FTSE 100 down as US manufacturing growth slows

S&P Global’s Rob Dobson said the improvement was encouraging given the “elevated levels of business uncertainty” ahead of the budget, but warned that growth remains “worryingly weak”.

He said falling factory-gate prices for the first time in over two years point to intensifying competitive pressures.

The FTSE 100 index closed down 17.98 points, 0.2%, at 9,702.53. The FTSE 250 ended down 144.49 points, 0.7%, at 22,020.68, and the AIM All-Share closed up 0.71 points, 0.1%, at 754.79.

On the FTSE 250, Harbour Energy ended up 1.7% after announcing plans to cut around 100 offshore North Sea jobs.

The UK’s largest oil and gas producer announced the proposed job losses as part of a review into its UK operations.

Managing Director Scott Barr said the process is necessary to make sure its UK business “remains competitive as we continue to adapt to a challenging future”.

Harbour said it has come under pressure from lower commodity prices and an “uncompetitive tax regime”.

It said this situation has worsened after the government opted to retain the energy profits levy in last week’s budget.

The windfall tax, which was brought in by the previous UK government and is expected to stay in place until 2030, means that operators hand around 78% of their profits to the Treasury.

On AIM, Eco Animal Health climbed 5.9%.

The London-based animal health company swung to a pre-tax profit of £1.1 million in the six months to September 30 from a £1.4 million loss the year prior, as revenue increased 19% to £39.4 million.

Revenue grew by 23% on a constant currency basis, with sales in the US & Canada up by 30% to £11.2 million and in China & Japan up 48% to £12.1 million.

Eco Animal Health expressed its “confidence” that full-year results will be in line with current market expectations for revenue of £83.8 million and adjusted earnings before interest, tax, depreciation and amortisation of £7.7 million.

In the financial year to March 31, it reported revenue of £79.6 million and adjusted Ebitda of £7.3 million.

In UK political news, Rachel Reeves has said she is confident she will be chancellor at the next election, despite accusations that she misled voters.

The Chancellor has been forced to defend herself against claims she was not clear about the state of public finances in the run-up to the budget.

While attending the Wales Investment Summit in Newport, Ms Reeves said she was “proud” of her budget and dismissed doubts about her future as chancellor, telling the Press Association: “I set out in a speech a couple of weeks before the budget that the ambition for the budget was to cut NHS waiting lists, cut the cost of living, and cut the debt and the deficit.

“We’ve achieved all of those things. We’ve increased the headroom and the idea that some people are suggesting that we had £4 billion to play with… Well, actually, what happened was the headroom was revised down by the OBR, was more than halved, but I wanted to double that headroom because that gives us the best shot of withstanding all of the volatility that we’re seeing in the global economy at the moment.”

She said an Office for Budget Responsibility (OBR) forecast showing a £4.2 billion surplus against her borrowing rules did not take into account the welfare reform U-turn or the abolition of the two-child benefit cap.

Stocks in New York were lower. The Dow Jones Industrial Average was down 0.5%, the S&P 500 index was down 0.4%, and the Nasdaq Composite was down 0.5%.

The US manufacturing purchasing managers’ index reading beat its flash estimate in November, S&P Global reported on Monday.

The S&P Global US manufacturing PMI recorded 52.2 points in November, slightly down from 52.5 in October.

However, it was slightly higher than the 51.9 flash reading published on November 21.

S&P Global said: “Operating conditions in the US manufacturing sector improved for a fourth successive month in November.

“A solid rise in production and a further increase in employment were reported as confidence in the outlook strengthened.”

However, Chris Williamson, chief business economist at S&P Global Market Intelligence, noted that “manufacturers are making more goods but often not finding buyers for these products”.

He added: “Profit margins are meanwhile coming under pressure from a combination of disappointing sales, stiff competition and rising input costs, the latter widely linked to tariffs.”

In European equities on Monday, the CAC 40 in Paris closed down 0.3%, while the DAX 40 in Frankfurt ended down 1.0%.

Ukraine’s President Volodymyr Zelensky on Monday sought to reinforce European support for Ukraine at a potentially pivotal moment in Kyiv’s battle against the Russian invasion, meeting President Emmanuel Macron in Paris as Washington pushed a plan to end the war.

“We share the view that the war must be brought to a fair end,” Mr Zelensky wrote on X after the talks, which also included phone conversations with other European leaders, including British Prime Minister Keir Starmer.

Washington’s plan to end the war is championed by US President Donald Trump, but European countries fear it risks forcing Kyiv to cave in to Russian demands, notably on territory.

The situation has been further complicated by a corruption scandal that has rocked Mr Zelensky’s inner circle and forced the dismissal last week of his top negotiator and chief of staff, Andriy Yermak.

US and Ukrainian negotiators held hours of what both sides called “productive” talks in Florida on Sunday, with Mr Trump declaring on Air Force One “there’s a good chance we can make a deal”.

TotalEnergies lost 0.2% in Paris.

Britain’s government has said it will no longer provide TotalEnergies SE with a loan for a gas project in Mozambique, which the French group halted over a jihadist attack.

Its decision to withhold up to 1.15 billion dollars of funding for the liquified natural gas project, LNG, comes after a consortium led by TotalEnergies announced in October that it would lift a suspension on the work imposed in 2021 because of the deadly violence.

“Whilst these decisions are never easy, the government believes that UK financing of this project will not advance the interests of our country,” Business Secretary Peter Kyle said in a statement.

In global news, a range of blockbuster weight-loss and diabetes drugs could help shift the trajectory of the global obesity epidemic, which affects more than one billion people worldwide, the World Health Organisation (WHO) said.

A new generation of appetite-suppressing drugs called GLP-1 agonists – which includes blockbuster brands Ozempic by Novo Nordisk AS and Mounjaro by Eli Lilly & Co – has become massively popular in recent years.

On Monday, the United Nations health agency issued its first guidelines on how such drugs could be used as a key tool for treating obesity in adults as a chronic, relapsing disease.

But the WHO highlighted that while the efficacy of the therapies in treating obesity was “evident”, more data was needed on efficacy and safety over longer periods.

Novo Nordisk lost 0.8% in Copenhagen. Eli Lilly was down 0.6% in New York.

The pound was quoted lower at 1.3227 dollars at the time of the London equities close on Monday, compared to 1.3236 dollars on Friday. The euro stood at 1.1625 dollars, higher against 1.1612 dollars. Against the yen, the dollar was trading lower at 155.28 yen compared to 156.19 yen.

The yield on the US 10-year Treasury was quoted at 4.09%, widening from 4.03%. The yield on the US 30-year Treasury was quoted at 4.74%, widening from 4.67%.

Brent oil was quoted at 63.03 dollars a barrel at the time of the London equities close on Monday, down from 63.19 dollars late on Friday.

Gold was quoted at 4,236.80 dollars an ounce, higher against 4,208.13 dollars.

Silver passed the 57 dollars per ounce mark for the first time ever on Monday. It bought 58.25 dollars an ounce near the London market close, up from 56.40 dollars on Friday.

“This fresh advance means the precious metal is now up by more than 80% in the past year, and way above its 1980 peak of 49.50 dollars,” said AJ Bell’s Russ Mould, adding: “Silver is up by nearly 7% from Friday, which saw a truncated session in the USA, thanks to the reported power outage at a data centre operated by the CME.”

On the FTSE 100 in London, Fresnillo ended 7.1% higher in response. Meanwhile, on the FTSE 250, Hochschild Mining rose 3.7%.

The biggest risers on the FTSE 100 were Fresnillo, up 186p at 2,820p; Endeavour Mining, up 122p at 3,612p; Reckitt Benckiser, up 142p at 5,994p; Burberry, up 26.5p at 1,166p; and Glencore, up 8.23p at 369.03p.

The biggest fallers on the FTSE 100 were Melrose Industries, down 27.6p at 567.4p; Rolls-Royce, down 31p at 1,037p; 3i, down 91.58p at 3,066.42p; Babcock International, down 29p at 1,104p; and BAE Systems, down 35.04p at 1,615.46p.

On Tuesday’s economic calendar, the Bank of England releases its financial stability report. The US has the Redbook index and vehicle sales data.

On Tuesday’s UK corporate calendar, several companies release earnings reports, including full-year results from Victrex and On the Beach, and half-year results from discoverIE and Severfield.

Contributed by Alliance News.