London Stocks Rise 1% as Investors Await Bank Earnings and Inflation Data
London’s FTSE 100 index rose 104.23 points to 10,656.28 on Monday, with gains in Standard Life helping offset concerns about higher crude prices. Investors…
London stocks started the week higher as investors looked past rising oil prices and toward a packed schedule of company results and economic releases. The FTSE 100 index ended Monday up 104.23 points, or 1.0%, at 10,656.28, while markets faced fresh uncertainty over energy costs and the health of financial markets.
The advance came even as crude climbed after attacks on Saudi Arabia and questions emerged around a claimed energy ceasefire between Ukraine and Russia. Investors are now watching US bank earnings and inflation figures, which could shape expectations for interest rates.
The FTSE 250 gained 114.28 points, or 0.5%, to 24,328.06. The AIM all-share fell 2.62 points, or 0.3%, to 774.91.
There are risks beneath the gains. “Beneath the surface calm” concerns are growing about the “plumbing” of financial markets, Kathleen Brooks, research director at XTB, said, citing issues ranging from the cost of capital to the sustainability of the AI trade.
Investors await earnings and inflation data
Brooks described the week as high-impact for markets. Results from major US banks are due to begin with JP Morgan, Goldman Sachs and Bank of America reporting on Tuesday. Earnings from ASML and TSMC are also expected to offer investors a view of the AI sector.
Economic releases on the calendar include US inflation figures, the UK’s August GDP reading, Eurozone CPI and US retail sales. US inflation could influence the Federal Reserve’s next interest-rate decision.
UBS expects core CPI inflation to remain at 2.4% year-on-year in September. The bank expects higher energy costs to lift headline CPI inflation to 3.6%, from 3.4%.
Federal Reserve chair Kevin Warsh and other Federal Open Market Committee participants are also due to speak about the economic outlook and monetary policy. UBS said it expected little concrete forward guidance, but policymakers could signal a need for additional policy firming over the next several months.
That calendar matters beyond the trading floor. A sustained rise in energy costs can affect household and business budgets, while inflation readings influence expectations for borrowing costs. For investors, the results and data arriving this week could test whether Monday’s gains reflect confidence in company earnings or a pause in wider concerns.
Oil rises as geopolitical concerns weigh
Crude prices rose on Monday following Houthi attacks on Saudi Arabia’s international airport in Riyadh. The strikes killed at least 18 people, including 13 on Saturday, in the deadliest attack on the country in more than a decade, the source report said.
Doubts about US President Donald Trump’s claim of an “energy ceasefire” between Ukraine and Russia also unsettled investors, following his surprise announcement of a deal to buy diesel from Moscow. Brent oil stood at 106.60 dollars a barrel on Monday, compared with 104.86 late on Friday.
European markets also finished higher: the Cac 40 in Paris rose 0.4%, while Frankfurt’s Dax 40 gained 0.8%. In New York, trading was mixed at the London close. The Dow Jones Industrial Average was up 0.4%, while the S&P 500 slipped 0.1% and the Nasdaq Composite fell 0.3%.
On the FTSE 100, Standard Life rose 1.1% after RBC Capital Markets upgraded the retirement savings provider to “outperform” from “sector perform”. The broker said the recent pullback had created a “better entry level” and described its total return yield of more than 10% as “particularly attractive”.
Informa fell 2.4% amid concerns that renewed tension in the Middle East could disrupt the Global Health Exhibition, scheduled to take place later this month in Riyadh. Brent oil was quoted at 106.60 dollars a barrel on Monday.
Source: uk.finance.yahoo.com
