Must read: European markets, UK shop prices, house prices, bitcoin
ii’s head of investment rounds up the morning’s big news.
2nd December 2025 09:21
by Victoria Scholar from interactive investor
Cryptoassets are very high risk and you should be prepared to lose all your money before you invest
GLOBAL MARKETS
European markets have opened flat with the FTSE 100 up modestly. Housebuilders are outperforming with Persimmon (LSE:PSN) jumping more than 2%, landing at the top of the leaderboard, while Burberry Group (LSE:BRBY) continues to suffer after JPMorgan cut the stock to underweight at the end of last week.
- Our Services: SIPP Account | Stocks & Shares ISA | See all Investment Accounts
The Bank of England has raised concerns about growing risks to financial stability amid elevated AI valuations that could cause a ‘sharp correction’. The Financial Policy Committee said risky valuations are materially stretched. Meanwhile, the Bank of England has loosened banks’ capital requirements in an attempt to drive greater economic activity after Britain’s top seven lenders all passed its stress tests, suggesting they would be able to withstand a significant financial shock.
US futures are pointing to a flat to modestly lower open as Wall Street looks set to hold onto yesterday’s declines. A risk-off mood gripped global bonds and stocks which fell on the first session of December with the S&P 500 ending the session down 0.5%.
- 10 hottest ISA shares, funds and trusts: week ended 28 November 2025
- Insider: ex-FTSE 100 chief buys stock with re-rating potential
Comments from the Bank of Japan Governor Ueda suggest the central bank is poised to raise interest rates this month, pushing Japanese government bond yields, other global yields and the Japanese yen higher.
Meanwhile, it pushed non-yielding riskier speculative assets like bitcoin sharply lower as well as stock market crypto proxy plays like Coinbase Global Inc Ordinary Shares - Class A (NASDAQ:COIN) into the red. In fact, bitcoin suffered its worst session since March, while ether dropped by 10%, extending the recent turmoil. Cryptocurrencies are attempting to regain ground this morning although bitcoin is only up by less than 1.5%, trading shy of $87k.
UK BRC SHOP PRICE INFLATION
UK annual BRC shop price inflation improved to 0.6% in November versus 1% in October. Food inflation eased from 3.7% to 3% and prices of non-food items fell by 0.6%.
This report suggests prices are moving in the right direction, with a drop in fresh food prices and non-food items. Heavy discounts in the run up to Black Friday have helped push inflation lower. Plus, amid the weaker consumer backdrop, retail spending has been subdued, forcing shops to cut prices and offer deals to lure customers into spending. However, looking ahead, there are concerns about the potential for cost push inflation as retailers look to face higher costs in 2026 that could translate into higher prices on the shelves.
- Shares for the future: a company profiting from fresh air
- The Week Ahead: Topps Tiles, Paragon Banking, Balfour Beatty
Overall, the latest shop price inflation data paints an encouraging picture for the trajectory of inflation, supporting the case for further rate cuts from the Bank of England.
UK NATIONWIDE HOUSE PRICES
UK Nationwide house prices rose by 0.3% last month to an average of £272,998, beating expectations for growth of 0.1% on a monthly basis. Annually, growth hit 1.8% above forecasts for 1.4% but slowed versus October.
This data paints a better-than-expected picture of the state of the UK housing market. November enjoyed forecast topping growth despite the significant uncertainty around Chancellor Rachel Reeves’ later-than-normal Autumn Budget. She specifically targeted the property market with the introduction of a mansion tax on properties over £2 million and an increase to the property income tax rate. Amid all the pre-announcement noise, speculation, and uncertainty, the housing market remained remarkably resilient with transactions continuing to take place.
This morning, shares in housebuilders like Persimmon and Land Securities Group (LSE:LAND) are rallying. Helping offset some of the fiscal pressures from the Budget, the Bank of England looks set to cut interest rates this month and again potentially around three times next year, helping to provide support for the sector by improving mortgage affordability and stimulating greater buying activity in the property market.
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.