Weekly Market Update 22/11/2024
Official data released on Wednesday by the Office for National Statistics showed a sharp increase in UK inflation. The Consumer Prices Index (CPI) rose by 2.3% in the year to October 2024, up from 1.7% in September and above analyst expectations of 2.2% according to Reuters. The rise could be partly attributed to a 10% increase to the energy price cap last month. This higher-than-expected inflation figure has made it highly unlikely that the Bank of England will lower rates again before early 2025, following the quarter of a percentage point cut earlier this month.
The world’s most valuable listed company, Nvidia, released its latest earnings report on Thursday, reporting another strong quarter of revenue growth as demand continues for it’s A.I. enabling chips. Revenue for the quarter to the end of October increased by 94% to $35.1bn, however this was a slower increase compared to the previous quarter and with lofty expectations from shareholders, the share price fell 1.2%. Analysts have also been watching closely the progress of the newest generation of chips which launched earlier this year, due to reports of some technical teething issues, but the company largely allayed any concerns by announcing that sales are ahead of previous forecasts.
UK businesses have reacted badly to the new policies announced in the budget, as business activity slumped to a 13-month low this month. The S&P Global flash UK PMI, which measures the health of manufacturing and services, fell to 49.9 in November, down from 51.8 in October. A figure below 50 indicates the majority of businesses have reported a decline in activity. The pound fell 0.6% against the dollar at $1.251, the weakest level in six months.
Andrea Wood, Chartered MCSI
Investment Manager
