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Gold holds above US$2,500
Gold remained within record-breaking territory on Monday morning, after surpassing the US$2,500 per ounce mark for the first time late last week.
The yellow metal was trading at US$2,506 in the morning, having hit a peak and new all-time high of US$2,521 early on.
This was as expectations built for a base rate cut in the US by the Federal Reserve over the coming months, with the dollar dropping 0.17% on the pound to 0.7712p.
Weak US housing market data late in the week had fuelled rate cut hopes, with a reduction in September now widely expected.
Hargreaves Lansdown (LON:HRGV) analyst Susannah Streeter noted heightened global tensions, including in Eastern Europe and the Middle East, were also pushing up demand for gold.
“While a lower dollar helps boost demand for the commodity, the uncertain outcome of ongoing conflicts is also pushing up appetite for the safe haven asset,” she said.
“Ukraine’s incursions into Russia continue, with unknown repercussions, and as negotiations for a ceasefire in the Middle East look set to reach a decisive moment.”
Plus500 gains after guiding for expectation-beating results
Plus500 Ltd (LON:PLUSP) climbed over 4% on Monday morning after hiking its dividend and announcing full-year results would beat expectations in interim results.
Full-year trading will be “ahead of current market expectations,” the group said Monday, as increased shareholder rewards were unveiled on an uptick in first-half profit… Read more
The trading platform gained 4.4% following the report to take the lead as the FTSE 250’s biggest riser for the day.
Energy price cap set to rise in October
Energy prices will jump in October as the UK approaches the colder winter months, according to consultancy Cornwall Insight.
Ofgem’s price cap is expected to climb by 9% from £1,568 to £1,714 come the autumn, reflecting the typical amount a British household would pay on an annualised basis.
This comes after volatility within the global energy market, Cornwall said, as gas prices have climbed in recent months and been driven by Ukraine’s incursion into Russia most recently.
The October cap will determine energy unit prices for the remaining three months of the year, with costs having sat at their lowest for two years between July and September.
Cornwall added that an increase in prices ahead of the winter was always expected, but warned further volatility could emerge as fighting continues between Russia and Ukraine.
“While we don't expect a return to the extreme prices of recent years, it's unlikely that bills will return to what was once considered normal,” principal consultant Craig Lowrey said.
He added: “Without significant intervention, this may well be the new normal,” with Ofgem’s cap having sat lower before the war at £1,277 in October 2021.
Ofgem is set to officially announce the cap price for October this Friday.
FTSE 100 falls early on
London’s blue chips started off the week in the red, falling 9 points to 8,302 as trading got underway on Monday and adding to a decline seen on Friday.
This comes after stocks last week largely recovered from a global sell off earlier in the month, which had been prompted by fears over the US economy on weak job market data.
Frasers Group PLC and DS Smith PLC (LON:SMDS) were among top risers on Monday morning, climbing 2.4% and 2% respectively, while BAE Systems (LON:BAES) slipped 2% to lead fallers.
Buyers flock back to housing market after BoE rate cut
A cut to base interest by the Bank of England earlier this month has led to an immediate surge in buyers returning to the housing market, according to Rightmove PLC (LON:RMV).
Following an 11% uptick in July, the number of prospective buyers contacting estate agents has climbed by 19% since the first of August, the property portal said Monday.
This led Rightmove to up its forecast for house prices to climb by 1% over 2024, against -1% previously.
The number of sales agreed over the year so far is up 16% on 2023, while new sellers coming to market has increased by 5%, the group added.
“The first bank rate cut since 2020 has sparked a welcome late summer boost in buyer activity,” Rightmove director Tim Bannister commented.
“While mortgage rates aren’t yet substantially lower since the rate cut, the fact that the long-hoped-for first cut has finally arrived, and mortgage rates are heading downwards, is positive for home-mover sentiment.”
Average prices of properties coming to market fell by 1.5% to £367,785 between July and August, Rightmove said, in line with drops seen over the period historically.
Bannister added: “The conditions are there for a more active autumn market.”
Barratt-Redrow merger set to be completed this week
Housebuilder’s Barratt Developments PLC (LON:BDEV) and Redrow PLC (LON:RDW) are set to complete a tie-up over the coming days, the duo have announced.
The proposed £2.5 billion takeover of Redrow by Barratt had previously come under the gaze of the Competition and Market Authority, which launched a Phase 1 investigation in March.
But the CMA stopped short of pursuing a Phase 2 investigation after concluding that the duo has a "high combined share" in just one local area of Whitchurch, Shropshire… Read more
Strike threshold laws to be scrapped
Laws meaning strikes can only go ahead if a certain proportion of union members vote in favour of action are set to be scrapped in the UK.
This is as Britain’s new Labour government presses ahead on pledges to reverse the Trade Union Act, with The Telegraph reporting rules could be tabled by mid-October.
These require half of a union’s membership to vote in ballots for a strike to be legal, while 40% of those in public services unions have to approve action.
Ted Baker to shut remaining stores
Ted Baker is set to close its remaining UK and Irish stores in the coming days, placing over 500 jobs at risk.
All 31 of the fashion brand’s stores in the region are expected to be shut by Tuesday after Ted Baker’s UK holding company, No Ordinary Designer Label, fell into administration in March.
Some 15 stores, alongside 245 jobs, were axed in April, with talks over a potential licensing deal with Sports Direct (LON:FRAS) owner Frasers Group PLC being held more recently.
These are said to have stalled in recent months, however, according to Sky News.
Over 500 people still work across the fashion brand’s stores and head office, with these jobs in doubt as the remaining stores are closed by administrators.
Ted Baker was taken off the London Stock Exchange in 2022 after being acquired by US-based Authentic Brands Group for around £210 million.
This was after founder Ray Kelvin left Ted Baker in 2019 over claims of inappropriate behaviour, which preceded a string of profit warnings during the pandemic.