Stock prices were mostly higher on Wednesday morning in London, with FTSE 100 constituent JD Sports Fashion enjoying a boost after it announced a new £100 million share buyback.
The increase will see bills increase by around £2.93 a month for the average household, PA reports, leaving a home on a default tariff paying £102 for what currently costs £100 per month. The new price cap of £1,755 per year is 2.0% higher than the previous cap of £1,720 in July through September, exceeding Cornwall Insight’s forecast of a rise to £1,737.
‘Whilst we are nowhere near the highs experienced in late 2022 and early 2023, there’s no sign of bills returning to the kind of levels we’d got used to before Russia invaded Ukraine, despite recent stabilisation in wholesale energy costs,’ commented AJ Bell’s Danni Hewson.
The FTSE 100 index opened up 34.89 points, 0.4%, at 9,300.69. The FTSE 250 was up 53.25 points, 0.2%, at 21,914.48, and the AIM All-Share was up 0.86 points, 0.1%, at 765.97.
The Cboe UK 100 was up 0.5% at 932.23, the Cboe UK 250 was up 0.1% at 19,233.33, and the Cboe Small Companies was marginally lower at 17,304.77.
On the FTSE 100, JD Sports Fashion led with a 5.3% rise.
The retailer reported that sales in its second quarter decreased 3.0% on a like for like basis but rose 2.2% organically. For the first half, sales declined 2.5% LFL but with organic sales growth of 2.6%. Looking ahead, the company expects its full-year pretax profit to be in line with market guidance.
Also, JD announced a new £100 million share buyback.
National Grid was the second-highest, up 1.9% after announcing its response to Ofgem’s Draft Determinations for the RIIO-ET3 price control.
The utility firm welcomed Ofgem’s ‘commitment to an £80 billion investment plan in the electricity transmission sector’ and other signs of ‘positive intent’, but said more recognition was needed of ‘the practical realities’.
Also in UK news, Thames Water Utilities has agreed to pay £24.5 million of its record £122.7 million in fines by the end of September under a payment plan agreed with regulator Ofwat.
The industry watchdog, which handed Thames Water the penalties in May for failures over sewage treatment and paying out dividends, said a fifth of the fines would be due in the initial instalment. Ofwat said it had set a final ‘backstop date’ of March 31, 2030, for the remaining penalties.
In European equities on Wednesday, the CAC 40 in Paris was up 0.4%, while the DAX 40 in Frankfurt was down 0.1%.
The pound was quoted lower at $1.3461 early on Wednesday in London, compared to $1.3483 at the equities close on Tuesday. The euro stood lower at $1.1616, against $1.1656. Against the yen, the dollar was trading higher at JP¥147.79 compared to JP¥147.37.
In Asia on Wednesday, the Nikkei 225 index in Tokyo was up 0.3%. In China, the Shanghai Composite was down 1.8%, while the Hang Seng index in Hong Kong was down 1.4%. The S&P/ASX 200 in Sydney closed up 0.3%.
In the US on Tuesday, Wall Street ended higher, with the Dow Jones Industrial Average up 0.3%, the S&P 500 up 0.4% and the Nasdaq Composite up 0.4%.
The yield on the US 10-year Treasury was quoted unchanged at 4.27%, narrowed from 4.28% late on Tuesday. The yield on the US 30-year Treasury was quoted at 4.92%, narrowed from 4.93%.
Noting US President Donald Trump’s order to oust Federal Reserve Governor Lisa Cook, Swissquote’s Ipek noted that if Trump succeeds, he could ‘tilt decision-making at the Fed in his favour’.
‘Inappropriate rate cuts could fuel inflation and push long-term yields higher, especially against the backdrop of soaring US debt,’ Ozkardeskaya commented. ‘The US 30-year yield continues to flirt with the 5% mark. The steepening of the curve, combined with rising sovereign yields in other DM bonds, adds to concerns that investors could rotate into bonds to lock in attractive returns at lower risk.’
She continued: ‘As summer winds down, the bullish sentiment that carried stocks higher on trade deals, resilient earnings, and softer Fed bets could give way to risk-off positioning. Concerns are rising about Fed independence and about internal and external US policies — some of which are unprecedented for a democracy.’
Brent oil was quoted lower at $66.52 a barrel early in London on Wednesday from $67.46 late on Tuesday.
Gold was quoted lower at $3,375.33 an ounce against $3,382.89.
Still, XS’ Linh Tran commented: ‘Gold has surged in recent sessions and is holding above the [$3,350 per ounce] level.
‘In the short term, the main narrative remains the expectation that the Fed will pivot to easing after Jackson Hole...However, caution is warranted with the risk of persistent inflation if energy prices or shipping costs rebound. In that case, the Fed could slow its pace of easing or signal ’higher-for-longer‘ rates, creating headwinds for gold.’
Still to come on Wednesday’s economic calendar, there is Switzerland’s economic sentiment index and US crude oil stocks.
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