Stock prices in London were slightly higher on Monday morning amid ongoing tensions in the Middle East and Taiwan and ahead of eurozone industrial production and trade balance data.
The FTSE 100 index opened up 8.58 points, 0.1%, at 7,633.51. The FTSE 250 was up 39.41 points, 0.2%, at 19,237.03, and the AIM All-Share was up 1.93 points, 0.3%, at 750.99.
The Cboe UK 100 was up 0.1% at 762.21, the Cboe UK 250 was up 0.2% at 16,690.22, and the Cboe Small Companies was down slightly at 15,097.32.
In European equities on Monday, the CAC 40 in Paris was up 0.1%, while the DAX 40 in Frankfurt was up 0.2%.
‘There is a lot of geopolitical and macro noise in the market, so it’s probably not the time to get over complacent, especially with consumer sentiment apt to get held hostage to the gnarly geopolitical scrim as policymakers, companies and investors struggle to operate in today’s highly politically charged environment,’ said SPI Asset Management’s Stephen Innes.
Over the weekend, focus has been on the Middle East and Taiwan.
‘Both of these issues could weigh negatively on consumer sentiment,’ said Innes.
Taiwan told China to ‘face reality’ and respect its election result, after voters defied Beijing’s warnings and chose pro-sovereignty candidate Lai Ching-te as president.
Voters spurned Beijing’s repeated calls not to vote for Lai, delivering a comfortable victory for a man China’s ruling Communist Party sees as a dangerous separatist.
Beijing, which claims Taiwan as its territory and has never renounced force to bring it under its control, responded to Lai’s victory by saying it would not change the ‘inevitable trend of China’s reunification’.
Meanwhile, Taiwan’s President Tsai Ing-wen met US delegates who arrived on the island on the heels of the election.
In the Middle East, tensions rose after the war between Israel and Hamas entered its 100th day on Sunday.
The US military said Sunday its forces shot down a cruise missile fired at an American destroyer warship from Huthi controlled areas of Yemen. The attack appears to be the first against a US destroyer amid a growing number of missile and drone strikes or attempted strikes by the Huthis, on what they deem Israeli-linked shipping on the key Red Sea trade route.
Meanwhile, Britain could strike Houthi targets in Yemen again if the rebel group continues to attack ships in the Red Sea, Foreign Secretary David Cameron has suggested.
In Asia on Monday, the Nikkei 225 index in Tokyo was up 0.9%. In China, the Shanghai Composite closed up 0.2%, while the Hang Seng index in Hong Kong was down 0.2% in late dealings. The S&P/ASX 200 in Sydney closed down slightly.
The pound was quoted at $1.2757 early on Monday in London, lower compared to $1.2760 at the equities close on Friday. The euro stood at $1.0961, lower against $1.0971. Against the yen, the dollar was trading at JP¥145.44, higher compared to JP¥144.62.
In the FTSE 250, Crest Nicholson lost 3.8%, making it the worst performer on the index in early trade.
The housebuilder said it has conducted a comprehensive review of the costs associated with its Brightwells Yard, Farnham project, as well as our other legacy sites. It has consequently identified ‘further additional costs’ which will impact results.
Based on this, Crest Nicholson now expects pretax profit in its financial year to October 31 to be £41 million. In November, the company had guided pretax profit to be between £45.0 and £50.0 million for the financial year ended October 31, having guided for £50.0 million in August. In financial 2022, the company reported pretax profit of £137.8 million.
In addition, Crest Nicholson expects to recognise an exceptional charge of £13 million regarding a legal claim. The claim relates to a low rise apartment scheme built by the company which was damaged by fire in 2021.
Other housebuilders were down. Persimmon lost 0.5%. Both Barratt Developments and Taylor Wimpey were down 0.1%.
In early news, the average price tag on a UK home jumped by around £4,500 month-on-month in January, according to a property website. Across Britain, the average price of a property coming on the market increased by 1.3% or £4,571 month-on-month, to £359,748, Rightmove said.
PageGroup lost 2.8%.
The recruitment firm said that fourth quarter gross profit fell 11% annually to £237.3 million from £266.9 million. Across the full year, profit fell 6.5% to £1.01 billion from £1.08 billion.
Chief Executive Nicholas Kirk commented: ‘We produced a resilient performance in challenging market conditions. Despite the year-on-year decline in gross profit, we are still seeing good activity levels, albeit we did see a deterioration in job flow through Q4. However, these activity levels are not all converting into gross profit due to ongoing lower levels of candidate and client confidence.’
In the US on Friday, Wall Street ended mixed. The Dow Jones Industrial Average closed own 0.3%, the S&P 500 up 0.1% and the Nasdaq Composite slightly higher. Stock markets in the US will be closed for Martin Luther King Jr Day on Monday. They will reopen on Tuesday.
Brent oil was quoted at $78.20 a barrel early in London on Monday, down from $78.65 late Friday. Gold was quoted at $2,055.44 an ounce, up against $2,053.68.
Still to come on Monday’s economic calendar, there is eurozone industrial production and trade balance data at 1000 GMT.
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