FTSE 100 Live April 07: Federal Reserve minutes cool markets, house price growth continues

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FTSE 100 down, gaming company 888 jumps 28%

The FTSE 100 index was down 18.25 points at 7569.45, not helped by several blue-chip stocks trading without the right to their final dividend.

Ex-dividend stocks on the FTSE 100 chart of fallers include Aviva, Lloyds Banking Group, Abrn and Mondi.

Ladbrokes games business Entain also fell 31.5p to 1590p, despite a first quarter update in which chief executive Jette Nygaard-Andersen reported strong performance across the board. business.

The biggest risers in London’s elite include Airtel Africa and Sainsbury’s with gains of 2%, while AstraZeneca continued its strong recent performance adding another 1% to 10,606p.

The FTSE 250 index fell 16.33 points to 21,084.40, but 888 Holdings jumped 28% after securing a cut price for British assets from bookmaker William Hill.

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Will rate hikes push the US into recession?

Wall Street now puts a greater than 80% chance that the Federal Reserve will raise rates by half a percentage point at its May meeting, the first time it has moved such a large amount since 2000.

UBS Global Wealth Management notes that futures markets point to 220 basis points of rate hikes this year, on top of the quarter-point increase from March.

However, the bank’s chief investment officer, Mark Haefele, does not believe the rate hikes will tip the United States into recession.

He said: “We expect the Fed to rise 50 basis points at each of the next two meetings. Beyond that, we think it will become evident that inflation is slowing, allowing the Fed to rise at a more gradual pace.

“Household balance sheets are strong and we are still seeing momentum since the end of Covid-19 restrictions.”

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Average home price up 1.4% in March

Average UK house prices rose again in March for the ninth consecutive month, with the 1.4% rise to £3,860 reported by Halifax today being the biggest increase since last September.

The annual house price inflation rate of 11% continues to track its highest level since mid-2007, leaving the average £282,753 up around £28,113 from a year ago.

Halifax chief executive Russell Galley said: “The story behind such high house price inflation remains unchanged: limited supply and strong demand, despite the prospect of mounting pressure on finances. Household.”

Today’s figures show the South West has overtaken Wales as the UK region with the highest annual house price inflation, at 14.6%.

The South East also saw a strong increase, with growth of 11.6% and an average price of £385,790. Prices in the region have now risen by £40,177 over the past year, the first time an English region outside of London has seen a 12-month increase of more than £40,000.

London continued its recent upward trend, with prices up 5.9% year-on-year to an average price of £534,977.

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US rate speculation hits growth stocks

Asian and Wall Street markets set the tone for a bearish session after the US Federal Reserve’s talk of monetary policy tightening unsettled traders.

Commentary from last month’s meeting pointed to a half-point increase in interest rates in May, alongside a reduction in the central bank’s balance sheet of about $95 billion a month.

U.S. stocks were down sharply for a second straight session, with growth-focused companies hardest hit as Tesla and Facebook-owner Meta Platforms were both down 4%.

Michael Hewson, chief market analyst at CMC Markets, said: “This is quite a turnaround for the Federal Reserve, which just finished adding to its balance sheet in March.”

He said a half-point hike in U.S. interest rates now looked fairly certain, especially if next week’s inflation figure shows CPI inflation breaking through the 8 barrier. %.

The sell-off on Wall Street resulted in a poor session in Asia, where Tokyo’s Nikkei index fell 1.5% after the IMF cut Japan’s GDP forecast from 3.3% to 2, 4%.

CMC Markets expects the FTSE 100 index to open 20 points lower at 7567.

Brent crude rose 3% to $103 a barrel, after falling in recent days after major oil consuming nations agreed to release some of their strategic reserves.