Goldman Sachs is out with its near-term forex outlook
- FTSE 100 closes at new high
- Pound falls as UK unemployment rises, wage growth slows
- Bellway (LON:BWY)’s solid trading update lifts shares in housebuilders
- Rolls-Royce (LON:RR) chosen for UK small nuke contract
4.59pm: FTSE notches all-time high
London stocks rose on Tuesday as weaker UK labour market data boosted expectations for interest rate cuts.
The FTSE 100 Index closed 0.2% above at 8,853, gaining 21 points today.
Pay growth slowed and unemployment hit a near four-year high, adding pressure on the Bank of England, which is already grappling with mixed economic signals and inflation driven by external factors. The credibility of labour data has also come under scrutiny, with the Labour Force Survey’s reliability in question due to low participation.
Meanwhile, investors remained focused on US-China trade talks, hoping for progress in resolving the ongoing tariff dispute.
4.15pm: London index drops back from potential record close
The FTSE 100 is on track for a solid but unspectacular day, up 34 points or 0.4% to 8,866, which if it finished at that leavel means it will not quite set a new record closing high.
The index’s record intraday high is 8,908.82, set on 3 March 2025, when it also finished with a record closing high of 8,871.31.
We topped 8,886 earlier but all those gains could not be held.
Top of the leaderboard looks like this, with housebuilders on top.
- Persimmon (LON:PSN) 5.8%
- Barratt Redrow (LON:RDW) 5.5%
- Taylor Wimpey (LON:TW) 4.2%
- Marks & Spencer 3.8%
- Shell (LON:SHEL) 3.7%
M&S was boosted by the resumption of online orders, 46 days after stopping them due to a ransomware attack.
Shell and BP (LON:BP) were both lifted by oil prices climbing to their highest in over a month.
Fallers are led by Next (LON:NXT), on the back of weaker data from the BRC and Barclaycard.
Banks are down interest rate cut expectations creep up again after a poor UK jobs report, with bond yields also falling in the UK and the US.
3.35pm: FCA could clamp down more on finfluencers
Financial Conduct Authority chief said the regulator could take more legal action against social media influencers punting scam financial products after launching a fresh crackdown this month, according to reports.
The FCA and City of London Police arrested three so-called finfluencers earlier this week and sent a raft of cease and desist letters to others.
2.51pm: Mixed Wall Street open
It’s a mixed open for Wall Street, with the blue-chip Dow Jones down 0.1%, the small-cap Russell 2000 up 1.1%, while the S&P 500 has inched up 0.1% and the Nasdaq 0.2%.
Top risers on the Nasdaq include Applovin, Regeneron Pharma (NASDAQ:REGN) and Tesla, all up between 1% and 2%.
Biggest faller in the S&P 500 is packaged food maker JM Smucker, as its outlook included an annual profit below current Street estimate.
Back in London, the FTSE is holding onto most of its gains, having ticked as high as 8,886 in the past hour, with housebuilders still leading the way.
2.06pm: Pisces private market platforms to be launched this year
HM Treasury and the UK financial regulator today confirmed that London’s new PISCES ’private company stock market’ will launch later this year.
After it was proposed by Rachel Reeves in her Mansion House speech last year, the Financial Conduct Authority has today announced the rules for the Private Intermittent Securities and Capital Exchange System, to give the platform its full name.
"As companies choose to stay private for longer, there is demand for investors to trade private company shares easily and efficiently in an organised marketplace," the FCA said, with PISCES allowing secondary trading of these shares for institutional and "more sophisticated" investors, plus employees of the companies listing their shares.
Companies will be able to set the ’floor and ceiling’ of share prices and will have a say over who can buy their shares.
It provides an opportunity for private companies to allow intermittent buying and selling of their shares without taking the leap to a full listing of their shares on AIM or the main market, meaning no significant increase in costs or disclosure requirements.
Simon Walls, executive director of markets at the FCA, said the design of PISCES "rebalances risk, but it is bold risk taking".
"The new platforms will give investors greater access and confidence to invest in exciting new companies, while early backers and employees can sell up and invest again."
City firms can apply to run their own PISCES platforms as part of a ’sandbox’ period, with the FCA and government monitoring what happens in order to improve the regime before making it permanent.
This is a new type of stock market that "won’t be like the ones people know today" and "while it won’t be open to the public, there are positives from its creation," says analyst Dan Coatsworth at AJ Bell (LON:AJBA).
"Pisces could help private companies get used to the idea of slices of their business being owned by different people. It might act as a stepping stone towards a public stock listing, getting them used to regular financial reporting, transparency as a business, and understanding that a company is run for the best interests of shareholders, not the board of directors."
Coatsworth said Pisces is not replacing AIM as it will not support capital raising and won’t be open to the public.
"Apart from employees of the private company, only institutional investors, high net worth individuals or those deemed to be ‘sophisticated’ investors will be able to buy and sell via Pisces. Share buybacks will not be permitted, at least in the initial stages of the market’s life," he said.
"The launch of Pisces does not sound the death knell for AIM. If anything, it could shine on a spotlight on AIM’s advantages in letting companies access capital markets for growth funding and the ability to conduct share buybacks, the latter treasured by many investors in the current environment."
Jason Hollands, managing director of Evelyn Partners, said it is a "welcome development and a genuinely innovative one for the UK’s capital markets" and should "provide a helpful bridge for companies who are not yet ready for an IPO, but who may be on a journey to public markets over time".
He felt it might, "at the margin...have a knock-on impact for AIM" as some private businesses who might have previously contemplated joining AIM as the next step, "may conclude this is a much better option for the next stage in their evolution".
AIM seen a dearth of new admissions in recent years, along with private equity buyouts and other companies leaving as they feel the extra costs are not bringing enough liquidity in their shares.
1.55pm: Subs boost for defence sector
Shares in Babcock International PLC (LSE:LON:BAB) have gained buoyancy, up 1.2% after the government confirmed a multibillion-pound boost to the UK’s submarine-building industry.
The engineering group, which maintains and upgrades the Royal Navy’s fleet, is expected to benefit from the £6 billion investment, part of a wider defence funding package to be outlined by Chancellor Rachel Reeves.
The funding will be spread over four years and aims to expand the capacity and productivity of the UK’s submarine industrial base.
Other key beneficiaries include BAE Systems (LON:BAES) and Rolls-Royce’s submarines arm.
12.54pm: Wall Street holding pattern
US stock futures remain doggedly flat in the run up to Wall Street’s opening bell.
Dow Jones futures are down 0.035%, while those for the S&P 500 and Nasdaq 100 are also pointing to modest drops.
Analysts says the key event being awaited is the inflation numbers tomorrow.
"It feels a bit tired to me," says Kenny Polcari at Slatestone Wealth, who expects "the churn to continue as we wait for any news out of London over US /China trade talks".
He notes that comments out of China seem to contradict what Scott Bessent and Howard Lutnick have been telling President Trump and in their interviews.
"China is not so sure that the talks are as ‘peachy’ as [Lutnick] suggested, so as you might expect – that just leaves us in limbo.
"And what happened to trade talks with all the other countries? Is that all settled? Hardly, but no one seems to be talking about it any longer. Nothing about the EU, nothing about India, or South Korea or Japan. China talks are sucking the air out of the room – are we to assume that everyone else is ‘ok’?"
12.07pm: FTSE stocks a source of positive vibes
London’s FTSE 100 and FTSE 250 are rare sources of positivity in global stock markets this afternoon.
The blue-chip index is up 0.4% and its mid-cap sibling has climbed 0.7%, which compares to a 0.4% fall for Germany’s DAX and just-below-flat performances in France and for US futures.
Housebuilders, along with Marks & Spencer and Rolls-Royce, are driving the gains for the Footsie, helped by strong gains for oil heavyweights Shell and BP.
Brent crude climbed to $67.30 a barrel this morning - its highest level since mid-April. Markets are pinning hopes on progress in US-China trade talks, says analyst Matt Britzman at Hargreaves Lansdown (LON:HRGV). "At the same time, ongoing geopolitical tensions and OPEC+ supply moves are keeping traders on high alert."
At the other end, retailers and lenders are dragging, with Next down 1.8% after the softer BRC retail data that analysts said was likely to weigh on the discretionary side of the sector.
Standard Chartered (LON:STAN), Barclays (LON:BARC) and Lloyds (LON:LLOY) are all down more than 1%, which comes as bond yields are down after the unemployment data.
The UK 10yr yield is down to 4.56%, its lowest in over a month, with a similar story for the 2yr and 30yr.
Kathleen Brooks at XBT notes that US yields were on the way down yesterday, with the dollar also falling.
"US Treasury yields [...] began to slide after the New York Fed published weaker than expected 1-year inflation expectations for May [...] For now, it does not appear that tariff disruption is putting pressure on inflation data, which may ease fears about prices spiking in the lead up to Wednesday’s CPI report.
"However, we would urge some caution. It is too early to tell how big the inflationary impact from tariffs will be. If trade agreements are not announced between now and July, then it will be the latter months of the year when the full impact from tariffs will show up in the data."
11.25am: Economic data - investors should focus on the broad trends
UBS economists say last week was a bad one for economic data aficionados – "or ’geeks’ to use the technical term" – on both sides of the Atlantic.
ONS revealed that they had wrongly added up the numbers in April’s consumer price data, inflating the inflation number, while the US Bureau of Labor Statistics admitted measurement errors in the April employment report.
"The increasingly complex and rapidly changing global economy make data harder and more expensive to collect. Survey fatigue and political bias are making things worse," says Paul Donovan, chief economist at the Swiss bank’s London branch.
"This should not be regarded as a uniquely Anglo-Saxon phenomenon. Just because some statistical agencies do not publicly admit their errors does not mean the errors do not exist.
"These errors have consequences. The UK’s inflation error increased the government’s interest rate bills. Less understanding of US inflation increases the chances of the Federal Reserve making a policy error (especially with the mantra of ’data dependency’).
"In an increasingly sensationalized media environment, reporting can make small changes in data seem important
"For investors, it is important to remember that broad trends matter, and data precision is increasingly an illusion."
10.58am: M&S resumes online orders after hacking attack
Marks and Spencer Group PLC (LSE:LON:MKS) has restarted selling clothes online, six weeks after halting orders due to a cyberattack.
The retailer says "select fashion ranges" are now available online for customers around mainland Britain, a resumption of digital sales after 46 days, with customers in Northern Ireland still having to wait to get their M&S garb.
After the ransomware hack in April, "we are bringing back online shopping this week," said managing director of fashion, home and beauty, John Lyttle.
10.28am: UK payrolls shocker, but worth taking a step back
How serious is the massive drop in HMRC payrolls reported by ONS this morning? This is the question being asked by Deutsche Bank (ETR:DBKGn) economist Sanjay Raja.
"The increase in labour market slack was always expected – particularly after a more benign April inflation print. More slack should be expected," he says.
"This will keep the MPC dialling down restrictive policy. But the UK labour market is not about to break – at least not yet."
The May payroll data, a drop of 109K, was the worst print we’ve seen since May 2020 and "paints a worrying picture", he says, "suggesting that firms may still be grappling with trade uncertainty and increased payroll costs".
However, it’s worth taking a step back, he adds, also noting that (like Pantheon’s Rob Wood, see below) that other data does not point in the same direction.
While the number of payrolled employees has fallen in seven consecutive months, a cumulative drop of 276k and this morning’s data was "a shocker", it’s worth noting a few things, Raja says.
"One, HMRC data tend to get revised up as more data is collected. We expect the 109k drop to be revised lower next month.
"Second, not all data point in the same direction as the HMRC payroll data," he adds, with the ONS Labour Force Survey painting a "slightly different picture" to the HMRC data, with employment growth up 89k in the three months to April, with the number of employees in the LFS sitting around 130k higher than at the end of last year.
Raja expect the Bank of England to continue dialling down restrictive policy, despite the hawkish May meeting.
"The path ahead remains clear in our view: more rate cuts are likely," he says, with underlying disinflation remaining on track and the unemployment rate rising further than the Bank’s projections in the near term.
"All in all, we expect the MPC to continue its cycle of quarterly rate cuts until Q4-25," with the base rate settling at 3.5% by year-end and dropping to a terminal rate of 3.25% in Q1 2026.
9.51am: Most shorted stocks
Alphawave IP Group (LON:IPO) PLC (LSE:AWE), despite having agreed to be bought by Qualcomm (NASDAQ:QCOM), is the most shorted stocks in the UK at the moment, according to S&P Global Market Intelligence.
Others attracting interest from short-sellers include Oxford Nanopore, Tullow Oil (LON:TLW), BT Group (LON:BT) and Aston Martin (LON:AML).
The list, which uses a metric based on the percentage of outstanding shares on loan, has a few UK tech names.
A rival measure, ShortTracker from Castellain Capital, has Yellow Cake PLC (AIM:LON:YCA), J Sainsbury PLC (LSE:LON:SBRY), Ocado Group PLC (LSE:LON:OCDO) as the most shorted.
Domino’s Pizza Group PLC (LSE:LON:DOM) and Aberdeen Group PLC (LSE:ABDN) are on both lists.
9.20am: UK retail and consumer data
The BRC-KPMG retail sales survey was released overnight, showing total sales were up 1.0% on last year, after a big 7% jump in April boosted by good weather and a late Easter.
Food sales increased 3.6%, while non-food sales decreased 1.1% as non-food store sales fell 0.9% and online dropped 1.5%.
This level of growth was more in line with the 1.1% growth seen in both February and March, says independent retail analyst Nick Bubb.
After a "bumper April", he says this was expected.
BRC chief Helen Dickinson said fashion and full-price big-ticket items were "held back by lower consumer confidence", while gaming bucked the trend thanks to new releases.
At the same time, Barclays issued its report on UK consumer spending via Barclaycard data, which covers nearly 40% of all UK credit and debit card transactions from April 26 to May 23.
Their survey was also "muted", says Bubb, flagging card spending was up 1.0% after 4.5% growth April and 0.5% in March.
The survey also attributed slower card spending "amid falling confidence in personal finances”.
Bubb says Barclays "badly under-estimated supermarket spending, claiming that it was only up by 0.2% (which is obviously wrong/too low, given the c3%/4% growth reported by Kantar/NielsenIQ for the 4 weeks to May 17th/18th and the reported BRC-KPMG Food sales growth for May of 3.6%".
Blockbuster films such as ‘Lilo & Stitch’ and ‘Mission Impossible - The Final Reckoning’ led cinema spending to surge 19.2% in May, whilst there was another strong performance from airline tickets (up 9.7%).
Bubb also flags that last week, Barclays released a report about the last 10 years of Consumer Spend insights, revealing that UK consumers "now view entertainment, travel and beauty as non-negotiables".
9.14am: Jobs data increases BoE rate cut chances for August
The ONS jobs data earlier raises the chance of the Bank of England cutting interest rates in August, say economists, which is why the pound is down 0.5% versus the US dollar and 0.3% against the euro.
"The labour market looks in worse shape in May," says Rob Wood at Pantheon Macroeconomics, which he says "could tip" the BoE’s Monetary Policy Committee into cutting rates again in August.
Payrolled employee numbers fell by a huge 109,000 month-to-month in May, worse than the 55K fall in April (which was revised from 33K) and below the consensus forecast of -20K.
"The upward creep in the LFS unemployment rate to 4.6% in April suggests a gradually rather than rapidly easing labour market," says Wood, which means he takes the very weak payrolls data "with some caution".
Redundancies dropped to their lowest since before October’s Budget, "suggesting that firms are past the worst of the adjustments for higher payroll taxes", he adds.
Market analyst Neil Wilson at Saxo says these were "unwelcome employment numbers" as unemployment rose to a four-year high of 4.6%, payrolls fell sharply and vacancies dropped.
"The only real good news for the Bank of England was that wage growth, unsurprisingly, also declined as the market softened."
Sterling, he notes, has dipped to its weakest level this month.
8.49am: FirstGroup jumps
Shares in FirstGroup PLC (LSE:LON:FGP) have whistled 7% higher as the rail and bus group disembarked with a £50 million share buyback alongside its final results.
As well as the buyback, shareholders were rewarded with a 6.5p total dividend, up from 5.5p a year earlier.
CEO Graham Sutherland said the rail and bus group, which runs the GWR route from London out to Bath, Bristol and beyond, is "well placed to at least maintain our adjusted earnings per share in FY 2026 from a stronger base, as we continue to successfully navigate a period of transition in bus and rail in the UK."
Analyst Gerald Khoo at Panmure Liberum says the results were "slightly ahead of our forecasts and consensus, despite a headwind from restructuring costs we had not anticipated".
Bus was the main driver of EPS growth, along with further progress in Open Access Rail, "highlighting the improving earnings quality of the group".
8.37am: Rolls bags UK small nuke contract
Some more details on that Small Modular Reactor win for Rolls-Royce Holdings PLC (LSE:RR.).
Shares in the company have risen 2% to a new all-time high after it beat off two US companies in the competition to work with the UK government to build the country’s first small modular nuclear reactors.
Over £2.5 billion has been pledged by the government for the overall SMR programme in the current spending period.
The decision comes at the end of a two-year selection process in which Great British Energy Nuclear (GBN) assessed various technologies from around the world, with Rolls beating two US companies in the final choice.
Small nuclear: A cross-section of the Rolls SMR design
GBN plans to allocate a site to build the first SMR later this year, it said, with the plant to be connected to the national electricity grid in the mid-2030s.
Group chief executive Tufan Erginbilgiç said: "This is a very significant milestone for our business and Rolls-Royce SMR. It is a vote of confidence in our unique nuclear capabilities, which will be recognised by governments around the world."
8.26am: FTSE tops record closing high
With a gain of 38 points so far this morning, London’s blue-chip index has topped 8,870, which is above its record closing high from March.
However, the UK benchmark is still a handful of points off its all-time intraday peak of 8,908.8 in that same month.
Housebuilders Persimmon, Barrat Redrow, Taylor Wimpey and Berkeley (LON:BKGH) Group are topping the leaderboard, up between 3.3% and 1.5%.
They are joined by Rolls-Royce, up 2.2%, after it was selected by the government as the preferred bidder to build country’s first small modular reactors.
8.14am: FTSE opens higher, lifted by builders and oil
The FTSE 100 is off to a solid start, rising 34.5 points to 8,866.8, a gain of 0.4%.
Housebuilders Persimmon and Barratt Redrow are leading the pack, with investors reading across to the robust numbers from rival Bellway (see below).
Oil giants Shell and BP are next, p 1.6% and 1.9% after crude prices climbed overnight, with a barrel of Brent now going for over $67.
7.55am: Solid update from Bellway
Bellway PLC (LSE:BWY) delivered a robust trading update for the second half of the year, with the full-year outlook for volume of completions and average prices has been nudged up slightly.
The housebuilder said it will have sold around 8,600-8,700 in the year at an average selling price of £315k, £5,000 above prior guidance, primarily due to the sales mix.
With margins expected to be close to 11%, operating profit for the year is guided to come in at around £295-300 million, 2-3% ahead of the current consensus.
The group remains confident in delivering 20% volume growth by the next financial year and plans to update the market on its refreshed capital allocation approach at its final results in August.
7.47am: SpaceX order with AIM’s Filtronic (LON:FTC)
Elon Musk’s SpaceX has bought more components from AIM-listed Filtronic PLC (LSE:FTC), in fact the $32.5 million order is its largest so far, the Country Durham company says.
This is for E-band solid state power amplifiers, and is expected to be mostly fulfilled in the 2026 financial year, meaning the board is now confident the company will exceed current revenue expectations for that year.
Under a warrant arrangement with SpaceX, the US rocket company now has a 9.96% stake in the company.
7.39am: Frasers confirms Revolution Beauty interest
Frasers Group PLC (LSE:LON:FRAS) has confirmed it is running the rule over Revolution Beauty Group PLC (AIM:REVB) and could make an all-cash offer.
However, the retail group said there is "no certainty" that it will make a bid.
7.20am: Wage growth slows
The UK’s ILO unemployment rate climbed to 4.6% for the three months to April, up from 4.5%, as expected, while growth in wages slowed as some firms stopped replacing workers when they left.
Data from the Office for National Statistics showed employment rose by 89.0k, which was more than forecast,
Wage growth excluding bonuses rose 5.3% in the three-month period compared to a year ago, down from 5.6%, as forecast.
Growth of private sector wages excluding bonuses 5.2%, also down from 5.6%.
The economic inactivity rate decreased by 0.2 percentage points on quarter in three months to April to 21.3%.
The ONE said some firms may not be recruiting new workers or replacing leavers.
ONS director of economic statistics Liz McKeown said: “There continues to be weakening in the labour market, with the number of people on payroll falling notably. Feedback from our vacancies survey suggests some firms may be holding back from recruiting new workers or replacing people when they move on."
On pay, she said: “Earnings growth has slowed in both cash and real terms, though it remains strong by historic standards. Public sector pay is now growing at a higher rate than wages in the private sector.”
The pound has dropped 0.2% to $1.3526.
7.14am: FTSE 100 called higher as wage growth slows
The FTSE 100 has been called higher on Tuesday as UK labour market numbers showed an increased unemployment rate and slower wage growth.
A gain of 16 points was being predicted on the futures market ahead of the open, after the index dropped 5.6 points to end at 8,832.28 at the start of the week.
Overnight, Wall Street also delivered a performance that was nothing to write home about, with the Dow Jones just below flat, the S&P 500 holding just a handful of points above the 6,000 mark and the Nasdaq rising 0.3%.
Asian markets are mixed this morning, though again none of the moves are that dramatic.
5am: What to watch on Tuesday 10 June
A third-quarter update from housebuilder Bellway PLC (LSE:BWY) comes amidst an uncertain housing market, though analysts highlight falling interest rates and supporting government policy on building regulations.
At the last update, CEO Jason Honeyman said the market had picked up since the turn of the year, with customer enquiries and reservations on the rise.
He guided for at least 10% growth in completions to upwards of 8,500 homes this year, a stable average selling price of around £310,000 (£310,600 in the first half), and a 100 basis point improvement in operating margin to 11%.
Elsewhere, there will be an update on the UK labour market from the Office for National Statistics, where the market is expecting 50k jobs to have been created in the three months to April, and for the unemployment rate to have ticked up a notch to 4.6%.
Wage growth is estimated to have moderated, which could open the door wider to more Bank of England interest rate cuts.
Markets are currently putting a 60% chance of an August rate cut, but "this could rise if we get weak UK labour market data", says market analyst Kathleen Brooks at XTB and "take the shine off" the pound.
Further afield, Taiwan Semiconductor Manufacturing Co (ADR) (NYSE:TSM), the world’s largest contract chipmaker and a critical link in the global semiconductor supply chain, reports earnings too.
At its last results in April, TSMC held its outlook amid an unclear impact of tariffs, but at its shareholder meeting last week confirmed that US trade tariffs were having an indirect impact.
US inflation figures for May will come later and should indicate what effect tariffs are having on prices.
"So far, those fears have not materialised, but experts have suggested that the effect of tariffs will only show up in data from the second half of the year," said market commentator Ed Monk at Fidelity.
Inflation is predicted to have been "too elevated for the Federal Reserve to contemplate reducing interest rates at present, although some analysts foresee a potential slowdown in services inflation", he said, with the US central bank anticipated to maintain rates in June and July.
Announcements due:
Trading updates: Bellway
Interims: Diales Group, Porvair, Safestore
Finals: FirstGroup, GB Group, Oxford Instruments (LON:OXIG), Vianet Group
Overseas earnings: Oracle (NYSE:ORCL), JM Smucker, Taiwan Semiconductor Manufacturing Company
Economic announcements: BRC Retail Sales Monitor (UK), Unemployment (UK), NFIB Business Optimism (US), Redbook (US)