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London open: Stocks fall as investors mull house price data
London stocks fell in early trade on Tuesday as data showed that house prices fell in December for the first time since March, although they ended the year in the black.
At 0850 GMT, the FTSE 100 was down 0.4% at 8,219.07.
According to Halifax, house prices declined by 0.2% on the month following five consecutive monthly increases, and 1.2% growth in November.
On an annual basis, prices were up 3.3%, down from 4.7% growth in November and leaving the average price of a home at £297,166.
Amanda Bryden, head of mortgages at Halifax, said: “The housing market was broadly steady at the start of 2024, with house price growth taking off from the summer onwards. In the latter half of the year, house prices grew in response to the falls in mortgage rates, alongside income growth, both leading to financial pressures somewhat easing for buyers.
“Impending changes to Stamp Duty thresholds have also given prospective first-time buyers even greater motivation to get on the housing ladder and bring any home-buying plans forward. Together, these elements meant mortgage demand picked up, hitting the highest level in over two years and back to levels seen pre-pandemic.
“In many areas across the country, house prices were also buoyed by demand outstripping supply, possibly further amplified by homeowners holding off putting their property on the market – perhaps in anticipation of mortgage rates reducing further.”
She said that while the housing market has been supported in recent months by falling mortgage rates, income growth and the announcement on upcoming Stamp Duty policy changes, mortgage affordability will remain a challenge, especially as the Bank Rate is likely to come down more slowly than previously predicted.
“However, providing employment conditions don’t deteriorate markedly from a more recent softening, buyer demand should hold up relatively well and, taking all this into account, we’re continuing to anticipate modest house price growth this year.”
In equity markets, JD Sports was the top gainer on the FTSE 100 after Bank of America Merrill Lynch reinstated coverage of the stock at ‘buy’.
Next was also a high riser as the clothing retailer lifted full-year guidance after better-than-expected December sales but warned UK growth is likely to slow, as employer tax increases, and their potential impact on prices and employment, begin to filter through into the economy.
Full-year guidance for the 12 months to January was lifted by £5m to £1.01bn after underlying full-price sales rose by 5.7% against expectations of a 3.5% increase. For 2026, Next anticipates full-price sales growth of 3.5% and profit before tax of £1.046bn, up 3.6%.
3i Group advanced after Citi opened an “upside catalyst watch” on the buy-rated shares, but AJ Bell fell after the bank cut its rating to ‘sell’, citing risks from cash balances and competitor pricing.
Raspberry Pi slid after a downgrade to ‘reduce’ at HSBC, while Pennon was knocked lower by a downgrade to ‘sell’ at Deutsche Bank and Mondi lost ground after a downgrade to ‘neutral’ at BNPP Exane.
Housebuilder Taylor Wimpey was weaker after a downgrade to ‘equalweight’ at Barclays.
Coats Group retreated as the industrial thread maker said that chief financial officer Jackie Callaway has mutually agreed with the board that she will step down from her role at the conclusion of the annual meeting on 21 May.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Jd Sports Fashion Plc | +4.71% | +4.61 | 102.55 |
| 2 |  |
Next Plc | +2.68% | +256.00 | 9,810.00 |
| 3 |  |
3i Group Plc | +1.44% | +52.00 | 3,674.00 |
| 4 |  |
International Consolidated Airlines Group S.a. | +1.31% | +3.90 | 300.50 |
| 5 |  |
Centrica Plc | +0.95% | +1.30 | 138.10 |
| 6 |  |
Bae Systems Plc | +0.83% | +9.50 | 1,155.00 |
| 7 |  |
Intermediate Capital Group Plc | +0.75% | +16.00 | 2,148.00 |
| 8 |  |
Diageo Plc | +0.74% | +18.50 | 2,522.00 |
| 9 |  |
Sage Group Plc | +0.62% | +8.00 | 1,299.00 |
| 10 |  |
Shell Plc | +0.54% | +14.00 | 2,591.50 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Aib Group Plc | -3.85% | -17.50 | 437.50 |
| 2 |  |
Carnival Plc | -2.61% | -46.50 | 1,736.00 |
| 3 |  |
Ferguson Enterprises Inc. | -2.33% | -330.00 | 13,820.00 |
| 4 |  |
Associated British Foods Plc | -2.24% | -46.00 | 2,008.00 |
| 5 |  |
Compass Group Plc | -1.93% | -51.00 | 2,592.00 |
| 6 |  |
Sainsbury (j) Plc | -1.80% | -5.00 | 272.20 |
| 7 |  |
Natwest | -1.78% | -7.30 | 402.40 |
| 8 |  |
Hsbc Holdings Plc | -1.43% | -11.20 | 773.30 |
| 9 |  |
Pershing Square Holdings Ltd | -1.41% | -58.00 | 4,052.00 |
| 10 |  |
Tesco Plc | -1.34% | -5.00 | 368.00 |
US close: Stocks mostly higher after tariff speculation, tech rally
US stocks trimmed earlier gains by Monday’s closing bell after Donald Trump quashed speculation that his proposed trade tariffs might be pared back, though tech shares still put in a strong performance to propel the Nasdaq higher.
The Nasdaq and S&P 500 rose for the second straight day, gaining 1.2% and 0.6% respectively, while the Dow slipped 0.1%.
Markets initially jumped on reports that Donald Trump’s proposed tariffs might be less severe than initially feared, raising the outlook for international trade and corporate prospects worldwide.
The Washington Post cited people close to the matter who said that duties would be imposed on every country but only applied to imports critical to economic or national security – a major shift from US president-elect’s initial campaign pledge.
However, in a post on Truth Social, Trump denied the “incorrect” rumours and labelled the speculation as “just another example of Fake News”, causing stocks to come off their intraday highs.
Nevertheless, stocks in the tech sector still powered ahead, lifted by news that Microsoft is to plough $80bn in AI-enabled data centres during its 2025 financial year, marking a substantial increase from its $53bn capital expenditure in 2023.
A bumper set of fourth-quarter results from Taiwanese outfit Foxconn was also helping the mood in the chip sector.
Economic data in focus
Economic data is likely to steal the show this week as investors look ahead to December’s ADP employment report on Wednesday and the all-important non-farm payrolls figure on Friday. This week will also see the release of the JOLTS job openings data, factory orders, weekly jobless claims and a closely watched consumer sentiment survey.
On the macro front on Monday, the seasonally-adjusted S&P Global US services PMI business activity index rose for the second month in a row in December, to a 33-month high of 56.8 from 56.1 in November.
The survey revealed the sharpest growth of output and new orders since March 2022, while employment increased for the first time in five months and business confidence hit an at 18-month high.
Chris Williamson, chief business economist at S&P Global Market Intelligence, said: “Expectations of faster growth in the new year are based the anticipation of more business-friendly policies from the incoming Trump administration, including favourable tax and regulatory environments alongside protectionism via tariffs.”
Market movers
Tech stocks were heavily in demand, with chip manufacturers leading the way, such as Nvidia, Broadcom and AMD. Microsoft also gained on its massive AI investment plans.
FuboTV shares rocketed 254% after it and Walt Disney announced plans to combine Disney’s Hulu+ Live TV with Fubo into a single virtual TV provider.
Telecoms giant T-Mobile was hit by a downgrade by Wells Fargo from ‘overweight’ to ‘equal weight’, while fashion conglomerate Capri Holdings was boosted by an upgrade at BMO from ‘market perform’ to ‘outperform’.
Tuesday newspaper round-up: Faculty AI, Wolford, Denise Coates
A company that has worked closely with the UK government on artificial intelligence safety, the NHS and education is also developing AI for military drones. The consultancy Faculty AI has “experience developing and deploying AI models on to UAVs”, or unmanned aerial vehicles, according to a defence industry partner company. – Guardian
The luxury tights and lingerie brand Wolford has apologised after heavy criticism from customers over delays to orders and refunds, admitting its delivery services were overstretched. Shoppers have taken to the reviews site Trustpilot to warn others against making orders, with some saying they had waited for more than a month for their goods to arrive and had been unable to obtain a refund. – Guardian
Britain has become Europe’s largest electric car market for the first time ever as tough net zero sales targets prompt manufacturers to offer steep discounts. The UK outsold Germany last year and surged ahead of France after a rise in electric vehicles (EV) registrations at the end of 2024. It came as the Government confirmed plans to bring forward Britain’s petrol and diesel ban from 2035 to 2030. Heidi Alexander, the Transport Secretary, said the plans, which will exempt some hybrid vehicles until 2035, would “give confidence to consumers considering making the switch”. – Telegraph
Reforms to encourage Britain’s multi-employer pension schemes to merge must not go so far that the industry is reduced to a “sub-optimal oligopoly”, one of the most acquisitive master trusts has warned. Andrew Evans, chief executive of Smart Pension, which after recent acquisitions will soon be looking after the retirement pots of two million people, said it was important that innovative new entrants could still break into the industry. – The Times
Denise Coates is believed to have received more than £150 million from her family’s gambling business, maintaining her position as one of Britain’s richest executives. The total pay for the joint chief executive of Bet365, based in Stoke-on-Trent, was £158.7 million for the year to the end of last March, newly filed accounts suggest, although that is a significant decrease from £270.7 million the previous year. – The Times
