Annual house price growth softened in August, building society Nationwide reported today.
The lender said the subdued market conditions were "understandable" given that affordability remains stretched relative to long-term norms.
Meanwhile, the FTSE 100 index rose after BAE Systems and other defence stocks were boosted by the UK’s biggest ever warship export contract.
FTSE 100 Live Monday
- Royal Mail profit milestone
- House price growth slows
- Alibaba lifts Hang Seng
Market update: FTSE 100 rallies, warship contract lifts BAE Systems
10:00 , Graeme EvansThe FTSE 100 index today recovered lost ground after the UK’s biggest ever warship export deal aided BAE Systems and other defence-focused stocks.
BAE rose 3% or 46.5p to 1804p as the MoD said the UK will supply Norway with Type 26 frigates designed for anti-submarine warfare in a move worth £10 billion.
The agreement is expected to support 4000 jobs across the UK supply chain until well into the 2030s, including more than 2000 at BAE’s Glasgow shipyards.
Babcock International also lifted 3% or 31p to 1047p while Rolls-Royce shares put on 25.5p at 1095.5p. The engines giant earlier denied it was planning an initial public offering of shares in its small nuclear reactors business.
The FTSE 100 index recouped the bulk of Friday’s losses by adding 22.81 points to 9210.15. The recovery came despite a pre-weekend reverse for Wall Street benchmarks ahead of today’s Labor Day holiday.
Tokyo’s Nikkei 225 fell 1.5% following the US sell-off, but the Hang Seng index bucked the trend after a surge for Alibaba shares led to a rise of 2.1%.
Alibaba, which reported a sharp surge in AI-related revenues in results published on Friday, rose 18% in Hong Kong dealings.
Joshua Mahony, chief market analyst at Scope Markets, said: “Coming hot off the heels of Nvidia’s earnings report that saw a collapse in H20 sales, the latest Alibaba earnings will have many wondering whether the value trade in the AI space lies in Chinese stocks after years of rampant Magnificent Seven gains.”
In the FTSE 100, supermarket Tesco rallied 9.8p to 432.5p after City firm UBS lifted its price target to 475p ahead of half-year results on 2 October.
The bank said: “We expect a robust first half update to further reassure investors on the Asda threat.”
Other retail stocks fared well as Sainsbury’s cheered 5.6p to 305p, Marks & Spencer put on 3.8p to 349.2p and JD Sports Fashion improved 1.3p to 97.4p.
AstraZeneca rose 87.6p to 11,877.6p, boosted by positive study results for potential blood pressure lowering treatment Baxdrostat.
NatWest shares added 4.8p to 515.4p as sentiment steadied after Friday’s heavy selling on fears of an industry tax raid. Lloyds Banking Group lifted 0.4p to 80p and Barclays improved 4.1p to 364.5p.
Endeavour Mining featured high up London’s risers board after gold’s latest rise of 0.6% to $3468 an ounce helped lift shares 2% or 62p to 2598p.
In the FTSE 250 index, Kainos shares jumped 18% or 129p to 836p after the IT services group boosted revenues guidance for the year ending next March.
The Belfast-based business said it had secured several significant programmes in both healthcare and the public sector, including contracts in the Home Office and NHS England.
Domino’s Pizza lifted 7% or 13.9p to 209.2p after announcing plans for a £20 million shares buyback and reiterating guidance for the financial year.
Royal Mail hails profit milestone after year of change
09:12 , Graeme EvansRoyal Mail has reported an underlying profit for the first time in three years, despite a “competitive and challenging” backdrop.
International Distribution Services (IDS) said the surplus of £12 million compared with losses of £336 million the year before.
When including redundancy costs, Royal Mail stayed in the red with an adjusted loss of £8 million for the year to March.
In its first set of figures since the group’s £3.6 billion takeover by Czech billionaire Daniel Kretinsky’s EP Group, IDS reported an operating profit of £278 million after revenues lifted by 4.8% to £13.1 billion.
Group chief executive Martin Seidenberg said: “It has been a year of change for IDS. Thanks to the hard work of our people and our investment in transformation, Royal Mail returned to profit for the first time in three years, marking an important milestone in the company’s turnaround. ”
Defence stocks bolster FTSE 100, Kainos up 14%
08:30 , Graeme EvansThe FTSE 100 index has recouped Friday's losses, with Rolls-Royce and BAE Systems among the stronger stocks in a rise of 26.15 points to 9213.49.
BAE lifted 2% or 30p to 1787.5p after the Ministry of Defence announced a £10 billion agreement to supply Norway with new Type 26 frigates.
Babcock International also benefited with an advance of 27p to 1043p while Rolls-Royce shares put on 12p at 1082p. The engines giant earlier denied it was planning an initial public offer of shares in its small nuclear reactor business.
AstraZeneca rose 120p to 11,910p, boosted by positive trial results for potential blood pressure treatment Baxdrostat.
NatWest shares added 4.5p to 515.1p, having slumped 5% on Friday amid fears of an industry windfall tax raid. Lloyds Banking Group lifted 0.4p to 80p.
Endeavour Mining led London’s top flight after gold’s 1.1% rise to $3474 an ounce helped shares to jump 3% or 68p to 2604p.
In the FTSE 250 index, Kainos shares jumped 14% or 102.4p to 809.4p after the IT services business boosted revenues guidance for the year ending next March.
Kainos bolsters top-line forecast, increases headcount
07:54 , Graeme EvansKainos, the FTSE 250-listed IT provider, today said revenues for the year ending next March are set to be at the upper end of City forecasts.
The specialist in digital services and the Workday platform added that it is recruiting additional staff as well as increasing short-term use of contractors.
The Belfast-based business has secured several significant programmes in both healthcare and the public sector, including contracts in the Home Office, NHS England and the Driver and Vehicle Standards Agency.
The group said it anticipates delivering adjusted profits in line with consensus forecasts of between £65.1 million and £74.7 million.
Kainos added: “Although the macro-economic environment has improved, volatility persists, and we continue to balance growth, international expansion, investment and profitability against this backdrop.
“Kainos continues to operate in markets with clear long-term structural drivers, including the emerging opportunities from wider AI adoption.”
House price growth softens - Nationwide
07:13 , Graeme EvansAnnual house price growth softened to 2.1% in August, according to new figures released today by Nationwide.
The slowdown from July’s rate of 2.4% follows a 0.1% month-on-month decline. The average price stood at £271,079.
Nationwide chief economist Robert Gardner said: “The relatively subdued pace of house price growth is perhaps understandable, given that affordability remains stretched relative to long-term norms.
“House prices are still high compared to household incomes, making raising a deposit challenging for prospective buyers, especially given the intense cost of living pressures in recent years.
Nikkei down 1.5% after US sell-off, gold price rises
07:03 , Graeme EvansGlobal stock markets are under pressure after a key measure of US inflation came in higher than expected on Friday.
The Nasdaq Composite lost 1.2% and the S&P 500 index fell 0.6% after the core PCE index accelerated to 2.9% on an annual basis.
The FTSE 100 index lost 29.48 points or 0.3% on Friday and is forecast to open today broadly unchanged near the previous closing level of 9187.34
Tokyo’s Nikkei 225 is down 1.5% following the US sell-off, although the Hang Seng index has bucked the trend after a surge for Alibaba shares led to a rise of 1.9%.
The e-commerce business traded 19% higher after it said on Friday cloud revenues rose 26% in the quarter to June, boosted by strong AI demand.
Meanwhile, the gold price is in record territory after rising 0.9% to $3480 an ounce.
US markets are closed for the Labor Day holiday.
