FTSE 100 Live: US Momentum Lifts Market; UK GDP Weakness Adds Pressure on Rate Debate

The FTSE 100 opened higher today, supported by overnight records on Wall Street and gains across global stocks. The index climbed 0.3% to 9735.94, extending its upward trend even as fresh economic data highlighted renewed weakness in the UK economy.

Gainers and Losers

Fresnillo rallied 3.29% at the open to £2,952; InterContinental Hotels Group jumped 1.84% to £10,235, and Ashtead Group gained 1.86% to £5,088, reflecting optimism tied to American construction. 

Endeavour Mining also gained 1.47% to 3,596, buoyed by higher precious metal prices amid global risk hedging. 

Standard Chartered up more than 2.27% to £1,756, supported by hopes of Chinese stimulus and improved liquidity conditions in Asia.

Conversely, Heavyweights such as AstraZeneca, Unilever, Reckitt Benckiser, and Spirax Group slipped between 0.22% and 0.79%, reflecting investor rotation away from defensives as risk appetite improves globally. 

Coca-Cola Europacific Partners also dipped slightly, down 0.60% to £6,680.

US Optimism Boosts Sentiment, But UK Data Dampens Outlook

The upbeat tone in London follows a record-breaking session on Wall Street. The rally came after the Federal Reserve delivered its third consecutive interest rate cut, reinforcing expectations of a soft economic landing in the United States.

However, the market’s positive momentum was tempered by concerning UK GDP data. The latest figures showed the economy contracted 0.1% in October, marking a second straight monthly decline. 

Services output fell sharply by 0.3%, while construction activity slid 0.6%. Production was a rare bright spot, rising 1.1%.

Weak manufacturing numbers, hit hard by the Jaguar Land Rover cyberattack fallout, added to worries. 

Analysts caution that the UK may now be at risk of a Q4 recession, with some forecasting the first quarterly GDP contraction since late 2023.

Card Factory Cuts Guidance Amid Weak Consumer Confidence

Card Factory issued a loss expectancy today, stating constant consumer spending pressure and less footfall than anticipated during its key trading period. 

The retailer pointed out that the British consumer is careful, as inflation and increased living expenses considerably affect non-essential buying.

The company has just lowered its profit projection for the period from the previous £60 million to £55 million.

Rate Cut Expectations Strengthen

The Bank of England could announce a 0.25% rate cut, bringing the overall policy rate being 3.75%. Key reasons for this change include the slowing growth, the declining trend of hiring, and the rising concerns over unemployment.

Upcoming economic releases including unemployment data, inflation numbers, and the BoE policy meeting, will set the tone for markets next week.

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Global Market View

Early trade in Asia was broadly positive, with Japan’s Nikkei up 1.4%, Hong Kong’s Hang Seng rising 1.5%.

Shanghai’s SSE Composite is gaining 0.4%. India’s Sensex rose 0.5%, while Australia’s ASX added 1.2%.