FTSE 100 falls as markets tread water ahead of interest rate decisions
The Bank of England and the US Federal Reserve will make calls on interest rates later in the week.
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Your support makes all the difference.The FTSE 100 fell on Monday as investors anticipated a double bill of interest rate decisions in the UK and the US.
London’s blue-chip index lost 38.28 points, or 0.46%, to end the day at 8,262.05.
The Bank of England is expected to hold rates at 4.75% at its decision on Thursday, after official figures last month showed inflation had jumped back up to 2.3% in October.
Meanwhile, the US Federal Reserve is likely to cut rates after a steady inflation reading last month.
Hargreaves Lansdown analyst Susannah Streeter said shares were “treading water” as traders speculated what 2025 will hold for central bank policy.
She said Fed chairman Jerome Powell is expected to cut a more reserved tone and indicate “more of a gradual reduction of rates next year, given the resilience of the economy and with some price rises remaining persistent”.
A weakening UK economy may make some policymakers more reticent about sitting on their hands, but February still looks likely to be the date of the next rate reduction
“The Bank of England is widely expected to keep rates on hold, especially given that inflation data due out on Wednesday is set to show that the headline rate for November jumped again from 2.3% to 2.6% further away from target.
“A weakening UK economy may make some policymakers more reticent about sitting on their hands, but February still looks likely to be the date of the next rate reduction.”
At the end of the day in Europe Frankfurt’s Dax index fell 0.45%, while the Cac 40 in Paris fell 0.71%.
In New York a little while after markets had closed in Europe the S&P 500 had risen 0.42%, while the Dow Jones was 0.08% lower.
On currency markets the pound was trading 0.52% up against the dollar at 1.269 and was 0.46% up against the euro at 1.207.
In company news, Royal Mail’s sale to Czech billionaire Daniel Kretinsky has been cleared by the Government.
The deal paves the way for the more than 500-year-old postal service to pass into foreign ownership for the first time.
The takeover is expected to complete early next year. Shares in owner International Distribution Services rose 0.78%.
Meanwhile, shares in French TV and film giant Canal+ launched on the London Stock Exchange in one of the biggest new listings for the City in recent years.
However, the company saw shares plunge from an opening price of 290p to 226.4p by the close.
Brent Crude Futures were down 0.67% to 73.59 US dollars at the close of trading.
The biggest risers on the FTSE 100 were Rolls-Royce, up 11.2p to 583.8p, 3i Group, up 51p to 3697p, Halma, up 38p to 2771p, London Stock Exchange, up 125p to 11515p, and IAG, up 3.2p to 296.4p.
The biggest fallers on the FTSE 100 were Entain, down 51.2p to 763.8p, Centrica, down 4.8p to 126.35p, ConvaTec, down 7.2p to 227.6p, Endeavour Mining, down 46p to 1459p, and BP, down 10.85p to 385.1p.