Proactive Investors -
- FTSE 100 flat
- Gold hits latest record
- House price growth slows
Saudi Aramco boss signals bullish stance on China
Saudi Aramco (TADAWUL:2222) boss Amin Nasser has signalled the oil giant is bullish on China, alongside oil demand, after the country’s latest measures to stimulate its struggling economy.
“We see more demand for jet fuel and naphtha especially for crude-to-chemical projects,” Nasser said on Monday on the sidelines of the Singapore International Energy Week conference.
This comes after the People’s Bank of China (PBoC) pushed ahead with respective 25 basis point cuts on one and five-year loan prime rates on Monday as part of measures to stimulate its economy.
“Coming in the wake of Friday’s surprisingly strong data deluge that saw industrial production, retail sales, and unemployment rate all improve, today’s fresh stimulative effort from the PBoC seeks to further build on the notion that the economy and market have bottomed out,” Scope Markets analyst Joshua Mahony commented.
Nasser’s bullish comments also come as oil prices have come under pressure in recent weeks, as fears over surplus supply ahead offset concerns around tensions in the Middle East.
Benchmark Brent crude ticked up 1.2% to US$74.06 a barrel on Monday, after having sat at almost US$78 early last week.
Consumer confidence improves as Budget fears moderate
Consumer sentiment has improved in October as concerns around this month’s Autumn Budget are said to have moderated.
S&P Global reported on Monday that its Consumer Sentiment Index increased to 47.3 over the month, from September’s 46.0.
This marked the second-highest reading in over three years, as strong labour market conditions in part boosted sentiment, S&P said.
Fears over the likes of a string of tax hikes in the October 30 Budget had hit sentiment in September, with S&P noting these had moderated more recently.
Confidence over household finances was also said to have improved, as easing inflation was met with robust wage growth.
“Consumer confidence is showing signs of reviving again after being hit by gloomy talk surrounding the Budget,” S&P economist Maryam Baluch commented.
“Confidence is being supported first and foremost by the strong labour market, with the survey showing both job security and income from employment improving.
“An easing of inflation worries, combined with expectations of a further lowering of interest rates, has also helped allay worries over the cost of living.”
Though households remained cautious over spending, attitudes towards major purchases had improved, Baluch added, in a “further sign of better things to come”.
VW Finance hit with £5.4mln fine over customer treatment
Volkswagen (ETR:VOWG_p) has been slapped with a fine from Britain’s financial watchdog over its treatment of customers in financial difficulty.
The Financial Conduct Authority (FCA) said on Monday that Volkswagen Financial Services (UK) Ltd would have to pay £5.4 million over unfair treatment of such customers.
VW had also agreed to pay £21.5 million in redress to roughly 110,000 customers over failing to provide tailored support based on individual circumstances between 2017 and 2023.
“This meant that, in some cases, Volkswagen Finance took cars away from vulnerable customers without considering other options,” the FCA said.
“This risked people being put in a worse position, particularly if they relied on their car to travel to work.”
Fresnillo leads FTSE 100 higher
Fresnillo PLC (LON:FRES) led risers on the FTSE 100 on Monday morning as continued gains for gold and new Chinese economic measures buoyed miners.
Shares in Fresnillo jumped 3.2% on Monday morning, while Glencore PLC (LON:GLEN) and Anglo American PLC (LON:AAL) also sat among the day’s early risers.
This followed a continued climb for spot gold to another record of US$2,733 and coincided with cuts to one and five-year loan prime rates in China under efforts to stimulate the world’s second-largest economy.
Housebuilders Barratt Redrow (LON:RDW) and Vistry Group (LON:VTYV) also gained as trading got underway, following news new sales and buyer demand had jumped across the property market in October.
Overall, the FTSE 100 ticked up 23 points to 8,382.
Gold hits another record
Gold remained inflated above the US$2,700 an ounce mark on Monday morning and hit yet another record high.
Having surpassed the mark for the first time on Friday, the spot price of the yellow metal climbed further as this week’s trading got underway, gaining 0.2% to reach US$2,727.
A peak at US$2,733 earlier on in the morning had seen gold hit another record, leaving gains for the year at almost 38% so far.
Tensions in the Middle East have buoyed the price of gold, with ever-growing attention on November’s US presidential election providing upward pressure most recently.
“It is hard to see this dynamic changing substantially over the next couple of weeks,” ING Think economists commented.