UK stocks experienced a dip as investors remained cautious, despite US inflation showing signs of slowing down. London’s FTSE 100 saw a decrease of 6.01 points, or 0.07%, closing at 8,237.73, with housebuilders notably contributing to the decline.
The global stock market took a hit on Thursday as investors processed fresh data from the US economy. In the US, the inflation rate showed a slowdown in September, indicating a general easing of price rises in the world’s largest economy.
Kathleen Brooks, the research director at XTB, noted that while the US inflation report was positive with the headline rate moderating to 2.4% in September, down from 2.5%, concerns lingered about a potential resurgence in inflation in the future. The core rate actually rose to 3.3% from 3.2% in August.
Market expectations hinted at a possible further interest rate reduction next month following the inflation update. Additionally, a separate report revealed a rise in initial jobless claims, partly attributed to volatile data collection due to extreme weather conditions.
By the time European markets closed, the S&P 500 and Dow Jones in New York were both down approximately 0.2%. Meanwhile, the Cac 40 in Paris was down 0.24% and the Dax in Frankfurt closed 0.25% lower. The pound saw a slight decrease against the US dollar to 1.31 and remained relatively stable against the euro at 1.195. Brent crude oil prices rose about 2.4% to 78.5 US dollars per barrel.
In corporate news, N Brown, the owner of Simply Be, reported a shift to a pre-tax profit in the first half of the financial year, causing shares to rise by 4.6% at close. Pharmaceutical giant GSK also experienced a share price increase after reaching a 2.2 billion US dollar settlement in lawsuits involving its discontinued heartburn drug, Zantac.
Despite ongoing challenges surrounding Zantac, the settlement was viewed as a positive outcome for GSK, leading to a 3.2% increase in share price. The day ended with notable risers on the FTSE 100 including Fresnillo, Beazley, GSK, Next, and Endeavour Mining, while Taylor Wimpey, Vistry, BAE Systems, Whitbread, and WPP were among the biggest fallers.