All eyes will be on the US Federal Reserve later today when policymakers set out how they plan to taper their $120 billion a month programme of economic support.
Comments on the outlook for interest rates by Fed chair Jay Powell will also be closely watched as central banks around the world grapple with the inflation threat.
The Bank of England starts its two-day meeting today, with markets pricing in a rise in interest rates from 0.1% to 0.25% when the result is announced at 12 noon tomorrow.
Based on today's trading update by retailer Next, consumer confidence appears to be holding up against inflationary pressures after its full-price sales for the 13 weeks to the end of October rose 17% versus the same period two years ago.
FTSE 100 Live Wednesday
Federal Reserve to outline taper plan
Lower close for the FTSE
17:11 , Oscar Williams-Grut
The FTSE 100 has closed lower, with the story in the final few hours of trade much the same as it had been all day.
The bluechip index has closed 25 points lower at 7248. Darktrace was at the foot of the index, down 5.1%, while Next wasn’t far behind.
Attention tomorrow will be focused on interim results from Sainsbury’s and the Bank of England’s interest rate decision at midday. Threadneedle Street was expected to hike rates for the first time since 2018 but odds have narrowed in recent days.
That’s all from us on the blog today. Join us again tomorrow.
Wall Street relaxed ahead of Fed update
07:37 , Graeme Evans
There were few signs of nerves among US investors ahead of tonight’s Federal Reserve update, with Wall Street markets advancing to fresh record levels last night.
Policymakers are later expected to set out the first steps for a tapering of the Fed's $120 billion a month bond buying programme, but they will also be under pressure to outline a possible timetable for an increase in interest rates.
Chairman Jay Powell has previously indicated that such a move is not imminent and could be as long as a year away.
He will have to tread a delicate path in his post meeting press conference in tempering market expectations about the timeline for the first interest rate rise, while painting an optimistic but cautious outlook for the US economy.
CMC Markets analyst Michael Hewson said a rate hike for 2022 could well become a majority view of the committee by the end of this year, which would be a significant shift in thinking from earlier this year.
He added: “A faster paced taper could also bring this date forward, especially if policymaker thinking were to shift as we head into 2022.”
US markets set fresh records last night, but there was no such rally for London shares yesterday after lower commodity prices weakened the picture for mining and oil stocks.
The FTSE 100 index is forecast to open seven points lower at 7267 today.
Pets at Home CEO to step down
07:42 , Joanna Bourke
The chain said the boss will remain fully engaged in his role until late May to oversee the presentation of the group’s 2022 preliminary results to investors.
Read more HERE.
Next sales rally
07:53 , Graeme Evans
Next continues to weather the stormy conditions on the high street after revealing that full-price sales for the 13 weeks to last weekend rose 17% on two years earlier.
In the last five weeks, the figure was 14% higher in a performance better than previous guidance for 10%. Online sales jumped 40% in the quarter.
Next has maintained its forecast for annual profits of £800 million, however, as it sees the current quarter as being more challenging, with some ongoing stock availability issues and the benefits of pent-up demand set to wane.
House price milestone
08:08 , Graeme Evans
The average house price in the UK is over the £250,000 threshold, according to the Nationwide.
The lender’s House Price Index rose another 0.7% to an average £250,311 in October, a rise of 9.9% on an annual basis and up £30,728 since the pandemic struck.
Prices have rocketed in part due to a Stamp Duty holiday during the pandemic that created a surge in demand, but momentum has continued even after that tax break ended.
Darktrace backer raises £63.8 million
08:41 , Graeme Evans
Darktrace shares are under more selling pressure after a major investor raised £63.8 million from offloading stock at a price of 580p, compared with last night's level of 632.5p.
The move by Vitruvian Partners follows the expiry of the six-month lock-up period for investors involved in the cyber security firm’s April flotation, when shares were priced at 250p.
Last night's placing, which was managed by Berenberg and Morgan Stanley, leaves Vitruvian with a stake of just below 3%.
Darktrace hit 985p in September but has fallen sharply since Peel Hunt issued a “sell” recommendation and as the lock-up expiry deadline approached, meaning investors are free to bank profits realised during the earlier strong run for shares.
The stock fell 6% to 596.5p today.
Anglo American boss bows out
09:00 , Oscar Williams-Grut
Cutifani will step down next April at the company’s AGM and be replaced by current strategy director Duncan Wanblad. The transition marks the end of an almost a decade in charge for Cutifani, who was appointed in 2013. He has previously signaled a desire to step down in 2022.
Anglo chair Stuart Chambers thanks Cutifani and said he had done an “incredible job” for which the board were “enormously grateful”.
Chambers said Wanblad, 54, was the “stand out candidate” to take over from Cutifani following a global search.
Mining recovery bolsters FTSE 100
09:02 , Graeme Evans
The FTSE 100 index is little changed at 7265.89 as investors remain on the sidelines ahead of the US Federal Reserve meeting later.
Mining stocks provided the main interest as shares in Antofagasta, Glencore and Rio Tinto reversed some of the falls seen yesterday.
Anglo American shares jumped 3% after it said strategy director Duncan Wanblad will replace chief executive Mark Cutifani, who is stepping down in April after nine years at the helm.
Next shares were 3% lower as investors heeded cautious comments about the fourth quarter outlook, even though sales for the past 13 weeks were an impressive 17% higher than two years earlier.
The FTSE 250 index rose 7.79 points to 21,147.79, led by Micro Focus International after the $375 million (£275 million) sale of its archiving and risk management portfolio sent shares 4% higher.
Next on tracks, but warns on Xmas slowdown
09:57 , Simon English
NEXT reinforced its status as the King of the High Street today, with booming sales that leave it on track for year-end profits of £800 million.
But it had some words of caution on supply chains and Christmas demand that sent retail shares wobbling.
The pent-up demand that has seen retailers bounce back post lockdown is “likely to continue to diminish” warned chief executive Simon Wolfson.
Shares sale keeps Darktrace under pressure
10:33 , Graeme Evans
The rocky ride for Darktrace since joining the FTSE 100 index continued today when a major investor dumped a third of its holding to send shares down by another 5%.
Deep Defence, part of private equity firm Vitruvian Partners, raised £63.8 million from the sale of 11 million shares at a price of 580p, a 9% discount to last night's level of 632.5p.
Its move, which followed a placing process by Berenberg and Morgan Stanley, represents a decent profit after the cyber security firm's April flotation priced shares at 250p.
But Darktrace had been trading at 985p in mid-September, earning the company run by co-founder Poppy Gustafsson a place in the FTSE 100 index.
Since then Peel Hunt has issued a “sell” recommendation and the prospect of more investors banking their profits at the end of a six-month lock-up period has shaken confidence.
Darktrace was today trading at 598.5p, a drop of 34p and the biggest fall in the FTSE 100 index, which declined overall by 25.26 points to 7249.55.
A 1.5% retreat for Brent crude was the biggest factor in the top flight's deterioration as shares in BP and Royal Dutch Shell were down as much as 2%.
Mining stocks offered support by regaining some of the ground lost yesterday, with Chile's Antofagasta the best performing after shares rallied 3.5%.
The recovery prospects at British Airways lifted IAG shares by 3% and Royal Mail was 12.9p higher at 445.6p after UBS removed its “sell” rating on the stock.
The FTSE 250 index improved 8.79 points to 23,148.79, led by Micro Focus International after the IT firm unveiled the $375 million (£275 million) sale of the archiving arm it picked up from Hewlett Packard Enterprise in 2017. Shares jumped 8% or 29.3p to 392.7p.
Shares in shipbroker Braemar Shipping Services rose 7p to 258p as it posted a 10% rise in half-year operating profits to £5.6 million and revealed an ambition to double the size of the group’s core business over the next four years.
Service sector activity picks up
11:46 , Oscar Williams-Grut
Business activity is growing at its fastest pace since July, the latest IHS Markit/CIPS PMIs show. The October index stood of services at 57.8, up from 54.9 in September — any number above 50 shows growth.
But firms are deeply worried about rising costs. Duncan Brock at the Chartered Institute of Procurement & Supply said: “Escalating business costs remain deeply concerning as salaries rocketed along with fuel and energy costs and material shortages as a result of supply chain disorder.”
Trainline targets European growth as sales recover
11:56 , Naomi Ackerman
The company, which currently sells around 70% of all digital train tickets in the UK, saw net ticket sales reach 54% of pre-Covid levels at £1 billion in the six months to September. This was 179% improvement on sales last summer.
CEO Jody Ford said the company now sees “significant growth opportunity in Europe” as new train companies emerge.
Read the full story here
Micro Focus soars on news of $375m Digital Safe sell-off
12:15 , Naomi Ackerman
The UK-listed company, which has 14,000 employees and offers software to the world’s biggest pharma and aerospace firms, said it has agreed definitive terms to sell its Digital Safe business - one it acquired as part of an ill-fated $8.8 billion deal with Hewlett Packard’s HPE in 2017.
Read the full story here
Petrol station giant EG Group acquires US brand Sprint
12:30 , Naomi Ackerman
Petrol station giant EG Group has acquired American brand Sprint Food Stores, expanding its US presence to 33 states and continuing the group’s run of foodservice-focused purchases.
This morning EG Group said it will acquire 34 Sprint fuel and convenience stores in Georgia and South Caroline, as well as the company’s Sprint Kitchen food brand.
Read the full story here
Is the Bank of England poised to raise rates?
12:50 , Simon English
The market betting on whether it will do so tomorrow (Thursday) is split nearly exactly 50:50.
A few weeks back is seemed nailed on that rates would go from 0.1% to 0.25%.
Banks had already pulled their cheapest fixed rate mortgage deals from the market and replaced them with slightly more expensive ones in expectation of such a move.
Darktrace and Next drag FTSE lower
14:27 , Oscar Williams-Grut
The FTSE 100 is still lower in afternoon trade. The topflight index is down 34 points at 7240.
Darktrace remains at the foot of the index. Shares are down 43.5p or 6.9% at 589p after Deep Defence, part of private equity firm Vitruvian Partners, raised £63.8 million from the sale of 11 million shares at a price of 580p, a 9% discount to last night’s level of 632.5p.
Next isn’t far behind, down 2.9%, after cautious guidance on supply chains heading into the crucial Christmas trading period. Sainsbury’s is weak ahead of interim results tomorrow. Shares in the supermarket are down 7.4p or 2.5% at 295.4p.