Market report

Oil price falls | Food inflation hits record high


4.30pm: Oil and commodities fall

The FTSE 100 closed 31.1 points higher at 7,585.19, though miners and commodities were among the big fallers.

Brent crude was down by more than 5% to below $80 a barrel. BP was off 3.6%, or 17.5p, to 465.85p while Shell fell 3.5%, or 82p, to 2285p.

AJ Bell investment director Russ Mould said that while oil prices have shed 5% already this year, such losses could ease inflation and encourage central banks to slow the pace of interest rate hikes or pause them altogether.

Analysts say a steep fall in forward wholesale electricity and gas over the past four weeks will be a ‘relief’ to the Government as it would significantly lower the cost of fiscal support in 2023-24 compared to 2022-23.

Falling metal prices sent Glencore down 6.9%, or 37.8p, to 506.6p while Anglo American slid 2.7%, or 87p, to 3180p and Antofagasta was 0.5%, or 8p, lower at 1554p.

Food inflation

UK food price inflation hit a new record high in December, according to the British Retail Consortium (BRC), which predicted 2023 would be another tough year for consumers and businesses.

Annual food inflation leapt to 13.3% in December, up from 12.4% in November, according to the figures compiled by the BRC and data firm Nielsen, the highest monthly rate since it began collecting data in 2005.

Inflation in fresh food was even higher with growth in early December hitting 15%, another record high.

10am: Rail talks

The RMT will resume talks with the government next Monday in the next move to resolve the rail strikes, according to union boss Mick Lynch. 

“We think there are some sensible changes to what’s been proposed, and that it could develop into an agreement,” he said. 

8.30am: Hydrogen plan

Scottish energy storage start-up Gravitricity is seeking up to £40 million to roll-out its plans to store hydrogen underground. Full story here

8am: London opens higher

The FTSE 100 opened 15 points higher at 7,569.04 after closing strongly last night, up 102.35 points (1.37%).

7am: Ryanair

Ryanair flew 11.5 million passengers last month, an increase of almost 3% on its previous December record as Christmas traffic volumes rebounded from the pandemic.

The Irish airline expects to fly 166.5m passengers in the year to the end of March, far ahead of its previous peak of 149m.

Passenger volumes were 21% ahead of last year and 11% ahead of December when Ryanair carried just 1.5 million customers due to pandemic-related restrictions on travel.

Last month’s passenger traffic levels were also 2.6% ahead of December 2019 when 11.2 million customers travelled with the airline.

Global markets

US stocks fell overnight, spooked by a poor US purchasing managers’ index print. PMI reports from across the eurozone, as well as another US reading, come later today.

Hang Seng: up 2.8% at 20,715.46

Nikkei 225: closed down 1.5% at 25,716.86

S&P/ASX 200: closed up 1.6% at 7,059.20

DJIA: closed down just 10.88 points at 33,136.37

S&P 500: closed down 0.4% at 3,824.14

Nasdaq Composite: closed down 0.8% at 10,386.98

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