FTSE 100 Rises Amid Labour Market Shifts and Metal Price Drops
The FTSE 100 slightly advanced as labour market conditions spurred hopes for a rate cut, while falling metal prices affected mining stocks. Britain’s unemployment increased, leading to an 80% chance of a Bank of England rate cut. Technology stocks rose as defence stocks fell, amidst easing geopolitical tensions.
London's FTSE 100 ticked up on Tuesday, signalling investor optimism for a potential interest rate cut next month due to cooling labour market signs, despite the pressure on mining stocks from falling metal prices. The FTSE 100 moved 0.2% higher to hover near a record high, while the FTSE 250 slipped by 0.1%.
The rise in Britain's unemployment rate to 5.2% raised the probability of a quarter-point Bank of England rate cut to 80%, leading to a slight depreciation of sterling. Bank shares, however, rose on this sentiment, while upcoming consumer price data could influence future monetary decisions. Meanwhile, geopolitical tensions eased with U.S.-mediated talks involving Iran and potential discussions between Ukraine and Russia.
Defence and precious-metal mining stocks experienced declines, reflecting reduced demand for safe-haven assets amid softer markets. Technology stocks countered this trend with gains, riding the wave of recent global market turbulence related to artificial intelligence. However, Plus500 fell sharply following executive share sales.
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