Must read: Rolls-Royce, China inflation, UK house prices
Our head of investment rounds up the morning's big news.
11th December 2023 08:37
by Victoria Scholar from interactive investor
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GLOBAL MARKETS
After closing at a seven-week high on Friday, the FTSE 100 is trading slightly lower to start the week. Rolls-Royce Holdings (LSE:RR.) is trading at the top of the index after Citigroup raised its target price on the stock from 294p to 431p, while Endeavour Mining (LSE:EDV) is languishing at the bottom.
Key UK economic developments are due this week, with unemployment data on Tuesday, GDP figures on Wednesday and the Bank of England’s rate decision on Thursday.
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In the US, all eyes are on the Federal Reserve’s rate decision on Wednesday and the latest US inflation figures on Tuesday. Goldman Sachs now expects two rate cuts from the Fed next year beginning in the third quarter.
Overnight consumer prices in China fell by 0.5% in November, down from a drop of 0.2% in October and below expectations. It was the fastest decline since November 2020 with food prices dropping the most in two years.
RIGHTMOVE HOUSE PRICES
According to Rightmove (LSE:RMV), average asking prices fell by 1.9% in December and are 1.1% lower than a year ago. Rightmove expects further weakness to come through in the property market next year, equating to a 1% decline in house prices in 2024.
December is typically a slow time of the year for housing transactions amid the Christmas celebrations and school holidays. However, this year, the fall was above average, highlighting the strain from higher mortgage rates, a weak consumer and broader cost-of-living pressures that are deterring individuals and families from buying a property.
While the latest data from Halifax and Nationwide painted a rosier picture, Rightmove’s figures are a reality check, showing how ‘higher for longer’ interest rates continue to dampen demand for property transactions.
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