The FTSE 100 index experienced modest gains, closing higher on Thursday, propelled by Bitcoin’s unprecedented surge past the $100,000 mark and regulatory approval for the Vodafone-Three merger. Meanwhile, US stock markets remained relatively flat as investors anticipated Friday’s critical jobs report.
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London’s benchmark index concluded the session with a marginal 0.1% increase, struggling to achieve substantial gains throughout the day. Germany’s DAX and France’s CAC 40 outperformed their UK counterpart, rising by 0.6% and 0.3% respectively, even amidst political instability in France following a vote of no confidence against Prime Minister Michel Barnier. The broader pan-European STOXX 600 index also registered a 0.3% gain.
Across the Atlantic, the Dow Jones Industrial Average dipped by 0.3%, while the S&P 500 and the tech-focused Nasdaq Composite hovered around the flatline. The British pound appreciated by 0.4% against the US dollar, reaching a rate of 1.2754. Bitcoin’s price shattered records, exceeding $100,000 for the first time, fueled by a rally ignited by Donald Trump’s US election victory.
Key Market Developments: Scottish Mortgage Downgrade, Nvidia’s AI Expansion, and More
Stifel downgraded Scottish Mortgage to a “Neutral” rating, citing concerns about the sustainability of the recent share price rally leading into 2025. The investment firm pointed to a 10% increase in the share price following Trump’s re-election, narrowing the fund’s discount to 8%.
Nvidia announced plans to establish an AI research and development center in Ho Chi Minh City, Vietnam, as part of its Southeast Asia expansion strategy. CEO Jensen Huang emphasized the importance of developing Vietnam’s AI capabilities within the country, leveraging its data as a national resource. Nvidia has already invested over £196m in Vietnam, collaborating with local tech companies across various sectors.
US stocks paused their recent rally, with the major indices experiencing minimal fluctuations as investors awaited Friday’s jobs report. While all three major averages had reached record highs on Wednesday, Thursday saw a more subdued performance.
AJ Bell initiated a £30m share buyback program following a year of robust growth in profits, users, and assets under management. The company reported a 14% increase in its customer base, reaching 542,000, and a 22% surge in assets under management to £86.5 billion. AJ Bell also announced a 16% increase in its annual dividend.
Oil prices saw a slight uptick as market participants awaited the OPEC+ meeting’s outcome regarding potential supply cuts. Brent crude futures traded at $72.44 per barrel, while US West Texas Intermediate (WTI) reached $68.70 per barrel. Analysts largely anticipated an extension of existing supply cuts to bolster oil prices amid weaker global demand.
Electric car sales in the UK reached a significant milestone, accounting for 25% of the new car market in November. Despite an overall decline in new car registrations, electric vehicle sales surged by 58.4%, driven by regulatory targets and manufacturers’ prioritization of EV production.
The UK construction sector experienced growth in November, fueled by the strongest increase in commercial building activity in over two years. The S&P Global construction purchasing managers’ index (PMI) reached 55.2, exceeding the 50 threshold that indicates expansion. However, residential construction continued to decline.
Analysts reacted to the approved Vodafone-Three merger, emphasizing the need for Vodafone to deliver on its promises. The merger, valued at £15 billion, received regulatory approval contingent on significant investments in the UK’s 5G infrastructure and a three-year cap on certain mobile tariffs. While the deal offers a potential turning point, Vodafone faces challenges in key international markets.
Asian markets presented a mixed picture, with Japan’s Nikkei 225 index rising by 0.3% due to a weaker yen and Wall Street’s tech rally. However, Hong Kong’s Hang Seng index declined by nearly 1%, while South Korea’s KOSPI retreated amid political uncertainty surrounding the potential impeachment of President Yoon Suk Yeol.
Conclusion: Market Volatility Persists Amidst Key Developments
Thursday’s market activity highlighted a mix of optimism and caution, with Bitcoin’s record-breaking surge and merger approvals juxtaposed against political uncertainties and concerns about economic recovery. Investors remain focused on upcoming economic data and geopolitical developments as they navigate a volatile market landscape.
