- FTSE 100 in buoyant mood, up 74 points
- Bank of England to delay bond sales programme - FT
- Moneysupermarket (LON:MONY).com rises, profits seen at top end of forecasts
9.57am: China delays publication of growth figures
China has delayed the release of its latest economic growth figures, which were due to be published as the Communist Party's leadership gathers.
President Xi Jinping is expected to be confirmed for a historic third-term at this week's party congress in Beijing.
The National Bureau of Statistics (NBS) did not give a reason for the delay.
The decision has been described as "very rare" by experts and is seen by some as a sign of further weakness in the world's second largest economy.
9.41am: WPP (LON:WPP) receives boost from France
Shares In advertising giant WPP PLC are near the top of the FTSE 100 risers today benefiting from positive numbers from its Paris-listed peer Publicis which reported third quarter results today.
In the third quarter of 2022, Publicis said revenues increased 24% to EUR3.24 billion from EUR2.62 billion and it now expects full-year organic growth of 8.5%, lifted from previous guidance for an increase of 6% to 7%.
In London, WPP shares were up 35p, or 4.64%, at 788.70p.
FTSE 100 has extended its gains as well, pushing back above 7,000, up 87 points at 7,008.
9.15am: All calm on the bond markets
Whisper it quietly but all is calm on the bond markets – so far anyway.
The prices of both short and long-dated sovereign debt are little changed this morning, meaning UK borrowing costs are flat too.
These gilts all rallied dramatically on Monday after chancellor Hunt ditched most of the mini-budget, and cut the length of the energy price freeze.
This morning, the yield (or interest rate) on 10-year UK bonds has dipped slightly to 3.96%, from 3.98% on Monday night, after tumbling from over 4.3% at the end of last week.
That means it still costs more to borrow than before the mini-budget (when the 10-year bond had a yield of 3.3%), but less than last week when it surged over 4.5%.
Long-dated bonds, where prices had plunged during the crisis in the pensions sector, are calm too.
Famous last words but today could well be the first calm-ish day in UK govt bond markets for a while. Most maturities have opened in a similar place to where they closed last night. Yesterday's harsh fiscal medicine seems to have had some impact. Here's the 30yr yield: pic.twitter.com/ldf7lCpaub— Ed Conway (@EdConwaySky) October 18, 2022
9.00am: FTSE 100 makes strong progress, bond yields down slightly
Equity markets made strong progress on Tuesday as investors continued to view yesterday’s fiscal moves by the new chancellor, Jeremy Hunt, positively.
At 9.00am the FTSE 100 was up 71 points at 6,991, while the FTSE 250 advanced 134 points to 17,637.
Analysts at Liberum said the measures were a “major positive to calm markets down” and it thinks a short-term rally in stock markets is likely, particularly in sectors like homebuilders, real estate and utilities, though it will probably be limited in duration.
The bond markets were certainly a calmer place with gilt yields down a touch after yesterday’s strong moves, while on the currency markets sterling gave up some of yesterday’s strong gains, down 0.22% against the US dollar.
On the equity markets Rio Tinto PLC (LON:RIO) recovered initial losses to trade little changed after it slightly toned down its annual guidance and warned of "downside risks to demand" for commodities.
The mining group said it now expects 2022 Pilbara iron ore shipments to be at the bottom end of a 320mln to 335mln tonnes range.
Looking ahead, the company said commodity prices continued to weaken during the third quarter amid a global economic growth slowdown with China's economy "challenged" by virus curbs recently.
Rio also pointed to signs of a slowdown in the US economy.
Better news from Ibstock PLC (LSE:IBST) with shares up 5.41% to 160.20p as it said it expects to perform above its previous expectations for the full year after strong demand and effective cost management delivered positive quarterly trading figures.
For the three months to 30 September, Ibstock said trading was "ahead of our expectations" thanks to "robust demand patterns."
The Leicester-based manufacturer of clay bricks and concrete products said that sales volumes in its clay division were "marginally above" the same period last year, while volumes of concrete sales were "broadly similar."
"Our strong trading in the first half of the year continued through the third quarter, supported by robust demand across our end markets,” Ibstock’s chief executive officer Joe Hudson said in a statement.
8.12am: FTSE 100 makes a bright start
FTSE 100 made a bullish start to trading on Tuesday lifted by strong gains in US and Asian markets and as investors continue to reflect on yesterday’s fiscal moves by the new chancellor, Jeremy Hunt.
At 8.15am the FTSE 100 was up 62 points to 6,982 and the broader FTSE 250 gained 128 points to 17,631.
The pound was slightly weaker in early trading, after strong gains yesterday, with sterling down 0.18% against the US dollar at $1.1334.
Price comparison website Moneysupermarket.com (LSE:MONY) saw its shares rise 4.23% to 207p after forecasting its annual core earnings would be at the upper end of expectations after third-quarter trading came in ahead of expectations, driven by customers switching financial products.
Revenue for the three months to September 30 rose 33% to £102mln. Sales in the company's money channel were up 42% "with particularly attractive products available in banking."
Bellway PLC (LON:BWY) was the latest housebuilder to report results reporting a jump in full-year profits along with record revenues and completions, although it did caution that demand was moderating.
In the year to 31 July, underlying pre-tax profit rose 22.5% to £650.4mln, with revenue up 12% to a record £3.54bn and housing completions 10.5% higher at a record 11,198 homes - ahead of the group's target.
On a reported basis, however, pre-tax profit was down 36.5% in the year to £304.2mln, as the net legacy building safety expense surged 568.3% to £346.2mln.
The company did also warn, however, that elevated demand since the start of the pandemic has moderated. In the nine weeks since 1 August, weekly reservations were 191 per week, down 12.4% from the same period a year earlier.
Shares slipped 2.11% to 1,813p.
7.47am: Euro looking upbeat, Sterling gains on the US dollar
The pound enjoy some relief this morning due to a decline in gilt yields following chancellor Jeremy Hunt’s scramble to unwind his short-lived predecessor’s regrettable legacy.
But despite some 20 pips being added to the GBP/USD pair in the early hours, a retreat seems to be forming on the one-hour chart.
Cable is currently changing hands at US$1.135, but we could be in for a volatile trading session as traders look towards tomorrow’s UK inflation data.
Cable is showing volatility in Tuesday’s early session
The euro is looking upbeat against the US dollar, at least relative to recent performance, having reached a 12-day high of US$0.985.
The EUR/GBP pair is looking particularly strong and it could be likely to break above the 87p barrier throughout the day’s trading session.
Once again, the Japanese yen fell against the US dollar and is currently changing hands at 149.9.
With the USD/JPY pair at its highest point in decades, speculation of a Bank of Japan intervention continues.
The Australian dollar is changing hands for US$0.63 against the US dollar while the AUD/EUR pair currently sits at €0.64.
7.41am: Average energy bills to top £4,000 from April - Cornwall Insight
The average annual energy bill will rise to more than £4,000 from April after Liz Truss’s U-turn over her policy to ease the cost of living crisis, according to the sector’s leading forecaster.
The price cap for a typical dual-fuel tariff will now be £4,347 in six months’ time if the government does not offer special support, according to the consultancy Cornwall Insight.
The new chancellor, Jeremy Hunt, said on Monday that the energy price guarantee, which caps the unit price of energy and was intended to last for two years from this month, will now be limited to six months.
7.21am: Bank of England to delay bond sale plans - FT
The Bank of England is likely to further delay the 31 October start of its sales of billions of pounds of government bonds to help stabilise the government bond markets after Britain's failed "mini" budget, the Financial Times reported on Tuesday.
Amid turmoil in financial markets, the BoE had already pushed back the start of a scheme to sell some of its £838 billion of government bond holdings, which was originally due to begin on 6 October.
The FT said it had learned that top officials at the BoE had come to the view that a delay was needed after judging the gilts market to be "very distressed" in recent weeks, a view backed by its Financial Policy Committee.
7.00am: FTSE 100 set to open higher
FTSE 100 set to open higher on Tuesday following strong gains in the US and Asia overnight.
Spread betting companies are calling the lead index up by around 55 points.
US markets continued their roller coaster ride, this time upwards, with all three major indices posting major gains by the close boosted by strong results from Bank of America (NYSE:BAC).
The Dow Jones Industrial Average soared 551 points, or 1.86%, to 30,186, the S&P 500 advanced 95 points, or 2.65% to 3,678, and the Nasdaq Composite jumped by 354 points, or 3.43%, to 10,676.
In London, on a quiet corporate day investors will focus on the fall out from yesterday's fiscal moves by the new chancellor, Jeremy Hutn, and speculation about the future about prime minister, Liz Truss.
Markets reacted positively to the news that nearly all of the mini-budget proposals announced by his predecessor, Kwasi Kwarteng, had been scrapped.