- FTSE 100 closes in red
- US stocks on the up
- Strong US PPI data
5.05pm: FTSE closes lower
FTSE 100 closed on Friday in the red with miners under pressure as commodity prices eased.
Britain's blue-chip benchmark finished down over 26 points, or 0.38%, at 6,915 but FTSE 250 stayed in the green, adding nearly four points, or 0.02%, to close at 22,251.
Chris Beauchamp, chief market analyst at trading group IG, said it was a "mixed bag" for stocks at the end of the week following on from some US producer price index (PPI) data, which came in "stronger than expected".
On Wall Street, the Dow Jones Industrial Average advanced around 80 points at 33,583, while the S&P 500 gained around nine at 4,106. The Nasdaq added six points at 13,853.
"Markets will once again have to revisit the topics of inflation and the Fed’s response to it, bearing in mind the dovish Fed minutes from this week," said Beauchamp.
"The feeling of being in uncharted waters remains, since normally PPI data begins to strengthen towards the end of the cycle, as the Fed is already tightening, but we are generally assumed to be at the beginning of a cycle, and no Fed tightening is in sight."
3.40pm: House prices hit record high in March
FTSE 100 held its losses before close and was down 21 points to 6,920, while sterling was flat at US$1.3731.
The average house price hit a new record high in March, according to the latest Halifax report, thanks to government support to boost confidence in the market.
The sector is benefitting from the stamp duty holiday and is expected to get a further lift from the new mortgage guarantee scheme that should start this month.
Last month, house prices were 6.5% higher than in March 2020 and 1.1% higher than in February, for an average of £254,606.
However, growth is expected to slow down by the end of this year due to the current levels of uncertainty and the potential for higher unemployment, the bank said.
House prices will be flat year-on-year by early 2022, the EY ITEM Club said, as the strengthening of the housing market has been outsized relative to economic fundamentals.
“Some quarters of falling prices likely at the end of 2021 and early on in 2022 as the Stamp Duty benefit ends, unemployment rises and there is a waning of pent-up demand,” noted Howard Archer, chief economic advisor to the EY ITEM Club.
“Housing market activity may also be affected from the latter months of 2021 onwards by growing expectations that interest rates could start to rise before long.”
3.20pm: Proactive North America headlines:
Phyto Extractions Inc (CSE:XTRX)(FRA:D2EP) launches three new Shatter Products, adding to its product line in the burgeoning cannabis extracts market
BioSig Technologies Inc (NASDAQ:BSGM) accepts invitation to join the Alliance for Artificial Intelligence in Healthcare
Vuzix Corporation (NASDAQ:VUZI) announces online panel discussion to discuss key takeaways for successful deployment of augmented reality for enterprise customers
Alternus Energy Group PLC (NOTC:ALT) on pace to see a tenfold increase in its power capacity by the end of 2023
Predictiv AI Inc (CVE: PAI) (OTCMKTS:INOTF) (FSE:71TA) installs ThermalPass scanners at Memorial Healthcare System facilities in south Broward County, Florida
American Manganese Inc (CVE:AMY) (OTCQB:AMYZF) (FRA:2AM) improves the manganese processing flowsheet for its US Defense Logistics Agency project
Hillcrest Petroleum Ltd (CSE:HEAT) (OTCMKTS:HLRTF) (FRA:7HI.F) rebranding as Hillcrest Energy Technologies as it transitions from fossil fuels to clean tech innovation and IP development
KWESST Micro Systems Inc (CVE:KWE) (OTCQB:KWEMF) upsizes brokered private placement to C$4M after it sees significant demand from investors
American Battery Metals Corporation (OTCQB:ABML) COO to speak at the US Energy Storage Association conference this month
ImagineAR Inc (CSE:IP) (OTCQB:IPNFF) technology 'drafted' by two motorsports organizations on day two of the Hype Sports Innovation Accelerator
Aurania Resources Ltd (CVE:ARU) (OTCMKTS:AUIAF) (FRA:20Q) finds black "pyrobitumen" through drilling at Kuri-Yawi target at Lost Cities- Cutucu project
CytoDyn Inc (OTCQB:CYDY) says its coronavirus long-haulers trial now fully enrolled faster than expected
2.45pm: Wall Street opens mixed
Wall Street has opened on a mixed footing on Friday after delayed and higher than expected US inflation report knocked investors a little of balance.
Shortly after the opening bell, the Dow Jones Industrial Average was up 0.32% at 33,609 while the S&P 500 rose 0.05% to 4,099. The Nasdaq was the outlier, falling 0.46% to 13,766.
The delayed data was the US producer price index (PPI), which showed the prices at the factory gates in America rose 1% in March, much faster than expected.
The rapid inflation rise is likely to reignite interest in wider US inflation and Fed policy, as well as the US government bond markets.
Back in London, the FTSE 100 had declined slowly into late afternoon, falling 19 points to 6,923 at around 2.45pm.
1pm: Wall Street to open in the green
FTSE 100 stayed put in the early afternoon, still down 2 points to 6,939.
US futures are pointing at a green open for the Dow Jones, S&P 500 and Nasdaq amid continued positivity.
“Steadying inflation concerns have opened the door for renewed buying interest in growth stocks,” said Richard Hunter at interactive investor.
“While the relief may be temporary, the previous rotation from value to growth has reversed. This resulted in a strong showing from big technology stocks which helped lift the S&P500, where the influence of the tech sector is significant, to another record closing high. Inevitably the Nasdaq index was also back in favour, with the likes of Microsoft and Apple clocking positive gains.”
“The imminent first quarter reporting season should add more colour to how companies are actually faring on the ground, while outlook comments will be scrutinised for further views on the economic rebound. More positively, the Fed remains determined to continue with its accommodative policies until such time as the picture clears and the expected bounce in economic fortunes gains traction.”
12.30pm: Royal Family announces death of Prince Philip
The Royal Family has announced that His Royal Highness The Prince Philip, Duke of Edinburgh, has died on Friday morning.
It is with deep sorrow that Her Majesty The Queen has announced the death of her beloved husband, His Royal Highness The Prince Philip, Duke of Edinburgh.
His Royal Highness passed away peacefully this morning at Windsor Castle. pic.twitter.com/XOIDQqlFPn
— The Royal Family (@RoyalFamily) April 9, 2021
He was born in Greece on 10 June 1921 and married Princess Elizabeth in 1947, who became Queen Elizabeth II in 1952.
Last month, Prince Philip left hospital after undergoing treatment for a month due to heart problems.
11.45am: Jet2 suspends flights and holidays until June
FTSE 100 was getting really close to green territory at lunchtime, dipping only 2 points to 6,939.
Jet2 PLC (LON:JET2) has announced it is suspending all flights and holidays until 23 June.
The travel firm said it was due to “continued uncertainty” after today’s framework published by the Global Travel Taskforce.
READ: Government says working to make traffic light scheme cheaper as airlines ratchet up criticism
“It has been over a year since international travel was first suspended because of the pandemic,” the company said in a release.
“Much has been achieved in that time, making it even more frustrating that we are still to receive a clear framework on how to restart international travel. We know it can be done, in a safe and secure way, and we will continue to support the government to achieve this.”
10.40am: Frasers Group reminds market of potential third wave as it warns of write-downs
FTSE 100 trimmed its losses in the late morning and was down 19 points to 6,922.
In the FTSE 250, Frasers Group PLC (LON:FRAS) was flat at 497.8p despite announcing its pandemic-related write-downs could exceed £200mln – more than twice its previous estimate.
Any such impairments would be in addition to impairments included in the half-year results announced on 10 December 2020, and would affect the current fiscal year, which runs to the end of April.
Mike Ashley’s retail group also said it believes further restrictions are “almost certain” having noted government statements regarding "third waves" and normality being "some way off".
“While other retailers appear to be riding a cheerful wave ahead of the re-opening of the high street, Frasers Group appears to be the party pooper, sounding a cautionary note about getting carried away too soon,” analysts at Hargreaves Lansdown noted.
“It’s the make up of Frasers Group’s retail portfolio which puts it under particular pressure. Although it has a significant online presence, to offset some of the lost sales, it also has a large footprint of stores in high streets which have fallen out of favour with shoppers, compared to retail parks, even when restrictions have eased.”
9.30am: UK government to bring down costs of COVID-19 tests for international travel
FTSE 100 dove deeper into the red in mid-morning, sliding 32 points to 6,910, while sterling was down 0.2% to US$1.3699.
“The same vaccine and third wave concerns that infected the pound this week may be creeping their way over to the blue-chip index,” noted Connor Campbell at Spreadex.
“This in light of the WHO’s warning on Thursday that it is the lockdown measures in place since Christmas, and not the vaccine rollout, that has supressed COVID-19 cases in the UK – a worry given the recent easing, and daily case numbers that, whilst falling, still number in the thousands.”
Meanwhile, transport secretary Grant Shapps said the government is committed to drive down the cost of coronavirus tests to make international travel more accessible.
The Global Travel Taskforce has published on Friday its recommendation for the ‘traffic light’ system categorising countries based on infection rates, vaccine rollouts and presence of variants.
However, it said it is too early to say how countries will be labelled for the summer.
8.30am: FTSE 100 pauses for breath
The FTSE 100 paused for breath after a 3% advance in the top stock index in just three trading days.
The morning’s lethargy on this side of the Atlantic contrasted with a resurgence of interest in American technology shares.
“Steadying inflation concerns have opened the door for renewed buying interest in growth stocks,” said Richard Hunter, head of markets at Interactive Investor.
“While the relief may be temporary, the previous rotation from value to growth has reversed.
“This resulted in a strong showing from big technology stocks which helped lift the S&P500, where the influence of the tech sector is significant, to another record closing high.”
Microsoft (NASDAQ:MSFT) and Apple (NASDAQ:AAPL) were well bid.
In London, much of the early action was seen on the FTSE 250, which slipped after another record close.
Engineer Babcock (LON:BAB) lost 6.6% following a Financial Times report suggesting it was preparing to make wholesale asset write-downs.
Travel firm TUI (LON:TUI) dropped 5.3% after it said it would tap the debt markets for up to €400mln of additional liquidity via a convertible bond.
A better than expected market update from recruiter PageGroup (LON:PAGE) pushed the shares 8.8% higher.
Proactive headlines:
Next Fifteen Communications PLC (LON:NFC) announced the acquisition of the entire issued share capital of data-led business Shopper Media Group (SMG) for £15.7mln.
Open Orphan PLC said its hVIVO operation has officially launched its Disease in Motion platform, a collation of clinical, immunological and virological biomarkers as well as data from wearable technology.
Alpha Growth PLC (LON:ALGW) said the trend of growth and improved operational & financial performance continued in the first quarter of 2021. Assets under management, which at the end of 2020 were said to be in excess of US$22mln, rose to US$25.5mln at the end of March.
IronRidge Resources Limited (LON:IRR) said it has strengthened its management team through the appointment of Mark Schild as full-time Group Financial Controller.
ECR Minerals PLC (LON:ECR), the gold exploration and development company focussed on Australia, has raised £2mln through a share placing.
Directa Plus PLC (LON:DCTA) has announced the appointment of Giorgio Bonfanti, who will take up the position of chief financial officer at the end of May. Bonfanti has been employed by the global accountancy network PwC since 2014, working out of their Milan office.
Sativa Wellness Group Inc (LON:SWEL) said it has closed the first tranche of its non-brokered private placement of units in the company raising gross proceeds of C$3.6mln.
Custodian REIT plc (LON:CREI) has unveiled the constitution of an environmental, social and governance (ESG) board committee. The committee comprises Hazel Adam as Chair, Elizabeth McMeikan and Chris Ireland, all of whom are independent non-executive directors of the company.
Bezant Resources PLC (LON:BZT) said AsiaPhos Ltd has terminated its proposed acquisition of MMJV Pte. Ltd, which if successfully completed would have triggered a payment of around £5.6mln in AsiaPhos shares being issued to Bezant.
Power Metal Resources PLC (LON:POW) said it has secured a short extension to its option to acquire First Development Resources (Pty) Limited, an Australian private company with a portfolio of copper-gold focused exploration interests in the Paterson Province in the eastern Pilbara Region of Western Australia. Late on Thursday, the company said the exercise period of the agreement has been extended to April 16, 2021, from its original date of April 8.
Tirupati Graphite PLC (LON:TGR) said production and sales from its Sahamamy deposit in Madagascar ran at record levels during the first three months of 2021.
San Leon Energy PLC (LON;SLE) said a drilling rig has been contracted for the Oza-1 re-entry well in Nigeria.
Walls & Futures REIT PLC (LON:WAFR) has advised shareholders to take no action regarding a cash offer from Virgata Services. Directors of the supported housing specialist said the offer was opportunistic and substantially undervalues the company.
6.50 am: Footsie set to stand pat
After a record-breaking week for some stock market indices, among them the FTSE 250, a pause for breath seems in order.
Spread betting quotes indicate the FTSE 100 will open just 4 points to the good at 6,946.
“European markets look set to open in positive territory this morning, as they look to continue where they left off yesterday after US markets finished higher with another record close for the S&P500, as it got to within a whisker of 4,100, led predominantly by the tech sector,” said CMC’s Michael Hewson.
“Asia markets ended the week on a more mixed note with the latest China inflation data pointing to a decent rebound in March. Factory gate prices, in particular, were strong rising 4.4% on an annualised basis, compared to 1.7% in February, as economic activity picked up at the end of Q1. As a forward indicator this could well be an arbiter of rising prices rippling out into the global economy as we head into Q2,” he added.
Jeffrey Halley at OANDA said the Federal Reserve chairman, Jerome Powell, stayed “solidly on message” overnight, once again emphasising the “Fed's priority in assisting the US employment recovery while dismissing inflation concerns as transitory”.
The comments came after the Dow Jones index had climbed 57 points to close at 33,504 and the S&P 500 had risen 17 points to finish at 4,097.
In Japan this morning, the Nikkei 225 has advanced 204 points to 29,913 but in Hong Kong the Hang Seng index is down 212 points at 28,796, after the US sent seven Chinese supercomputing firms to the naughty step with an export ban.
Looking at today’s agenda, you’d have thought that in a shortened week (because of Easter) there would be some company results scheduled, even on what is traditionally a quiet day of the week for corporate announcements, but you’d be wrong.
It’s too soon after the end of the quarter and too long after the end of the year. There are sure to be some announcements but the usual sources have not been given notice of what they are.
That leaves the Halifax house price index as the major “known unknown”, as Donald Rumsfeld might put it. The March index is expected to rise 0.2% from February’s level after falling 0.1% in February.
On the face of it, that looks like a rebound but the annual increase in the index is expected to retreat to 5.1% from February’s 5.2%.
n the US, the March producer price index is expected to a 0.4% increase, which represents a slight slowdown from February’s 0.5%.
US wholesale inventories, which on a normal day would be far down the bill below the sword swallowers and contortionists, might also garner some attention from insomniac traders.
Economists are expecting a 0.5% advance for February, following February’s 1.3% gain.
Around the markets
- Sterling: US$1.3726, down 0.1 cents
- 10-year gilt: 0.751%, down 2.63 bps
- Gold: US$1,752.60 an ounce, down US$5.60
- Brent crude: US$63.18 a barrel, down 2 cents
- Bitcoin: US$58,216, up US$534
6.50am: Early Markets - Asia / Australia
Stocks in the Asia-Pacific region were mostly lower on Friday even as the S&P 500 in the US surged to yet another record closing high overnight.
The Hang Seng index in Hong Kong slipped 0.88% while the Shanghai Composite in China fell 0.78%.
In Japan, the Nikkei 225 rose 0.54% but South Korea’s Kospi dipped 0.28%.
Shares in Australia were weaker, with the S&P/ASX 200 trading 0.20% lower.
Proactive Australia news:
Australian Potash Ltd (ASX:APC) hit a new record high after ongoing work at its 100%-owned Laverton Downs Project (LDP) returned compelling targets with Kambalda-style massive nickel sulphide potential.
Jindalee Resources Ltd (ASX:JRL) has skyrocketed after confirming that the upgraded resource estimate of 10.1 million tonnes at McDermitt Project on the Oregon-Nevada border is the USA's largest lithium deposit by contained lithium.
Kazia Therapeutics Ltd (ASX:KZA) (NASDAQ:KZIA) (FRA:NV9) will share new data from its ongoing phase II study of paxalisib in glioblastoma in a poster presentation at the prestigious American Association of Cancer Research (AACR) Annual Meeting being held virtually from April 10-15 and from May 17-21, 2021.
Latin Resources Ltd (ASX:LRS) (FRA:XL5) ongoing test results from the Noombenberry Project in Western Australia are showing some of the highest grade halloysite and kaolin assays in Australia, including a 41% halloysite assay.
Australian Strategic Materials Ltd (ASX:ASM) (OTCMKTS:ASMMF) has received a strong endorsement of its integrated metals production strategy centred on rare earths by attracting two new substantial shareholders.
Chase Mining Ltd (ASX:CML) executive chairman Dr Leon Pretorius, non-executive director Julian Atkinson and non-executive director Charles Thomas have shown support for the company’s exploration strategy by participating in a share placement.