FTSE 100 live: London set for cautious start amid weak global cues; ECB policy decision in spotlight

The latest updates on the FTSE 100 and London’s financial markets from City A.M.’s newsroom in the heart of the City of London.

Overnight, the Dow Jones Industrial Average declined by 1.09 per cent to 38,461.51, the S&P 500 dropped 0.95 per cent to 5,160.64, and the Nasdaq Composite fell by 0.84 per cent to 16,170.36. Except for energy, most sectors in the S&P 500 recorded losses, with real estate shares posting the largest decline. 

In Asia, Japan’s Nikkei N225 fell by 0.6 per cent, China’s CSI300 blue chips eased by 0.3 per cent, and Hong Kong’s Hang Seng index dropped by 1.13 per cent. 

The US dollar strengthened, hitting a five-month high against major peers, including the yen. It also reached a 34-year high of 153.24 yen before easing to 152.86 yen on Thursday. 

Japanese Finance Minister Shunichi Suzuki said that all options would be considered to address significant exchange rate swings after the dollar hit a 34-year high against the yen. 

Oil prices sustained gains, gold prices rebounded, and commodities market reactions were driven by geopolitical concerns. 

Traders reduced expectations for Federal Reserve interest rate cuts due to higher-than-expected US inflation. Forecasts suggest rate cuts may not occur until after the November 5th vote, with predictions adjusted to one to two quarter-point cuts for the year. 

Confidence in a July rate cut halved following the inflation report, with markets now focusing on potential cuts by September. 

China experienced a slight increase in consumer prices in March, below analysts’ predictions, indicating ongoing challenges in stimulating domestic demand. Official data showed a 0.1 per cent rise in consumer prices compared to the previous year, lower than the expected 0.4 per cent. 

Britain’s housing market surged with buyer interest reaching a two-year high. House prices also reached their peak since 2022, driven by easing inflation and lower mortgage rates.

The Royal Institution of Chartered Surveyors (RICS) reported a notable increase in March buyer inquiries, surpassing economists’ forecasts. 

All eyes will be on the European Central Bank’s monetary policy decision today, with speculation about a potential rate cut in June. 

Updates on US producer prices and weekly unemployment claims are expected today, while major financial players like JPMorgan, Citi, State Street, Wells Fargo, and BlackRock are set to reveal first-quarter earnings on Friday.