Related Articles
FTSE down 36 points
Investors worry over US fiscal tightening
Royal Mail the index’s largest faller
The UK government said it will make a new energy security body, The Future System Operator, which will oversee most non-renewable and green sources of power.
This “whole system” approach was aimed at reducing reliance on Russia and accelerating the move towards renewable energy.
Greg Hands, energy minister, said: “Russia’s appalling aggression in Ukraine amid escalating global gas prices has shown the vital importance of strategic change to the UK energy system.
“We need to boost our energy resilience, reduce our dependence on expensive imports and slash emissions.”
10.20am: UK construction rises in line with costs
March saw a continued rise in UK construction output, but inflationary pressures and war continued to hit sentiment for the sector, according to S&P Global.
The headline S&P Global / CIPS UK Construction Purchasing Managers’ Index (PMI) – which measures month-on-month changes in total industry activity – registered 59.1 in March, unchanged from February and well above the 50.0 mark that separates expansion from contraction. The latest reading signalled the joint-fastest rate of output growth since June 2021.
Commercial work was the best-performing segment in March at 60.8, with projects restarting after the lifting of pandemic restrictions. This part of the construction sector has seen output growth accelerate for three months in a row and the latest upturn was the strongest since June 2021.
In contrast, the recoveries in civil engineering at 56.3 and residential work at 54.9 lost momentum last month. The latter saw the slowest expansion of the three broad categories monitored by the survey.
Concerns about the war in Ukraine, forecasts of severe cost inflation and a less favourable global economic outlook all weighed on constructors’ confidence in March. Around 48% of the survey panel expect a rise in business activity during the year ahead, while only 15% predict a decline. However, the balance of positive sentiment was the weakest seen since October 2020.
“Escalating fuel, energy and commodity prices led to the fastest rise in costs for six months. Intense inflationary pressures appear to have unnerved some construction companies. Business optimism slipped to its lowest since October 2020 on concerns that clients will cut back spending in response to rising prices and heightened economic uncertainty,” said Tim Moore, economics director at S&P Global.
9.46am: Royal Mail the biggest faller
London’s blue-chip index has fallen 46 points so far, down to 7,567.
Royal Mail leads the way as the largest faller, down 4.21% to 318.5p, closely followed by Airtel Africa, losing 3.62% to 133.3p.
9.00am: Quick snapshot of the market
FTSE 100 opened lower, losing 31 points to 7,581. London’s blue-chip index had resisted the stock slide seen in America as investors mull the prospect of quantitative tightening from the US Federal Reserve.
Twitter confirmed that it was working on an edit button for tweets but denied that the idea came from Elon Musk. The billionaire acquired just over a 9% stake in the company this week which sent the shares soaring.
Imperial Brands leads the way as Footsie’s biggest climber so far today. The tobacco company informed investors in its trading statement that it is on track to deliver full-year results in line with its revised guidance.
The cost of filling a family car with petrol was a third higher in March than a year ago, while it was 40% more expensive for a diesel car. According to RAC Fuel Watch, the chancellor’s 5p fuel duty cut has had little to no effect.
Among the small caps, Gaming Realms gained exposure to Ontario, Canada, with seven mobile games launched. More content is expected to be certified “very soon”, with agreements to go live with many leading operators.
Afritin Mining laid out a plan to more than triple tin production in the coming five years, as well as significantly increasing its lithium and tantalum output. This should raise its revenues five-fold to US$100mln a year.
Eco (Atlantic) Oil & Gas raised nearly £20mln in an oversubscribed City fundraiser – cash that will bankroll its exploration efforts offshore South Africa. Investors subscribed for shares at 30p via a stock placing and a retail offer overseen by Primary bid.
8.19am: Quiet start
The FTSE 100 made a quiet start to proceedings, opening 4 points lower at 7,610.16.
It did, however, largely resist the stock slide that saw the Dow Jones end 280 points lower and knocked 338 points or 2.2% off the Nasdaq.
The potential for fiscal tightening in the US sent investors scurrying for cover.
“A likely escalation of sanctions and the possibility of a more aggressive Federal Reserve combined to pull the rug from markets,” said Richard Hunter, head of markets at Interactive Investor.
6.55 am: Footsie called lower
The FTSE 100 was indicated slightly lower as investors respond to the prospect of ‘quantitive tightening’ potentially to come from the US Federal Reserve, as the central bank seeks to fight inflation.
In London, CFD firm IG Markets saw the FTSE starting on the back foot making a price of 7,590 to 7,593 with just over an hour to go until the open.
“US markets had a difficult session, sliding back on comments from Fed governor Lael Brainard and Mary Daly of the San Francisco Fed, who both suggested that the Fed could start the process of reducing the size of the balance sheet at the same time as raising rates next month,” said Michael Hewson, analyst at CMC Markets.
“Yesterday’s comments put into sharp relief the concerns investors have, that in looking to rein back inflation, the Fed might overplay its hand and tighten too aggressively and tip the economy into recession. This concern looks set to manifest itself into a sharply lower open for markets in Europe this morning.”
Eyes will now be on the Federal Reserve’s meeting minutes later today for more insight.
Wall Street closed lower on Wednesday, particularly the growth stocks.
The Dow Jones was down 280 points or 0.8% at 34,641 whilst the S&P 500 was lower still, giving up 1.26% to close at 4,525.
At the same time, the Nasdaq was down 2.26% at 14,204 and the small-cap Russell 2000 index lost 2.36% to 2,046.
In Asia, Japan’s Nikkei slid 1.49% to 27,373 whilst Hong Kong’s Hang Seng was 1.3% lower at 22,210. The Shanghai Composite dipped only slightly, to 3,282.
Around the markets
The pound: US$1.3075, up 0.02%
Gold: US$1,923 per ounce, up 0.18%
Silver: US$24.36 per ounce, up 0.18%
Brent crude: US$106.87 per barrel, down 0.6%
WTI crude: US$101.84, down 1.39%
Bitcoin: US$45,377, down 2.99%
Ethereum: US$3,366, down 0.8%
Source link
