Stocks rise ahead of UK autumn statements

Stock prices in London opened slightly higher on Wednesday, reflecting cautious optimism ahead of UK tax policy announcements.

The FTSE 100 index opened up 13.59 points, or 0.2%, at 7,495.58. The FTSE 250 was up 67.31 points, or 0.4%, at 18,414.94, and the AIM All-Share was up 11.15 points, or 0.2%, at 7,493. 14.

The Cboe UK 100 was up 0.2% at 748.21, the Cboe UK 250 was up 0.3% at 15,932.57, and the Cboe Small Companies was slightly lower at 13,531.91.

In Europe, the CAC 40 in Paris was up 0.4%, while the DAX 40 in Frankfurt was up 0.2%.

The main focus on the local front will be Chancellor Jeremy Hunt’s statement at around 12:30 GMT.

Mr Hunt’s statement is expected to contain 110 different growth measures, as he seeks to revive the UK’s economy and the Conservatives’ chances of being elected.

“The rumor mill continues to spin on what seasoning Jeremy Hunt plans to bring to the UK economy in an attempt to improve its growth prospects. Investors will be paying close attention to what the Chancellor plans as part of this “Revenue and tax cuts now appear to be a key ingredient, although they risk stoking inflation,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown.

Mr Hunt is expected to use his autumn statement to cut national insurance rates and make permanent a £10bn-a-year tax break for businesses investing in new machinery and equipment. He will promise to cut business taxes, cut planning red tape and speed up access to the national electricity grid.

At the same time, traders examined the minutes of the latest Federal Reserve meeting, published Tuesday evening.

Fed officials said interest rates were expected to remain high for “some time,” calling it “essential” to bring “unacceptably high” inflation back to its 2 percent target. Officials “continued to view it as critical that the monetary policy stance remains sufficiently restrictive to return inflation to the committee’s 2 percent target over time.”

“Alas, the cautious tone of the Fed minutes was not heard, as the latest CPI data acted as a shield against the Fed hawks. Thus, the market reaction to the Fed minutes was attenuated,” noted Ipek Ozkardeskaya, senior analyst at Swissquote Bank.

The dollar was mixed against major currencies early in the day.

Sterling was trading at $1.2536 early Wednesday, higher than $1.2531 at the close of London stock markets on Tuesday. The euro was trading at $1.0917, down from $1.0926. Against the yen, the dollar was quoted at 148.90 yen, up from 147.91 yen.

In the FTSE 100, Sage Group jumped 9.2%.

The business software maker reported double-digit growth in annual revenue and began buying back shares worth £350 million.

In the year ended September 30, revenue increased 12% year-on-year from £1.95 billion to £2.18 billion, and recurring revenue annualized increased by 11%, from £1.96 billion to £2.19 billion. Pre-tax profit fell 16% from £337m to £282m as the company’s operating profit margin contracted from 18.9% to 14.4%. The proposed final dividend is 12.75p, bringing the annual total to 19.3p, up from 18.4p the previous year.

Kingfisher fell 5.6%.

The owner of DIY chain stores including B&Q has cut its profit forecast again, now expecting underlying annual pre-tax profits of £560 million. By September it had cut its forecast to £590m, from the £634m initially forecast.

Kingfisher said the UK DIY market was more “resilient”, with sales of its various brands increasing slightly during the third quarter. However, it said sales at its French arm, where it operates under the names Castorama and Brico Depot, fell 8.7%.

“A number of issues affected the business during the quarter, ranging from unusually warm weather which delayed the start of sales of products such as heating and insulation, to general weakness in the French home heating market. renovation, which has deteriorated much more than expected,” said Richard Hunter of Interactive Investor.

Elsewhere in London stocks, CRH rose 0.5% after announcing it would sell its European lime business to SigmaRoc for around $1.1 billion.

The Dublin-based construction materials group announced a $2.1 billion deal Tuesday to acquire cement and ready-mix concrete assets in Texas.

Sigmaroc, a procurement and construction group targeting building materials assets, said the lime deal represented an opportunity to become “the lime leader in Northern Europe”. The company suspended trading in its shares this morning, noting that the transaction constitutes a reverse takeover.

In the United States, Wall Street ended lower, with the Dow Jones Industrial Average losing 0.2%, the S&P 500 index 0.2% and the Nasdaq Composite index 0.6%.

Chipmaker Nvidia reported third-quarter profit and revenue that beat expectations. In the three months to October 29, revenue tripled to $18.12 billion, and non-GAAP diluted earnings per share increased from $0.58 to $4.02. The company, however, expects a sharp decline in sales in China in the fourth quarter due to U.S. export restrictions, but expects growth in other countries to more than offset the decline.

Its shares slipped 1.7% in after-hours trading.

Swissquote’s Mr. Ozkardeskaya said: Investors couldn’t decide whether to buy the fact that the company has exceeded high expectations, or whether to sell the reality that chip sales to China will slow down this year. quarter and that will weigh on revenue – although Nvidia said the “decline will be more than offset by strong growth in other regions” and that they are working to comply with regulations to sell to China, of all way”.

Derren Nathan, head of equities at Hargreaves Lansdown, commented: “There are fears that more restrictions will follow, which could accelerate local efforts to close the technology gap. But given that Nvidia has set the bar very high , it won’t be easy.”

In other AI industry news, OpenAI announced early Wednesday that its co-founder Sam Altman would once again become CEO, days after he was fired by the board. He was to lead an AI team at Microsoft.

Gold was trading at $2,006.13 an ounce early Wednesday, up from $1,999.42 on Tuesday.

Brent oil was trading at $82.58 a barrel, up from $81.74.

In Wednesday’s economic calendar, there is Eurozone consumer confidence data at 1500 GMT. There will also be weekly US initial job applications, published before the US Thanksgiving holiday.

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Beth Malcolm

Beth Malcolm is Scottish based Journalist at Heriot-Watt University studying French and British Sign Language. She is originally from the north west of England but is living in Edinburgh to complete her studies.