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(Alliance News) - Stock prices in London opened lower on Tuesday after a long bank holiday weekend and new data showing that UK house prices slipped in April.
Financial markets in the UK re-opened on Tuesday, after being closed on Monday for the coronation of King Charles III. Markets in the rest of Europe, the US and Asia all were open on Monday, ending mixed.
The FTSE 100 index opened down 6.17 points, 0.1%, at 7,772.21. The FTSE 250 was down 74.58 points, 0.4%, at 19,377.92, and the AIM All-Share was down 0.55 points, 0.1%, at 828.24.
The Cboe UK 100 was down 0.1% at 777.27, and the Cboe UK 250 was down 0.5% at 16,971.24, but the Cboe Small Companies
was up 0.1% at 13,540.52.
According to Halifax, the average UK house price fell by 0.3% month-on-month in April, following a 0.8% rise in March. This marks the first fall in house prices after three consecutive months of growth, the mortgage lender said.
The typical UK property now costs GBP286,896, compared to GBP287,891 a month earlier.
The annual rate of house price growth slowed to a marginal 0.1% from 1.6% in March.
"House price movements over recent months have largely mirrored the short-term volatility seen in borrowing costs. The sharp fall in prices we saw at the end of last year after September’s 'mini-budget' preceded something of a rebound in the first quarter of this year as economic conditions improved," said Halifax Mortgages Director Kim Kinnaird.
The latest figures indicate a "more steady environment", Kinnaird said, despite cost of living concerns and the impact of higher interest rates.
Later this week, on Thursday at midday, the Bank of England will announce its latest interest rate decision.
In European equities early Tuesday, the CAC 40 in Paris was down 0.3%, while the DAX 40 in Frankfurt was up 0.1%.
The pound was quoted at USD1.2600 early on Tuesday in London, lower compared to USD1.2628 at the equities close on Friday. The euro stood at USD1.0976, down from USD1.1016. Against the yen, the dollar was trading at JPY134.84, soft versus JPY134.88.
On the FTSE 100, JD Sports was the best performer in early trade, up 2.9%.
It said it is in exclusive talks to buy Groupe Courir in France from Equistone Partners Europe at an enterprise value of EUR520 million, including EUR195 million in assumed net debt.
Courir is sports footwear and apparel retailer with 313 stores across six European countries.
On the FTSE 250, Marshalls shed 15%.
The natural stone and concrete manufacturer said that revenue for the four months that ended April 30 was GBP227 million, up from GBP202 million a year earlier. It noted that this marks 12% growth, including the benefit of the acquisition of Marley.
However, on a like-for-like basis, revenue fell by 14%. Marshalls blamed this on an uncertain macro-economic climate, a reduction in new house building, and continued weakness in private housing repair, maintenance and improvement activity.
Marshalls noted also that, in the first quarter of the year, new housing starts in the UK were 27% lower than 2022, according to the National House Building Council.
"Management have acted quickly to reduce costs in the business and are accelerating plans to improve production efficiency, whilst ensuring flexibility to respond when market demand improves," Marshalls said.
On AIM, Echo Energy shares surged 70%.
The Latin America-focused energy company said it plans to sell 65% of its 70% working interest in Santa Cruz Sur to Selva Maria Oil and Interoil Exploration & Production. Echo Energy said it will receive GBP1.7 million in cash.
Echo added that the sale addresses its near-term funding challenges by providing near term funding, enabling the company to walk away from the significant in-country creditors which had build up during the Covid-19 period and providing access to funding for the Santa Cruz assets.
Purplebricks plummeted 62% on a disappointing trading statement.
The online estate agent said it expects to have finished the financial year ended 30 April 2023 in line with management expectations.
However, instruction levels did not increase through the fourth quarter of financial 2023 as previously anticipated, which is expected to hurt revenue and earnings before interest, tax, depreciation and amortisation.
Purplebricks now believes that it necessary to "promptly" conclude its strategic review, in a manner that will provide "more certainty" around its future ownership.
Purplebricks' formal sales process has been ongoing since the start of March. It said it is currently in discussions with a small number of parties and negotiations are ongoing.
In Asia on Tuesday, the Nikkei 225 index was up 1.0%. In China, the Shanghai Composite closed down 1.1%, while the Hang Seng index in Hong Kong was down 2.1%. The S&P/ASX 200 in Sydney closed down 0.2%
In the US on Monday, Wall Street ended mixed, with the Dow Jones Industrial Average ending down 0.2%, the S&P 500 flat and the Nasdaq Composite up 0.2%.
Brent oil was quoted at USD76.25 a barrel early in London on Tuesday, up from USD74.94 late Friday. Gold was quoted at USD2,022.62 an ounce, higher against USD2,013.19.
Still to come on Tuesday's economic calendar, there is a key political meeting to head off a US debt default.
The White House gathering involves Biden, House Speaker Kevin McCarthy and Senate Republican leader Mitch McConnell, setting in motion the deciding round of a power struggle that also threatens massive consequences for the world's largest economy.
The lifting of the national debt ceiling, which allows the government to pay for spending already incurred, is often routine. But raising the borrowing limit, currently at USD31.4 trillion, has been a contentious issue for the past several years, with congressional Republicans pushing for spending curbs and a smaller budget deficit in exchange for lifting the ceiling.
By Sophie Rose, Alliance News reporter
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