FTSE 100 Ends Pre-Christmas Trading Up, With 2024 Looking Positive
23 December 2023 - 12:15AM
Dow Jones News
The FTSE 100 ended Friday up 0.04% ahead of the holidays. The
remarkable rally since early November has been for good reason, as
expectations of rate cuts next year seem well founded, although
arguably now well priced into markets, Barclays said. Central banks
look to have engineered the soft landing that was hoped for, with
inflation moderating nicely, and still keeping labor markets
healthy, Barclays analysts said in a research note. "This sets us
up well for next year, although the strength and speed of the rally
have left markets looking short term overbought, cyclicals in
particular," the U.K. bank said.
COMPANIES NEWS:
M&C Saatchi to Offload Sweden, Hong Kong Subsidiaries
M&C Saatchi said it will offload overseas subsidiaries as
part of its strategy to simplify its operating structure and
improve efficiency across the company.
---
EnQuest Agrees to Sell 15% of the Bressay Field and EnQuest
Producer for GBP46 Mln
EnQuest said it reached agreement with Viaro Energy's
subsidiary, RockRose, to sell a 15% working interest in each of the
Bressay field and the EnQuest Producer--a floating production,
storage and offloading vessel--both located in the U.K. North Sea,
for 46.0 million pounds ($58.4 million).
---
Unilever to Acquire Haircare Brand K18
Unilever said it agreed to acquire the premium haircare brand
K18, without disclosing financial details.
MARKET TALK:
U.K. GDP Data Puts Recession Into View
1017 GMT - The latest U.K. GDP data--which downgraded
third-quarter GDP to a contraction of 0.1% on quarter, from 0.0%
initially estimated--suggests a winter recession is far more
probable, according to Investec economist Ellie Henderson. However,
while the story remains that economic growth has been subdued, the
3Q revision is "a matter of semantics" as the original release had
already shown a 0.03% contraction, she says in a note. Elsewhere on
the release, the Office for National Statistics said real household
disposable income rose 0.4% on quarter, and alongside retail-sales
growth in November and continued wage rises, the consumer could
save the day when it comes to the economy, she notes. That could
help the economy out of any recession in 2024, Henderson adds.
(edward.frankl@wsj.com)
---
Gilt Yields, Sterling Trade Flat After Weaker-Than-Forecast U.K.
GDP Data
0944 GMT - Gilt yields and sterling trade flat as market
expectations of a Bank of England rate cut in early 2024 are
reinforced by weaker-than-expected U.K. GDP data. "There are
growing concerns that the U.K. economy is heading towards a
technical recession having now logged one of two consecutive
quarters of negative growth required to meet the threshold,"
Interactive Investor head of investment Victoria Scholar says in a
note. The report shows U.K. economy contracted 0.1% in the third
quarter, lower than the 0.0% consensus forecast by economists in a
WSJ survey. U.K. 10-year gilt yield trades flat at 3.524% while the
U.K. 2-year gilt yield falls 1 basis point to 4.056%, Tradeweb data
show. GBP/USD rises 0.1% to last trade at 1.2698.
(miriam.mukuru@wsj.com)
---
U.K. 3Q GDP Data Disappoints, But 4Q Indicators Are More
Upbeat
0943 GMT - The downward revision of U.K. GDP growth in the third
quarter opens up the possibility of a recession in the country,
even if signals for 4Q were better, Elizabeth Martins, senior
economist at HSBC, says in a note. "Clearly, the U.K. economy has
been struggling under the weight of higher costs and higher
interest rates," she says. The 3.2% decline in business investment,
after a better couple of quarters, is particularly disappointing,
Martins says. But data for 4Q is more upbeat, including the 1.3%
on-month rise in retail sales published Friday, adding to lower
inflation, rising real wages, and the stronger services PMI,
consumer confidence and housing market indicators, she says. "With
falling inflation and easier financial conditions, we are hoping
for a happier economic new year," she concludes.
(edward.frankl@wsj.com)
Contact: London NewsPlus, Dow Jones Newswires; Dow Jones
Newswires; paul.larkins@wsj.com
(END) Dow Jones Newswires
December 22, 2023 08:00 ET (13:00 GMT)
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