Business
Stocks rise as inflation dips and oil price rebounds
The FTSE 100 made strong headway on Wednesday, supported by a larger-than-expected cooling in inflation and a spike in the oil price.
The FTSE 100 index closed up 89.53 points, 0.9%, at 9,774.32. It had earlier traded as high as 9,853.13.
The FTSE 250 ended 123.78 points higher, 0.6%, at 22,164.76, and the AIM All-Share ended up 2.07 points, 0.3%, at 751.48.
The soft UK inflation data sealed the Bank of England’s (BoE) expected interest rate cut on Thursday and increased the likelihood of further reductions in 2026, analysts said.
Barclays said it “removes the final hurdle that could likely have, in our view, dissuaded the BoE from cutting bank rate tomorrow”.
The headline Consumer Prices Index (CPI) rose 3.2% year-on-year in November, slowing from 3.6% in October, and well below FXStreet-cited consensus of 3.5%, according to data published by the Office for National Statistics.
On a monthly basis, CPI fell by 0.2%, compared with a 0.1% increase a year earlier.
November’s figure was below the 3.4% forecast in the recent BoE Monetary Policy Report. Similarly, core CPI inflation, which excludes energy, food, alcohol and tobacco, slowed to 3.2% from 3.4% against expectations for it to remain unchanged.
In addition, closely watched CPI services inflation cooled to 4.4% from 4.5% in October, compared with forecasts for it to remain unchanged. CPI goods inflation slowed to 2.1% from 2.6%.
“UK price pressures are rapidly easing amid persistent softness in demand growth. We expect headline inflation to fall towards the BoE’s 2% target over the course of next year,” said Peel Hunt chief economist Kallum Pickering.
Mr Pickering thinks the risk now is that the BoE has “fallen behind the curve and may need to play catch-up in 2026”.
“We will be paying careful attention to the voting pattern and forward guidance which accompany tomorrow’s BoE decision for a signal that the bank is ready to lean harder against downside risks,” he explained.
“Do not be surprised if the BoE sends dovish signals that it stands ready to lean against downside risks next year – implying cuts at successive meetings.”
The BoE is forecast to reduce the bank rate to 3.75% from 4.0% on Thursday, after voting for the status quo at meetings in September and November.
Mr Pickering said that, following the inflation surprise, money market bets for a BoE cut on Thursday jumped to 97% from 92%, while expectations for the total number of cuts over the next year increased to 2.7 from 2.4.
Money markets now put a 65% chance on a cut in the first quarter of 2026, up from 45% prior to Wednesday’s data, he noted.
The pound was quoted lower at 1.3359 dollars at the time of the London equities close on Wednesday, compared with 1.3429 dollars on Tuesday.
Rate-sensitive housebuilders were in vogue, with Barratt Redrow up 3.7% and Persimmon up 2.3%.
A rebound in the oil price also provided support in London, with Shell up 1.4% and BP up 0.7%.
Brent oil was quoted at 59.91 dollars a barrel at the time of the London equities close on Wednesday, up from 59.01 dollars late Tuesday.
Kathleen Brooks, at XTB, said the reversal in prices came after US President Donald Trump announced a “total and complete blockade of all sanctioned oil tankers” going in and out of Venezuela.
“This is an unusual move, typically blockades need to be agreed by Congress, so this is a serious escalation of events. Venezuela holds the world’s largest share of oil reserves, hence why this blockade has caused ructions in the energy market,” Ms Brooks pointed out.
In Europe on Wednesday, the CAC 40 in Paris closed down 0.3%, while the DAX 40 in Frankfurt ended 0.5% lower.
The euro stood at 1.1749 dollars, down against 1.1775 dollars. Against the yen, the dollar was trading higher at 155.55 yen compared with 154.79 yen.
Stocks in New York were lower at the time of the London equity close on Wednesday.
The Dow Jones Industrial Average was down 0.2%, the S&P 500 index was 0.7% lower, while the Nasdaq Composite declined 1.1%.
The yield on the US 10-year Treasury was quoted at 4.17% flat from Tuesday. The yield on the US 30-year Treasury was at 4.83%, also unchanged from Tuesday.
Back in London, insurer Phoenix Group rose 3.3% after UBS upgraded it to ‘buy’ from ‘neutral’, while an upgrade from Berenberg supported miner Glencore, which rose 1.5%.
Bunzl fell 2.0% after backing its 2025 guidance but cautioned that its operating margin is expected to be slightly down in the coming year.
In response, JPMorgan analyst Jane Sparrow lowered 2026 earnings per share forecasts by 4% and revenue estimates by 1%, with the bulk of the EPS downgrade being margin-driven, reflecting continued operating expenditure inflation but without price inflation to offset.
On the FTSE 250, Serco climbed 7.4% after upgrading guidance for underlying operating profit for this year, citing growth in the defence sector.
The Hampshire-based government services outsourcing provider said it now expects 2025 underlying operating profit of around £270 million, up 3.8% from previous guidance of £260 million but 1.5% lower than £274 million in 2024.
“We believe Serco is well positioned, with rising defence budgets, attractive fundamentals, and strong balance sheet optionality,” analysts at Peel Hunt said.
But Ceres Power’s woes continued, down a further 6.1%, after last week’s critical note from Grizzly Research.
Hunting was knocked down 4.6% as Jefferies downgraded to ‘hold’ from ‘buy’.
Gold was quoted at 4,326.25 dollars an ounce on Wednesday, higher against 4,304.60 dollars.
The biggest risers on the FTSE 100 were Barratt Redrow, up 13.30 pence at 375.00p, Phoenix Group, up 23.00p at 719.00p, Convatec, up 7.40p at 242.20p, HSBC Holdings, up 30.00p at 1,141.80p and United Utilities, up 30.00p at 1,203.00p.
The biggest fallers on the FTSE 100 were DCC, down 181.00p at 4,924.00p, Bunzl, down 44.00p at 2,176.00p, ICG, down 32.00p at 2,024.00p, Weir, down 44.00p at 2,814.00p and IMI, down 34.00p at 2,434.00p.
Thursday’s economic calendar has interest rate decisions in the UK, Europe, Norway and Sweden, plus US inflation data.
Thursday’s UK corporate calendar has half-year results from electricals retailer Currys.
– Contributed by Alliance News
The annual tradition of “Dry January” turned into “Damp Monday” at one supermarket, with shoppers returning to alcohol consumption in the middle of the month.
Waitrose said that the month was “not so dry after all,” identifying January 12 as “Damp Monday” after sales of wines, beers, and spirits surged by 11 per cent compared to the week before.
The grocer noted a “significant softening” of the Dry January trend over the past five years, suggesting a more balanced “Damp January” approach is now prevalent.
While alcohol sales in January 2022 were 42 per cent lower than other months, this year saw a reduced drop of just 25 per cent.
Notably, Argentinian and Chilean wine sales experienced a considerable boost last month, rising by 25 per cent and 27 per cent respectively compared to the previous year.
Compared to this time last year, searches on Waitrose.com for “Argentinian wine”, “red wine” and “Chilean wine” were up 300%, 63% and 18% respectively.
Pierpaolo Petrassi, head of beers, wines and spirits at Waitrose, said: “Damp is the new dry, as we’re seeing customers move away from the ‘all-or-nothing’ mentality and instead look towards more mindful, ‘damp’ moderation rather than quit entirely.
“This shift sees the likes of a luxury Argentinian Cabernet sitting comfortably alongside premium non-alcoholic spirits as sophisticated sips, proving that the modern palate values flavour profiles and social connection over the buzz alone.
“No doubt the no and low trend skyrocketed in 2022 as the result of the ‘pandemic reset’ transitioning out of the final lockdowns, as well as the ‘sober curious’ movement going mainstream on social media.
“Now, 2026 is the ‘lifestyle’ year, with customers finding balance as part of a more tempered, year-round approach to drinking.”
Data reported by The Spirits Business trade publication from early this year suggested that while 58% of the UK public aimed to cut back, a significant portion – roughly 31% – had opted for a “damp January” – reducing intake rather than cutting it out entirely.
Business
Budget eases PF, ESI deduction rules for employers, allows relief for delayed deposits – The Times of India
In a move expected to bring relief to employers and reduce routine tax disallowances, the finance bill has proposed a key change to the treatment of employees’ provident fund (PF), ESI and similar contributions, allowing deductions even where there is a delay in deposit, provided the amount is deposited by the employer entity with the relevant welfare fund authorities before the due date of its Income-tax return.At present, employers can claim deduction for employees’ PF and ESI contributions only if the amounts are deposited within the strict timelines prescribed under the respective welfare laws. Even a minor delay permanently disqualifies the expense for tax purposes, a position that had been settled by the Supreme Court (SC) after years of litigationUnder the proposed amendment to Section 29 of the Income-tax Act, 2025, the definition of “due date” for claiming deduction of employees’ contributions is set to be aligned with the due date for filing the income-tax return by the employer entity.Explaining the shift, Deepak Joshi, a SC advocate said employers are currently held to a rigid standard. “The law, as interpreted by the SC, meant that if employee contributions were not deposited within the due date under the relevant welfare fund laws, no deduction was allowed — even if the payment was made before filing the income-tax return,” he said.“The proposed amendment substitutes the definition of ‘due date’ to mean the due date of filing the income-tax return. The positive impact is that even if there is a slight delay in depositing employees’ contributions, so long as the amount is deposited before the return-filing deadline, the employer will be allowed the deduction,” Joshi added. Experts view the move as part of the government’s broader effort to soften compliance rigidities and reduce avoidable litigation.
Baby boxes are being delivered to expectant families in some of Wales’ most deprived areas.
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