Market report

House price rise points to stability | FTSE 100 falls


4.30pm: London blue chips swing to loss

The FTSE 100 opened higher but the mood swung sharply negative and it ended the session 97.54 points (1.24%) lower at 7,773.03., as US stock indexes dropped amid worries ahead of the Federal Reserve’s latest interest rate decision on Wednesday.

There are also concerns over the US debt ceiling following comments from Treasury Secretary Janet Yellen.

IG’s Chris Beauchamp said: “Last week saw risk appetite revive on better earnings from tech giants, but a host of worries about interest rates, further bank crises, the US debt ceiling and of course pre-Fed nerves have conspired to prompt a reversal in equity markets.

“European and US indices are down sharply, as investors’ nerves get the better of them.”

7am: House prices rise

housing for sale

House prices rose by 0.5% in April after falling for the seven previous months, according home loans provider Nationwide.

It said the data shows the property market has stabilised after last year’s “mini-budget” upheaval.

The average house price remained 4% below its peak in August last year which was before former Prime Minister Liz Truss and her finance minister Kwasi Kwarteng briefly sent debt markets into a tailspin by announcing a plan for big, unfunded tax cuts.

Nationwide chief economist Robert Gardner said: “Recent Bank of England data suggests that housing market activity remained subdued in the opening months of 2023, with the number of mortgages approved for house purchase in February nearly 40% below the level prevailing a year ago, and around a third lower than pre-pandemic levels. 

“However, in recent months industry data on mortgage applications point to signs of a pickup.

“This also chimes with the recent shifts in consumer sentiment. 

“While confidence remains subdued by historic standards, people’s views of their own financial position over the next twelve months, and general economic conditions in the year ahead, have both improved markedly in recent months.”

7am: BP profits up

Energy giant BP has reported a fall in profits for the first three months of the year, but stronger than markets expected.

Underlying replacement cost profit of $5 billion between January and March compared to $6.2bn in the same period last year. Analysts had forecast $4.3bn.

Full story here

7am: Macfarlane acquisition

Macfarlane Group, the Glasgow-based packaging company, has acquired A & G Holdings, owner of Gottlieb Packaging Materials in north west England in a £3.55 million deal.

Full story here

6am: HSBC profits surge

HSBC chief executive Noel Quinn declared that its “strategy is working” after announcing a surge in profits and its first dividend since before the pandemic.

Pre-tax profits smashed expectations by rising 200% to $12.9bn (£10.3bn) from $8.7bn as revenue soared by 64% to $20.2bn.

Full story here

Global markets

A nervous session on Wall Street saw all three major US indices finish in the red at the start of a week that also includes results from Apple and a report on April’s employment figures.

The Dow Jones Industrial Average and tech-heavy Nasdaq Composite Index both slipped by 0.1% while the S&P 500 dipped by just less than 0.1%.

JP Morgan’s acquisition of regional bank First Republic appeared to settle nerves over the banking sector’s immediate outlook.

Jack Ablin, chief investment officer at Cresset, added that the latest deal would go “a long way to calm investors’ concerns” on turmoil in the sector.

Investors are watching the US Fed’s next interest rate decision due on Wednesday.

Most markets across Asia and Europe were closed on Monday for public holidays.

In Toyko, the Nikkei 225 index rose 0.9% after the Bank of Japan policy decision on Friday which was seen as more dovish than expected.

SoftBank Group rallied 1.35% after it said its UK-based chip designer Arm has submitted “a draft registration statement” to the US Securities and Exchange Commission related to its planned initial public offering.

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