- FTSE 100 ends 44 points lower
- But up 12% for 2019, a strong year for global stocks
- Over the decade Footsie leapt 40% in value
12.45pm: Ring in the new
The FTSE 100 index closed out the last session of the year – and the decade – with a whimper rather than a bang, but it still notched up pretty solid gains for the two time periods.
At the final closing bell of 2019, the UK blue-chip index was 44.61 points, or 0.6% lower at 7,542.44, above the half-day low of 7,532.38, having sunk from a session peak of 7,587.41.
The benchmark closed at 6,728.10 a year ago, so it has put on over 800 points, or just above 12% in a pretty volatile year.
It ended December 31 2009, the final session of the Noughties at 5,412.88 - so that’s a gain of almost 40% for the decade which followed the 2008 financial crash.
Chris Beauchamp, chief market analyst at IG commented: “It has been a year for rallies in equities, even for the FTSE 100, which is up about 12% in price terms from New Year’s Eve 2018. Compared to the S&P 500 or the Dax, this is fairly unimpressive, but is unsurprising given the tough macro outlook not just for the UK but for the broader global economy.
“We endured plenty of Brexit and trade war headlines in 2019, but these will go with us into next year, ensuring more volatility for traders and investors.”
He added: "The dollar ends the year on the back foot too, with signs of further life today in a host of other currencies. In addition, the last year has been a good one for gold bugs, and 2020 may well be a strong one too, if inflation picks up and Fed policy remains loose.
“Gold seems to have finished its pullback from the 2019 highs, and having stabilised in Q4 it looks poised to move higher once again.”
12.10pm: Ring out the old
Ahead of the curtailed 12.30pm close today, profit-taking and a stronger pound are the likely reasons why London’s blue-chip stocks seem set to end the decade on a bum note.
The FTSE 100 is down 46 points or 0.6% at 7,540.70, while sterling is up 0.7% against the dollar at 1.3198.
A trio of drug manufacturers are lurking on the bottom three rungs of the index at noon, namely Hikma Pharmaceuticals (LON:HIK), GlaxoSmithKline (LON:GSK) and AstraZeneca (LON:AZN).
Despite President Trump’s hawkish trade adviser Peter Navarro saying Phase One of the US-China deal was “in the bag”, traders may be looking a little further ahead.
“While market volumes are predictably light, investors continue to strike a year-end cautionary tone as December optimism is gradually giving way to 2020’s uncertainty,” says Stephen Innes of AxiTrader.
“Sure, the worst-case of a tariff escalation scenario has been seemingly averted.
“But, once the P1 deal is signed, investors will then press to consider the P2 risks, after all how much more progress can be realistically expected ahead of the US elections next year.”
10.40am: FTSE trims losses
London stocks have pared the worst of their losses even though the pound is strengthening.
By mid morning the FTSE 100 was down just 20 points at 7,567.28 while sterling was up 0.4% versus the dollar at 1.3163.
With the Footsie ending last year at 6,728.13, this means we're heading for around a 12.5% gain over the past 12 months.
Oil prices have had a topsy-turvy year, but after ending 2018 at US$53.8 are on track to have spurted 24% higher.
Among the commodities complex, there has been a real mix of stories, with palladium one of the success stories but key metals like copper seeing disappointing progress. As 2020 rolls around, you might want to read our feature on 'What's next for commodities'.
There are also predictions aplenty for digital commodities in the form of cryptocurrencies in another forward-looking feature: 'Crypto 2020: predictions and investment ideas for the year ahead'.
For a look back, we've taken a look at the winners and losers in 2019 among the FTSE 350 stocks, as well as the best and worst performers of the past decade - with best performer having increased 46-fold and still not a household name.
8.30am: FTSE opens on back foot, after year of global gains
The Footsie is finishing the year on the back foot, lurching lower as trading kicked off on New Year’s Eve.
London’s stock benchmark dropped 41 points or 0.5% to 7,546.17 in the first half-hour of trading on Tuesday as the pound picked up a little against the dollar, adding 0.1% to 1.3132.
NMC Health (LON:NMC) and Bunzl (LON:BNZL) are bottom of the FTSE 100, but internationally focused banks and other overseas earners dominate the lower echelons, including Barclays (LON:BARC), HSBC (LON:HSBA), British American Tobacco (LON:BATS) and Coca-Cola HBC (LON:CCH).
But the past year has been the best for global indices since the financial crisis, with the MSCI World Index roaring 24% higher since starting last January at 456 points and now at 564.38, just down from last week's all-time high of almost 567.
Proactive news headlines
Redx Pharma PLC (LON:REDX) said it is in discussions about a possible cash offer from an investor group led by Franco-US biotech veteran Sam Waksal.
Bango PLC (LON:BGO) said underlying earnings were positive this year as end-user spend of its mobile customer billing technology doubled for the fifth year in a row.
Ncondezi Energy Ltd (LON:NCCL) said it remains on track to deliver a formal tariff offer to the Mozambique authorities in “early Q1 2020” after receiving tender bids from engineering and operations partners.
The merger between Open Orphan PLC (LON:ORPH) and AIM-listed peer hVIVO PLC (LON:HVO) is going ahead after sufficient shareholder approval has been received.
Amur Minerals Corporation (LON:AMC) and its advisers are reviewing fresh rock mechanics, reserves estimates and metallurgical studies ahead of the next stages of its pre-feasibility study for the Russian nickel copper sulphide project.
6.45am: FTSE tipped to tumble
The FTSE 100 has been tipped to tumble on New Year’s Eve, as an element of caution reigned for the last days of trading for 2019.
London’s blue chip shares index is expected to fall almost 30 points, according to spread-betters using the IG platform, which would extend the losses seen at the start of the week.
This follows an 11-day winning streak in the run up to Christmas as the pound has picked back up, now at $1.3116.
Tuesday will only be a half-day session on the London Stock Exchange, with trading closing at 12.30pm.
A fall from the FTSE would track the moves seen overnight on Wall Street, where the Dow Jones sank 183 points or 0.6% to 28,462.14, with the S&P down 0.6% and the Nasdaq Composite falling 0.7%.
These declines came before the White House’s trade adviser said in a TV interview that he expected a trade deal with China could be signed within “within the next week or so”.
There were also reports in the South China Morning Post that Washington has invited a delegation from Beijing to travel to the US this weekend to sign a deal.
Back in the UK, the business headlines will be dominated by Downing Street’s announcement that the minimum wage will be increased from the start of April, with over-25s in line to receive an increase from £8.21 an hour to £8.72.
No major economic data is expected today.
Around the markets:
The pound: US$1.3118, flat
Gold: US$1,514 per ounce, up 0.2%
Brent crude: US$66.59 per barrel, down 0.1%
Business headlines
The Guardian - White House expecting agreement with China 'within next week or so'
Financial Times - EU commissioner casts doubt on Johnson’s Brexit deal deadline
Financial Times - Low-paid workers to get 6.2% rise in living wage
The Guardian - TSB staff sacked over gaming of customer compensation system
The Times - Next tribute to former chief executive Sir David Jones