Hot Features
Premium
Trade like a pro: Leverage real-time discussions and market-moving ideas to outperform.
London open: Stocks fall after surprise BoJ move
London stocks fell in early trade on Tuesday, taking their cue from a weak Asian session, after a surprise policy shift from the Bank of Japan.
At 0820 GMT, the FTSE 100 was down 0.7% at 7,313.12.
Earlier, the BoJ shocked markets as it held its benchmark interest rates steady but said it was widening its yield target range.
The Bank left the policy balance rate unchanged at -1.0% and the 10-year yield control target unchanged at zero. However, it also announced a surprise tweak to the yield control curve policy meaning that it will now allow the 10-year bond yield to fluctuate in a range of 0.5% above or below the target of zero, versus 0.25% previously.
The BoJ said in a statement that the change to the yield curve control policy is expected to “enhance the sustainability of monetary easing”.
The yen strengthened and bonds sold off after the announcement.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said: “The decision is being read as a sign of testing the water, for a potential withdrawal of the stimulus which has been pumped into the economy to try and prod demand and wake up prices.
“But the Bank is still staying firmly plugged into its bond purchase programme, claiming this is just fine tuning, not the start of a reversal of policy.”
With only days to go until Christmas, there was just a smattering of corporate news.
Petrofac tumbled after the oilfield services provider warned that it expects a full-year group EBIT loss of around $100m due to challenges in the Engineering & Construction segment.
International distribution group Bunzl said it was selling its UK healthcare division to Mediq and buying four other businesses.
Elsewhere, Irn Bru maker AG Barr took full ownership of plant-based milks business Moma Foods after buying the remaining 38.2% stake from founder Tom Mercer and the other minority shareholders for £3.4m.
Fuel and toll payments company Eurowag said it was buying the remaining 30% Sygic it does not already own for €14.4m.
Hilton Food Group said it has signed a long-term collaboration in Singapore with Country Foods.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
|||||||
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Johnson Matthey Plc | +0.85% | +18.00 | 2,133.00 |
| 2 |  |
Sainsbury (j) Plc | +0.73% | +1.60 | 221.70 |
| 3 |  |
Antofagasta Plc | +0.68% | +10.00 | 1,481.00 |
| 4 |  |
Fresnillo Plc | +0.44% | +3.80 | 868.00 |
| 5 |  |
Glencore Plc | +0.39% | +2.10 | 538.90 |
| 6 |  |
Hsbc Holdings Plc | +0.37% | +1.85 | 497.60 |
| 7 |  |
Compass Group Plc | +0.37% | +7.00 | 1,910.50 |
| 8 |  |
Bp Plc | +0.33% | +1.55 | 468.15 |
| 9 |  |
Shell Plc | +0.28% | +6.50 | 2,293.50 |
| 10 |  |
Astrazeneca Plc | +0.23% | +26.00 | 11,134.00 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
|||||||
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Sage Group Plc | -3.27% | -25.20 | 746.00 |
| 2 |  |
Ocado Group Plc | -3.12% | -19.80 | 614.20 |
| 3 |  |
Land Securities Group Plc | -2.47% | -15.20 | 600.40 |
| 4 |  |
Tui Ag | -1.90% | -2.60 | 134.00 |
| 5 |  |
Segro Plc | -1.70% | -13.00 | 751.80 |
| 6 |  |
British Land Company Plc | -1.70% | -6.60 | 381.90 |
| 7 |  |
Auto Trader Group Plc | -1.57% | -8.20 | 513.60 |
| 8 |  |
Easyjet Plc | -1.50% | -5.20 | 341.80 |
| 9 |  |
Carnival Plc | -1.19% | -7.00 | 580.00 |
| 10 |  |
Persimmon Plc | -1.08% | -13.00 | 1,196.00 |
US close: Stocks lower as recessionary fears continue to weigh on sentiment
Wall Street stocks closed lower on Monday following back-to-back losing weeks for major indices.
At the close, the Dow Jones Industrial Average was down 0.49% at 32,757.54, while the S&P 500 lost 0.90% to 3,817.66 and the Nasdaq Composite saw out the session 1.49% weaker at 10,546.03.
The Dow closed 162.92 points lower on Monday, extending losses recorded in the previous session as market participants struggled to shake off recessionary concerns after the Federal Reserve announced a 50 basis point short-term interest rate hike.
With all three major indices heading south on Monday, US stocks remained firmly on track to end the month in the red, with a Santa Claus rally now looking less likely.
On the macro front, the National Association of Home Builders‘ December housing market index fell from 38 in October to 33 in November – an 11th straight loss and, outside the immediate onset of the Covid-19 pandemic, the lowest reading since 2012.
Current sales conditions declined to 39 from 45, sales expectations in the next six months went down to 31 from 35, and traffic of prospective buyers fell five points to 20.
No major corporate earnings were released on Monday.
Tuesday newspaper round-up: Asda, Capricorn Energy, Wirecard
MPs have called for a ban on forced installations of prepayment meters amid fears that elderly and vulnerable people are being effectively cut off from heating and power supplies. Prepayment meters (PPM) are under the spotlight as thousands of warrants allowing forced installations are being issued while households struggle with a rise in the cost of energy. – Guardian
A raft of nuclear power station closures have condemned France to two years of low output at the height of the European energy crisis, the country’s state-owned electricity company has said. EDF is forecasting annual output below historic typical levels until 2024 as it grapples with maintaining its ageing fleet. – Telegraph
Asda is battling a shortage of shopping trolleys in the crucial lead-up to Christmas. The supermarket is waiting on stocks of trolleys to be replenished after placing an order in October, as manufacturers in China are impeded by rigid Covid restrictions and a surge in cases. In some locations across the UK, Asda shoppers have been faced with empty trolley racks as a result. – Telegraph
A leading investor in Capricorn Energy is attempting to oust almost all of the oil company’s board in protest at a proposed merger it has called “a quick sale at the wrong price”. Palliser Capital, a hedge fund that owns almost 7 per cent of the FTSE 250 group’s shares, has requisitioned an emergency general meeting to seek the removal of seven of the nine directors including Simon Thomson, the chief executive, who has led the company for more than a decade. – The Times
Wirecard was “a swindle from the beginning” with the former chief executive Markus Braun at its core, a key prosecution witness in a criminal fraud trial examining its collapse has told a court in Munich. Oliver Bellenhaus, who was head of the German payments group’s subsidiary in Dubai, became a chief witness in the case after turning himself in to the authorities in 2020. – The Times
