder and last week increased its holding to 24.2% from 23.4%.
2.58pm: Chancellor's statement
Chancellor of the Exchequer Rachel Reeves has issued a comment following the BoE rate decision, preparing some political ground ahead of her spring statement next week (where she seems to be planning more austerity rather than raising taxes).
"We’ve had three rate cuts since the summer, but there’s still work to do to ease the cost of living."
"That’s why I’m fighting every day to put more money in the pockets of working people to deliver our plan for change, and why we protected workers’ payslips with no rise in national insurance, income tax or VAT, boosted the national living wage and froze fuel duty.
"In a changing world, I’m determined to go further and faster to kickstart growth, and bring in a new era of stability, security and renewal that protects working people and keeps our country safe."
2.04pm: Market tone feels 'calmer'
Despite early weakness in US stocks, "the broader tone is certainly calmer after a turbulent month", says market analyst Fawad Razaqzada at City Index.
"Still, traders remain wary of Trump’s tariff agenda and its potential drag on global growth, all while stoking inflation fears.
"As such, profit-taking on rallies has been the order of the day, keeping the S&P 500 outlook cautious.
"Yet, with markets showing greater resilience of late, dip-buyers may feel emboldened as equities gravitate towards key support zones."
1.46pm: US stocks open lower
US domestic small and mid-cap stocks are feeling the brunt of selling as trading starts in New York, a day after the latest Fed decision.
The Russell 2000 index dropped 0.8% in initial trades, while the Dow Jones fell 0.3%, the S&P 500 dipped 0.2% and the Nasdaq Composite eased 0.15%.
Headlines on the Wall Street Journal today warned that "tariffs are a risk for midsize businesses, and their lenders".
Among the tech giants, Nvidia and Meta were both up either side of 1%, while Tesla and Broadcom both fell more than 1%.
On the Dow, IBM was the big weight, falling 5.4%.
Reacting to the Fed decision last night, someone in a big white house was not best pleased.
"The Fed would be MUCH better off CUTTING RATES as US Tariffs start to transition (ease!) their way into the economy,” President Trump said in a social media post. "
"Do the right thing. April 2nd is Liberation Day in America!!!" he ranted, referring to when a range of global tariffs kick in.
12.39pm: BoE a little more hawkish than expected
The Bank of England was "always" going to continue its cut-hold, cut-hold pattern by leaving interest rates alone today, "but, in the opposite of what happened at the last meeting in February, the vote was more hawkish than expected", says economist Paul Dales at Capital Economics.
"This increases the possibility that as inflation rises later in the year, the Bank cuts rates even slower," he adds, but says he still thinks the MPC will eventually reduce rates to 3.50% rather than to the low of 4.00% that markets currently expect.
There was only one call for a cut today, compared to three at the last BoE 'hold' in December, with Swati Dhingra also not repeating her vote for a 50bps cut from February, while Catherine Mann, who also voted to cut rates by 50bps in February, voted to leave rates on hold.
Admittedly, he says there were "some dovish developments" in the policy statement, including the acknowledgement that global trade policy has intensified and that other geopolitical uncertainties have increased, and that surveys have suggested weakness in growth and particularly employment intentions.
They were "outweighed" by other new more hawkish comments on inflation rising from 3.0% in January to 3.75% in Q3 and less precise language on how inflation will fall back after as the Bank seems to be "getting a bit more worried" about the persistence in domestic wages and prices.
"In other words, there appears to be diminishing appetite for cutting rates faster and a growing desire to cut at the current pace at best."
12.23pm: Not a surprise
The BoE standing pat on rates is "not a huge surprise given the climate of uncertainty," says Rob Morgan, chief investment analyst at Charles Stanley.
"A cloudy domestic inflation picture, potential fiscal changes from the Chancellor, and a possible global trade war present significant complexities for monetary policy.
"The issue closest at hand is that inflation is still a problem. Despite weakness indicated by industry surveys, official measures of the UK jobs market still show a more robust picture with strong wage growth. This is feeding into services inflation, which has re-accelerated to 5% year-on-year."
He also notes that it is "still far from clear" how businesses are reacting to the increased costs of National Insurance contributions in April, with a large portion saying they intend to raise prices in response, which would further contribute to inflationary pressure.
"Waiting a little longer to see what permutation of higher prices, fewer jobs and reduced profits the economy is left with as this unfolds seems appropriate.
"The Bank is also mindful the Chancellor’s Spring Statement is just days away and any fiscal factors coming into play can be digested by its next meeting.
"By then the full geopolitical picture should be taking shape more clearly too. With a capricious President Trump looking to implement tariffs there is the potential for global inflationary pressures to build rapidly – even if the UK escapes much of the proximate trade war damage."
With Rachel Reeves poised to make some spending cuts next week to restore fiscal headroom, as well as possibly flagging some tax rises, "there is going to be growing pressure on the BoE to reduce rates further and it seems likely it will stick to its slow and steady approach of cutting at a roughly quarterly pace over the course of 2025".
12.12pm: A lot has happened, so let's wait and see, says BoE
The BoE notes that a lot has happened since the Monetary Policy Committee’s February meeting, with global trade policy uncertainty having "intensified", as the US has made a range of tariff announcements, to which some governments have responded.
Other geopolitical uncertainties have also increased, mostly relating to defence and security, to which the EU, Germany, UK and others have responded with plans for more spending and some reforms to fiscal rules.
"While UK GDP growth estimates have been slightly stronger than expected at the time of the February Monetary Policy Report, business survey indicators generally continue to suggest weakness in growth and particularly in employment intentions. In recent quarters, subdued activity has been judged to reflect both demand and supply factors."
The MPC again said it will continue to closely monitor the risks of inflation persistence and that monetary policy "will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further".
12.03pm: BoE votes for no rate cut
The Bank of England voted 8-1 to keep rates on hold.
One consenting vote was from Swati Dhingra, for a quarter-point cut.
BoE governor Andrew Bailey said there is “a lot of economic uncertainty at the moment” but the MPC still think that interest rates are “on a gradually declining path”.
The BoE said business survey indicators “generally continue to suggest weakness in growth and particularly in employment intentions."
Staff now forecast first-quarter GDP up 0.25% on the previous quarter, up from their February forecast of 0.1%.
Inflation is seen peaking at 3.75% in Q3, up from 3.7%.
11.06am: Market dive
US stock futures also dived in the past hour, along with European stocks.
The dollar index is up 0.5%, with with euro and Swiss franc down 0.5%, sterling down 0.4% and the Japanese yet just below flat.
While the DAX is down 1.4% in Frankfurt, and other European benchmarks are down around 0.9%, with the Euro Stoxx 600 down 1%, the FTSE 100 is only just below flat.
The Footsie's oil and pharma giants, along with LSE, RELX and Unilever are helping support the London index.
London's big fallers are education group Pearson, down 5.2% as its shares go ex-dividend, along with Beazley.
Defence and aerospace groups BAE, Rolls and Melrose, not helped by headlines overnight that non-EU groups might be excluded from big defence spending unless governments can do deals. Banks also down, most falling over 1%.
10.40am: Catering giant leads fallers
The biggest faller in Europe is caterer Sodexo, the French rival to Compass Group, which has crashed 20% after cutting its full-year outlook, saying organic growth in North America was slower than expected.
Organic revenue growth is now expected to be 3-4% for the year to August, down from the previous guidance of 5.5-6.5%.
"We are facing more challenges in Education, with volumes remaining low, and in Healthcare with postponements in the opening of new contracts," CEO Sophie Bellon said about the North American market.
Sodexo also said it underlying operating margin would not rise as much as expected.
"Today's warning will drag the overall catering space down," JP Morgan said. "However, we see today's warning as more company specific, with the weaknesses seen in Education in North America more specific to Sodexo's own exposure."
London-listed Compass Group PLC (LSE:CPG) fell 2.7%, down 8% this week, after a broker downgrade yesterday.
10.26am: Stocks tanking on tariffs talk
Blue chips in London and Europe are on the slide now, with Germany's CAC crumbling 1.7% and the French, Italian and Spanish benchmarks all down over 1% too.
Tariffs seem to be the cause. And the euro is down 0.5% to $1.0843.
European Central Bank president Christine Lagarde said the 25% tariff imposed by the US on imports from Europe would lower euro zone growth by about 0.3 percentage points in the first year, while retaliatory measures could increase this to about half a percentage point.
"In the near term, EU retaliatory measures and a weaker euro exchange rate...could lift inflation by around half a percentage point," she said at a hearing of lawmakers.
"The effect would ease in the medium term due to lower economic activity dampening inflationary pressures."
European Trade Commissioner Maros Sefcovic has also weighed in saying the EU could delay the imposition of a first set of counter-measures against the US until mid-April.
Tariffs on €4.5 billion of US products had been planned for on 1 April, followed by a further €18 billion of US goods on 13 April.
"We are now considering to align the timing of the two sets of EU countermeasures so we can consult with member states on both lists simultaneously, and this would also give us extra time for negotiations with our American partners," Sefcovic told the parliament in Brussels.
10.02am: LME fined over extreme nickel volatility in 2022
The UK financial watchdog has fined the London Metal Exchange £9.2 million for having inadequate systems and controls to deal with a massive short squeeze in the nickel market three years ago.
It what is the first enforcement action taken against a UK recognised investment exchange, the Financial Conduct Authority said the LME failed to ensure its systems and controls were "adequate to deal with severe market stress".
Between 7 and 8 March 2022, extreme volatility in the price of LME’s three-month nickel futures contract saw its price more than double the closing price on the previous day in little over an hour, leading to it suspending its nickel market for eight days and cancelling all nickel trades.
9.43am: Wickes shares feeling proud
Wickes Group shares are up 6% after the DIY and kitchen retailer reassured investors that full-year expectations remain intact, with a fresh £20 million share buyback also announced.
The company reported a solid start to 2025, with retail sales continuing to grow and improvements in its struggling kitchen and bathroom installation business.
For 2024, revenue dipped 1% to £1.54 billion as demand for big-ticket items remained weak, but trade sales were a bright spot.
9.21am: Wages and BoE thoughts
Various thoughts on the ONS jobs data as the BoE monetary policy committee meeting is underway.
Danni Hewson, AJ Bell head of financial analysis, says: "Picking our way through the UK’s jobs data has become tricky. Not only are we having to consider how reliable the numbers really are because of the health warnings from the ONS about small sample sizes, but we’re also hyper aware that the changes to labour costs announced in last year’s budget have yet to really filter through."
While today’s numbers look pretty settled, she says "we can’t look at these numbers without considering the bigger picture. Business after business has said that they expect the increased labour costs will impact their decisions in the year ahead and with growth expectations considerably softened, the case for investment might be one being pushed into the long grass."
Hewson also notes that Donald Trump’s chaotic implementation of tariffs has, in the words of Fed chair Jerome Powell, "muddied the outlook" for central bankers, governments and businesses alike, too.
Market analyst Neil Wilson at TipRanks says the data is "a trifle more encouraging" ahead of the Bank of England decision later.
As inflation rose by 3% in the year to January and the BoE sees inflation rising further this year, "the real risk" for the UK is the lack of growth, with the US tariff impact on global trade implying conditions will weaken.
He says Catherine Mann will be the MPC member to watch today, with the former "arch hawk" having advocated for a 50 basis point rate cut at the last meeting.
ING economist James Smith says thinking about the BoE decision later today, there labour market numbers offered "no clear impetus" for a greater number of officials to back a faster pace of rate cuts.
After Mann's switch from arch-hawk to arch-dove in February, Smith says she is likely to go against the committee again today and vote for another rate cut.
"At the time, she highlighted the risk of “non-linear” falls in employment as her catalyst for action. While she could still be proven right on that, for now, the data doesn’t appear to back up that line of thinking. Private sector pay growth appears to be slowing," says Smith.
"While other officials might not join Mann’s camp just yet, there are still good reasons to expect the Bank to keep cutting rates once per quarter throughout this year and into 2026," he adds, noting wage momentum appears to have slowed, which could mean services inflation may also prove more benign than the BoE expects.
9.07am: Shaftesbury deal 'unequivocally positive'
The deal by Shaftesbury Capital to sell a quarter of its stake in Covent Garden to Norges Bank, its largest shareholder for many years, "is unequivocally positive for Shaftesbury", says analyst John Cahill at Stifel.
First, completing the transaction at book value "shows portfolio is valued fairly", even with a low yield of 3.6%.
Second, the "significant" cash proceeds add to the company's existing reserves available for deployment, reducing the LTV to 16% from 27%, and the net debt to EBITDA ratio to 7x from 11x.
"Third, the co-investment with Norges further shields Shaftesbury from a possible takeover during the current UK REIT sector capitulation... unless that takeover bid was from Norges itself of course, though it would seem to us if Norges wanted to acquire all of Shaftesbury it has pockets deep enough to have done so long ago."
8.53am: Crest of a wave?
Topping the FTSE 350 leaderboard is Crest Nicholson PLC (LSE:CRST), following a trading update that reveals "an encouraging start to the yearn" and ahead of an investor day that analysts at Stifel call "long-anticipated".
Management set out their determination to improve build quality and customer service, increase efficiency and reset the landbank.
With profit margins having declined to 5% in 2024 from 15% in 2022, due to cost inflation, legacy building issues and soft selling prices, management aims to improve returns to industry levels, with an explicit target of reaching over 13% by 2029.
Trading continues to improve with sales rates for the past ten weeks 22% ahead of the prior year.
"The shares price in little improvement, at 0.54x book vs the sector on 0.93x, so there is significant upside if the strategy delivers improved returns as expected," said Stifel's Charlie Campbell.
8.42am: Rate cut - in Switzerland
The Swiss National Bank (SNB) has cut its key interest rate by 25bp to 0.25%, and indicated that it is willing to intervene in the foreign exchange market as necessary amid low inflationary pressures.
This appears to be the lowest interest rate in the world right now.
Capital Economics says: "We think today’s SNB rate cut... will be the last in this cycle.
"While inflation was very low in February, at just 0.3%, and may fall further in the coming months, underlying inflation has actually been a bit stronger than we had anticipated so far this year, limiting the need for further cuts."
8.31am: Bloomsbury blooming
Bloomsbury Publishing PLC (LSE:BMY) shares are up over 7% after the company said it is set for another strong year, with results surpassing expectations following a solid second half.
Best known for bestselling authors like JK Rowling and Sarah J Maas, the publisher revealed broad success across its fiction and non-fiction books in the past year, while its academic arm, Bloomsbury Digital Resources, continued to expand despite financial pressures in the sector.
A key driver of growth was last May’s acquisition of US publisher Rowman & Littlefield, where the integration is said to be progressing smoothly.
"Our authors, customers, consistent performance, and the scale and resilience of our business continue to underpin the confidence we have in the future," said the FTSE 250-listed company.
8.15am: FTSE starts higher
The FTSE 100 has started higher, taking some confidence from the US session overnight, rising 14 points or 0.2% to 8,720.8 at the open.
Mid-cap shares also started on the front foot, with the FTSE 250 climbing 63 points or 0.3% higher to 20,185.6.
Prudential PLC (LSE:PRU) topped the blue-chip risers on the back of its results, released early doors in Hong Kong and now also in London, where highlights included a dividend hiked 13%, 3% ahead of consensus, in addition to a $2 billion ongoing share buyback that is only halfway complete.
Real estate developer Shaftesbury Capital PLC (LSE:SHB) and housebuilder Crest Nicholson PLC (LSE:CRST) are topping the mid-caps.
Shaftesbury has announced a strategic partnership with the Norwegian sovereign wealth fund, Norges Bank, in respect of its Covent Garden estate.
7.54am: Ofgem support for the grid smaller than planned
Another regulator with an RNS news item this morning.
Energy regulator Ofgem has approved a smaller-than-expected £4 billion of investment for the country's three transmission owners owned by National Grid PLC, SSE PLC and Scottish Power to build out the electricity grid.
Late last year, Ofgem launched a consultation into potentially providing funding of between £5 billion and £8 billion to help speed the expansion of the electricity network.
7.46am: Stricter plans for BT
BT Group PLC's (LSE:BT.A) Openreach arm faces stricter oversight on pricing, under new proposals from the sector watchdog today, but it said the company should also "not have to incur unnecessary costs" for running the old copper network and full-fibre networks at the same time.
"Reflecting the greater-than-expected level of new infrastructure build, we now propose to identify more of the UK as having competition between broadband networks, or the potential for it," Ofcom said.
"Under our plans, competitors will continue to have access to Openreach's ducts and poles, so they can roll out their new full-fibre networks and connect customers quickly and at a lower cost than digging themselves."
7.30am: Fed decision last night 'a relief'
US markets "breathed a sigh a relief" following the Federal Reserve decision, last night, says Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
The Fed kept its policy rate unchanged as expected, cut the growth forecast and hiked its inflation outlook, but Fed chair Jerome Powell stressed that the potential impact of tariffs on inflation would be "transitory".
This implied that the Fed could continue to ease policy to support growth, said Ozkardeskaya. "And more importantly, the Fed decided to reduce the pace of quantitative tightening (QT) – a move that eases the tightening of the financial conditions."
"As such, the Fed elegantly downplayed the long-term impact of rising inflation while cutting its growth forecast."
The 'dot plot' of rate cut projections showed that Fed officials continue to foresee two rate cuts on average this year, with Fed funds futures now giving around 70% chance for the next cut to come in June.
"The decision was more dovish than expected," says Ozkardeskaya.
She notes that the US 2-year Treasury yield slipped below 4%, the 10-year yield eased below 4.25% and the dollar index reversed recent falls.
7.19am: Jobs numbers
Also within the labour market data from the Office for National Statistics, more timely data from February shows the jobless claims increased 44.2K, more than the 7.9K expected and the previous 22.0K, revised down to 2.8K.
February's claimant count rate was 4.7% versus 4.6% previously.
The number of payrolled employees was up 21K, with the previous figures revised down to 9K.
"Overall pay growth remains relatively strong, with pay growth high in both the public and private sectors, despite the latter slowing slightly in the latest period," said ONS director of economic statistics Liz McKeown.
"The wider labour market picture is relatively unchanged, with the number of employees on payroll broadly flat in the latest period and with little growth seen over much of the last year.
"Unemployment, as measured by the Labour Force Survey, and the Claimant Count have both increased slightly in the latest periods, though caution continues to be advised with the survey estimates.
"Initial estimates show that the number of vacancies is little changed on the previous quarter, remaining just above pre-pandemic levels."
The pound is down 0.2% versus the dollar at 1.298 and roughly flat against the euro at 0.8386.
7.10am: FTSE 100 called lower, UK unemployment unchanged
The FTSE 100 was called lower ahead of the open on Thursday, despite Wall Street enjoying a strong session overnight as the Federal Reserve provided a little more confidence to markets.
London's blue-chip index is predicted on futures markets to fall around 11 points at the open, having added just over one point yesterday to close at 8,706.7 to wrestle back from earlier negative positions and finish higher for the fifth day in a row.
Overnight, the Nasdaq led the gains, rising 1.4%, with the S&P 500 adding 1.1% and the Dow Jones 0.9%.
Asian markets are mixed this morning, with the Hang Seng down over 2% and the Nikkei down 0.25%, but India's Sensex up 0.7%.
UK jobs market figures have just been published, and the headlines are that there was little changed, with the unemployment rate remaining 4.4% in January.
Average wage growth including bonuses eased to 5.8%, from a revised 6.1% the previous time, while pay growth excluding bonuses remained at 5.9%, as expected. More on that in a second.
5am: What to watch on Thursday
The Bank of England meeting is expected to see interest rates held steady at 4.50%, following last month's cut, though last time saw a 'dovish' split of the vote, with two members of the monetary policy committee voting for a larger cut.
For the next meeting in early May, markets are currently pricing a 75% chance of a rate cut, with a 55% chance of a third cut in August, and several economists predicting a third cut this year.
Before the announcement at midday, there will be labour market data from the Office for National Statistics and a smattering of mid-cap and small cap results in the diary.
The unemployment rate is expected to remain at 4.4% in January, with average wage growth easing to 5.9% for the three months to January from 6.0% including bonuses, or remaining at 5.9% if excluding bonuses.
More timely data is expected to show the claimant count for February soften to under 8K, from 22K before, while HMRC payrolls are predicted to rise to 95K from 21K before.
Announcements due on 20 March:
Trading updates: Bloomsbury Publishing, Sanderson Design Group
Finals: Central Asia Metals, Energean, Eurocell, Foresight Solar Fund Ltd, Hostelworld Group, James Fisher & Sons
US earnings: Accenture, Nike, Micron, Fedex, Lululemon, Darden Restaurants, Factset Research
AGMs: BlackRock Energy & Resources Income Trust, Helix Exploration, Nuformix
Economic news: Unemployment (UK), Payrolls Change (UK), Claimant Count (UK), CBI Industrial Trends (UK), Bank of England Decision (UK), Existing Home Sales (US), Initial Jobless Claims (US), Philly Fed Manufacturing Index (US)
Ex-dividends to reduce FTSE 100 by: 1.34 (Hikma, Pearson, Beazley)