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FTSE 100 opened this week in positive territory, gaining around 0.3% in early trading on Monday, fueled by stronger-than-expected housing market activity and a rally in gold-linked stocks. The FTSE 250 also edged up 0.1%, leaving UK equities slightly ahead of their European peers despite broader market caution.
Fresh data from Rightmove pointed to a surprise boost in housing transactions during July. The number of agreed sales was 8% higher year-on-year, marking the busiest July since the post-pandemic boom in 2020.
Unlike that period, when stamp duty breaks fuelled demand, this rebound has been driven largely by sellers cutting prices to secure buyers in an oversupplied market.
New listings in August carried an average asking price of £368,740, down 1.3% from July and more than £10,000 cheaper than three months ago.
Rightmove described the market as “two-speed,” with competitively priced homes selling within 32 days on average, compared to 99 days for those needing price reductions.
Lower borrowing costs have also supported activity, with the average two-year fixed mortgage rate now at 4.49%, down from 5.17% a year earlier, helped by three Bank of England rate cuts this year.
Endeavour Mining led the FTSE 100 gainers, climbing nearly 3% to a record high as gold prices strengthened ahead of the Federal Reserve’s annual Jackson Hole meeting. Investors anticipate a dovish tone from US policymakers, boosting demand for safe assets.
Other gold miners also performed well, while larger diversified players like Rio Tinto and Glencore weighed on the index amid weakness in base metals.
Defensive heavyweights AstraZeneca, British American Tobacco, and BAE Systems provided additional support to the index, offsetting declines in banking giant HSBC, as well as energy majors BP and Shell.
Shares in meat producer Cranswick slipped about 2% following new reports of animal welfare violations at one of its pig farms in Lincolnshire. Several supermarkets cut supply ties after fresh allegations surfaced, although the company said corrective measures, including welfare officer hires and CCTV installations, are already underway.
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Market sentiment remains cautious as geopolitical risks dominate investor focus. Ahead of crucial talks between US President Donald Trump and Ukraine’s Volodymyr Zelenskyy, concerns are growing over difficult compromises on Crimea and NATO membership.
Closer to home, economists warn that the recovery in UK living standards is faltering, with real wage growth slowing sharply to 1.5% last quarter and potentially dropping further to 0.5% by year-end, according to Deutsche Bank.
