FTSE 100: London closes higher and Wall Street rallies after soft job report (2024)

The FTSE 100 (^FTSE) and European stocks closed higher on Friday amid hopes that the cooldown in the US labour market will embolden the US Federal Reserve to begin cutting interest rates.


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    Pedro Goncalves

    UK pulling out of recession as services sector growth hits 11-month high

    Activity in the UK’s services sector rose at the fastest rate nearly a year in April, as spending was boosted by improved consumer and business confidence, according to new data.

    The S&P Global UK services PMI survey scored 55.0 in April, up from 53.1 in March, and above estimates from economists.

    It was also the fastest rate of business activity growth since May last year.

    Any reading above 50 indicates that the services sector is growing, while anything below that implies it is shrinking.

    Tim Moore, economics director at S&P Global, said:

    The latest survey results are consistent with the UK economy growing at a quarterly rate of 0.4% and therefore pulling further out of last year’s shallow recession. Relief at a turnaround in the economic outlook was commonly cited as a factor supporting sales pipelines in April. However, there were also reports that clients remained somewhat risk averse and under pressure from elevated inflation.

  • Pedro Goncalves

    That is all we have time for today but do follow our US blog for the latest moving markets across the pond.

    Hope you'll join us again Tuesday as we bring you the latest stock news.



  • Pedro Goncalves

    Traders bet on faster interest rate cuts as US job growth slows

    Richard Flynn, managing director at Charles Schwab UK, said: “In recent months, it has become clear that the Fed is happy to move slowly in the cutting part of the rate cycle, but unwanted and unexpected weakness in the economy, as we are seeing today, may cause a shift in this approach.

    “A dive in the labour market may be what it takes to push the Fed from a stroll to a sprint.”

  • Pedro Goncalves

    US stock markets surge at the open

    US stocks surged on Friday, as upbeat earnings from Apple (AAPL) lifted spirits and a weaker-than-expected jobs report revived bets that the Federal Reserve could cut interest rates sooner than thought.

    The April jobs report painted a picture of a cooling US labor market, as employers added 175,000 jobs and the unemployment rate unexpectedly jumped to 3.9%. Economists had expected an addition of 240,000 jobs.

    The report pushed up bets on a sooner-than-expected rate cut from the Fed.

    The Dow Jones Industrial Average (^DJI) jumped 1.5%, or more than 500 points, while the S&P 500 (^GSPC) rose 1.2%. The tech-heavy Nasdaq Composite (^IXIC) increased roughly 1.9%. All three gauges are poised to build on sharp closing gains from Thursday.

    Read the full story here

  • Pedro Goncalves

    Mortgage mistake costing homeowners £3,000

    FTSE 100: London closes higher and Wall Street rallies after soft job report (1)

    Almost a third (31%) of homeowners have let their mortgage slip into a higher rate for at least 1 month after their fixed-rate deal has ended, a mistake that can add £3,000 in unnecessary mortgage repayments

    The total amount of time during which people had let their mortgage revert to a higher rate was an average of 10 months over the course of their mortgage, according to a survey by personal finance comparison site finder.com

    Someone paying off the cost of the UK’s average house, worth £281,913, on a competitive fixed 3-year rate* of 5.5% would pay £1,361 per month during those 3 years.

    But if they didn’t remortgage immediately at the end of the initial fixed term, the interest rate would revert to the lender’s standard variable rate, which is typically around 7.5% at the moment. This would cost them £1,661 per month, which is an extra £300. The average person paying 10 months of this would therefore part with an extra £3,000 to pay the extra interest.

    While the average time that homeowners in the survey had left their revert rate going was 10 months, over 1 in 10 (11%) had paid a higher revert rate for more than 1 year. Worryingly, 3% said they’d paid a revert rate for over 5 years. This would cost over £30,000 in extra interest.

  • Pedro Goncalves

    HSBC expects interest rate cut in June

    HSBC is in a strong position to continue paying robust dividends to shareholders chairman Mark Tucker said at the bank's annual shareholder meeting.

    He predicts that the BoE will lower interest rates by 1.5 percentage points by the end of next year. That would lower Bank Rate to 3.75%, from 5.25% today.

    "We expect the ECB and Bank of England to cut rates in June, cutting by 150bps by year-end 2025. We expect the Fed to cut in September, cutting by 100bps by year-end 2025," Tucker said.

    The bank returned $19bn to shareholders in 2023 through dividends and share buybacks, has announced a further $8.8bn so far for 2024.

  • Pedro Goncalves

    TGI Fridays operator Hostmore narrows losses after cost-cutting

    TGI Fridays operator Hostmore has narrowed its losses for the past year as it pushed forward with its turnaround strategy.

    The UK hospitality company reported lower revenues in the face of the challenging backdrop for hospitality firms.

    The update comes weeks after Hostmore, which runs 89 sites across the UK, agreed a deal to merge with US-based TGI Fridays Inc, to create a larger firm which will remain listed in London.

    Hostmore said that 2023 was a “transitional year” as it sought to put its finances back on a strong footing.

    It revealed revenues for the year to December 31 of £190.7m, dropping from £195.7m in 2022.

    Nevertheless, it heavily reduced its pre-tax losses to £25.5m from £108.3m a year earlier.

    The reduction came after significant cost-cutting, which it said provided a £6.2m boost last year.

  • Pedro Goncalves

    Trending tickers: Apple, Coinbase, Anglo American and Diageo

    FTSE 100: London closes higher and Wall Street rallies after soft job report (2)

    Apple (AAPL) - Apple shares climbed in pre-market trading after the iPhone maker reported fiscal second-quarter earnings that topped estimates and announced an expanded stock buyback programme.

    Coinbase (COIN) - Coinbase reported better-than-expected revenue in its first-quarter earnings report, helped by an uptick in cryptocurrency trading following the launch of the first US-listed exchange traded funds (ETFs) tracking bitcoin in January.

    Anglo American (AAL.L) - Anglo American has jumped 3% after Reuters reported that Glencore (GLEN.L) was considering an approach for the 107-year old miner, a move that could spark a bidding war.

    Diageo (DGE.L) - Guinness owner Diageo has poached the finance boss of the world’s largest Coca-Cola bottler as it seeks to recover from a drop in sales and profits.

    Read the full story here

  • Pedro Goncalves

    Oil prices set for steepest weekly drop in 3 months

    The oil price is on track for its biggest weekly losses in three months, bringing relief to consumers.

    Brent crude futures (BZ=F) rose to $83.98 per barrel. Meanwhile, US West Texas Intermediate (MCL=F) crude futures climbed to $79.22 per barrel.

    Still, both benchmarks were on track for weekly losses as investors worried about the prospect of higher-for-longer interest rates curbing growth in the US, the top global oil consumer, and in other parts of the world.

    "With the US driving season almost upon us, high inflation may see consumers opt for shorter drives over the holiday period," analysts at ANZ Research said in a note.

  • Pedro Goncalves

    FTSE nears all time high but has further to climb, says Interactive Investor

    In the City, the blue-chip share index has nearly hit a new all time high at the start of trading.

    Richard Hunter, head of markets at Interactive Investor, suggests the London stock market has further to climb:

    US markets may have lost some of their mojo but the same cannot be said for a flourishing FTSE100, where opening strength lifted gains in the year so far to 6%. The mixture of technical factors, such as rising commodity prices and higher interest rates underpinning the likes of the mining, oil and banking sectors has been combined with improving sentiment towards the premier index. Even at these elevated levels at or around record highs, the valuation of the index remains undemanding in comparison to many of its peers which could suggest that the recent rally still has some way to go.

  • Pedro Goncalves

    Wall Street ends higher as Fed signals dovish bias

    FTSE 100: London closes higher and Wall Street rallies after soft job report (3)

    US stocks strode higher Thursday in a calm after the Fed day storm, as investors set aside rate worries for now to focus on Apple (AAPL) earnings and the coming monthly jobs report.

    The S&P 500 (^GSPC) rose roughly 0.9%, while the Dow Jones Industrial Average (^DJI) gained about 0.8%. The tech-heavy Nasdaq Composite (^IXIC) led the gains, up 1.5%.

    Stocks are recovering from Wednesday's volatile session dominated by the wait for the Federal Reserve's policy decision. Chair Jerome Powell played down the likelihood of an interest-rate hike, bringing relief to investors worried that recent signs of "sticky" inflation might prompt that move.

    Read the full article here

  • Pedro Goncalves

    Trainline leads FTSE 230 as it surpasses £5bn ticket sales

    Rail ticket platform Trainline (TRN.L) are the top riser on the FTSE 250 (^FTMC) after doubling its operating profits in the last year.

    Trainline surpassed £5bn in ticket sales for the first time, as the aggregator enjoyed a recovery in rail travel in Britain and sharp growth across Europe.

    The London-listed company’s pre-tax profit more than doubled to £48m in the year ending February 29, buoyed by an easing in rail strikes, which fell to 25 days from 30 in the previous 12 months.

    Trainline’s ticket sales grew 22% year-on-year, mainly driven by £3.5bn in UK tickets. The overall British rail market recovered to an estimated £10.6bn in passenger revenues during the reporting period, up from £8.9bn in the prior year.

    The bumper year was further boosted by sales across Spain and Italy, which grew a combined 43%, as Trainline further penetrated both international markets.

    On the back of its European growth, Trainline also surpassed £1bn in international ticket sales for the first time.

  • Pedro Goncalves

    Asda refinances £3.2bn of debt

    Supermarket Asda has refinanced around £3.2bn of its debt amid “strong demand” from investors.

    It said the new bond agreements will now mature in 2030 and 2031.

    As part of the refinancing, the UK’s third largest grocery chain said it also used £300m of cash from its balance sheet to reduce its gross debt.

    Asda had net debt of £3.8bn at the end of 2023, having built up the debt pile through its takeover by the billionaire Issa brother and private equity firm TDR Capital.

    Michael Gleeson, Asda’s chief financial officer, said: “We saw strong demand from investors after taking a thoughtful and prudent approach to refinancing our near-term debt well ahead of maturities – to further strengthen our balance sheet.

    “The refinancing also reflects the wider strength of Asda as a diversified retail group with a strong grocery business at its core supported by a fantastic non-food offering in George and following recent investments, a major presence in the high-growth convenience and food-service markets.”

  • Pedro Goncalves

    Asia stocks hit 15-month high

    Asian stocks surged to their highest in 15 months led by tech and Hong Kong stocks.

    Hong Kong’s Hang Seng jumped 1% to 18,301.11, tracking gains on Wall Street. News of fresh moves by Chinese leaders to energise the economy helped drive buying of technology shares.

    Gains were driven by e-commerce giant Alibaba (9988.HK) climbing 4.4% and rival JD.com (9618.HK) gaining 5%.

    Vey-Sern Ling, managing director at Union Bancaire Privée, said: “The strong performance in the past two weeks is probably attracting more fund inflows for fear of missing out.

    “Even after the sharp rally, valuations for the China tech stocks are still well below historical average as well as when compared with global peers.”

    Several major markets including Tokyo (^N225) and Shanghai (000001.SS) were closed for holidays.

  • Pedro Goncalves

    Holiday Inn owner boosted by Europe and China

    Holiday Inn operator Intercontinental Hotels Group (IHG) has revealed stronger revenues over the first quarter of 2024 driven by growth in Europe and Asia.

    It came as the company, which also runs Crowne Plaza hotels, continued to expand by opening more than 6,200 rooms across 46 hotels during the period.

    This represented an 11% rise in room openings compared to the same quarter a year earlier.

    IHG told shareholders that global revenues per available room grew by 2.6% for the quarter.

    Elie Maalouf, chief executive officer of IHG Hotels & Resorts, said: “There was an impressive performance in EMEAA (Europe Middle East Africa and Asia) which was up nearly 9%.

    “The Americas, having already recovered very strongly, was broadly flat due to some adverse calendar timing, and Greater China grew by 2.5% and will continue to benefit from returning international inbound travel this year.

    “Global occupancy moved up to 62% and average daily rate increased by a further 2% as pricing remained robust, reflecting the complete return of leisure, business, and group travel.”

FTSE 100: London closes higher and Wall Street rallies after soft job report (2024)


Why has the FTSE rallied? ›

There have been various drivers behind the rising tide, including hopes for interest rate cuts and the pound's weakness against the dollar, with the latter boosting the FTSE 100 due to companies in the index earning most of their revenues outside the UK.

How often is FTSE 100 reviewed? ›

Source: FTSE Russell as at 30 April 2024. The FTSE constituents are reviewed every quarter. At each review some companies will exit and other will enter, this impacts share price and is a busy day of trading.

Why is the FTSE 100 doing so well? ›

Hopes of easing geopolitical tensions and brighter prospects for the UK economy with falling inflation and possible late summer interest rate cuts has given investors and the stock market a boost. The FTSE 100 seems to have its mojo back and has finally swept past the record closing high from February 2023.

How does a company move from FTSE 250 to FTSE 100? ›

For the FTSE 100, if a company not currently in the FTSE 100 is now in 90th position or higher (in terms of total market value) they are promoted to the FTSE 100. For the FTSE 250, if a company is now in the 325th position or higher (in terms of total market value) they are promoted to the FTSE 250.

Why are UK stocks rallying? ›

Energy companies and miners have an outsize presence in the British benchmark and climbing commodity prices as well as a spate of buybacks have helped lift their shares. Pound weakness has made the nation's exports more competitive, while the economy has bounced back from recession.

What is the highest FTSE 100 ever recorded? ›

Record values

The index began on 3 January 1984 at the base level of 1,000. The highest closing value of 8,445.80 was reached on 15 May 2024 and the highest intra-day value of 8,474.71 was also reached on 15 May 2024.

How often are stock market analysts correct? ›

One study looked at the track record of stock market “experts” who predicted the market's direction. Their findings were eye-popping. Overall their accuracy rate was only 47%, less than you might expect from random chance. Jim Cramer, a fixture on CNBC, had an accuracy rating of 46.8% based on 62 forecasts.

What is the best month for the FTSE 100? ›

Historically, April has been, on average, the best month for the FTSE 100.

Is FTSE 100 expected to rise? ›

Profits still expected to reach all-time high

Analysts are still expecting a new all-time high for aggregate FTSE 100 pre-tax profits in 2024, at £246.5 billion.

What is the most valuable company in the FTSE 100? ›

The top FTSE 100 companies are AstraZeneca, Shell, Linde, HSBC Holdings, Unilever Group, BP, Diageo, Rio Tinto Group, Glencore, British American Tobacco, and GlaxoSmithKline.

Will the FTSE ever recover? ›

If you take a look over a longer timeframe, the FTSE 100 has risen over 8% in the past five years. The FTSE 250 paints a different picture. Before the pandemic-induced crash it was around 21,000 points. The index recovered rapidly to reach a new record high of around 24,000 points in September 2021.

Is the FTSE 100 a good investment? ›

The FTSE 100 began this year at 7,733, no higher than it had been in spring 2018, even though aggregate profits for 2024 are expected to come in one quarter higher than they did six years ago. Aggregate ordinary dividend estimates suggest the total payment in 2024 could come in at £79.1 billion.

Can you invest in the FTSE 100 as a whole? ›

You can't invest in the FTSE 100 directly, but you can invest in an index fund or exchange-traded fund (ETF). This can be a good option if you want exposure to all of the companies in the index without having to buy individual shares. These funds and ETFs track the performance of the stocks in the FTSE 100.

Which companies are leaving the FTSE 100? ›

The September 2023 quarterly review also brought bad news for Abrdn (ABDN) (whose share price dropped significantly in the past month), Hiscox (HSX), Johnson Matthey (JMAT) and Persimmon (PSN) will leave the FTSE 100 and enter the FTSE 250 Index.

What are the largest companies in the FTSE 100? ›

As of March 6, 2024, the biopharmaceutical company AstraZeneca was the second-largest company on the FTSE 100 Index, with a market capitalization of 157 billion British pounds. First in the ranking was oil and gas giant Shell, with a market cap of just over 158 billion British pounds.

Why is the stock market rallying so much? ›

Over much of this month, stock investors have enjoyed a rally, helped by easing monthly consumer-price gains for April and the Federal Reserve's willingness to put low chances on a future interest-rate hike despite the first quarter's upward surprises on inflation.

What does it mean when the FTSE is up? ›

When the FTSE 100 is 'up' or 'down', the change is being quoted against the previous day's closing price. The figure you see on the evening news is the closing value of the FTSE 100 for that day.

Why does FTSE rise when pound falls? ›

So, if the pound falls all those foreign revenues and profits are worth more in pounds. A stock market index – FTSE 100 – which measures the value of companies trading in foreign in pounds rises when the value of the pound falls.

What moves the FTSE? ›

Trade deals, foreign relations, and geopolitical events also have the potential to move the FTSE 100. Earnings reports: Earnings and forecasts released by the FTSE 100 constituents can have a notable impact on the value of the index, depending on the weight of the particular stock.

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