4th Nov 2025 12:14
(Alliance News) - Stock prices in London were lower at midday on Tuesday, while US futures also sank, as risk-off sentiment took hold in global markets.
The FTSE 100 index was down 57.13 points, 0.6%, at 9,644.24. The FTSE 250 was down 112.47 points, 0.5%, at 21,996.42, and the AIM All-Share was down 9.26 points, 1.2%, at 762.76.
The Cboe UK 100 was down 0.5% at 962.61, the Cboe UK 250 was 0.6% lower at 19,068.73, and the Cboe Small Companies was down 0.6% at 17,862.87.
In European equities on Tuesday, the CAC 40 in Paris was down 1.1%, while the DAX 40 in Frankfurt fell 1.3%.
In a speech on Tuesday morning, Rachel Reeves put the country on notice that tax rises are coming in her Budget, saying "each of us must do our bit".
The chancellor declined to recommit to Labour's manifesto commitments not to raise income tax, national insurance or VAT, saying "we will all have to contribute".
She blamed global problems including the tariff war triggered by US President Donald Trump and domestic issues including the budget watchdog's expected downgrade of economic productivity for the "hard choices" she will make.
Reeves took the unusual step of delivering a speech three weeks ahead of her Budget to prepare the ground for the expected tax increases she will announce.
Speaking in Downing Street, she said: "As I take my decisions on both tax and spend, I will do what is necessary to protect families from high inflation and interest rates, to protect our public services from a return to austerity and to ensure that the economy that we hand down to future generations is secure with debt under control.
"If we are to build the future of Britain together, we will all have to contribute to that effort.
"Each of us must do our bit for the security of our country and the brightness of its future."
The Office for Budget Responsibility is expected to heavily downgrade its previous forecasts for productivity, adding to the chancellor's headaches.
AJ Bell analyst Dan Coatsworth said: "Rachel Reeves' unusual stance of giving a big speech on the eve of the Budget has left investors with more questions than answers, and done nothing to remove uncertainty around taxes."
Yields on UK government bonds, also known as gilts, fell as much as six basis points to 4.38%, while the 30-year yield dropped to its lowest level since April at 5.15% at one stage.
But gilts soon trimmed their rally as questions continued to swirl over the upcoming November 26 Budget, with Reeves's refusing to give any firm details on what can be expected.
Coatsworth said: "The bond market would be happy if the chancellor raises taxes as it would help to improve public finances and make the UK less risky from an investment perspective. It was telling that the 10-year gilt yield fell as Reeves began her speech, indicating that bond investors thought we'd get confirmation that taxes would go up at the Budget. But as it became clear that Reeves was merely dancing around the topic, yields went back up."
Sterling was at USD1.3070 at midday on Tuesday, down from USD1.3146 at the London equities close on Monday. The euro was lower at USD1.1496 from USD1.1531. Against the yen, the dollar was lower at JPY153.46 versus JPY154.14.
Stocks in New York were called lower. The Dow Jones Industrial Average was called down 0.7%, the S&P 500 index 1.0% lower, and the Nasdaq Composite was called to fall 1.3%.
The yield on the 10-year US Treasury slimmed to 4.09% at midday on Tuesday from 4.12% on Monday. The yield on the 30-year narrowed to 4.68% from 4.70%.
In London, Associated British Foods were down 3.1% after it said it is considering separating its Primark retail business and its Food operations as part of a review into the group's structure.
The London-based food processing firm and clothing retailer said no decision has been taken, and the review is being conducted in consultation with ABF's largest shareholder, Wittington Investments, which remains committed to maintaining majority ownership of both businesses.
Chief Executive George Weston said he "fully" supports the review and will be "closely involved" in the process and any outcome.
The news came as AB Foods reported pretax profit of GBP1.41 billion for the 12 months to September 13, down 26% from GBP1.92 billion a year prior.
Adjusted pretax profit declined 12% to GBP1.70 billion from GBP1.96 billion.
Revenue fell to GBP19.46 billion from GBP20.07 billion, while operating costs before exceptional items decreased to GBP17.88 billion from GBP18.24 billion.
Revenue was below GBP19.7 billion consensus but adjusted pretax profit beat GBP1.67 billion expectations.
In Primark, ABF expects the consumer environment to "remain subdued", while it expects international brands in the Grocery arm to deliver "good growth in sales and profit".
It expects to improve profitability in Sugar and deliver a small adjusted operating profit for the division in 2026.
"This was a year of intense strategic and operational activity within ABF. Most of our businesses delivered robust financial results, while navigating a challenging external backdrop," said CEO Weston.
On the FTSE 250 index, Diversified Energy shot up 9.8%.
After the London market close on Monday, Diversified Energy Co hailed the strength of its portfolio of high-quality assets as it reported a much improved sales, earnings and cash flow performance.
The Birmingham, Alabama-based oil and gas production company said adjusted earnings before interest, tax, depreciation and amortisation multiplied to USD286 million in the third quarter from USD115 million the year prior.
Revenue more than doubled to USD500 million from USD244 million, while adjusted free cash flow improved to USD144 million from USD56 million.
Chief Executive Rusty Hutson commented: "Our growing portfolio of high-quality assets continued to deliver exceptional results this quarter... demonstrating Diversified’s ability to generate substantial value in volatile markets."
International Workplace shares were down 3.6% as it reported stable group revenue in the third quarter, and said "the evolution of occupancy and pricing" positions it well for further growth.
The Zug, Switzerland-based provider of hybrid workspace reported group revenue of USD947 million for the three months to September 30, flat with the prior year.
Looking ahead, International Workplace confirmed its annual guidance given at its interim results. It continues to expect adjusted earnings before interest, tax, depreciation, and amortisation between USD525 million and USD565 million, and with net debt "roughly unchanged" from 2024.
Among small-caps, shares in Ferro-Alloy Resources were 18% higher.
The Kazakhstan-focused vanadium producer agreed terms for the front-end engineering and design for the Balasausqandiq vanadium project with China National Chemical Engineering Sixth Construction Co Ltd, or CC6.
The firm said CC6 estimates construction costs of USD261 million for the project, which cuts the funding required to get into production to USD311.9 million, a 40% reduction compared to the feasibility study.
"As previously indicated, we have identified substantial capital cost savings that demonstrate the potential to significantly enhance the project's financial returns," said Ferro-Alloy Chief Executive Officer Nick Bridgen.
"In addition CC6, a company that has vast experience in building plants all over the world with particular expertise in vanadium processing technology, has secured an attractive conditional offer of construction financing for the project with BOC Bank."
Zotefoams shares were down 11% as it said revenue fell to GBP38.2 million in the quarter to the end of September from GBP39.7 million a year ago.
The Croydon, London-headquartered foams, insulation, seals and interior trims provider said it "sustained its positive trading momentum" during the period and added that the performance was in line with the board's expectations.
Looking ahead, Zotefoams said: "The board is confident in the group's ability to sustain positive momentum, with good visibility of confirmed orders across most business units for the remainder of the final quarter, underpinning a continued expectation of delivering mid-single-digit growth for the year as a whole."
Gold was slightly higher at USD3,997.90 an ounce at midday on Tuesday from USD3,997.03 late Monday. Brent oil was trading lower at USD64.00 a barrel from USD65.08.
By Michael Hennessey, Alliance News reporter
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AB FoodsDiversified EnergyInternational Workplace GroupZotefoams Plc