FTSE 100 LIVE: London stocks rise as China rate cut supports miners
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The FTSE 100 rose, while major European indexes declined in early trade on Monday, as markets reacted to a rate cut by the People's Bank of China.
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The FTSE 100 (^FTSE) was 0.2% higher in early trade, led upwards by mining stocks such as Fresnillo (FRES.L), Glencore (GLEN.L) and Antofagasta (ANTO.L), which gained on rate cut news from China. Strong business activity in China tends to lift the stock prices of companies selling raw materials.
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The People's Bank of China made expected moves to cut rates on Monday, reducing both its two and five-year rate by 25 basis points. The two-year rate is 3.1% and the five-year rate stands at 3.6%.
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The DAX (^GDAXI) was 0.2% lower in Germany, while France's CAC (^FCHI) was 0.1% lower.
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The pan-European STOXX 600 (^STOXX) ticked up 0.1%.
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Gold (GC=F) prices rose 0.5% to $2743 a troy ounce in early trade, building on all-time highs.
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LIVE 8 updatesUK consumer sentiment regains steam in October
The latest S&P Global release on UK consumer sentiment says:
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Consumer Sentiment Index (CSI) lifted higher in October, moving closer to July’s 37-month high
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Outlook for household finances turned positive
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Positive income growth and slower inflation bolstered household confidence
“Confidence is being supported first and foremost by the strong labour market, with the survey showing both job security and income from employment improving at some of the fastest rates seen since data were first collected in 2009," said Maryam Baluch, economist at S&P Global Market Intelligence.
"An easing of inflation worries, combined with expectations of a further lowering of interest rates, has also helped allay worries over the cost of living."
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Sterling slips against the dollar
Sterling was lower against the dollar, slipping 0.2% to $1.3025 in early European trading, after tumbling to a near two-month low against the greenback last week, following weaker-than-expected UK inflation data.
Sterling initially showed resilience, buoyed by positive domestic jobs data. Despite a slowdown in wage growth, an unexpected drop in the UK’s unemployment rate lent support to the currency early in the week.
However, the rally was short-lived. On Wednesday, the release of softer-than-anticipated inflation figures sent the pound sharply lower. The UK’s consumer price index (CPI) for September showed headline inflation easing from 2.2% to 1.7%, below market expectations of 1.9%, and significantly under the Bank of England’s (BoE) 2% target.
READ MORE: Today's pound, gold and oil prices in focus: commodity and currency check, 21 October
Average UK house price hits ￡371,958 ahead of budget
Our reporter Pedro Goncalves writes:
The average asking price for properties coming to market in the UK has risen by 0.3% this month, equivalent to ￡1,199, bringing the total to ￡371,958, a small uptick as most owners are pricing homes to sell quickly.
This increase falls short of the typical October rise of 1.3%, amid a surge in buyer choice, which has reached levels not seen in a decade, according to property website Rightmove.
With a broader array of properties available, buyers are leveraging their newfound negotiating power, keeping price increases in check. Market activity, however, remains strong despite the uncertainty and fears surrounding the upcoming autumn budget.
China cuts key lending rates
Over in Asia stocks in Hong Kong received a knock, despite the Chinese central bank's efforts to support the economy by slashing lending rates.
The People's Bank of China made the expected move of cutting benchmark lending rates: the one-year loan prime rate was cut to 3.1% from 3.35% and the five-year LPR dropped rom 3.85% to 3.6%.
The Hang Seng (^HSI) headed for a close 1.4% lower, dragged down in part by banking stocks.
Over in Japan, the Nikkei (^N225) fell 0.1% in the session.
How US stocks are faring in premarket
Stocks hovered in premarket trade on Monday, with the three major indexes flirting with the flatline.
Friday trade in the US
Our US team writes:
US stocks notched records and extended impressive streaks Friday as Netflix (NFLX) delivered powerful earnings and set the stage for Big Tech's corporate results in the coming days.
The S&P 500 (^GSPC) added about 0.4% and recorded a fresh all-time high, as well as its sixth straight week of gains, the longest streak in 2024. The tech-heavy Nasdaq Composite (^IXIC) moved up 0.6%, leading gains. The Dow Jones Industrial Average (^DJI) rose 0.1% after hitting a new closing high the day before.
The major stock gauges logged weekly wins after a strong showing by big banks to kick off earnings season. The Dow grabbed the top of the weekly chart, adding 0.9%, followed by the S&P 500, which increased 0.8%, and the Nasdaq's 0.7% gain.
Netflix's results late Thursday relieved some worries that Big Tech names might struggle in the third quarter as they did in the last. The streaming giant's profit surged to outstrip Wall Street estimates, while revenue and subscriber growth also came in stronger than expected. Its shares jumped around 11%.
Good morning!
Hello from London. Lucy Harley-McKeown here, ready to bring you another week of markets news. The temperature has dropped in London — but the mood appears to be positive in premarket for the FTSE 100 (^FTSE).
Coming up later we'll be watching Microsoft's event on AI at work, featuring CEO Satya Nadella and UK CEO Clare Barclay.
Let's get to it.