FTSE 100 flirts with record high ahead of Spending Review
The FTSE 100 once again looks like it could seal a record closing high on Wednesday after it crept up ahead of Chancellor Rachel Reeves’ inaugural Spending Review.
The UK’s flagship index opened up 0.3 per cent to 8882.44p before retreating to broadly flat at around 8,858.53p in early trading.
The index narrowly missed March’s record close of 8871.31p on Tuesday as it settled on a 0.24 per cent gain of 8853.08p.
Russ Mould, AJ Bell investment director, said: “The FTSE 100 looks like it might attain the closing high it missed by a whisker yesterday”.
Housebuilders topped the morning risers with Persimmon and Barratt Redrow climbing over two per cent and Berkeley nearly two per cent.
Meanwhile, the mid-cap FTSE 250 was up 0.2 per cent to 21,438.43p. Builder Vistry led the risers with a nine per cent surge.
This came as Reeves was set to inject £39bn into an affordable homes plan as part of her Spending Review.
Cautious mood in markets
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said a “cautious mood is descending on the London market” ahead of the Chancellor’s Spending Review – pencilled in for 12:30pm following Prime Ministers’ Questions.
“Focus will be trained on bond market reaction to Chancellor Rachel Reeves’ plan to boost capital spending on infrastructure but keep a tighter rein on the day-to-day spending of departmental budgets, while ringfencing funding increases to health and defence,” Streeter added.
Lenders with Asian-ties enjoyed a shares bump after the US and China agreed to a framework deal to restore a trade war truce. Standard Chartered and HSBC jumped over 1.5 per cent after markets opened.
London markets were also hit with a double blow of foreign takeovers this morning as KKR returned with a final bid for GP Landlord Assura and engineering firm Ricardo was snapped up by a Canadian consultancy giant.
Shares in Ricardo soared 25 per cent on the news.
Mould said: “The UK stock market continues to be a hive of activity regarding takeovers as predators take advantage of cheap valuations. Some situations have entered a bidding war, while others have collapsed, providing plenty of drama for investors.”
