London’s FTSE indexes finished in the green on Monday ahead of a busy week of UK data which will give investors clues as to when central banks might start cutting interest rates.
The FTSE 100 closed slightly higher at 7,573.69 while the FTSE 250 index, which is more aligned with the health of the domestic economy, rose 0.72 per cent to finish at 19,203.93.
Investors were largely sitting on their heads ahead of a packed calendar of data releases. The latest labour market statistics are due out tomorrow alongside US consumer prices before January’s inflation figures in the UK are published on Wednesday.
“UK labour market data due out on Tuesday will be closely watched given that inflation busting pay growth is still a nagging worry for policymakers, who are concerned that it risks igniting a fire under prices again,” Susannah Streeter, head of money and markets, Hargreaves Lansdown said.
“CPI data out on Wednesday is set to show that inflation’s bumpy ride downwards is continuing, and a slight uptick in the headline rate could be on the cards, partly due to the rise in the energy price cap in January,” Streeter continued.
It was a relatively quiet morning in London but the M&A spree continued with a merger announced between commercial property real estate investment trusts, Tritax Big Box and UK Commercial Property.
The deal would create the fourth largest UK real estate investment trust based on market capitalisation, at £3.9bn with a property portfolio worth £6.3bn. Its size would leave it on the edge of entering the FTSE 100.
Shares in UK Commercial Property REIT were up 4.8 per cent in early trade although shares in Tritax Big Box lost 3.9 per cent.
“A key question, assuming the tie-up goes through as planned, will be whether the enlarged entity decides to streamline the combined portfolio through the sale of less-important assets,” Russ Mould, investment director at AJ Bell said.
Frasers shares rose to the near to the top of the FTSE 100 after the firm began an £80m share buyback scheme. Its shares were up 5.0 per cent.
The programme, which begins today and will run for 11 weeks to 28 April, will see a maximum of 10m shares acquired for £80m at most, or about two per cent of the firm. The purpose of the new buyback was to reduce the share capital of the firm.
Shares in Astrazeneca sunk 2.7 per cent after a number of investment banks downgraded their expectations following the firm’s results last week.
“Barclays, UBS and BMO were among the investment banks adjusting their models and the updated research notes caused the shares to wobble,” Dan Coatsworth, investment analyst at AJ Bell said.