FTSE 100 narrowly misses record high after housebuilders rally
The FTSE 100 closed just short of a record high on Tuesday after fresh economic data fuelled hopes of further interest rate cuts from the Bank of England.
The UK’s flagship market inched up 0.24 per cent to 8853.08p after a rally from homebuilders. This narrowly missed March’s record close of 8,871.31p.
Builders Persimmon and Barratt Redrow led the risers at over five per cent with Taylor Wimpey both up over four per cent.
Retailer Marks & Spencer soared 3.8 per cent after resuming website orders following its cyber attack chaos.
The mid-cap FTSE 250 climbed nearly 0.5 per cent to 21,389.46p.
This came on the back of a duo of economic news with the unemployment rate rising to 4.6 per cent from 4.5 per cent and wage growth hitting 5.2 per cent in April.
Danni Hewson, head of financial analysis at AJ Bell, said: “Hopes that lacklustre jobs data might give rate setters the ammunition they need to deliver further cuts helped to propel London’s blue-chip index to within a whisker of a fresh record close”.
The FTSE 100 secured a record 16-day run of consecutive gains last month as markets bounced back from President Donald Trump’s tariff onslaught. However the streak came to an end as pharma stocks slumped after a controversial US appointment.
Lenders and gold miners buck the trend
Raised expectations of a rate cut marked a headache for lenders on Tuesday, which struggled to escape the red.
Barclays and Standard Chartered tumbled over two per cent and Natwest and over one per cent.
Hewson said: “Of course, where there are winners there are also losers, and a host of lenders including Barclays and Lloyds found themselves sliding down the FTSE snake.
“It wasn’t just bad news masquerading as good that nudged the FTSE 100 back towards record breaking territory. The potential of a US-China trade agreement helped bump up the oil price, which hit a six-week high today and pushed up London-listed oil giants Shell and BP.”
Rolls-Royce once again gave the London market a boost jumping nearly two per cent after the firm was named the winning bidder for UK small nuclear reactors.
Meanwhile, goldminers topped the index’s fallers with Fresnillo and Endeavour falling over two per cent and Endeavour.
Gold prices have responded bullishly to the deteriorating state of the US dollar, but with trade talks between the US and China set for this week the price has retreated to around $3,330, compared to $3,400 just last week.