The FTSE 100 (^FTSE) pushed higher against its European peers on Tuesday as traders digested new growth figures and inflation data for the eurozone.
It managed to escape recession, beating growth forecasts for the start of this year, with gross domestic product (GDP) across the single currency bloc expanding by 0.3% in the January to March period.
This means that the eurozone’s shallow technical recession is over after GDP shrank by 0.1% in both the third and fourth quarters of last year. According to statistics body Eurostat, it was lifted by stronger-than-expected growth in Germany, France, Italy and Spain.
Meanwhile, consumer price inflation across the eurozone remained at 2.4% in the year to April, matching March’s reading.
Read more: Eurozone avoids recession while inflation holds steady at 2.4%
“The spigot has been opened since it attained its new record high and the FTSE 100 continued to flow higher on Tuesday amid a raft of corporate announcements,” said Russ Mould, investment director at AJ Bell.
“The index took its cue from gains on Wall Street with the next key test of the relative optimism displayed by the market coming tomorrow with the latest meeting of the US Federal Reserve.
“While the Fed is expected to maintain the status quo on interest rates, commentary on its current thinking on the trajectory of rates in the remainder of the year will likely have a significant impact on markets.”
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Feature on gold, gold bars, gold production. The price of gold has risen to more than $ 1,700. in recent days In the picture: gold bars at the company Ögussa in Vienna. – 20120130 PD4749 – Rechteinfo: Rights Managed (RM) (APA-PictureDesk, APA-PictureDesk) Gold prices dipped on Tuesday, with market focus turning to this week’s impending Fed meeting and rate decision. It comes as geopolitical instability has been a primary driver of gold’s value, spurred by heightened haven demand.
This surge has seen bullion prices climb nearly 20% in the past two months, peaking at an all-time high of $2,431.
Ricardo Evangelista, senior analyst at ActivTrades, said:
“However, as reports surface of peace talks between Israel and Hamas, reducing prospects of regional conflict escalation, trader attention shifts to the Federal Reserve and its forthcoming monetary policy announcement.”
“The decline in gold prices mirrors concerns that Jerome Powell, grappling with persistent inflation and a robust US economy, may adopt a more hawkish stance, delaying expectations for a rate cut until the fourth quarter of the year or even as far as 2025.”
“Such a scenario could spur dollar appreciation and higher treasury yields, posing a negative outlook for gold prices.”
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UK shop price inflation cools as retailers ramp up clothing deals
Clothing and footwear were among items that led the charge in a drop in annual shop price inflation in April, as the heat continues to dial down for UK consumer spending.
Shop price inflation eased to 0.8% in April, down from 1.3% in March, below the three-month average rate of 1.4% according to new figures from the British Retail Consortium. Shop price annual growth is its lowest since December 2021.
Non-food items were in deflationary territory, down 0.6% in April from a rise of 0.2% the previous month. This is below the three-month average rate of 3.9%. Inflation is its lowest since March 2022.
The falls in clothing and footwear are due to retailers ramping up promotions to encourage consumer spend, Helen Dickinson, NRC CEO said.
Meanwhile, food inflation slowed for the twelfth consecutive month to 2.4% from 2.6% a month earlier, as fresh products such as butter, fish and fruits, continued to fall in price due to easing input costs and intense competition between grocers.
Ambient food inflation also decelerated to 4.9% in April, down from 5.2% in March. This is below the three-month average rate of 5.6% and is the lowest since June 2022.
“While consumers will welcome the lower shop price inflation, geopolitical tensions and the knock-on impact on commodity prices, like oil, pose a threat to future price stability,” said Dickinson.
Read the full article here
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London rents hit record high of £2,633 a month
The costs of average advertised rental properties coming onto the market continue to balloon, especially in London, according to new data by property platform Rightmove (RMV.L), with average rental prices in the capital reaching a new record of £2,633 per calendar month.
The latest data shows that rental prices have reached new records for a seventeenth consecutive month across the country too, with the average price outside of London now £1,291 per month.
Despite the fact that average prices are now 8.5% higher than a year ago, there is potential relief on the horizon. The pace of rent growth has dropped for the second quarter in a row, with London experiencing a more significant pace of slowing rental growth than the rest of the country.
Average rents in the capital are now 5.3% higher than last year, with rent growth steadily slowing since the peak of 16.1% in the third quarter of 2022.
Tim Bannister, Rightmove’s director of property science, said:
“The rental market is no longer at peak boiling point but it remains at a very hot simmer.”
“Looking at data across the whole market, we can see some slow improvements for tenants with more choice, and competition with other tenants slowly starting to ease.”
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Rental stock availability up 12.1% annually
Selly Oak, Birmingham, 4th February 2024 – Houses for rent in Selly Oak, Birmingham, England as the UK Housing Market continues to fluctuate. Credit: Stop Press Media/Alamy Live News (Stop Press Media) The latest research by London lettings and estate agent, Benham and Reeves, has shown that rental stock availability is up 12% year on year across England. London saw the largest boost to the number of homes available to prospective tenants.
Here are some of the key findings:
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There were 154,510 rental properties available to tenants across England in Q1 of this year, marking a 12.1% increase versus Q1 2023.
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Some 33 of the nation’s 48 counties have seen an improvement in the volume of homes reaching the market for potential tenants.
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London saw the biggest boost to the level of rental stock currently available, with the City of London having an annual increase of 44.3%, while Greater London had a 34.7% jump.
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Outside of the capital, Nottinghamshire was home to the largest increase in rental market listings, having seen a 28.2% increase versus the same period last year.
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Other areas to rank within the top 10 include Northamptonshire (+19.5%), Berkshire (+18.8%), Dorset (+16.5%), Warwickshire (+15.6%), Bristol (+14%), Derbyshire (+13.2%) and Bedfordshire (+13.1%).
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However, in Leicestershire, rental market stock levels have dropped by -17.3% annually, whilst the West Midlands (-11.4%) and Cheshire (-9.7%) have also seen some of the largest reductions.
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Premier Inn owner Whitbread to axe 1,500 jobs
File photo dated 3/4/22 of a Premier Inn in London. Premier Inn and Beefeater owner Whitbread, is set to reveal a rise in revenues and profits for the past year as investors will be keen for a positive outlook for hospitality spending, when it unveils its latest annual results in an update on April 30. Issue date: Sunday April 28, 2024. (Mike Egerton, PA Images) Premier Inn owner Whitbread is set to cut 1,500 jobs as it closes restaurants and expands its hotel business.
It is looking to cut the number of branded restaurants, which includes the likes of Brewers Fayre and Beefeater, by more than 200 in a bid to build more hotel rooms.
Whitbread said the sale of 21 restaurants has already been agreed. The changes will add more than 3,500 hotel rooms across its estate.
Dominic Paul, Whitbread chief executive, said:
“We recognise that our transition will impact some of our team members so we will be providing support throughout this process and we are committed to working hard to enable as many as possible of those affected to remain with us.”
Whitbread said it would try to find “alternative opportunities” for affected staff “wherever possible” through new jobs created by its plans and through existing recruitment.
The firm employs 37,000 people across Britain.
It comes as Whitbread announced an adjusted pre-tax profit of £561m for the year to March, an improvement on its £413m profit the previous year.
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HSBC beats estimates and announces buyback
HSBC’s (HSBA.L) results for the first quarter of 2024 came with a surprise as its CEO Noel Quinn announced early retirement after a five-year stint leading the bank. The lender has begun the hunt for his replacement.
The news came as it reported a pre-tax profit of $12.7bn (£10.1bn) — above analysts’ forecasts of $12.6bn and slightly less than the $12.9bn for the same quarter a year ago.
The bank has grappled with rising costs across Asia, high inflation and what it called “investment in technology”.
Profit before tax included a $4.8bn gain on the sale of its Canada business and a $1.1bn impairment relating to the planned sale of its Argentina business.
HSBC announced it will buyback $3bn worth of shares, bringing the total buybacks for shareholders to $8.8bn. It will also pay out a $0.10 per share dividend.
The bank’s 2024 guidance remains unchanged, it added.
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