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Stock prices in London went into the afternoon in negative territory, with sentiment cautious before the release of a key US inflation report, which comes just days before the next Federal Reserve decision. Promising UK data failed to spark some enthusiasm on the stock market, while sterling stayed above the $1.33 mark before the afternoon’s US inflation release. The FTSE 100 index was down 7.20 points, 0.1%, at 9,571.13. The FTSE 250 fell 21.50 points, 0.1%, at 22,339.91, and the AIM All-Share gave back 3.07 points, 0.4%, at 772.22. The Cboe UK 100 was down 0.2% at 956.38, the Cboe UK 250 was down 0.3% at 19,461.34, and the Cboe Small Companies was up 0.1% at 17,594.75. The pound was quoted at $1.3322 at midday Friday in London, almost unchanged from $1.3323 at Thursday’s close. The euro traded at $1.1615, up versus $1.1609, while against the yen, the dollar rose to JP¥152.93 from JP¥152.71. UK retail sales rose more than expected in September. The Office for National Statistics reported retail sales volumes increased 0.5% month-on-month, beating forecasts for a 0.2% fall and extending a four-month run of growth. The data reinforced optimism about consumer resilience heading into the final quarter of the year. Adding to the positive tone, flash PMI data showed business activity in the UK expanded at a faster pace in October, led by a rebound in manufacturing. The S&P Global flash composite output index climbed to 51.1 points, exceeding both the 50 no-change threshold and expectations for 50.6. September’s reading had slipped to 50.1 points, missing consensus. The latest data showed the slowest pace of job cuts since May and the weakest input price inflation since November 2024. ‘While easing, jobs continue to be cut amid a backdrop of business confidence that remains subdued by historical standards,’ said Chris Williamson, chief business economist at S&P Global Market Intelligence. In mainland Europe, the CAC 40 in Paris was down 0.4%, while the DAX 40 in Frankfurt was marginally higher. Eurozone business activity accelerated to its strongest pace in nearly two-and-a-half years in October, according to flash PMI data from the Hamburg Commercial Bank. The composite index rose to 52.2 points from 51.2 in September, its highest since May 2023. The services PMI climbed to 52.6 points, a 14-month high, from 51.3, while the manufacturing index returned to neutral territory at 50.0 from 49.8. The Hamburg Commercial Bank’s flash composite purchasing managers’ index reading rose to 52.2 points in October from 51.2 in September. Climbing further above the 50-point neutral mark, the reading hit a 17-month high. The composite PMI is calculated using a weighted average of the services and manufacturing readings. The flash services PMI rose to 52.6 points in October, a 14-month high, from 51.3 in September. The manufacturing PMI hit a two-month high of 50 points, the neutral mark, from 49.8 in September. ING analyst Peter Vanden Houte said the data supports the view that the European Central Bank is likely to ‘keep rates on hold for now,’ given limited signs of deflationary pressure. The ECB’s next rate decision is on Thursday. Elsewhere in Europe, the European Commission said Facebook, Instagram and TikTok breached EU digital regulations, according to preliminary findings that could result in heavy fines. Parent companies Meta Platforms and ByteDance have the opportunity to respond or adjust their platforms to comply. Meta shares were up 0.5% in pre-market trading in New York. In the US, stocks were called higher ahead of key inflation data. The Dow Jones Industrial Average was seen up 0.1%, the S&P 500 up 0.3%, and the Nasdaq Composite up 0.5%. The yield on the US 10-year Treasury was quoted at 4.01%, widening slightly from 4.00%. The yield on the US 30-year Treasury was quoted at 4.59%, widening from 4.58% The Bureau of Labor Statistics confirmed it will publish September consumer price index data later Friday despite the ongoing US government shutdown. According to FXStreet cited consensus, the pace of annual US consumer price inflation is expected to have accelerated to 3.1% in September, from 2.9% in August, stretching further away from the Federal Reserve’s 2% target. The Fed announces a rate decision on Wednesday. Analysts at Lloyds Bank commented: ‘With the market operating without the September payrolls report there ought to be sensitivity to an upside surprise on the day. But that would not derail prospects for another Fed rate cut next week.’ Back in London, London Stock Exchange Group was the top performer in the FTSE 100, rising 4.3%, while metal producer Metlen Energy & Metals was the biggest laggard, down 2.7%. Among small caps, Record rose 4.2% after reporting record-high assets under management of $110.3 billion as at September 30, up from $107.9 billion three months earlier. Growth in underlying assets and modest net inflows of about $100 million supported the rise. Chief Executive Jan Witte said AUM ‘ended the quarter at the highest level we have ever reported’. Revolution Bars Group plunged 28% as it launched a strategic review and formal sale process following what it described as a ‘prolonged period of external pressures’. First-quarter like-for-like revenue fell 7.4% to £26.3 million, with bar sales down 11%. Despite cost-saving efforts, the company said recent tax changes announced in the UK autumn budget have added over £4 million to its annual costs. Brent oil was quoted at $65.35 a barrel at midday in London, down compared with $65.75 late Thursday. Gold traded lower at $4,060.90 an ounce, from $4,146.49. Still to come on Friday’s economic calendar is the US inflation data at 1330 BST, before a flash composite PMI reading at 1445 BST. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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