Stocks mixed as traders digest UK house price record and await US jobs data

This year was already expected to be an eventful one for markets, with Donald Trump’s return to the White House in January.

But even before Trump’s inauguration, investors were met with plenty of volatility. Concerns about stubborn inflation, economic stagnation and rising sovereign debt levels prompted a sell-off in government bonds, leading to a rise in borrowing costs.

After Trump was sworn in for a second term on 20 January, the US president stormed ahead with his policy agenda, signing a flurry of executive actions in just hours after returning to office. This didn’t spook investors but rather spurred markets on, with the S&P 500 (^GSPC) notching a fresh high that week, as Trump holding off on immediately imposing trade tariffs provided some relief.

However, just a week later an artificial intelligence-related tech stocks sell-off gripped markets, as the latest AI model release from Chinese startup DeepSeek, sparked concerns over the level of spending in the space by US tech giants. Market darling Nvidia (NVDA) saw $589bn (£471bn) wiped off its market value, marking the largest single-day loss in stock market history.

To round off a hectic January, Trump confirmed that he would be following through on threats to impose 25% tariffs on imports from Mexico and Canada, as well as a 10% duty on those from China.

As these tariffs kicked in on Tuesday and China retaliated with levies, markets wobbled, getting February off to a shaky start.

So where were investors putting their money amid this uncertainty in January?

Here’s which stocks and funds proved most popular last month, according to investment platforms.

Santander (BNC.L) has said it will cut its rate for tracker mortages, its standard variable rates, and the interest rate on savings products too, from the start of March.

Here are the details from the Guardian:

Mortgages

• All existing Santander tracker mortgage products linked to the base rate will decrease by 0.25% from 3 March 2025. This includes the Santander Follow-on Rate (FoR) which will decrease to 7.75% from 8.00%.

• The Santander Standard Variable Rate (SVR) will also decrease by 0.25% to 6.75% from 7.00% on 3 March 2025.

Savings:

• Santander savings products that are linked to the Bank of England base rate will decrease by 0.25%, effective from 3 March 2025. The products linked to the base rate are the Rate for Life and Good for Life savings accounts.

Rachel Reeves, welcomed the Bank’s decision to cut interest rates today, as well as signalling her commitment to growing the economy.

But the chancellor added that she was still not satisfied with the growth rate.

She said:

• Andrew Bailey started the press conference by saying that the cut will be “welcome news to many”, adding that the monetary policy committee expects to be able to cut rates further as “the disinflation process” continues.

• He warned that the UK labour market is cooling, as economic activity weakens.

• The governor took a swipe at US trade policies which “change from day to day” as he insisted he could not judge the potential impact of tariffs on the UK economy.

• Bailey added that he is very very strong supporter of the government’s growth agenda, and the growth agenda of the previous government too.

• “I am a very strong supporter of the growth agenda of this government and what the previous government had. Growth rate in the UK has been low since the financial crisis – addressing those questions is critical, so I very strongly agree with the chancellor.”

• He later said he wants to be “very, very clear” that markets should not overinterpret moves in voting patterns after the vote split of 7-2.

Some car insurers are outperforming their competitors when it comes to speed of claims handling, while others are leaving customers frustrated by delays, research from consumer group Which? found.

A survey of over 4,700 car insurance claimants found that 39% of respondents had to chase their insurer to move their claim forward.

While LV and NFU Mutual earned five-star ratings, six insurers — 1st Central, Admiral (ADM.L), Age Co, Ageas, Esure, and RAC — received just two stars out of five.

Delays in the claims process have emerged as one of the main reasons for a rise in customer complaints about car insurance firms, according to the Financial Ombudsman Service (FOS).

But speed isn’t the only area where some insurers are falling short. In terms of settlement value — the amount offered to customers in total loss claims — many insurers also earned just two stars.

NFU Mutual was the only provider to secure five stars in this category. Allianz (ALV.DE), Halifax, AA, Hastings Direct, Lloyds Bank (LLOY.L), Churchill, 1st Central, Admiral (ADM.L), Ageas, Age Co, RAC and Esure all received two stars, the lowest score in the survey as no provider received only one star in any category.

Read the full article here

The number of homeowners having their property repossessed increased towards the end of 2024, but mortgage arrears now appear to be on a “confirmed downward trend, according to the latest figures.

UK Finance said on Thursday that 1,030 homeowner-mortgaged properties were repossessed in the fourth quarter of last year, which was 12% higher than in the previous quarter, and 54% higher than the same period a year before.

Meanwhile, 700 buy-to-let mortgaged properties were repossessed in the fourth quarter of 2024, which was unchanged from the previous quarter and 30% higher than the same period a year earlier.

The overall proportion of mortgages in arrears remains low at 1.06% of homeowner mortgages and 0.65% of buy-to-let mortgages.

Some 92,170 homeowner mortgages were in arrears of 2.5% or more of the outstanding balance in the fourth quarter of 2024 – 2% fewer than both the previous quarter and the fourth quarter of 2023.

Charles Roe, director of mortgages at UK Finance, said:

The value of the pound dropped more sharply after the Bank of England signalled more interest rate cuts are on the way.

Sterling was down 1pc against the dollar to $1.238 and down 0.6% versus the euro, which is worth 83.7p.

Traders are surprised that the formerly hawkish Catherine Mann has taken on a dovish stance which could pave the way to further rate cuts in the months ahead.

Meanwhile, London’s benchmark index was last up 1.6% today to 8,761.43, at the time of writing.

Nicholas Hyett, Investment Manager at Wealth Club, said:

The Monetary Policy Committee was split 7-2 today in favour of a drop from 4.75% to 4.5%.

Swati Dhingra, a dovish policymaker who has long been pushing for lower interest rates, voted for a larger cut, as well as Catherine Mann.

Some thought Mann would oppose a rate cut today, as she has in the past, so this comes as a bit of a surprise. Although Mann recently told MPs that she favoured an “activist monetary policy strategy” of cutting rates aggressively once inflation pressures had eased.

The pair both voted to reduce Bank Rate by 0.5 percentage points, to 4.25%.

In response to the Bank of England’s decision to lower the base rate from 4.75% to 4.5%, Nick Leeming, Chairman of Jackson-Stops, comments:

The Bank of England (BoE) has reduced its interest rate to 4.5%, its lowest level in more than 18 months, offering some relief to mortgage holders across the UK.

The base rate, which serves as a benchmark for borrowing costs, directly affects mortgage rates, with tracker mortgages in particular following its movements. It also influences the rates individuals and businesses pay for loans.

Andrew Bailey, governor of the Bank of England, said:

New research from Moverly, has shown that almost 3,000 homes were sold every day in the UK last year, marking a 7% increase to the average estate agent’s workload.

Moverly analysed residential property transaction data between 2014–2024 and found the following:

This annual total equates to a daily average of 2,984 sales, which is the highest UK daily transaction average since 2022 (3,447) and marks an annual increase of +6.8%. It remains, however, slightly behind the pre-pandemic norms which saw more than 3,200 daily transactions each year between 2014 – 2019.

• England and Northern Ireland both saw annual upticks of 6.9% in 2024 to record an average of 2,512 and 69 daily sales respectively.

• Meanwhile, an average of 272 daily sales in Scotland marks an annual increase of +6.8%, and 130 sales per day in Wales is an increase of +5.6%.

While 2024’s transaction total remained behind pre-pandemic levels, a late boost in sales towards the end of the year indicates that agents could well be in for a busy start to 2025 as buyer confidence returns.

• The two busiest months of 2024 were October (3,590 sales per day) and November (3,481) while in previous years, the peak time tends to come much earlier in the year.

Bitcoin (BTC-USD) continued its upward trajectory during Thursday’s Asian trading hours, climbing from a local low of around $96,000 (£77,000) to just over $98,000. The surge followed a social media post from Eric Trump, hinting at a potential forthcoming allocation into bitcoin.

Eric Trump, son of US president Donald Trump, voiced his support for bitcoin in a post on X at 1:41 UTC, saying, “Feels like a great time to enter bitcoin.”

He also linked the Trump-associated decentralised finance platform, World Liberty Financial, to his post.

Trump’s wording was somewhat ambiguous, making it unclear whether his call to “enter” bitcoin was merely investment advice or a suggestion that the cryptocurrency could play a role in World Liberty Financial — or even in the administration’s broader national strategy.

Eric Trump recently endorsed ethereum (ETH-USD), saying on X on Monday, “In my opinion, it’s a great time to add $ETH.” His cryptocurrency endorsements have since sparked speculation on social media, particularly on X.com.

Some users claim he sold ether following his statement, while others suggest that wallets linked to World Liberty Financial were simply conducting routine reallocations of funds within the platform’s digital asset holdings.

Ethereum rose 3% to $2,842 on Thursday, according to CoinGecko data.

Read more here

Activity in the UK construction sector fell unexpectedly for the first time in nearly a year as economic uncertainty weighed on the industry,.

According to the S&P Global construction purchasing managers’ index (PMI), the latest reading came in at 48.1 in January, down sharply from 53.3 in December. It was the first contraction since February 2024.

Bosses said cost inflation accelerated to a 21-month high in January just as they grappled with a renewed downturn in order books.

Tim Moore, economics director at S&P Global, said the construction sector had been hit by “gloomy economic prospects, elevated borrowing costs and weak client confidence”.

The FTSE 100 is at an all-time high this morning, up as much as 1.25% to 8,730 points.

Matt Britzman, senior equity analyst at Hargreaves Lansdown, said:

AstraZeneca (AZN.L) has reported a jump in annual profits boosted by strong sales of its cancer, lung and immunology treatments.

Britain’s biggest drugmaker, which is also the largest listed company, said revenues rose by 21% to $54.1bn (£43bn) in 2024. Pre-tax profit jumped by 38% to $8.7bn last year on a constant currency basis.

The drugmaker stuck to its $80bn revenue goal by 2031, with late-stage results for seven new medicines expected this year.

Chief executive Pascal Soriot added that the current year will mark the beginning of an “unprecedented, catalyst-rich period” for the company as it sets about targeting revenues of $80 bn by the end of the decade.

In 2025, the company anticipates the first late-stage trial data for seven new medicines along with several important new indication opportunities for existing medicines.

Soriot said: “We are also investing in and making significant progress with transformative technologies that have the potential to drive our growth well beyond 2030, many of which have now entered pivotal trials.”

Government borrowing costs have edged higher ahead of the Bank of England’s latest interest rate decision.

The 10-year gilt yield, the benchmark for government borrowing, edged up two basis points to 4.45% amid broad rises across Europe.

Germany’s 10-year bond yield, the benchmark for the eurozone, rose just under two basis points to 2.38% after hitting 2.35% the day before, its lowest since 2 January.

Borrowing costs have fallen this week amid concerns that potential US tariffs could have a deflationary effect on the European economy, which could prompt the ECB to cut rates further and faster.

The pound fell against the dollar on Thursday morning, as traders await the outcome of the Bank of England’s meeting.

Sterling was 0.2% lower against the US greenback at $1.2478, having touched a four-week high at $1.255 the day before.

It also edged down less than 0.1% against the euro ahead of the BoE’s decision.

Investors are worried about a stagnating British economy, but domestic price pressures remain hot, limiting the central bank’s scope to act.

The UK currency has been bouncing back from over one-year lows of $1.217 hit in January amid turmoil in bond markets and concerns that low growth and rising debt costs would mean Rachel Reeves would not be able to meet her fiscal rules.

Money markets currently indicate the Bank of England will cut interest rates three or four times this year. But some think it may cut faster.

Pimco economist Peder Beck-Friis said:

Meanwhile, Ashley Webb, UK economist at Capital Economics, said: