Bitcoin, the US dollar and stock markets have surged as traders position for Donald Trump’s return to the White House.
The FTSE 100 rose more than 1%, although the prospect of further tariffs on Chinese goods impacted trading in Hong Kong.
Trump’s policies are seen as inflationary, meaning interest rates may be more elevated.
FTSE 100 Live Wednesday
- Dollar and Bitcoin surge on Trump election
- Marks and Spencer momentum continues
- Persimmon cost inflation warning
Market update: US-focused stocks surge, Marks and Spencer up 6%
10:24 , Graeme EvansThe FTSE 100 index today jumped 1.3% as traders swept up stocks with exposure to potential Trump tax cuts and celebrated “superb” Marks & Spencer results.
Beneficiaries of the US election result included hotels giant IHG and the lender Barclays, which has investment and consumer banking operations in America.
They rallied 5% - 448p to 9002p and 12.4p to 257.3p respectively - as the FTSE 100 index mirrored European markets with a bounce of 106.95 points to 8279.34.
In New York, futures trading is pointing to big gains later today amid expectations that Trump’s second White House term will mean stronger domestic growth, increased M&A activity and lower corporate taxes.
The dollar index also rose 1% as many of these policies are seen as inflationary, meaning that interest rates are likely to stay higher for longer. Bitcoin hit a record above $75,000 as Trump’s pro-crypto stance boosted regulation hopes.
The impact of a stronger greenback on commodity prices put pressure on mining stocks, while housebuilder Persimmon slid 6% or 85p to 1386p after it warned in a trading update that build cost pressures are starting to return.
In contrast, Marks & Spencer jumped 6% or 23.3p to a fresh nine-year high of 406.8p after its half-year profits growth of 17% to £408 million easily beat City expectations.
The performance, which follows four years of market share growth, was driven by a strong second quarter in clothing and another uplift in the food department’s margin performance.
Peel Hunt called the results “superb” while Shore Capital said it had been several years since the chain was this well placed going into the Christmas period.
Most other stocks on the FTSE 100 risers board were driven by the election, led by Sunbelt plant hire firm Ashtead after a jump of 7% of 394p to 6363p.
BetMGM joint venture partner Entain added 30.2p to 757.2p, Rentokil Initial improved 3% or 12.6p to 410.2p and British American Tobacco rallied 103p to 2824p. Rolls-Royce hit a fresh record of 583.6p after lifting 4% or 23.6p.
Other risers included Prudential, which put on 25.2p to 673.2p after third quarter figures showed new profit growth of 11%.
The FTSE 250 index added 1.3% or 257.31 points to 20,627.35, with the US-focused corporate merchandise firm 4imprint among those higher after a gain of 5% or 260p to 5350p.
In the FTSE All-Share, Ukraine-based iron ore pellets exporter Ferrexpo jumped 21% or 12.8p to 75p after hopes rose of an end to the war in the country.
Bitcoin in record territory amid Trump's pro-crypto stance
09:22 , Graeme EvansBitcoin’s price has settled near $74,000 having risen 6% to a new record on anticipation that Donald Trump’s policies could favour cryptocurrency assets.
Javier Molina, market analyst at investment platform eToro, said technical projections place Bitcoin’s price between $80,000 and $90,000 before his inauguration in January.
He said: “A combination of Trump’s favourable stance toward the crypto ecosystem and the expectation of a more permissive regulatory environment suggests an interesting outlook, though not without risks.”
Molina said the regulatory outlook could encourage major institutions to move toward Bitcoin, driving up demand and value.
Ukraine-based Ferrexpo boosted by Trump election
09:07 , Graeme EvansShares in Ukraine-based iron ore pellets exporter Ferrexpo have jumped 38% - up 23.7p to 85.9p - after Donald Trump’s White House return boosted hopes of an end to the war in the country.
Analysts at Peel Hunt forecast last week that the former FTSE 250 stock could be one of the so-called Trump trades.
The bank said: “Given its Ukrainian mine and processing plant, Ferrexpo currently encapsulates the potential of a settlement in Ukraine.
“A settlement, allowing far cheaper shipping of Ferrexpo’s pellets to markets, could see the shares recover back towards the 300-400p level where they traded in late 2020 to early 2022.”
Ferrexpo has been listed on the London Stock Exchange since 2007, but the group’s operating assets have been producing iron ore pellets since 1970.
US growth outlook boosts S&P 500 futures
08:46 , Graeme EvansS&P 500 index futures are up by 1.9% and the Russell 2000 small-cap index around 4.5% higher ahead of this afternoon’s Wall Street opening bell.
The movement comes as traders position for stronger domestic growth, increased M&A activity and lower corporate taxes under a Trump presidency.
US 10-year Treasury yields have risen 13 basis points, in anticipation of higher GDP growth and higher fiscal deficits. The US dollar is up by 1.7% against the euro.
UBS Global Wealth Management said this morning: “Trump campaigned on a platform of extending personal income tax cuts, lower corporate taxes, deregulation, trade tariffs, immigration controls, and re-assessing America’s role in global affairs.
“If the Republicans secure control of Congress, the President would have greater scope to pursue his policy agenda. That said, narrow Congressional majorities could constrain some policy measures, especially given already large federal budget deficits.”
The bank adds that the mooted 60% tariff on imports from China and a 10% on imports from the rest of the world could make much of US-China trade unviable, reduce US domestic demand and corporate profits, and lead to lower GDP growth around the world.
Such tariffs could also contribute to higher inflation in the US.
M&S shares at nine-year high after another results beat
08:32 , Graeme EvansMarks & Spencer shares have jumped 4% or 15.1p to 398.6p after the retailer smashed City forecasts with half-year profits of £408 million.
The FTSE 100 stock is at its highest level since early 2016, having risen 82% in the past year as the chain’s trading momentum continues.
Shore Capital analyst Clive Black said today: "Marks & Spencer is probably in its best condition approaching a key Christmas trading period than it has been for many years.”
FTSE 100 up 1.3%, Barclays and Rentokil among big risers
08:25 , Graeme EvansThe FTSE 100 index is 1.3% or 106.66 points higher at 8279.05, with the prospect of lower corporation tax under Trump’s presidency boosting several stocks.
The pest control firm Rentokil Initial, which generates about 60% of its revenues in the US, lifted 10.6p to 408.2p.
Barclays, which has investment banking and consumer banking operations in the country, rose 3% or 8.1p to 253p.
Online learning and coursework business Pearson jumped 6% or 74.5p to 1259.5p and Sunbelt plant hire firm Ashtead surged 342p to 6310p.
Weaker commodity prices due to the stronger dollar left shares in Anglo American, Glencore and Antofagasta down by about 1%.
Wetherspoon issues Budget cost warning, sales rise
07:58 , Graeme EvansJD Wetherspoon today reported record sales but said that cost inflation has “jumped substantially” in the aftermath of the Budget.
Like-for-like sales lifted 5.9% in the first 14 weeks of the financial year to 3 November.
Chair Tim Martin said: “The company achieved record sales in the 14-week period and staff retention continues to be at high levels.
"Cost inflation, which had jumped to elevated levels in 2022, slowly abated in the following two years, but has now jumped substantially again following the budget.
"All hospitality businesses, we believe, plan to increase prices, as a result. Wetherspoon will, as always, make every attempt to stay as competitive as possible.
"The company is confident of a reasonable outcome for the year, although forecasting is more difficult given the extent of the increased costs."
Persimmon highlights cost pressures, trading on track
07:49 , Graeme EvansHousebuilder Persimmon is seeing some signs of build cost inflation beginning to emerge in price negotiations for 2025.
It said today it is working with its supply chain to manage the costs, which will also be impacted by new building regulations and the employer national insurance increases in the Budget.
Persimmon added: “We are seeking to mitigate the impact of these cost increases through robust commercial controls and other management actions.”
In its third quarter trading update, the FTSE 100-listed company also stuck by forecasts for full-year completions of 10,500.
Persimmon’s forward order book is up 17% on the prior year, with the private average selling price robust.
Chief executive Dean Finch said: “Visitor numbers and enquiries remain strong and sales rates continue to be well ahead of the prior year.”
US futures pointing higher, Nvidia overtakes Apple as top stock
07:35 , Graeme EvansThe dollar index is up by more than 1%, the highest level in over three months amid expectations that Donald Trump is set for another White House term.
Given the inflationary outlook the 10 year Treasury yield rose by 13 basis points to 4.42%.
The move higher comes with Federal Reserve policymakers due to begin their scheduled two-day interest rates meeting.
On futures markets, the S&P 500 index is pointing about 1.8% higher after the benchmark lifted 1.2% by last night’s close.
Yesterday’s session included a milestone for chip giant Nvidia after its 3% advance meant it overtook Apple as the world’s most valuable company.
M&S profits rise as market share recovery continues
07:15 , Graeme EvansMarks & Spencer today reported a 17% rise in half-year profits to £407.8 million.
Food sales rose 8.1% and Clothing & Home revenues by 5.7%, with their respective margins for the period coming in at 5.1% and 12%.
Chief executive Stuart Machin said both M&S Food and Clothing have now delivered market share growth for four consecutive years..
He added: “The recent Budget's long-term impact on M&S, our suppliers, and our customers is for now uncertain.
“Meanwhile, we are confident and we remain on track and focused on what is in our control.”
Trump tax cut pledges boost US stocks
07:07 , Graeme EvansDonald Trump appears on track to win the US presidential race after winning key swing states, including North Carolina and Georgia.
The Republicans also appear set to win the Senate, although the outcome of the House of Representatives race remains unclear.
Peel Hunt chief economist Kallum Pickering said the most likely outcomes of the election look likely to be either a Trump presidency with a mixed Congress or a Trump presidency with a full sweep for the Republicans.
He added: “The initial reaction - dollar up, US Treasury yields up, equities futures up - suggests markets are starting to factor in Trump’s policy pledges to deregulate and cut taxes, a boon for US-exposed equities, but also the increased inflation risks coming from fresh trade tariffs and tight controls on immigration.
“A rising dollar probably reflects higher demand for safe dollar assets given increasing uncertainty over the outlook for US foreign and trade policy.”
Dollar rallies and stocks higher on Trump trade
07:01 , Graeme EvansThe dollar has strengthened and Wall Street futures are pointing sharply higher as traders position for Donald Trump’s return to the White House.
Bitcoin also rose 7% to a record high of $74,372, while a stronger dollar has weighed on commodities after Brent Crude fell 1.6% to $74.32 a barrel.
The pound this morning fell 1.4% to stand at $1.28. The FTSE 100 index is forecast to open 0.8% higher.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: “Investors are bracing for tariffs and a clamp down on immigration, policies considered to be inflationary which are likely to mean interest rates may be more elevated in the years to come.”
Stock markets in Shanghai and Hong Kong are lower amid the prospect of further tariffs on Chinese goods.
IG Index chief market analyst Chris Beauchamp said: “So far US markets are putting their best foot forward - all those Trump trades that were being unwound last week are getting put back on in rapid fashion.”
