Investors in London bought at the open on Tuesday, reacting to the UK unemployment rate remaining unchanged and looking ahead to US inflation this afternoon.
The FTSE 100 index opened up 33.30 points, 0.4%, at 7,578.19. The FTSE 250 was up 55.14 points, 0.3%, at 18,805.53, and the AIM All-Share was up 1.20 points, 0.2%, at 726.93.
The Cboe UK 100 was up 0.4% at 756.55, the Cboe UK 250 was up 0.4% at 16,327.61, and the Cboe Small Companies was up 0.3% at 14,045.17.
In the US on Monday, Wall Street ended higher, with both the Dow Jones Industrial Average and the S&P 500 up 0.4% and the Nasdaq Composite up 0.2%.
Stocks are edged higher ahead of a key week for investors and central bank policymakers. On Wednesday, markets will be eyeing an interest rate decision from the US Federal Reserve, while the European Central Bank and the Bank of England will make their own decisions on Thursday.
The Bank of England, European Central Bank and US Federal Reserve are all expected to leave interest rates unchanged this week.
Ahead of those, US consumer prices figures will be released on Tuesday afternoon by the Bureau of Labor Statistics.
According to FXStreet market consensus, the consumer price index is expected to rise by 3.1% annually in November, decelerating from 3.2% in October.
If CPI does decelerate, the rate of inflation will move closer to the Fed’s 2% target.
‘These numbers certainly look much better than what they did back in 2022, when we saw the US core inflation reach 6.6%,’ Swissquote Bank’s Ipek Ozkardeskaya pointed out.
Early Tuesday, investors were digesting the latest unemployment data from the UK.
Figures from the Office for National Statistics showed that UK unemployment was steady at 4.2% in the three months to October. The unemployment rate came in line with FXStreet-cited market consensus.
In the three months to September, annual growth in average total pay, excluding bonuses, was 7.3%. This was slightly lower than market consensus of 7.4%. Growth in the previous three-month period was 7.8%.
The pound was quoted at $1.2569 early on Tuesday in London, up compared to $1.2545 at the equities close on Monday. The euro stood at $1.0782, higher against $1.0746. Against the yen, the dollar was trading at JP¥145.53, lower compared to JP¥146.52.
In the FTSE 100, Unilever lost 0.1%.
The UK competition regulator said it will investigate claims made by Unilever PLC about the environmental impact of its consumer products.
Unilever makes a wide variety of food & drink, cleaning, toiletry, and personal care products, including brands such as Cif, Dove, Comfort, and Lynx. The UK Competition & Markets Authority said it has contacted the London-based company about its claims that some of these products are environmentally friendly.
The CMA said its investigation of Unilever is part of a wider probe of corporate ’greenwashing’ that it launched back in January.
Unilever didn’t immediately respond to the CMA announcement early Tuesday.
AstraZeneca edged 1.0% higher.
It said it has entered into a definitive agreement to acquire Icosavax. Icosavax is a US-based clinical-stage biopharmaceutical company focused on developing differentiated, high-potential vaccines using an innovative, protein virus-like particle platform.
Astra said the proposed acquisition will build on AstraZeneca’s expertise in respiratory syncytial virus, strengthening AstraZeneca’s Vaccines & Immune Therapies late-stage pipeline with Icosavax’s lead investigational vaccine candidate, IVX-A12.
In the FTSE 250 index, Chemring was down 0.9%, as its results failed to capture investor attention.
Chemring, a provider of technology products and services to aerospace, defence and security markets, provided its results for the year ended October 31.
It reported that revenue rose to £472.6 million from £401.0 million a year earlier. Underlying pretax profit jumped to £71.7 million from £57.9 million.
On the back of the results, Chemring upped its dividend per share by 21% to 6.9p from 5.7p.
Chief Executive Michael Ord said: ‘2023 was another year of strong group performance; and in an environment of increasing global uncertainty demand continues to grow for our mission-critical products and services. With record order intake and an order book at the highest level in over a decade the group is well placed for continued delivery of sustainable performance and growth.’
On AIM, SmartSpace Software shares surged 91% to 63.90p.
The surge in share prices follows Skedda proposing to buy the Bury St Edmunds, England-based designer and builder of smart software solutions.
It has offered the company 82p per share, more than double the closing price of 33.5p on Monday. The offer values SmartSpace at £25.0 million.
Skedda commented: ‘Skedda is excited by a potential of a combination with SmartSpace. Skedda believes that it can provide SmartSpace with the considerable financial support and technical expertise that Skedda believes will be necessary for SmartSpace to maintain its technological advantage in a rapidly developing and increasingly competitive sector.’
In Asia on Tuesday, the Nikkei 225 index in Tokyo closed up 0.2%. In China, the Shanghai Composite closed up 0.4%, while the Hang Seng index in Hong Kong was up 1.1% in late dealings. The S&P/ASX 200 in Sydney closed up 0.5%.
In European equities on Tuesday, the CAC 40 in Paris was up 0.3%, while the DAX 40 in Frankfurt was up 0.2%.
Brent oil was quoted at $76.27 a barrel early in London on Tuesday, up from $75.41 late Monday. Gold was quoted at $1,986.42 an ounce, higher against $1,981.92.
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