Business
What Budget rumours are doing to the FTSE 100
Banking stocks gave the FTSE 100 a lift on Tuesday amid rumours that the sector will be spared a tax hit in Chancellor Rachel Reeves’ budget.
The FTSE 100 index closed up 74.62 points, 0.8 per cent, at 9,609.53.
The FTSE 250 ended up 205.83 points, 1.0 per cent, at 21,617.41, and the AIM All-Share closed up 4.93 points, 0.7 per cent, at 742.09.
High street lenders Lloyds Banking Group rose 3.8 per cent, NatWest Group climbed 3.7 per cent and Barclays advanced 2.4 per cent.
It came as the Financial Times said that Ms Reeves is unlikely to impose further tax hikes on UK banks, calming fears that they could be hit.
The chancellor will deliver the budget statement to Parliament around 12.30pm on Wednesday, after Prime Minister’s Questions.
It is likely to contain further hefty tax increases as Ms Reeves looks to cover the expected fiscal deficit and seek a higher buffer against future economic shocks.
An extension to the freeze on personal tax allowances, a mansion tax, increases in betting duties, and changes to salary sacrifice schemes are all likely to form part of a smorgasbord approach to tax policy.
But economists are less sure that this scatter-gun approach is the right path to follow.
Citi’s Callum McLaren-Stewart called the smorgasbord approach “politically palatable, but economically problematic”.
Kallum Pickering at Peel Hunt said a “haphazard patchwork of smaller anti-growth tax increases” would be a “bad outcome”.
Ahead of the budget, the pound was quoted higher at US$1.3183 at the time of the London equities close on Tuesday, compared to $1.3104 on Monday.
The yield on the UK 10-year gilt was down by 5 basis points at 4.49 per cent.
Reports also suggest that the chancellor may announce a stamp duty holiday for new listings on the London Stock Exchange.
Hargreaves Lansdown’s Emma Wall said this would be a “welcome boost” for the UK stock market which has been “losing out” to New York for initial public offers in recent years.
Currently, investors have to pay 0.5 per cent stamp duty tax when they buy shares, but this is expected to be waived for new listings for up to three years.
In European equities on Tuesday, the CAC 40 in Paris closed up 0.8 per cent, while the DAX 40 in Frankfurt ended 1.0 per cent to the good.
Stocks in New York were mixed after Monday’s stellar gains.
The Dow Jones Industrial Average was up 0.7 per cent, the S&P 500 index was up 0.2 per cent, but the Nasdaq Composite fell 0.2 per cent.
The yield on the US 10-year Treasury was quoted at 4.01 per cent, narrowed from 4.05 per cent. The yield on the US 30-year Treasury was quoted at 4.65 per cent, trimmed from 4.69 per cent.
After the data vacuum caused by the American government shutdown, investors weighed a hefty batch of new figures on the health of the US economy.
Reports were mixed with US producer price growth steady year-on-year in September, while a retail sales rise was tamer than forecast on-month.
According to the Bureau of Labor Statistics, producer prices rose 2.7 per cent on-year in September, in line with August’s rise and meeting the FXStreet-cited consensus estimate.
Separately, the Census Bureau reported US retail sales rose 0.2 per cent in September from August, shy of the FXStreet-cited forecast of a 0.4 per cent rise. In August, sales rose 0.6 per cent from July.
In addition, a report from the Conference Board showed consumer confidence in the US weakened in November, hitting its second-lowest level since April.
The CME FedWatch tool now places an 83 per cent chance of a quarter-point cut at December’s Federal Reserve meeting.
The data weighed on the dollar. The euro stood higher at $1.1569 on Tuesday, against $1.1525 on Monday. Against the yen, the dollar was trading lower at 156.13 yen compared to 156.91 yen.
Back in London, Beazley fell 9.2 per cent as analysts said a planned US$500 million investment to build out a new Bermuda platform will mean a “material” step down in share buyback expectations.
The Lloyds of London insurer announced the news alongside mixed trading results in the first nine months of 2025.
But RBC Capital Markets said the “key new news” was the $500 million capital to be set aside to set up in Bermuda.
Beazley said the investment supports growth from 2026 onward and “supports our expansion into the alternative risk transfer market”.
But UBS thinks this puts a share buyback at the year-end “at risk”, and if there still is one, it could be of a lesser amount than the broker’s US$700 million estimate.
Faring better, Kingfisher rose 6.0 per cent after raising profit guidance for the second time in three months.
The DIY retailer, which owns the B&Q, Screwfix, Castorama and Brico Depot brands, now expects full-year adjusted pretax profit between £540 million to £570 million.
In September, Kingfisher upgraded its profit outlook to the “upper end” of the previously guided range of £480 million to £540 million.
On the FTSE 250, AO World jumped 1.5 per cent as it raised its profit forecast after reporting “continued positive trading”.
The Bolton, England-based consumer electronics seller in September upped its profit view to a £45 million to £50 million range.
Since then, AO World said it has seen “continued positive trading”, and it now expects pre-tax profit “around the top” of the outlook range.
But Baltic Classifieds slid 2.2 per cent as JPMorgan double-downgraded it to “underweight” from “overweight”.
The broker thinks online classifieds players will have to “materially” increase their efforts to maintain their gatekeeper position by delivering “undisputable, top-notch, now AI-driven search experiences and relevant information to compete with GenAI agents and new aggregators”.
Brent oil was quoted at 61.71 dollars a barrel at the time of the London equities close on Tuesday, down from $62.90 late on Monday.
The oil price fell amid reports that Ukraine has agreed to the terms of a peace deal with US representatives, although additional reports suggested Russia may block any modified plan.
Gold was quoted at 4,132.40 dollars an ounce, up against $4,097.64.
The biggest risers on the FTSE 100 were Airtel Africa, up 19.2p at 314.80p, Kingfisher, up 17.5p at 309.9p, Burberry, up 52.5p at 1,168.5p, Barratt Redrow, up 15.5p at 393.9p and Lloyds Banking Group, up 3.3p at 90.6p.
The biggest fallers on the FTSE 100 were Beazley, down 79p at 781p, Intertek, down 278p at 4,592, Pearson, down 21.8p at 985.2p, BAE Systems, down 31p at 1,621p and Compass, down 41p at 2,408p.
Wednesday’s economic calendar has the UK budget, the Beige Book in the US and an interest rate call in New Zealand overnight.
Wednesday’s UK corporate calendar has half-year results from property developer Helical, equipment hire firm Speedy Hire, and celebration cakes retailer Cake Box.
One of Britain’s most prolific rail fare dodgers could face jail after admitting dozens of travel offences.
Charles Brohiri, 29, pleaded guilty to travelling without buying a ticket a total of 112 times over a two-year period, Westminster Magistrates’ Court heard.
He could be ordered to pay more than £18,000 in unpaid fares and legal costs, the court was told.
He will be sentenced next month.
District Judge Nina Tempia warned Brohiri “could face a custodial sentence because of the number of offences he has committed”.
He pleaded guilty to 76 offences on Thursday.
It came after he was convicted in his absence of 36 charges at a previous hearing.
During Thursday’s hearing, Judge Tempia dismissed a bid by Brohiri’s lawyers to have the 36 convictions overturned.
They had argued the prosecutions were unlawful because they had not been brought by a qualified legal professional.
But Judge Tempia rejected the argument, saying there had been “no abuse of this court’s process”.
JSW Jetour T2 Launch: JSW Motors Limited, the passenger vehicle arm of the JSW Group, is reportedly preparing to enter the Indian car market this year. It has partnered with Jetour, a China-based automotive brand owned by Chery Automobile, and the Jetour T2 SUV could be the company’s first product, according to the reports.
Media reports suggest that the launch will happen independently and not under the JSW MG Motor India joint venture. The SUV will wear a JSW badge and name, instead of the Jetour branding. The upcoming SUV will be assembled at JSW’s upcoming greenfield manufacturing facility in Chhatrapati Sambhaji Nagar, Maharashtra.
According to the reports, the company plans to have the vehicle on sale by the third quarter of this year. With this move, JSW aims to establish itself as a standalone carmaker in India.
Expected Powertrain
The SUV is likely to arrive with a 1.5-litre plug-in hybrid setup. Internationally, this hybrid powertrain is offered with both front-wheel drive and all-wheel drive options. It is still unclear which version will be introduced in India.
Design
In terms of design, the T2 is a large and rugged-looking SUV. It has a boxy and upright stance, similar to vehicles like the Land Rover Defender. Despite its tough appearance, it uses a monocoque chassis instead of a ladder-frame construction.
Size
The SUV measures around 4.7 metres in length and nearly 2 metres in width. This makes it larger than the Tata Safari, even though it is a five-seater. A longer 7-seat version is also sold in some markets.
Price
Pricing details for India are yet to be announced. For reference, the front-wheel-drive five-seat T2 i-DM is priced at AED 1,44,000 (around Rs 35 lakh) in the UAE.
Jetour
Jetour is a brand owned by Chinese automaker Chery. Launched in 2018, it focuses mainly on SUVs and is present in markets across China, the Middle East, Africa, Southeast Asia and Latin America.
John Swinney has been pressed over whether this week’s Scottish Budget gives some workers the “smallest tax cut in history” – with Tory leader Russell Findlay branding the reduction “miserly” and “insulting”.
The Scottish Conservative leader challenged the First Minister after Tuesday’s Holyrood Budget effectively cut taxes for lower earners, by increasing the threshold for the basic and intermediate bands of income tax.
But Mr Findlay said that would leave workers at most £31.75 a year better off – saying this amounts to a saving of just £61p a week
“That wouldn’t even buy you a bag of peanuts,” the Scottish Tory leader said.
“John Swinney’s Budget might even have broken a world record, because a Scottish Government tax adviser says it ‘maybe the smallest tax cut in history’.”
Raising the “miserly cut” at First Minister’s Questions in the Scottish Parliament, Mr Findlay demanded to know if the SNP leader believed his “insulting tax cut will actually help Scotland’s struggling households”.
The attack came as the Tory accused the SNP government of increasing taxes on higher earners, with its freeze on higher income tax thresholds, which will pull more Scots into these brackets.
This is needed to pay for the “SNP’s out of control, unaffordable benefits bill”, the Conservative added.
Mr Findlay said: “The Scottish Conservatives will not back and cannot back a Budget that does nothing to help Scotland’s workers and businesses.
“It hammers people with higher taxes to fund a bloated benefits system.”
Hitting out at Labour – whose leader Anas Sarwar has already declared they will not block the government’s Budget – Mr Findlay said: “It is absolutely mind-blowing that Labour and other so-called opposition parties will let this SNP boorach of a budget pass.
“Don’t the people of Scotland deserve lower taxes, fairer benefits and a government focused on economic growth?”
Mr Swinney said the Budget “delivers on the priorities of the people of Scotland” by “strengthening our National Health Service and supporting people and businesses with the challenges of the cost of living”.
He insisted income tax decisions in the Budget would mean that in 2026-27 “55% of Scottish taxpayers are now expected to pay less income tax than if they lived in England”.
The First Minister went on to say that showed “the people of Scotland have a Government that is on their side”.
Referring to polls putting his party on course to win the Holyrood elections in May, the SNP leader added that “all the current indications show the people of Scotland want to have this Government here for the long term”.
Benefits funding is “keeping children out of poverty”, he told MSPs, adding the Budget contained a “range of measures” that would build on existing support.
The First Minister said: “What that is a demonstration of is a Government that is on the side of the people of Scotland and I am proud of the measures we set out in the Budget on Tuesday.”
Meanwhile he said the Tories wanted to make tax cuts that would cost £1 billion, with “not a scrap of detail about how that would be delivered”.
With the weekly leaders’ question time clash coming less than 48 hours after the draft 2026-27 Budget was unveiled, the First Minister also faced questions from Scottish Labour’s Anas Sarwar, who insisted that the proposals “lacks ambition for Scotland”.
Pressing his SNP rival, the Scottish Labour leader said: “While he brags about his £6 a year tax cut for the lowest paid, one million Scots including nurses, teachers and police officers face being forced to pay more.
“Even his own tax adviser says this is a political stunt. So why does John Swinney believe that someone earning £33,500 has the broadest shoulders and therefore should pay more tax in Scotland?”
Mr Swinney, however, said that many public sector workers would be better off in Scotland.
He told the Scottish Labour leader: “A band six nurse at the bottom of the scale will take home an additional £1,994 after tax compared to the same band in England.
“A qualified teacher at the bottom of the band will take home £6,365 more after tax in Scotland than the equivalent in England. There are the facts for Mr Sarwar.”
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