Must read: FTSE 100 lags Europe ahead of Trump visit, house prices, AO World

US President Donald Trump boarding Air Force One. Photo: Kevin Dietsch/Getty Images.

GLOBAL MARKETS

The FTSE 100 has opened flat, lagging mainland Europe with the DAX and the CAC 40 in the green. Sainsbury (J) (LSE:SBRY)’s is up nearly 5% after it walked away from talks with JD.com over a potential sale of Argos, arguing that the terms weren’t right for its shareholders, colleagues, and broader stakeholders. Investors are clearly judging that this was a smart move.

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BT Group (LSE:BT.A) is at the bottom of the basket after appointing two new board members from its largest shareholder. 

Weak data came out of China overnight with a slowdown in industrial output and retail sales, both missing expectations for August, while its jobless rate hit a six-month high. 

Focus this week is on US President Donald Trump’s UK state visit with the potential for deals on tech, nuclear energy and data centres. Plus central banks take centre stage with the Federal Reserve, Bank of England and the Bank of Japan among others deciding on interest rates.

RIGHTMOVE HOUSE PRICES 

According to Rightmove, house prices fell for the first time since January 2024, dropping by 0.1% year-on-year in September. The average asking price now stands at £370,257. Rightmove said properties listed for sale are at a 10-year high, up 9% in the past 12 months. 

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Sellers are clearly finding it harder to get the price they want, as pressures on the economy and elevated mortgage rates result in fewer potential buyers. There is also significant uncertainty ahead of the Autumn Budget that is delaying property transactions.

We could see an increase in buy-to-let properties on sale too given that landlords are concerned about higher taxes, and with reports about a potential broader overhaul of the stamp duty system, the market looks like it could slow down through the rest of the year - it is likely to be stuck in wait-and-see mode until the chancellor’s announcements on 26 November followed by the annual Christmas lull.

AO WORLD 

AO World (LSE:AO.) has raised the lower bound of its annual profit forecast range, now anticipating pre-tax profit for the year ending March 2026 to come in between £45 and £50 million, up from £40 to £50 million. Meanwhile, it is returning cash to shareholders via a share buyback programme for the first time, repurchasing up to £10 million of ordinary shares. 

Amid the backdrop of a sluggish economy and elevated living costs on essentials such as food, discounted retailers like AO World are well positioned to benefit from the bargain-seeking attitude among many consumers, particularly going into the expensive, present-buying Christmas season. AO World is committed to keeping prices low, recently outlining plans to use AI to help reduce its cost burden, offset pressures this year from national insurance and minimum wage increases.  

AO World shares have reacted positively to today’s update with the stock rallying over 8%, helping to reverse some of its recent stock market losses. Until Friday’s close, the stock was down over 19% year-to-date and down 24% over a one-year period. 

For a company that has largely suffered a downtrend in its share price since July last year, today’s update provides a glimmer of optimism for value investors who could snap up shares at a discount.