Yahoo Finance FTSE 100 Live: UK inflation tumbles to 4.6%, blue-chip shares higher
UK inflation fell to just 4.6%, its lowest level since 2021, in a key political victory for Rishi Sunak as well as a win in the Bank of England's battle to get prices back under control.
The FTSE 100 is expected to open slightly higher, boosted by an improved US interest rate outlook.
FTSE 100 closes at 7,486.91
Wednesday 15 November 2023 16:40 , Daniel O'Boyle
The FTSE 100 closed at 7,486.91 today, after a boost from this morning's lower-than-expected inflation figures.
An improved interest rate outlook helped stocks rise, with big winners including Ocado, Experian and St James's Place.
Fallers included Diageo and Pearson.
Jump in London office lettings to law firms, with US companies dominant
Wednesday 15 November 2023 16:19 , Daniel O'Boyle
Law firms signed for over 380,000 sq ft of London office space in the third quarter, which was 52% higher than a year earlier according to property consultancy Knight Frank.
The research also said the take-up figure was 70% above what was done in the second quarter of 2023.
Of the total take-up in the three months to September 30, US firms accounted for 90% of legal sector activity. Recent deals inked included New York-founded Proskauer Rose taking 60,000 sq ft at the 8 Bishopsgate development.
A host of employers have embraced hybrid working following the pandemic, but a number of landlords have reported good demand for high quality modern offices in the City and West End even if staff are not in headquarters every day.
Ocado shares surge on first non-grocery deal
Wednesday 15 November 2023 15:45 , Daniel O'Boyle
Ocado shares jumped further today as the delivery firm announced a deal to provide automated fulfilment technology at a distribution site for healthcare business McKesson Canada.
The deal is Ocado's first outside of grocery retail.
Tim Steiner, CEO of Ocado Group said: "Today represents a new and exciting milestone as we bring the amazing benefits of Ocado's technology to the healthcare distribution and logistics sector.
"Our technology is ideally suited to supply chains that require dense storage, highly accurate inventory management and secure stock control. lt has been proven over 20 years in one of the most complex supply chain environments, online grocery, and we're now bringing our experience and IP to more sectors. We are very pleased to be expanding in Canada."
Ocado shares gained 8.4% on the news, to 592p.
US stocks rise further
Wednesday 15 November 2023 15:21 , Daniel O'Boyle
US stocks rose a little further today, after their big jump yesterday.
The S&P 500 is up 0.4% to 4,513.32, while the Dow Jones is up 0.4% to 34,964.97. The Nasdaq Composite is up 0.4% as well, at 14,154.23.
Big risers include retail giant Target, which saw its shares soar by 18% after reporting strong results. Other winners included Expedia, Etsy and Bath & Body Works.
TK Maxx owner TJX is the biggest faller.
City pubs becoming a 'seven-day operation' thanks to weekend tourist boost, Fuller's boss says
Wednesday 15 November 2023 14:19 , Daniel O'Boyle
The boss of Fuller’s, Smith and Turner said the City is becoming a “seven-day operation”, as a boom in London tourism keeps bankers’ favourite pubs busy even on the weekend.
Profits at the chain, which owns more than 380 pubs and hotels across the south of England, rose by 40% to £14.7 million as sales grew to £188.8 million.
Boss Simon Emeny told the Standard that the Square Mile helped drive the company’s post-pandemic rebound.
UK spending for Black Friday forecast to fall to £5.6 billion with purse strings tighter this year
Wednesday 15 November 2023 13:23 , Daniel O'Boyle
UK consumer spend for Black Friday could plunge by £1.5 billion from a year earlier with interest in the shopping extravaganza waning, a PwC survey has found.
The Big Four accounting company pointed to a host of reasons for the anticipated decline in total spend to £5.6 billion compared with £7.1 billion forecast for the event in 2022. Factors included the cost of living crisis impacting certain purchasing decisions and some older generations being less tempted by promotions.
The annual discounting event takes place on Friday 24 November this year, although a host of retailers will offer deals in the weeks ahead and days after.
Lunchtime market snapshot
Wednesday 15 November 2023 12:17 , Daniel O'Boyle
The FTSE 100 is above 7500 after today's surge.
Take a look at our latest market snapshot
'Last mile is hardest' on inflation
Wednesday 15 November 2023 11:52 , Daniel O'Boyle
Investec analyst Philip Shaw said: "Today’s inflation numbers reinforce our view that interest rates have peaked.
"It is true this side of the Channel too that, as senior ECB officials have reminded us recently, ‘the last mile is the hardest’ in getting inflation back to the 2% target on a sustainable basis.
"Even so, with the economy in our view heading towards a mild recession and what at least seems to be a loosening in labour market tightness, we continue to expect the first rate cut in Q2 next year."
Inflation fall masks challenges up ahead
Wednesday 15 November 2023 11:42 , Daniel O'Boyle
Yaelâ¯Selfin, Chief Economist at KPMG UK, said the fall in official inflation figures masks the price challenges that are still ahed.
“Today’s data reflect the fall in the energy price cap, which is down significantly compared to a year ago when household energy bills were capped at £2,500 by the Energy Price Guarantee. While the drop in inflation will be welcomed by households, it is not in itself a signal of sustained inflationary easing but rather reflects the lagged impact of the fall in wholesale gas prices feeding through to energy bills.
“Despite the sharp fall in energy prices, underlying indicators of inflationary pressure such as services prices continue to show persistence. More encouragingly however, producer price inflation moved into negative territory, pointing to further disinflationary momentum in the pipeline.
“With headline inflation remaining significantly above target, today’s data are unlikely to shift the dial for the Bank of England, with interest rates expected to remain at their current level until the second half of next year.”
City Comment: Today's mortgage rates could look very good in a few months
Wednesday 15 November 2023 11:39 , Daniel O'Boyle
Anyone inclined to give the government credit for today’s fall in inflation might wonder how much better they could have done were they not a squabbling bunch of reshuffled egos who plainly can’t stand each other.
The housing crisis would be solved. The NHS a gleaming model of how to do health care. International wars; what international wars?
The more prosaic truth is that inflation is out of its control in either direction. There’s not a lot it or the Bank of England could do about the energy shock that followed Russia’s invasion of Ukraine. Nor about the entirely depressing Israel/Gaza situation.
Rishi Sunak’s bet was that electricity and food price pressures would ease in time for Christmas. They haven’t stopped going up remember, they are just rising less quickly.
SSE and Experian higher in FTSE 100, Genuit up 10% in FTSE 250
Wednesday 15 November 2023 10:26 , Graeme Evans
An improved FTSE 100 index today included strong performances for Experian and SSE shares after their robust trading updates.
The renewables giant rose 2% or 37p to 1748.5p after half-year earnings comfortably beat City hopes.
Lower output due to unfavourable weather conditions meant the result was down 11% on a year ago, but SSE remains confident in its guidance for the year.
It plans to pay a rebased interim dividend of 20p a share in March and has increased investment by £2.5 billion to £20.5 billion for the period to 2027.
Alongside SSE, Experian shares jumped 145p to 2826p at the top of the FTSE 100 after the credit checking giant delivered half-year results in line with hopes.
With consumers and businesses watching credit scores more closely amid higher interest rates, the company reported growth in every region as underlying earnings lifted 6%.
The wider FTSE 100 index improved by 0.7% or 50.30 points to 7490.77 after risk appetite was boosted by inflation readings on both sides of the Atlantic and better-than-expected industrial output figures from China.
The mid-cap FTSE 250 continued its recent outperformance, following yesterday’s jump of more than 3.5% by adding another 1.2% or 224.12 points to 18,760.25.
Housebuilder Crest Nicholson surged 6% during a strong session for rate-sensitive stocks, while Aston Martin Lagonda added 5% or 9.8p to 225p.
Buildings supplier Genuit jumped 10% or 32p to 324p after forecasting annual profits marginally ahead of City expectations, aided by robust demand in its drainage, storm water and ventilation markets.
Market snapshot: Shares climb on inflation fall
Wednesday 15 November 2023 10:12 , Daniel O'Boyle
The FTSE 100 is approaching the 7500 mark after today's good news on inflation.
Take a look at today's market snapshot.
Is Sunak right to claim victory on inflation and what does it mean for me?
Wednesday 15 November 2023 09:50 , Daniel O'Boyle
UK inflation fell by more than expected last month, taking it down to its lowest level for two years and allowing Prime Minister Rishi Sunak to claim victory on his pledge to halve inflation.
The Office for National Statistics (ONS) said Consumer Prices Index (CPI) inflation stood at 4.6% in October, down from 6.7% in September.
The Government was quick to claim it has met its inflation target early, but experts warned that the battle is not over yet.
Leasing activity picks up for landlord CLS
Wednesday 15 November 2023 08:48 , Joanna Bourke
CLS has become the latest landlord to record improved office market activity in the UK, with group leasing activity increasing substantially.
The company is most known for its portfolio of typically long-let offices in the UK, Germany and France.
It said between July 1 and September 30 it signed 24 leasing deals securing £2.4 million of annual rent, over 50% higher than the same period last year, at 6.2% above ERV (estimated rental value). Read more HERE
Does inflation fall put triple lock at risk?
Wednesday 15 November 2023 08:41 , Daniel O'Boyle
The fall in inflation could put more pressure on the Chancellor over the pension triple-lock, as the value of a pension is set to rise by almost twice the rate announced today.
The triple lock means that the pension rises by the highest out of inflation, wage growth or a flat 2.5% increase. For this year, that is set to be wage growth, which was at its peak at the time used to determine the triple lock values.
Steven Cameron, Pensions Director at Aegon, said: “Today’s official inflation figure of 4.6%% from the Office for National Statistics shows the Government has delivered on its promise to halve inflation from its 10.7% starting point by the year end.
“It comes a day after figures show total earnings continue to increase at a rate of 7.9%. While this ‘real’ earnings growth of over 3% is good news for those of working age receiving average pay increases, it piles pressure on the Government as it weighs whether or not to honour the triple lock in full next April, with an announcement possibly made as part of the Chancellor’s Autumn Statement.
“The official formula would grant an 8.5% increase, based on year-on-year earnings growth for the May to July period. This is further above inflation than we’ve seen in recent months. With rumours of the Chancellor having more fiscal headroom than anticipated, the Government may decide to grant the full 8.5%, providing another bumper increase after this April’s highest ever 10.1%. But this is paid for out of the National Insurance of today’s workers and raises real questions around intergenerational fairness.
FTSE 100 rallies on inflation boost, SSE up 3% after update
Wednesday 15 November 2023 08:30 , Graeme Evans
Encouraging inflation trends have fuelled fresh stock market buying, with the FTSE 100 index up 0.9% or 68.99 points to 7509.46.
Strong blue-chip performances have been seen in the mining sector, as well as for rate-sensitive stocks in housebuilding and property after Taylor Wimpey rose 2.2p to 126.35p and Land Securities lifted 11.2p to 655.6p.
SSE shares cheered 3% or 45.25p to 1756.75p after the renewables giant reported half-year earnings per share of 37p, representing a 11% fall on a year earlier that compared with guidance for at least 30p.
The FTSE 250 index added 1% or 188.27 points to 18,724.40, having rallied yesterday by 3.5% on optimism that interest rates have peaked.
Today’s big risers included Aston Martin Lagonda after a surge of 4%. Pipe supplier Genuit also improved 13p to 305p after forecasting annual operating profits marginally ahead of City expectations.
Sir Jeremy Darroch to become next chair of Reckitt Benckiser
Wednesday 15 November 2023 07:38 , Joanna Bourke
Consumer goods giant Reckitt Benckiser has said Sir Jeremy Darroch, a seasoned non-executive director, will become the Dettol and Nurofen maker’s next chair.
He joined the board as senior independent non-executive director in November last year. He will succeed Chris Sinclair, who having completed his full nine-year term, plans to retire from the role following the annual general meeting in May 2024.
Reckitt Benckiser said Darroch has “considerable expertise in the consumer retail environment ”.
Don't expect interest rate cuts soon economists warn
Wednesday 15 November 2023 07:29 , Daniel O'Boyle
The latest plunge in inflation to 4.6% will be cheered on Downing Street and Threadneedle Street alike, but economists today warned that it will not be enough for the Bank of England to think about cutting interest rates.
A sharp decline in the space of price rises was seen as almost certain as the new, lower, energy price cap came into effect at the start of October, reducing the amount spent on heating bills. But the rate fell even more quickly than economists or the Bank had predicted.
The decline has been hailed as a key victory for Rishi Sunak, who pledged to halve inflation, but it is also a win for the Bank of England, which hiked interest rates 14 times in its effort to bring inflation back down to its 2% target, before back-to-back pauses at its last two meetings.
Markets cheer continues on China boost, FTSE 100 seen higher
Wednesday 15 November 2023 07:22 , Graeme Evans
The rally for stock markets following yesterday’s US inflation boost is set to continue after better-than-expected figures from China’s economy.
Industrial output and retail sales both beat forecasts, giving a further lift to risk appetite after hopes of an end to US interest rate rises were fuelled by an inflation reading of 3.2%.
Deutsche Bank reported today that Wall Street now sees an 86% chance of a rate cut by May, compared with 23% on Monday.
This turnaround was reflected in a decline of 15 basis points in the US ten-year bond yield to 4.5%, while the S&P 500 index rose 1.9% in its strongest performance since April.
The defensively-weighted FTSE 100 index lagged markets elsewhere by closing just 0.2% higher yesterday. In contrast the mid-cap FTSE 250 index jumped 3.5% and benchmarks in Europe rose by around 1.5%.
The Hang Seng index in Hong Kong surged by more than 3.5% this morning, while IG Index expects a rise of 0.4% for London’s top flight.
Inflation falls to 4.6%
Wednesday 15 November 2023 07:02 , Daniel O'Boyle
Inflation plunged to 4.6% in October in a sharper-than-expected fall that will be cheered by Rishi Sunak, who has fulfilled his pledge on price rises, and the Bank of England alike.
The growth rate of the Consumer Price Index fell from 6.7% in September to its lowest since 2021, and is now less than half of December 2022’s reading. That milestone is key for the Prime Minister, who included a promise to halve inflation as one of his five pledges at the start of the year.
A sharp decline in the space of price rises was seen as almost certain as the new, lower, energy price cap came into effect at the start of October, reducing the amount spent on heating bills.
But thie rate announced today is lower than the expected 4.8%.
Core inflation also fell faster than expected to 5.7%.
ONS Chief Economist Grant Fitzner said: “Inflation fell substantially on the month as last year’s steep rise in energy costs has been followed by a small reduction in the energy price cap this year.
“Food prices were little changed on the month, after rising this time last year, while hotel prices fell, both helping to push inflation to its lowest rate for two years.
“The cost of goods leaving factories rose on the month. However, the annual growth was slightly negative, led by petroleum and basic metal products.”
Yesterday's top stories
Wednesday 15 November 2023 06:51 , Daniel O'Boyle
Good morning from the City desk of the Evening Standard. Here's a selection of yesterday's top stories:
The West End is full -- at least in terms of Land Securities' property portfolio, which hits 99.6% occupancy, making it "effectively full"
Unemployment remains at 4.2%, ahead of Sunak's D-Day on inflation
Revolution Beauty returns to profit in first half, upgrades full-year guidance, after chaotic 2022-23 in which shares were suspended for nine months
Dr Martens poaches its new CFO from William Grant & Sons Limited, the maker of Glenfiddich scotch, as Giles Wilson swaps a tumbler for the bovver boot
BT pension fund deficit down from £8bn in 2020 to £3.7bn now. Aims to be fully funded by 2030.
Vodafone profits down by two thirds to €550m - CEO says "Vodafone's transformation is progressing... although much more needs to be done"
Glencore ends months-long takeover saga with Teck, agreeing to buy its steelmaking coal business for $6.9 bn in one of the year's biggest deals
Payments transfer firm Wise sees profits quadruple to £194 million amid rising interest rates. CEO says "we are unable to return interest to customers at the level we would like."
