Proactive Investors -
- FTSE 100 rises 51 points
- UK inflation fell to 1.7% last month, increasing BoE cut hopes
- Whitbread (LON:WTB) reports lower interim profits but sweetens the pill
- FCA to investigate insurance market pricing
Gold hits new highs
Gold prices have risen to a new record high, topping $2,680, which analysts are putting down to movements in government bond markets.
US Treasuries have been rallying this week, having sold off following the US Federal Reserve rate cut decision, which sent the 10 year sliding to a yield of 4.12%, the highest sine late July, before rallying again yesterday back to circa 4.01%.
Today the 10year yield has fallen to just over 4.0%.
"The dollar has been strengthening amid global geopolitical tensions and slowing growth from other global economies," says metals analyst John Meyer at SP Angel.
He said ETF investors "rotating into gold as US Treasury yields slide", also noting that China's yuan has also been weakening as the People's Republic looks to support its economy with a large fiscal stimulus, while the BRIC countries are due to meet next week with "de-dollarisation top of the agenda" following the US freezing of Russia’s foreign reserves.
"Retail sales due tomorrow will be of primary focus to the US Treasury market, with a miss potentially providing the next leg higher for gold."
Top risers in the FTSE 350
Top of the FTSE 350 risers is Marshalls PLC (LON:MSLH), up almost 10% after the building materials manufacturer reported a smaller drop in revenue for the third quarter.
The 3% fall in turnover marked a “material improvement” when compared to the 12% fall in the first half, with sales from the group’s roofing products division climbing 12% thanks to sales of solar panels.
Next is XPS Pensions Group PLC, up 9.1% as its half-year trading statement revealed that regulatory change, including a new funding regime for defined benefit schemes that came into force last month, "continues to support client demand" for its advisory services.
Moonpig Group PLC (LON:MOONM), up 8.8% as it announced a share buyback and reiterated revenue growth targets ahead of its capital markets day event.
Quilter PLC (LON:QLT) is up 5.8% after saying assets under management had risen 2% in the past quarter.
Highest-placed blue-chip stock is Whitbread PLC, with the Premier Inn owner got a warm reception for its half-year numbers, with analysts saying positives from its new five-year plan outweighed the negatives.
Elsewhere in the FTSE 100, precious metals miner Fresnillo (LON:FRES) is second place, up 3.1% (Endeavor Mining PLC is up 3% and Centamin (LON:CEY) up 2.8% on the 250.)
Inflation effects on state benefits
One other point from the lower inflation is that it eases some potential Budget strain for the government, as September's rate of consumer price inflation is used to work out how much benefits will increase next spring.
Families of working-age on universal credit will therefore get a 1.7% hike to benefits, or £253 next year, according to calculations by the Resolution Foundation.
Lalitha Try, economist at the Resolution Foundation, said: "There was a larger-than-expected fall in inflation last month, but it will rise sharply in October driven by base effects from energy prices.
"This temporary fall is badly timed for millions of low-to-middle income families as will result in a lower increase in their benefits next year."
Try said the government "needs to address the age divide in benefits which has left working-age support fall further behind rising wages and living standards".
She noted that as October inflation is expected to pick back up as falls in energy prices last year drop out of the 12-month calculation, means the same family would see their UC award rise by £327 instead, a cash gain of £74.
Dodge and Alfa Romeo SUVs recalled
Stellantis (LON:0QXR), the maker of Vauxhall, Fiat and Chrysler cars, is recalling 20,755 hybrid crossover SUVs in the US over a worrying brake pedal issue.
This is due to some Alfa Romeo and Dodge SUVs having been made with pedals that could inadvertently become disengaged while being applied, a Reuters report revealed.
The Dutch-headquartered giant said it was aware of 15 cases around the world, but only one that had led to an accident.
Recalled models include Alfa Romeo Tonale plug-in hybrids released this year and some Dodge Hornet based on the same platform.