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The financial newswire headlines are covered in various iterations of ‘sell the US’ but stocks on the FTSE 100 in London and over on the Continent have moved off their lows.
Tuesday’s price action follows another bruising session for US dollar assets at the start of the week, in part linked to worrisome headlines around trade such as Washington’s plans to hit Chinese ships with port fees or the US president’s criticism of his central bank chief.
As of 0852 GMT, London’s top-flight index was edging up 0.18% to 8,290.26, although the FTSE 250 was still 0.14% lower at 19,222.92.
Cable is flat, Brent futures are a tad higher and gold – is flying.
In overnight trading, COMEX gold futures topped the $3,500/oz. mark for the first time ever, as investors had apparently now caught on to the yellow metal’s ‘stealth bull(ion) market’ of the past three years, when not even longer.
“Gold just punched through $3,500 like it owed it money — and this isn’t some kneejerk move off Trump barking at Powell,” said Stephen Innes at SPI Asset Management.
“That’s sideshow fluff. The real driver here is the slow-motion trainwreck of fiat credibility. We’re staring down a synchronized global easing cycle with rate cuts queued up like Sunday night IMM orders.”
No major economic releases were scheduled for Tuesday in the UK, but several Fed speakers were lined up for later in the day Stateside.
Significantly, it wasn’t all bad headlines on the geopolitical front, although concern continued to be running sky-high.
Marc Galleoti wrote in the Sunday Times that he has expecting some sort of deal around Ukraine, possible by 30 April when Trump’s first 100 days in office would be up.
Steven Rosenberg over at the BBC also appeared not to dismiss a deal, although he suspected that something might be afoot.
US and Iranian negotiators were due to meet again during the week and there was some market chatter to be heard regarding the possibility of an easing in US-China trade tensions in about one month’s time.
DCC divesting unit, Sainsbury buying back shares
DCC said it has agreed to sell its healthcare division to HealthCo Investment, an independently managed unit of funds managed or advised by Investindustrial Advisors for a total enterprise value of £1.05bn. The company on Monday said it expected total expected net cash proceeds of £945m, including an unconditional deferred amount of £130m receivable within two years, and would return surplus to shareholders “while maintaining a strong, investment-grade balance sheet”.
J Sainsbury announced the launch of a share buyback programme of up to £200m on Tuesday, as flagged in its results announcement last week, aiming to complete it by 12 September. The FTSE 100 retailer said it intended to cancel all repurchased shares to reduce its share capital. It said BNP Paribas would conduct the buyback independently under non-discretionary instructions, in line with shareholder authority granted at the annual general meeting in July last year.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Wheaton Precious Metals Corp. | +3.18% | +200.00 | 6,480.00 |
| 2 |  |
Fresnillo | +2.94% | +30.00 | 1,051.00 |
| 3 |  |
Sainsbury (j) Plc | +2.73% | +7.00 | 263.80 |
| 4 |  |
Ck Infrastructure Holdings Limited | +2.47% | +12.00 | 498.00 |
| 5 |  |
Tesco Plc | +2.37% | +8.40 | 363.00 |
| 6 |  |
Vodafone Group Plc | +2.30% | +1.62 | 72.10 |
| 7 |  |
Aib Group Plc | +2.14% | +10.00 | 478.00 |
| 8 |  |
Banco Santander S.a. | +1.96% | +10.00 | 521.00 |
| 9 |  |
Barratt Redrow Plc | +1.82% | +8.10 | 452.40 |
| 10 |  |
Endeavour Mining Plc | +1.58% | +34.00 | 2,188.00 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Flutter Entertainment Plc | -5.59% | -965.00 | 16,290.00 |
| 2 |  |
Carnival Plc | -4.04% | -49.50 | 1,177.00 |
| 3 |  |
Crh Plc | -3.58% | -230.00 | 6,202.00 |
| 4 |  |
South32 Limited | -3.54% | -4.60 | 125.40 |
| 5 |  |
Ferguson Enterprises Inc. | -2.66% | -330.00 | 12,070.00 |
| 6 |  |
Smurfit Westrock Plc | -2.49% | -77.00 | 3,017.00 |
| 7 |  |
Pershing Square Holdings Ltd | -2.46% | -84.00 | 3,330.00 |
| 8 |  |
Rentokil Initial Plc | -2.46% | -8.60 | 341.40 |
| 9 |  |
Wise Plc | -2.44% | -23.50 | 939.00 |
| 10 |  |
Scottish Mortgage Investment Trust Plc | -1.80% | -15.60 | 849.40 |
US close: Stocks sharply lower as Trump takes aim at Powell
Major indices closed sharply lower on Monday as traders returned from the Easter long-weekend break to an escalation in tensions between the White House and the Federal Reserve.
At the close, the Dow Jones Industrial Average was down 2.48% at 38,170.41, while the S&P 500 lost 2.36% to 5,158.20 and the Nasdaq Composite saw out the session 2.55% weaker at 15,870.90.
The Dow closed 971.82 points lower on Monday, extending losses recorded in the previous session on the back of a warning from Federal Reserve chairman Jerome Powell that the central bank could very well find itself in somewhat of a quandary when it comes to its efforts to both control inflation and support economic growth.
Powell noted that with elevated uncertainty surrounding the impact of Donald Trump’s recently implemented tariffs on the US economy, he now expects to see inflation rise and growth slow, undermining both elements of the Fed’s dual mandate of ensuring price stability while maximising employment and making it harder for the central bank to justify loosening monetary policy and further.
“We may find ourselves in the challenging scenario in which our dual-mandate goals are in tension,” Powell said. “If that were to occur, we would consider how far the economy is from each goal, and the potentially different time horizons over which those respective gaps would be anticipated to close.”
Powell said Trump’s tariffs were “likely to move us further away” from its goals for “the balance of this year”, while Chicago Fed head Austan Goolsbee cautioned that the tariffs will potentially cause the US economy to “fall off” by the summer.
Trump said Powell’s termination “can’t come fast enough”, with White House economic advisor Kevin Hassett stating the administration was currently looking into just that, leading to fresh questions around the central bank’s independence. He later demanded that Powell, who he called “Mr Too Late and “a major loser”, lower interest rates “NOW”.
Also of note, the greenback hit a three-year low on Monday, while gold prices surged to record highs of more than $3,400 per ounce.
No major data points were scheduled for release on Monday.
Tuesday newspaper round-up: Global trade, Trump-Powell relations, power pylons, parking fines
Rachel Reeves will fly to Washington this week to argue for global free trade in the face of Donald Trump’s punitive tariffs, amid continued international economic turbulence. The UK chancellor will use the spring meetings of the International Monetary Fund, which is attended by top finance ministers and central bankers, to make the case that free trade is in both British and global interests. – Guardian
American equities fell sharply in early trading and the dollar weakened as investors digested rising uncertainty over the future of US economic policy amid President Trump’s repeated attacks on the chairman of the Federal Reserve. Last Thursday Trump said the “termination” of Jerome Powell as Federal Reserve chairman “cannot come fast enough”, after Powell raised concerns about the impact of tariffs on the US economy. – The Times
Pylons have knocked up to £100,000 off the value of nearby homes across England and Wales, according to new research. Findings shared with The Telegraph by property consultancy Allsop show the average-sized home in England and Wales within 500 metres of a pylon sells for around £8,000 less than the typical price for the area. In the worst case, the penalty can run to almost six figures. – Telegraph
Thousands of drivers in England are being sent demands for up to £170 from private parking companies because of faulty ticket machines, campaigners have said. Many private car parks require motorists to input their vehicle registration when purchasing a ticket from a machine, which is supposed to ensure they do not receive a parking fine. – Guardian
More than eight million people will be dragged on to, or forced higher up, the tax ladder over the next five years as a result of successive governments freezing tax thresholds, official forecasters say. In data published alongside its economic forecast at the March spring statement, the Office for Budget Responsibility (OBR) predicted that, by the 2029-30 financial year, an extra 8.3 million people will be hit by so-called fiscal drag as their pay rises. – The Times
