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Stocks mixed as attention turns to inflation

Chairman of the Federal Reserve Jerome Powell listens during a Senate Banking Committee hearing on
Market moves come ahead of a reading of US inflation and US GDP later on in the week — two measures the Federal Reserve will look to when deciding its next moves on the base interest rate. (REUTERS / Reuters)

European markets were higher on Tuesday and the FTSE was flat, while US markets were mixed in early trade, as eyes turn to the next batch of US inflation data.

  • The FTSE 100 (^FTSE) finished the day 3.6 points higher — almost flat on the day before. Frankfurt's DAX (^GDAXI) ticked up 0.8% and the CAC (^FCHI) in Paris hovered 0.3% higher.

  • The pan-European STOXX 600 (^STOXX) was 0.2% higher.

  • Across the pond, the S&P 500 (^GSPC) was flat, the Dow (^DJI) fell 0.4% and the Nasdaq (^IXIC) was 0.2% in the green by the close in Europe.

  • Market moves come ahead of a reading of US inflation and US GDP later on in the week — two measures the Federal Reserve will look to when deciding its next moves on the base interest rate.

  • The PCE index report due Thursday, a key inflation input into the Federal Reserve's rate-setting decisions.

  • In the meantime, economic updates due on Tuesday cover consumer confidence, the S&P Case-Shiller home price index, and durable goods orders.

  • Markets in Europe moved following a warning by the Institute for Fiscal Studies (IFS) that the UK government's tax cut plans for the spring budget could be unrealistic when considering national debt.

  • Maintaining real-terms spending on unprotected services, such as the NHS, would require a cash top-up of £20bn in 2028–29; maintaining it in per-person terms would require a cash top-up of £25bn, the IFS report said. An implied investment spending cut of £20bn "will not help growth," the think tank added.

Follow along for live updates:

  • Logging off

    That's all from me for the day! Head over to our US site for more market moving news.

  • US rally dampened by durable goods orders

    Axel Rudolph from IG has the latest:

    "Risk on sentiment has taken a hit as US durable goods orders saw their biggest month-on-month fall since April 2020 while US home prices increased the most since November 2022. The rally in major US and European stock indices is thus taking a breather except for the German DAX 40 index which has made a new record high as consumer morale improved slightly."

  • BoE policymaker touts more balanced approach to inflation

    Dave Ramsden, a deputy governor of the Bank of England said in a speech that there needs to be more evidence that inflation has been tamed before rates can start to fall from the current level of 5.25%.

    Even though the latest data has been "encouraging", key indicators of inflation "remain elevated".

    “I am looking for more evidence about how entrenched this persistence will be and therefore about how long the current level of Bank Rate will need to be maintained,” he said at the Association for Financial Markets in Europe (AFME) conference.

  • US stock futures

    Here's what US stocks are doing just ahead of the open

  • Easter egg prices on the up

    We have a commodities dispatch from UK Finance reporter Pedro Goncalves — this time on the very important matter of how a bad year for cocoa crops might affect prices of easter chocolate.

    Read more here: Chocolate Easter egg prices set to rise as cost of cocoa surges

  • Trending tickers: Workday

    HR management software company Workday was trading as much as 6.7% lower in premarket on Tuesday, following its Q4 earnings report, making it a stock to watch at the open.

    Despite its better-than-expected earnings for the three months to December, the company held its outlook for 2025, citing macro concerns.

    Workday's revenue for the fourth quarter stood at $1.9bn, in line with market expectations.

    The company said it expects subscription revenue of $7.7bn to $7.8bn, up 17% to 18%, next financial year.

    It has also agreed to acquire AI-powered talent software company HiredScore for an undisclosed amount.

    "We've only just begun to see the opportunities of what is possible with responsible AI in the workforce, and how organizations can use it more efficiently and effectively to deliver on HR transformation goals related to recruiting and employee experiences," said Athena Karp, HiredScore founder and CEO.

  • Trending tickers: abrdn

    Aberdeen stock briefly surged in London on Tuesday despite warnings of pressure on its margins amid a shift by its clients away from actively managed funds.

    Shares were as much as 6% higher following a report that beat analyst forecasts, that rally has since snapped with the stock about 0.7% lower.

    The company's CEO Stephen Bird is attempting to stem the outflow of client cash, which amounted to £13.9bn in 2023 compared with £10.3bn a year earlier. The company will also look to reduce its range of funds and expand into mass-market investing.

    Bird also dismissed speculation the company could be broken up amid the exodus.

    Abrdn reported adjusted operating profit of £249m ($316m), down 5% from £263m the previous year — ahead of analyst forecasts.

  • French consumer confidence misses expectations

    Small update on France's consumer confidence, which dipped below expectations in February:

    The CAC is basically flat on the back of the news, so perhaps not such a nasty surprise:

  • FTSE fallers

    And here are the companies tipping the FTSE 100 balance lower:

    Data: Hargreaves Lansdown
    Data: Hargreaves Lansdown
  • FTSE risers

    The FTSE 100 is almost flat right now, but is being propped up by the following:

    Data: Hargreaves Lansdown
    Data: Hargreaves Lansdown

    There are a number of miners also in the top 10 for this morning, including Antofagasta, Rio Tinto and Endeavour. They could be being supported by copper prices which are up 0.4% in the session. There is still, however, the existential worry of falling nickel prices.

  • City regulator promises more transparency

    The FCA said today it will change the way it issues updates around enforcement cases. Under the plans the regulator will publish updates on investigations as appropriate and be open about when cases have been closed with no enforcement outcome.

    The moves are a step change from the current process where investigations are only announced in very limited circumstances, it said.

  • Meat, fish and fruit prices fall

    The heat has come out of food inflation, according to new data from the BRC.

    UK food inflation eased to its lowest rate for almost two years in February as meat, fish and fruit prices fell in a boost for households trying to navigate the cost of living crisis.

    The British Retail Consortium (BRC)-Nielsen Shop Price Index showed the pace of price increases slowed to 2.5% over the 12 months to February, down from 2.9% the previous month.

    It was the lowest reading since March 2022, the BRC said.

    The index showed food prices fell 0.1% in February on the previous month, its first monthly fall since last September.

    Our reporter Pedro Goncalves has the full story: Food price inflation eases to nearly two-year low

  • Bitcoin above $56,000

    Bitcoin's (BTC-USD) price rose more than 9% in the last 24-hours on Tuesday, as the world's largest cryptocurrency was spurred on by cash flowing into US spot ETFs.

    Bloomberg ETF analysts said Monday saw $2.4bn in volume as sentiment headed higher with the price.

  • Gender parity still eludes the top of the FTSE 100

    An interesting report here from This is Money this morning, revealing there are only 10 female chief executives in the FTSE 100 (^FTSE), and two women who chair a blue-chip board.

    The latest addition to that group is BT (BT-A.L) CEO executive Allison Kirkby who took over at the telecom giant last month.

    Data comes from a government-backed FTSE Women Leaders Review, which also showed that the proportion of boardroom jobs held by women in the FTSE 350 (^FTLC) increased by two percentage points last year to 42.1%.

  • Shein for London?

    Fast fashion retailer Shein is exploring a London listing, according to reports that cite people familiar with the matter. Listing hurdles in the US were too high and numerous so it could now opt for the City as its base. A report in Fortune says that the US is its preferred location, citing sources.

    The Chinese fashion conglomerate listing in London would be a coup for the market, which has seen large companies look elsewhere for deep pocketed investors. Chipmaker Arm (ARM) opted for a US listing, officially going public in September last year.

  • US trade on Monday

    US stocks finished Monday trade lower, easing off the gas pedal from last week's Nvidia-fueled rally.

    All three major indexes (^DJI, ^IXIC, ^GSPC) closed more than 0.1% down.

    Our US team writes:

    New inflation data in the coming days will test the staying power of the breakout rally that followed Nvidia's (NVDA) results. A hotter-than-expected CPI report spooked the market and sparked a stock sell-off earlier in February, and investors are already weighing the chances of a surprise in Thursday's PCE index reading.

    Given the PCE index is the Federal Reserve's preferred inflation gauge, the reading will factor into the ongoing debate on the timing of a rate cut, already pushed back.

    The inflation report is the highlight of this week's data, with temperature checks on the consumer and manufacturing also on deck. What they say about the health of the US economy may determine whether the bullish mood in stocks continues.

  • Overnight in Asia

    Tuesday trade in Asia was mostly positive, with the Hang Seng (^HSI) and SSE Composite (000001.SS) rising 1% and 1.3% in the session respectively.

    Analysts at IG have suggested the rally in Chinese equities shows signs of snapping some time soon.

    "The percentage of Hang Seng stocks trading above their 20-day MA has now reached 92%, the highest reading since September 2021," wrote Chris Beauchamp.

    "​This overbought condition implies the Hang Seng’s rally is likely exaggerated and could be nearing exhaustion. While the index may see a brief period of sideways consolidation, odds favour the downtrend exerting itself again before any meaningful rebound can take hold."

    The Nikkei (^HSI), meanwhile, was flat stopping just short of the 40,000 mark that has so far eluded it.

  • Good morning!

    Hello, it's me again! Here to bring news of what's moving markets in London today. US markets lost steam yesterday, following last week's feverish rally, and Asia was in a mixed mood too, but mostly positive. First up, the Institute for Fiscal Studies (IFS) puts UK chancellor Jeremy Hunt's feet to the fire. Let's get to it.

Watch: AI stock 'exuberance' has legs CIO

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