The FTSE 100 made a strong start to the week on Monday, as investors shrugged off rising oil prices and eyed key earnings and economic data later in the week.
asserted
investors → make → week
Despite the gains, Kathleen Brooks, research director at XTB, said that “beneath the surface calm” there is growing concern about the “plumbing” in financial markets, everything from the cost of capital to the sustainability of the AI trade.
asserted
Brooks → say → trade
Earnings season will ramp up with Q3 reports from the major Wall Street banks.
asserted
season → ramp → banks
US CPI, the UK’s August GDP reading, Eurozone CPI and US retail sales will dominate the economic calendar,” she added.
asserted
she → dominate → calendar
Earnings from ASML and TSMC this week will also provide some idea of the outlook for the AI sector.
asserted
week → provide → sector
Also due this week are US inflation figures, which could determine the Federal Reserve’s next move on interest rates.
uncertain
which → determine → rates
UBS expects core CPI inflation to remain steady at 2.4% year-on-year in September, while higher energy costs will likely see headline CPI inflation pick up to 3.6% from 3.4%.
asserted
inflation → expect → %
UBS also notes Federal Reserve chair Kevin Warsh and a range of other Federal Open Market Committee participants will speak on the economic outlook and monetary policy.
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Warsh → note → outlook
“We expect little in the way of concrete forward guidance, but policymakers will likely suggest a need for additional policy firming over the next several months,” the broker said.
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broker → expect → months
On Monday, crude prices rose following Houthi attacks on Saudi Arabia’s international airport in Riyadh.
asserted
prices → rise → Riyadh
Strikes on the airport killed at least 18 people, including 13 on Saturday in the deadliest attack on the country in more than a decade.
asserted
Strikes → kill → decade
Doubts surrounding US President Donald Trump’s claim of an “energy ceasefire” between Ukraine and Russia, following his surprise announcement of a deal to buy diesel from Moscow, further unsettled investors.
uncertain
Doubts → surround → investors
In European equity markets on Monday, the Cac 40 in Paris ended up 0.4%, while the Dax 40 in Frankfurt rose 0.8%.
asserted
Dax → end → Frankfurt
The Dow Jones Industrial Average was up 0.4% at the time of the closing bell in London, the S&P 500 was down 0.1%, and the Nasdaq Composite was 0.3% lower.
asserted
Composite → close → London
The US observes Columbus Day on Monday.
asserted
US → observe → Monday
The Securities Industry & Financial Markets Association in the US has recommended a Treasury market closure on Monday as a result.
asserted
Association → recommend → result
The pound was quoted at 1.3211 dollars, down from 1.3233.
asserted
pound → quote → 1.3233
Against the euro, sterling firmed to 1.1829 from 1.1818.
asserted
sterling → firm → 1.1818
Gold was quoted at 4,167.84 dollars an ounce, down from 4,189.88.
asserted
Gold → quote → 4,189.88
On the FTSE 100, Standard Life gained 1.1% as RBC Capital Markets upgraded the London-based retirement savings provider to “outperform” from “sector perform”.
asserted
Markets → gain → perform
The broker thinks the recent pullback in Standard Life has created a “better entry level”, and sees the 10% plus total return yield as “particularly attractive”.
asserted
pullback → think → yield
Informa was a weak feature, down 2.4%, on fears that renewed Middle East tension could disrupt the upcoming Global Health Exhibition due to take place later this month in Riyadh.
uncertain
tension → disrupt → Riyadh
On the FTSE 250, GlobalData rose 6.4% after The Times reported late Friday that Mike Danson, the firm’s founder and chief executive, is willing to mull an offer for one of more of the data, analytics, and intelligence firm core divisions.
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Danson → rise → divisions
In 2023, Inflexion Private Equity Partners bought a 40% stake in the company’s healthcare division.
asserted
Partners → buy → division
If somebody came along and they said, we’ll buy one unit for the Inflexion-type valuation, it would be fairly transformative,” GlobalData CEO Danson told The Times.
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Danson → come → Times
Hays fell 13% after a poorly received trading update from the recruiter.
asserted
Hays → fall → recruiter
Among its sector peers, Robert Walters fell 5.5%, and Michael Page declined 8.5%.
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Page → fall → peers
Hays said its first quarter went in line with expectations, as the decline in net fees slowed.
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decline → say → fees
However, it noted activity in the permanent recruitment sector is “mixed with sustained strong growth in North America but ongoing fragility in Northern Europe”.
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activity → note → Europe
Russ Mould, investment director at AJ Bell, said the update implies the jobs market is as “tough as ever”, particularly for permanent roles.
“While Hays has put a positive spin on the period, the numbers speak for themselves.
asserted
numbers → say → themselves
First quarter like-for-like net fees are down across its key regions, with only its ‘rest of world’ operations avoiding losses and even that division was flat year-on-year,” he added.
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he → avoid → year
Pennon traded 9.5% as it traded ex-rights, following last week’s equity issue and dividend cut.
asserted
it → trade → issue
Deutsche Bank Research lowered the water utility to “hold” from “buy”.
asserted
Research → lower → buy
Analyst James Brand still believes there is a high chance of success in Pennon’s turnaround, but thinks the near-term buy case now looks “increasingly difficult”.
asserted
case → believe → turnaround
This reflects a lack of medium-term guidance and stable earnings per share, with the lack of growth contrasting with other utilities and returns now below the cost of equity.
asserted
lack → reflect → equity
Elsewhere in London, ActiveOps plunged 52% as it warned financial 2028 revenue and earnings will be significantly below market expectations after the loss of a major contract.
asserted
revenue → plunge → contract
Tuesday’s local corporate calendar has full-year results from housebuilder Bellway, and trading statements from recruiter Michael Page and convenience food manufacturer Greencore.
asserted
calendar → have → Page
Tuesday’s global economic calendar has the minutes of the most recent Reserve Bank of Australia meeting overnight.
asserted
Bank → have → Australia
In the UK, the British Retail Consortium publishes its retail sales monitor.
asserted
Consortium → publish → monitor
In the US, existing home sales figures are released.
asserted
figures → exist → US
The Aporia
