2nd Dec 2025 12:04
(Alliance News) - Stock prices in London were mixed at midday on Tuesday, with bank gains helping to steady the market.
The FTSE 100 index was up 38.61 points, 0.4%, at 9,741.14. The FTSE 250 was up 13.01 points, 0.1%, at 22,033.69, and the AIM All-Share was down 3.43 points, 0.5%, at 751.36.
The Cboe UK 100 was up 0.4% at 976.35, the Cboe UK 250 was down 0.3% at 19,126.63, and the Cboe Small Companies was down 0.3% at 17,572.00.
The OECD said on Tuesday that tax rises and spending cuts will act as a headwind for the UK economy over the next two years, with UK inflation expected to remain among the highest in the G7.
It warned that fiscal consolidation will weigh on household incomes and consumer spending, forecasting that GDP growth will slow from 1.4% this year to 1.2% in 2026, before edging up to 1.3% in 2027.
The report comes amid political pressure on Chancellor Rachel Reeves following last week's budget, with opposition parties and businesses criticising the plan for failing to include significant pro-growth measures.
The budget included GBP26 billion in tax rises, such as a freeze on income tax thresholds that will push 1.7 million more people into higher tax brackets, taking the UK tax burden to a record high.
The Bank of England said all seven major UK lenders passed its latest stress test, confirming the resilience of the sector. It noted that all participating banks maintained capital and leverage ratios above regulatory minima.
Lloyds, Nationwide, NatWest and Santander UK were most affected by the UK-focused scenario of higher rates, inflation and house price declines, while Barclays, HSBC and Standard Chartered also faced international market pressures.
Bank shares rose following the announcement, with Lloyds up 1.6%, Barclays up 0.9%, NatWest up 1.2%, HSBC up 0.9% and Standard Chartered up 1.3%. Santander rose 1.8% in Madrid.
In European equities on Tuesday, the CAC 40 in Paris was up 0.4%, while the DAX 40 in Frankfurt was up 0.7%.
Eurostat reported that eurozone annual inflation unexpectedly ticked up to 2.2% in November from 2.1%, despite expectations for no change. Monthly prices fell 0.3%.
Energy prices rose 0.9% on the month but were still 0.5% lower than a year earlier.
Eurozone unemployment held at 6.4% in October, with Spain posting the highest jobless rate at 10.5% and Malta the lowest at 3.1%.
The pound was quoted at USD1.3200 at midday on Tuesday in London, lower compared to USD1.3227 at the equities close on Monday. The euro stood at USD1.1607, lower against USD1.1625. Against the yen, the dollar was trading unchanged at JPY155.96.
On the FTSE 100, Endeavour Mining was the biggest faller, down 1.9%, after it outlined a new five-year exploration plan. From 2026 to 2030, the gold miner aims to discover between 12 million and 15 million ounces of resources at a cost below USD40 per ounce, implying USD540 million in exploration spending.
CEO Ian Cockerill said the company expects to identify two to three new greenfield projects totalling around 6 million ounces, and to find a further 6 million to 9 million ounces near existing mines.
Among smaller caps, Pantheon Resources fell 21% after reporting an USD8 million cost overrun at its Dubhe-1 well in Alaska, taking the total to USD33 million, above the USD25 million previously expected.
The company said the additional spending reflected refined targeting, contingency measures and inflation. Clean-up operations continue, with around 40% of injected water recovered and modest light oil and gas output.
CEO Max Easley said the cost increase does not detract from "solid operating performance".
Stocks in New York were called higher on Tuesday, with the Dow Jones Industrial Average seen up 0.2%, the S&P 500 up 0.3% and the Nasdaq Composite up 0.4%.
The yield on the US 10-year Treasury was quoted at 4.12%, widening from 4.09%. The yield on the US 30-year Treasury was quoted at 4.74%, unchanged from late Monday.
Geopolitics also featured, as US special envoy Steve Witkoff travelled to Moscow to meet Russian President Vladimir Putin, carrying an early-stage peace plan aimed at finding a path to ending the nearly four-year war in Ukraine. Kremlin spokesman Dmitry Peskov said that US President Donald Trump's son-in-law Jared Kushner will join Witkoff for the talks.
The visit came as Ukrainian President Volodymyr Zelensky travelled to Ireland, continuing efforts to shore up European support.
Washington's diplomacy has run along parallel tracks, with Secretary of State Marco Rubio meeting Ukrainian officials in Florida, and Witkoff now engaging with Moscow.
Few details of the plan have emerged, and European leaders warned that bridging core differences - such as territorial control - will be difficult, stressing that the road to peace will be long.
Gold was quoted at USD4,197.40 an ounce at midday, down from USD4,236.80. Brent oil traded at USD62.88 a barrel, lower compared to USD63.03 late Monday. Silver, which reached USD58.84 on Monday, eased to USD57.26.
By Eva Castanedo, Alliance News reporter
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