City of London landscape
FTSE 100 index surged 93.28 points, 1.3%, at 7,504.25 / Image source: Adobe

London’s FTSE 100 ended the week the outperformer, as a more favourable interest rate and inflation outlook, as well as hope of an easing of US and China tensions, supporting the large-cap benchmark.

Shares in New York surrendered some of this week’s monster gains, however.

The FTSE 100 index surged 93.28 points, 1.3%, at 7,504.25. The FTSE 250 ended up 216.39 points, 1.2%, at 18,567.87, and the AIM All-Share closed up 5.76 points, 0.8%, at 719.05.

For the week, the FTSE 100 added 2.0%, the FTSE 250 surged 4.0% and the AIM All-Share ended up 2.6%.

The Cboe UK 100 ended up 1.2% at 748.42, the Cboe UK 250 closed up 1.4% at 16,076.36, and the Cboe Small Companies added 1.0% at 13,463.09.

In European equities, the CAC 40 in Paris added 0.9%, while the DAX 40 in Frankfurt closed up 0.8%.

In New York, the Dow Jones Industrial Average and S&P 500 were each down 0.1%, while the Nasdaq Composite was 0.2% lower.

US stocks were lower despite better than forecast housing and construction data, which gave a bullish reading of the world’s largest economy.

According to the Census Bureau, new building permits amounted to 1.487 million, rising 1.1% from 1.471 million in September. It was down 4.4% from 1.555 million a year prior, however.

The latest figure topped the FXStreet cited consensus of 1.450 million.

Housing starts totalled 1.372 million, up 1.9% from 1.346 million in September, but down on-year from 1.432 million.

They had been expected to amount to 1.350 million for October, so the figure topped consensus.

The pound was quoted at $1.2421 late Friday in London, higher than $1.2417 at the equities close on Thursday. The euro stood at $1.0881, higher against $1.0855. Against the yen, the dollar was trading at JP¥149.77, lower than JP¥150.54.

In London, China-exposed stocks ended higher, with investors optimistic amid signs of a thawing of tensions between the Asian powerhouse and the US. Lender Standard Chartered rose 4.4%, insurer Prudential added 3.0% and miner Anglo American climbed 2.7%. China is a major buyer of minerals.

Analysts at Dutch bank Rabobank commented: ‘US president Biden and president of China Xi Jinping met each other this week, for the first time since November 2022. The US-Sino relationship has deteriorated since the Trump administration. Areas of tensions between both nations include security, trade investments and territorial issues amongst others. While the meeting did deliver some concrete results it is unlikely that we will see a significant improvement of US-Sino relations for the foreseeable future.’

Back in London, interest rate sensitive stocks were on the up as markets continue to celebrate a pair of favourable inflation readings from either side of the Atlantic.

‘This week could hardly be better in terms of economic, political, and geopolitical news. The US inflation slowed more than expected, the US politicians inked a short-term deal to avert a shutdown. On top, the US retail sales fell last month, but fell less than expected, the initial jobless claims rose, and the US unemployment benefits reached the highest level in almost two years, factory production fell more than expected and homebuilder sentiment fell to the lowest level for the year,’ Swissquote analyst Ipek Ozkardeskaya commented.

Property investor Land Securities added 2.1%, while housebuilder Taylor Wimpey closed up 2.3%.

Real Good Food plummeted 15% after it announced the disposal of Rainbow Dust Colours and said it is ‘exploring all possible options’ to decide the fate of remaining business JF Renshaw.

The Liverpool, England-based food manufacturer added that cash constraints and supply issues have continued to hurt its performance. Due to these ongoing problems, Real Good Food expects sales in November and December to be ‘lower than previously forecast’.

‘We have made substantial progress over the last year,’ said Executive Chair Mike Holt. ‘The radical reform programme has delivered significant benefits and recent senior management changes have also made a real difference.

‘The group, however, is struggling to meet demand through supply issues and cash constraints. The board together with JF Renshaw is exploring all possible options and is working closely with Interpath Advisory to determine the best way forward.’

Brent oil was quoted at $79.74 a barrel late Friday in London, higher than $77.44 late Thursday. Gold was quoted at $1,981.88 an ounce, lower than $1,983.48 late Thursday.

Monday’s economic calendar has an interest rate decision from China overnight, before a German producer price reading at 0700 GMT. The week picks up pace with UK public sector finances data on Tuesday, before the all-important autumn statement from Chancellor Jeremy Hunt on Wednesday.

Monday’s local corporate calendar has annual results from contract caterer Compass and technical products and services supplier Diploma.

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Issue Date: 17 Nov 2023