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London open: FTSE edges down after US losses
London stocks edged lower in early trade on Friday following a downbeat close on Wall Street.
At 0920 BST, the FTSE 100 was down 0.3% at 8,417.94.
Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said: “Although market enthusiasm has stalled slightly, the FSTE remains in a relatively bright mood overall. The follows the Dow touching an all-time high yesterday, as positive expectations for the Federal Reserve’s interest rate plans continue to buoy sentiment.
“The next catalyst for change will be more UK data, as company results season starts to fizzle out in earnest after today. With fewer corporate news stories in the diary, the macro picture will be the driving force over the coming weeks.”
Investors were mulling the latest move by the Chinese central bank, which stepped in again to help the struggling property sector on Friday by relaxing lending rules.
The news came as data showed house prices in major cities fell last month, while industrial production and retail sales data painted a more mixed economic picture.
In equity markets, Land Securities fell despite reporting a halving of its full-year losses.
Auto Trader was under the cosh after a downgrade to ‘underweight’ from ‘equalweight’ at Morgan Stanley.
GSK was in focus after selling its remaining 4.2% stake in consumer health business Haleon, which it spun off in July 2022. The pharmaceutical company sold just over 385m ordinary shares in Haleon at 324p each, raising gross proceeds of about £1.25bn.
BT Group was on the rise again, having surged on Thursday after it reported a 31% drop in annual profits but also laid out plans to save £3bn of costs a year by the end of the decade.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Rio Tinto Plc | +1.49% | +84.00 | 5,733.00 |
| 2 |  |
United Utilities Group Plc | +1.28% | +14.00 | 1,111.00 |
| 3 |  |
Sage Group Plc | +1.11% | +12.00 | 1,096.50 |
| 4 |  |
Barratt Developments Plc | +1.04% | +5.40 | 524.80 |
| 5 |  |
Severn Trent Plc | +0.95% | +25.00 | 2,649.00 |
| 6 |  |
Bt Group Plc | +0.90% | +1.20 | 133.80 |
| 7 |  |
Vodafone Group Plc | +0.88% | +0.68 | 78.20 |
| 8 |  |
Bunzl Plc | +0.79% | +24.00 | 3,068.00 |
| 9 |  |
Tesco Plc | +0.75% | +2.30 | 309.00 |
| 10 |  |
Kingfisher Plc | +0.73% | +1.90 | 263.50 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Auto Trader Group Plc | -3.84% | -29.00 | 726.00 |
| 2 |  |
Spirax-sarco Engineering Plc | -3.29% | -315.00 | 9,265.00 |
| 3 |  |
Ashtead Group Plc | -3.11% | -188.00 | 5,848.00 |
| 4 |  |
Tui Ag | -2.97% | -17.00 | 556.00 |
| 5 |  |
Dcc Plc | -2.32% | -140.00 | 5,895.00 |
| 6 |  |
Land Securities Group Plc | -2.32% | -16.00 | 674.00 |
| 7 |  |
Ferguson Plc | -2.29% | -390.00 | 16,640.00 |
| 8 |  |
Flutter Entertainment Plc | -2.11% | -350.00 | 16,245.00 |
| 9 |  |
Itv Plc | -1.65% | -1.30 | 77.50 |
| 10 |  |
Easyjet Plc | -1.65% | -8.20 | 489.50 |
US close: Stocks fall as markets retreat from record highs
US stock markets finished lower on Thursday, dropping into the red in afternoon trade, as investors took profits amid a barrage of economic data after Wall Street’s three main indices all hit record highs the previous session.
The Dow closed down 0.10% at 39,869.38, after briefly topping the 40,000 mark for the first time in history, pulling back from the previous day’s all-time closing high of 39,908.
The S&P 500 also slipped from back from record highs, falling 0.21% to 5,297.10, while the Nasdaq declined to 16,698.32, down 0.26% from Thursday’s peak of 16,742.39.
“Investors have been pumped up by the latest inflation reading, believing it is cool enough to stir the Federal Reserve into action and cut rates in the near future,” said Dan Coatsworth, investment analyst at AJ Bell.
“It also helps that quite a few US companies are getting a positive reaction to their latest results, together lifting the general mood around the markets and firing up enthusiasm to make trades.”
Economic data barrage
US building permits fell by 3% to 1.44m in April, according to the Census Bureau, the lowest reading since December 2022 and below market expectations of 1.48m, while housing starts rose 5.7% month-on-month to 1.36m, below forecasts of 1.42m.
Seasonally adjusted initial unemployment claims fell by 10,000 over the week ending on 11 May. Economists had anticipated a drop to 220,000. The four-week moving average, which aims to strip out week-to-week volatility, meanwhile rose by 2,500 to 217,750.
The Federal Reserve Bank of Philadelphia’s manufacturing sector index slipped from a reading of 15.5 in April to 4.5 for May. Economists had pencilled in a decline to 8.
Seasonally adjusted US import prices leapt 0.9% month-on-month, according to the Department of Labor, ahead of the consensus forecast of 0.3%. That was chiefly the result of a 2.4% jump in fuel import prices, while those of non-fuel imports rose by 0.7%.
US industrial production decreased 0.4% year-on-year in April for the first drop in three months, according to the Federal Reserve, while capacity utilisation edged down to 78.4% in April from an upwardly revised 78.5% in March, and in line with market estimates.
Market movers
Walmart shares jumped 7% to a record high after posting quarterly numbers that came in ahead of estimates thanks to an increased percentage of high-income shoppers and a jump in online sales. The retail giant also said net sales and adjusted earnings would be at the high end of slightly above earlier guidance.
Insurance group AIG announced the sale of a 20% stake in retirement and insurance firm Corebridge Financial to Japanese peer Nippon Life for $3.8bn, causing shares in Corebridge to surge 8%.
Chevron finished lower on reports it is set to launch the sale of its remaining UK North Sea oil and gas assets, in a move that would mark the US energy firm’s exit from the ageing basin after more than 55 years.
Meta fell after the European Commission launched formal proceedings to investigate whether the company may have breached the Digital Services Act through how it treats and protects minors on Facebook and Instagram. Meta will be investigated over whether it is exploiting the weakness and inexperience of minors to cause addictive behaviour on Facebook and Instagram.
Friday newspaper round-up: Bank branches, mortgages, Northern Rock
The number of UK bank branches that have shut their doors for good over the last nine years will pass 6,000 on Friday, and by the end of the year the pace of closures may leave 33 parliamentary constituencies – including two in London – without a single branch. The tally is being published by the consumer group Which? as it seeks to make the “avalanche” of closures and the “disastrous” impact they can have on local communities an election battleground. – Guardian
Three UK banks have announced cuts to the cost of fixed-rate mortgages, reversing some of the price rises seen in recent weeks. Barclays Bank has announced it will reduce the price of five-year fixed-rate deals for new borrowers and remortgagors by up to 0.45 percentage points from Friday. Its five-year fixed-rate for borrowers with a 40% deposit is decreasing from 4.47% to 4.34%. – Guardian
Swathes of nuclear waste are set to be buried in the English countryside after ministers agreed to dig a 650ft pit starting this decade. The facility, which has yet to be allocated a site, will hold some of the 5m tonnes of waste that was generated by nuclear power stations over the past seven decades. This will ease pressure on the 17 nuclear waste disposal plants currently in operation around the country, which consist of giant sheds and cooling ponds. – Telegraph
A group fighting for compensation for 150,000 Northern Rock shareholders whose shares were seized in the lender’s 2007 collapse and nationalisation is to resuscitate its campaign. The Northern Rock Shareholder Action Group accused the government of grabbing profits of as much as £9 billion after it took control of the mortgage bank in the wake of a depositor run. – The Times
The prospect of government opposition to a proposed £3.5 billion acquisition of the Royal Mail’s parent company has receded after the business secretary welcomed contractual undertakings being negotiated as part of a Czech tycoon’s takeover. In a potentially politically significant moment for the deal, on Thursday Kemi Badenoch met Martin Seidenberg, the chief executive of International Distributions Services, Royal Mail’s parent company, after Wednesday’s 370p-per-share “non-binding” proposal from EP Group, a conglomerate controlled by Daniel Kretinsky, a billionaire investor. – The Times
