17th Dec 2024 09:07
(Alliance News) - Stock prices in London opened lower on Tuesday, with the data docket including eurozone trade balance, two ZEW economic sentiment surveys, and the US Redbook index.
The Office for National Statistics reported that UK unemployment, in the three months to the end of October, remained unchanged at 4.3% compared to the three months to the end of September. Growth in average earnings including bonuses picked up to 5.2% from 4.4%, however, easily beating the FXStreet-cited consensus of 4.6%. Average earnings growth excluding bonuses increased to 5.2% from 4.9%, outperforming the consensus of 5.0%.
"There's a disconnect between the rising tide of misery among businesses, anxiety building for economists, and festive cheer running rampant among the workforce: these figures show why," said Hargreaves Lansdown's Sarah Coles. "For businesses, the Budget brought huge challenges of rising employment costs, so every announcement of recent weeks has been laced with dire warnings of what the future might hold in store...For economists, rising wage inflation is a matter of concern...For the rest of the population, things are on the up. Wages are rising even faster than a month ago – and well ahead of inflation, so we feel richer with each passing month."
Coles added: "Anyone wondering whether we might get another [Bank of England] interest rate cut this week can now be fairly confident it's going to be off the table entirely in December."
The FTSE 100 index opened down 63.74 points, 0.8%, at 8,198.31. The FTSE 250 was down 105.17 points, 0.5%, at 20,707.86, and the AIM All-Share was down 2.23 points, 0.3%, at 727.26.
The Cboe UK 100 was down 0.7% at 823.11, the Cboe UK 250 was down 0.7% at 18,205.49, and the Cboe Small Companies was down 0.1% at 16,051.19.
London Stock Exchange Group was the biggest large-cap winner, up 0.6%.
UBS raised it to 'buy' on Tuesday morning from 'neutral', increasing the price target to 13,500 from 11,500 pence.
Bunzl was the biggest loser, down 4.5% despite a generally positive trading update.
The firm said it expects 2024 revenue to be up 3% on 2023 at constant currency, "driven by acquisitions", but either flat or down 1% at reported rates. Moreover, it expects adjusted operating profit in 2024 to represent a strong annual increase at constant exchange rates.
"Looking ahead, despite uncertainties relating to the wider economic and geopolitical landscape, the group expects robust [CER] revenue growth in 2025...driven by announced acquisitions and slight underlying revenue growth," Bunzl added.
Chemring was the FTSE 250's biggest loser, down 8.7% despite reporting increased earnings.
It declared a final dividend of 5.2 pence, up 13% on-year, also lifting its annual dividend 13% to 7.8p from 6.9p.
Revenue rose to GBP510.4 million from GBP472.6 million, while pretax profit increased to GBP53.3 million from GBP44.1 million. Looking ahead, it expects 2025 to be in line with expectations.
Goodwin was 250's runaway leader, surging 15%.
Pretax profit for the first half year rose to GBP16.7 million from GBP12.1 million, while revenue rose to GBP106.4 million from GBP97.6 million. However, Goodwin declared no interim dividend.
GSTechnologies lost 6.1%.
It said it is "extremely well-positioned for the future" after a "period of significant development" in the form of its first half year.
Its pretax loss narrowed to USD110,000 from USD737,000 the year before, while revenue surged to USD2.2 million from USD256,000.
In European equities on Tuesday, the CAC 40 in Paris was down 0.3%, while the DAX 40 in Frankfurt was down 0.2%.
The pound was quoted flat at USD1.2693 early on Tuesday in London, compared to USD1.2694 at the equities close on Monday. The euro stood lower at USD1.0490, against USD1.0504. Against the yen, the dollar was trading lower at JPY153.86 compared to JPY154.23.
In Asia on Tuesday, the Nikkei 225 index in Tokyo was down 0.2%. In China, the Shanghai Composite was down 0.7%, while the Hang Seng index in Hong Kong was down 0.2%. The S&P/ASX 200 in Sydney closed up 0.8%.
In the US on Monday, Wall Street ended mixed, with the Dow Jones Industrial Average down 0.3%, the S&P 500 up 0.4% and the Nasdaq Composite up 1.2%.
Brent oil was quoted lower at USD73.28 a barrel early in London on Tuesday from USD73.82 late Monday.
Gold was quoted lower at USD2,648.35 an ounce against USD2,650.30.
Still to come on Tuesday's economic calendar, US retail sales and industrial production readings come out this afternoon.
By Emma Curzon, Alliance News reporter
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