- FTSE 100 down 78 points
- Rents outside London soar
- Dunelm, Smiths Group on the rise
9.50am: Rents outside London rise at fastest rate in 13 years
The FTSE 100 extended its losses in mid-morning, slumping 78 points to 7,071.
Rents outside London have grown at the fastest rate in 13 years, up 5% since August 2020 compared to a 2.2% rise in the year to January 2021.
Monthly rents outside London are averaging £790, up from £752 a year ago. It means renters are paying an average of £456 more a year, according to data compiled by property platform Zoopla.
This is because renters are coming back to live in cities after lockdown ended, to be closer to offices and leisure locations, however the current supply of homes can’t meet the high demand.
There are also seasonal factors at play, such as university students looking for accommodation ahead of the new academic year, graduates starting jobs and families moving before the school term starts.
"The recovery in the rental market has, in many ways, mirrored the boom in the sales market, with people looking for homes that accommodate a different set of needs shaped by their lockdown experience,” said Kate Eales, head of regional residential agency at Strutt & Parker.
"Lack of stock and high demand are inevitably driving price growth. This stock depletion is a result in part of many accidental landlords having now sold their properties - benefiting from the soaring demand in the sales market."
8.45am: FTSE 100 knocked by economic growth concerns
Fears over the global recovery from the pandemic sparked by the Covid delta variant put the skids under the FTSE 100.
Asia’s main markets were rattled too, while on Wall Street after the close Tuesday there was a divergence in opinion and sentiment.
For while the Dow Jones Industrial Average and S&P 500 index of old economy stocks ended firmly in the red (the Dow was off almost 270 points), the tech-heavy Nasdaq avoided the buffeting.
“Big tech shares continued their relentless growth amid fears of faltering growth in the world’s largest economy,” said Richard Hunter, head of markets at Interactive Investor.
“Relatively unaffected by the vagaries of the return to normality due to the delta variant, consumers continue to use technology regardless.
“As such, big tech stocks are edging towards becoming the ‘new defensives’, as uncertainty abounds elsewhere. In addition, investors switched once more from value to growth, propelling the Nasdaq to a fresh record closing high, and ahead by 19.3% in the year to date.”
Back here in London, the lure of a special dividend and a surge in online sales attracted investors to soft furnishings specialist Dunelm (LON:DNLM) early on as its shares flew 7.1% higher.
Stock in engineer Smiths Group (LSE:SMIN) jumped 3.9% after it agreed to sell its medical division for £1.75bn.
6.50 am: Footsie called lower
The FTSE 100 is expected to open in the red amid concerns over the faltering pace of economic growth.
London’s leading index is expected to open 25 points below at 7,124.
Various downgrades to US growth prospects, with Goldman Sachs (NYSE:GS) downgrading its economic outlook for the US economy appears to have prompted a reassessment of where markets might go next, in the face of a possible paring back of stimulus measures in the coming months.
Against these concerns of a weaker outlook, the August jobs report has also served to crystallise concerns, that after a decent summer, the economic recovery is rolling over, at around the same time central banks are starting to look at reducing some of their emergency stimulus measures.
“With Fridays disappointing August payrolls report still fresh in the memory, today’s JOLTS report for July will be a timely reminder that the jobs market still has a long way to go before normalising. It’s also important to note the lag the JOLTS report has, with expectations that we could still see vacancies slip back from the 10mln number we saw in June, due to the huge number of job gains in the July report of over 1mln new jobs,” said Michael Hewson at CMC Markets.
“The Fed’s Beige Book of economic conditions is also set to give investors a snapshot of the US economy, and where it is in relation to the previous survey. In July it said that the economy had strengthened showing moderate to robust growth, which was a significant upgrade to the previous report in May. On the downside there was an acknowledgment that supply disruptions were becoming more widespread, with shortages of labour and raw materials, causing problems.”
6.50am: Early Markets - Asia / Australia
Stocks in the Asia-Pacific region were mixed on Wednesday as Japan’s GDP grew 1.9% on an annualised basis in the April to June quarter, higher than the initial estimate for a 1.3% rise.
China’s Shanghai Composite fell 0.20% and Hong Kong’s Hang Seng index dipped 0.08%
In Japan, the Nikkei 225 surged 0.83% while South Korea’s Kospi slipped 0.73%.
Australia’s S&P/ASX200 is lower today, dropping 27.6 points or 0.37% to 7,502 in the last hour of trading.
https://news.google.com/__i/rss/rd/articles/CBMilgFodHRwczovL3d3dy5wcm9hY3RpdmVpbnZlc3RvcnMuY28udWsvY29tcGFuaWVzL25ld3MvOTU5NzE2L2Z0c2UtMTAwLWNhbGxlZC1sb3dlci1hZnRlci11cy1zdG9ja3MtcmV0dXJuLXdpdGgtc29tYnJlLW1vb2QtZnJvbS1sb25nLXdlZWtlbmQtOTU5NzE2Lmh0bWzSAT5odHRwczovL3d3dy5wcm9hY3RpdmVpbnZlc3RvcnMuY28udWsvY29tcGFuaWVzL2FtcC9uZXdzLzk1OTcxNg?oc=5
2021-09-08 07:46:00Z
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