FTSE 100 Live: US rate rise speculation lifts sentiment, oil price steady
A rally for global markets is continuing amid hopes that Federal Reserve interest rate hikes may not be as aggressive as earlier feared.
The FTSE 100 index added more than 2.5% on Friday and leading indices on Wall Street finished the week sharply higher.
The price of Brent crude, meanwhile, has held firm as attention turns to the G7 summit and a potential price cap mechanism on Russian oil.
FTSE 100 Live Monday
US rate rise hopes boost markets
Mining stocks lead FTSE 100 higher
FCA probe into Wise CEO over tax
Imperial Leather soap owner faces “challenging” outlook
11:58 , Jonathan Prynn
Consumer goods company PZ Cussons, the owner of the Carex , Charles Worthington and Imperial Leather brands said it faced a “challenging” economic environment but that it had plans to “mitigate” the impact of costs to consumers as belts become tighter due to rampant inflationary pressures.
In a trading update the company said it anticipated group revenue for the year to climb to £590 million, a like-for-like sales growth of 3% and a like-for-like sales growth of 7% for the fourth quarter.
CareTech to go private in £870m deal with its founders
11:20 , Jonathan Prynn
CareTech Holdings, the residential social care provider, has announced plans to take itself private in a deal worth over £870m.
The AIM-listed company recommended investors accept the deal -- priced at 750p per share in cash -- and struck with its co-founders Haroon Sheikh and Farouq Sheikh. It is backed by THCP Advisory, the fund management firm.
FTSE 100 rally continues, Anglo American up 3%
10:01 , Graeme Evans
A cooling of US rate rise expectations helped shares in London’s band of heavyweight miners jump by as much as 3% today.
Risk appetite also benefited from optimism around China’s economy as the country’s Covid restrictions continue to ease.
The FTSE 100 index lifted another 1% or 74.31 points to 7283.12, having jumped 2.7% on Friday after Wall Street markets rebounded on expectations that interest rates will reach 3.5% in March compared with a previous estimate of 4%.
Signs that household inflation expectations may have passed the peak added to hopes that markets have gone too far anticipating aggressive Fed rate rises.
Commodities-focused stocks were boosted today, with Anglo American shares up 101p to 3167p and copper miner Antofagasta 42p higher at 1226.5p.
Scottish Mortgage Investment Trust, whose portfolio includes leading China and US-based tech stocks, topped the risers board with a surge of 4% or 29p to 762p. There was also a recovery for engines giant Rolls-Royce, which added 2.77p to 83.71p.
Whitbread shares were 11p higher at 2567p after analysts at Liberum backed the Premier Inn owner with a “buy” recommendation and new target price of 3320p.
The shares are down 15% this year, despite a strong recent trading update and the potential for greater shareholder returns through dividends and buybacks. Liberum said: “Leisure demand looks strong for the summer and business demand supported by the return of ‘white collar’ demand.”
The FTSE 250 index was 236.84 points higher at 19,360.55, fuelled by gains of 6% for cruise ship business Carnival and 5% for Aston Martin Lagonda.
FCA probe into Wise CEO over tax
09:57 , Simon English
THE trouble facing Kristo Käärmann, the billionaire co-founder of Wise, grew today when the City watchdog opened an investigation into his tax affairs.
The financial entrepreneur has been on the list of HMRC’s so-called “deliberate defaulters” since September 2021. He failed to pay a £720,000 bill for 2017-18 and was hit with a fine of £366,000.
Today Wise said the Financial Conduct Authority has opened its own probe into his affair.
That is potentially very serious since the watchdog has the power to rule him an unfit person to lead a financial business.
Mining stocks lead FTSE 100 recovery
08:22 , Graeme Evans
The FTSE 100 index is 43.62 points higher at 7252.43, a rise of 0.5% fuelled by higher mining stocks including Anglo American and Antofagasta.
Richard Hunter, head of markets at Interactive Investor, said today: “There are occasions when bad news can be good news.
“A record low in US consumer confidence level raised hopes that the Federal Reserve may begin to consider a lighter touch in its approach to tightening after the likely July hike.
“It also raised the possibility that the so-called “terminal rate” may be approaching, with the current consensus being that rates will reach 3.5% by March, down from a previous estimate of 4%.”
The FTSE 250 index improved 81.55 points to 19,205.26, with gains of 2% for Watches of Switzerland and Aston Martin Lagonda.
Interest rate hopes boost market sentiment
07:54 , Graeme Evans
The rally for European markets is set to continue after Friday’s strong Wall Street session was followed by improved trading in Asia.
Support for China’s economy after the country’s central bank made its biggest injection into the banking system in three months lifted Hong Kong’s Hang Seng index by 2.5% and the Shanghai Composite by 1%.
The improved mood means IG Index expects the FTSE 100 index to open 28 points higher after closing at 7208 on Friday.
US futures markets are pointing higher after markets rallied at the end of last week on hopes that the peak for the Federal Reserve funds rate may come as soon as March.
The reduced urgency for steeper Fed rate hikes followed figures showing longer-term consumer inflation expectations had settled back from a 14-year high.
Friday’s rally meant the Dow Jones Industrial finished 5% higher across the week, while the Nasdaq Composite was up by more than 7%.
