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(Sharecast News) - London's financial markets delivered a mixed performance on Monday, as traders digested fresh housing market data and braced for upcoming catalysts, including Nvidia's earnings and the latest UK inflation figures.
The FTSE 100 index edged up 0.57% to close at 8,109.32 points, while the FTSE 250 slipped 0.4% to 20,395.41 points.
In currency markets, sterling was last up 0.32% on the dollar to trade at $1.2659, while it slipped 0.07% against the euro, changing hands at €1.1966.
"European stock indices, except the FTSE 100, slid on Monday amid a strong US dollar trading near two-year highs and rising US yields," said IG senior analyst Axel Rudolph.
"Despite the world's most valuable company Nvidia seeing its shares drop by 2.5% ahead of Wednesday's earnings, the Nasdaq 100 rose by around half a percentage point."
Rudolph noted that oil prices rallied around 2.5% from their key October support zone as US homebuilder sentiment hit its highest level since April.
"TTF Gas also hit a one-year high on supply and weather concerns.
"Precious metals like gold and silver also rose between 1.5% and 3% as bargain hunters made the most of the last few weeks' sell-off."
UK consumer confidence dips, house prices decline in November
In economic news, consumer confidence in the UK dipped slightly in November, as concerns over job security and household finances tempered optimism.
S&P Global's consumer sentiment index fell to 46.9 from 47.3 in October, staying below the neutral 50-point mark but marking the third-highest reading since August 2021.
While the labour market sentiment sub-index rose to a four-month high, that was offset by a weaker outlook for future household finances.
Indicators for spending, debt, and savings also declined, reflecting a more cautious mood among consumers.
"Any intensification of job worries, spurred perhaps by the recent measures announced in the Budget, including higher employer National Insurance contributions, could result in a further loss of consumer confidence," said Chris Williamson, chief business economist at S&P Global Market Intelligence.
"This would likely in turn hit consumer spending and economic growth.
"Consumer confidence has fallen back since spiking higher in July amid the election buzz, as ongoing pressure on household finances has resulted in squeezed spending, higher debt and lower savings."
On the housing front, UK house prices declined by 1.4% in November, according to Rightmove, a sharper fall than the typical 0.8% seasonal drop.
Average new asking prices stood at £366,592, though prices were up 1.2% year-on-year.
Despite the downward pressure from Budget uncertainty, market activity improved, with sales agreements rising 26% compared to last year and new listings increasing by 6%.
Early signs of revived demand emerged following the Bank of England's recent interest rate cut, the second this year.
"There's been a lot of news to digest for homeowners over the last few weeks, and it appears that the market may still be chewing it over," said Tim Bannister, Rightmove's director of property science.
"We had been seeing a drop-off in buyer demand, both in the lead up to the Budget and in its immediate aftermath, as it was confirmed that there will be an increase to stamp duty charges.
"However, a second Bank Rate cut and a boost of optimism regarding 2025 appear to have reversed this trend at least temporarily."
Energy prices were meanwhile forecast to rise slightly in early 2025, with consultancy Cornwall Insights predicting a 1% increase in the annual price cap to £1,736 per household.
The revision reflected a volatile wholesale energy market, driven by geopolitical tensions, infrastructure maintenance, and weather disruptions.
"Given the price cap rise in October, many will have been hoping to see a fall in the cap for January. Unfortunately, forecasts show that prices will be staying relatively high for the remainder of winter," Cornwall Insights said.
Ofgem is set to announce its updated price cap later this week.
On the continent, the eurozone trade surplus surged in September to €12.5bn, up from €4.1bn in August and surpassing forecasts of €7.9bn.
Eurostat attributed the increase to higher surpluses in machinery and vehicles and a narrowing energy deficit.
Exports rose 0.6% year-on-year to €237.8bn, while imports fell by the same margin to €225.3bn.
Across the Atlantic, the US housing market showed signs of recovery, as the NAHB/Wells Fargo housing market index climbed to 46 in November from 43 in October, its highest level in seven months.
Current sales conditions and future sales expectations both improved.
Melrose jumps, IP Group in the red
On London's equity markets, Melrose Industries surged 7.58% after reporting a 7% rise in revenues for the four months to 31 October, driven by strong aftermarket demand in its aerospace engines division, particularly for defence-related products.
Aftermarket revenue climbed 32% year-on-year, though growth in original equipment volumes was constrained by ongoing supply chain challenges.
Melrose reaffirmed its annual guidance, forecasting an adjusted operating profit of £550m to £570m for 2023, and remained confident in achieving its £700m profit target for 2025.
"There will be genuine relief at a lack of further downgrades at aerospace business Melrose after its warning this summer," said Russ Mould, investment director at AJ Bell.
"Supply chain issues remain in the background amid problems at the world's two major plane makers Airbus and Boeing, yet Melrose has felt able to stick with its current guidance.
"Historically Melrose bought up industrial businesses and executed a buy, improve, sell model - investors will hope the 'improve' bit has been retained now its entire focus is being brought to bear on the old GKN aerospace business."
Elsewhere, mining stocks also advanced, with Hochschild Mining rising 4.06% and Centamin up 3.63%, as gold prices climbed, bolstering investor sentiment in the sector.
Safety equipment manufacturer Halma edged 1.16% higher after announcing its acquisition of Paris-based Lamidey Noury Medical for €50m.
The deal was expected to enhance Halma's portfolio of medical technology devices.
HSBC Holdings gained 1.19%, buoyed by reports that the bank was streamlining operations in its corporate and institutional banking division.
The reorganisation involved senior managers from the commercial and global banking units reapplying for roles, as part of CEO Georges Elhedery's push for greater efficiency.
John Wood Group saw a sharp rebound, climbing 6.54%, despite continued uncertainty flagged by analysts.
Berenberg slashed its price target on the engineering firm to 60p from 150p, citing concerns about an independent review of its projects business.
Shares had fallen significantly since a weak third quarter update on November 7, but the company maintained its 2024 earnings guidance.
Babcock International rose 1.77% as geopolitical tensions supported defence stocks.
The US lifted restrictions on Ukraine using American-made long-range missiles, potentially boosting demand for weaponry.
On the downside, IP Group plunged 8.69%.
The drop came despite its portfolio company AMSL Aero achieving a milestone with its Vertiia electric vertical take-off and landing aircraft, which completed its first untethered flights.
Reporting by Josh White for Sharecast.com.
Market Movers
FTSE 100 (UKX) 8,109.32 0.57%
FTSE 250 (MCX) 20,395.41 -0.40%
techMARK (TASX) 4,602.33 0.18%
FTSE 100 - Risers
Melrose Industries (MRO) 526.60p 7.58%
DCC (CDI) (DCC) 5,595.00p 3.61%
Smurfit Westrock (DI) (SWR) 4,149.00p 3.00%
Intermediate Capital Group (ICG) 2,042.00p 2.20%
BT Group (BT.A) 144.75p 1.94%
Entain (ENT) 755.00p 1.92%
Intertek Group (ITRK) 4,504.00p 1.90%
Fresnillo (FRES) 660.00p 1.85%
Vodafone Group (VOD) 70.74p 1.73%
Smith & Nephew (SN.) 980.60p 1.72%
FTSE 100 - Fallers
B&M European Value Retail S.A. (DI) (BME) 347.90p -8.06%
Vistry Group (VTY) 660.00p -5.58%
Convatec Group (CTEC) 239.60p -3.70%
Land Securities Group (LAND) 584.50p -3.39%
easyJet (EZJ) 524.40p -2.31%
Kingfisher (KGF) 286.50p -2.15%
JD Sports Fashion (JD.) 116.00p -2.03%
Taylor Wimpey (TW.) 129.15p -1.86%
British Land Company (BLND) 373.40p -1.79%
Unite Group (UTG) 846.00p -1.28%
FTSE 250 - Risers
Wood Group (John) (WG.) 52.75p 5.50%
PayPoint (PAY) 846.00p 3.68%
Centamin (DI) (CEY) 145.70p 3.55%
Endeavour Mining (EDV) 1,582.00p 3.47%
Hochschild Mining (HOC) 217.50p 3.34%
Babcock International Group (BAB) 525.00p 3.04%
Energean (ENOG) 1,017.00p 2.94%
Discoverie Group (DSCV) 679.00p 2.88%
Mitie Group (MTO) 113.40p 2.14%
TBC Bank Group (TBCG) 3,255.00p 2.04%
FTSE 250 - Fallers
IP Group (IPO) 41.50p -8.69%
Close Brothers Group (CBG) 206.40p -6.52%
Wizz Air Holdings (WIZZ) 1,359.00p -5.62%
Syncona Limited NPV (SYNC) 102.00p -4.31%
PureTech Health (PRTC) 164.60p -4.08%
RHI Magnesita N.V. (DI) (RHIM) 3,100.00p -3.29%
Marshalls (MSLH) 324.00p -3.13%
Shaftesbury Capital (SHC) 128.30p -3.10%
SDCL Energy Efficiency Income Trust (SEIT) 53.30p -3.09%
Genuit Group (GEN) 419.00p -3.01%
