The FTSE 100 index in London closed higher on Tuesday, gaining 58.95 points or 0.6% to finish at 10,207.80. This upward movement came as investors turned their attention towards the United States, where the Federal Reserve's imminent interest rate decision and a slew of major corporate earnings reports were set to dominate market sentiment.
Mixed Performance Across London Indices
While the blue-chip FTSE 100 advanced, other London indices showed varied results. The FTSE 250 mid-cap index ended the session up 52.36 points, a modest increase of 0.2%, closing at 23,404.02. In contrast, the AIM all-share index, representing smaller companies, declined by 4.52 points or 0.6% to settle at 823.97.
Gold and Mining Stocks Under Pressure
Gold prices experienced a slight retreat, quoted at $5,093.94 per ounce compared to $5,095.11 previously. This minor pullback from recent record highs impacted precious metals mining stocks significantly. On the FTSE 100, Fresnillo led the fallers with a substantial 5.9% drop, while Endeavour Mining declined by 4.4%.
The trend continued in the FTSE 250, where Hochschild Mining fell 4.5% and Pan African Resources decreased by 3.6%. Dan Coatsworth, an analyst at AJ Bell, commented: "Gold prices remain elevated, even if they have eased a bit below their recent record highs, as investors await the Federal Reserve's latest meeting and earnings reports from most of the big tech contingent."
Regulatory Changes and Corporate Moves
The London Stock Exchange Group saw its shares decline by 1.1% following Monday's announcement of proposals to make it easier for international companies to join the FTSE 100 index. FTSE Russell, owned by LSEG, has launched a consultation to reduce the free-float requirement for non-UK incorporated companies listed in London from 25% to 10%.
If implemented, this change would align the requirements for international firms with those for British businesses seeking inclusion in the FTSE 100, FTSE 250, and other indices. In smaller cap news, Eco Buildings Group surged 11% after announcing the completion of groundworks at its luxury apartment development in Tirana, Albania. The company anticipates generating €2.2 million in revenue per apartment block with a 40% gross margin.
Global Market Context and Currency Movements
European equity markets showed mixed results, with Paris's Cac 40 closing up 0.3% while Frankfurt's Dax 40 ended down 0.1%. In the United States, stock indices were divided: the Dow Jones Industrial Average fell 0.6%, whereas the S&P 500 gained 0.5% and the Nasdaq Composite rose 1.0%.
Currency markets saw the pound strengthen to $1.3765 at the London close, up from $1.3704 on Monday. The euro also appreciated, standing at $1.1969 compared to $1.1884 previously. In commodity markets, Brent crude oil traded higher at $65.92 per barrel, up from $65.43 late Monday.
Key Performers and Economic Calendar
Among the biggest risers on the FTSE 100 were HSBC, NatWest, Spirax, BT, and St James's Place. The largest fallers included Fresnillo, Relx, Sage, Experian, and Endeavour Mining. Looking ahead, Wednesday's economic calendar features the US Federal Reserve's rate decision alongside durable goods orders, crude oil stocks, and wholesale inventories data.
Corporate earnings will be closely watched, with Tesla releasing first-quarter results and full-year reports expected from IBM, Meta Platforms, and Amphenol. Microsoft is set to publish its half-year results. In the UK, trading updates are anticipated from PayPoint, Pets At Home, and Computacenter, while Hargreaves Services releases half-year earnings. Additionally, the Bank of Canada will announce its interest rate decision.
US Treasury yields showed little movement, with the 10-year yield unchanged at 4.22% and the 30-year yield widening slightly to 4.82% from 4.81%. As markets await these critical developments, investor caution remains evident in the mixed performances across global indices and sectors.
