FTSE 100 seen lower, oil above $90 a barrel
The poor run for the FTSE 100 index is set to continue as investors worry about slowing economic activity and the prospect of elevated oil prices contributing to interest rates staying higher for longer.
London’s top flight is forecast by CMC Markets to open 18 points lower at 7408, having posted three successive sessions in negative territory during this week.
The latest downbeat performance follows falls for Wall Street benchmarks as the S&P 500 index lost 0.7% and the Nasdaq declined by 1%.
Brent Crude is 0.5% lower this morning but still above $90 a barrel after rallying above the threshold yesterday. The pound is just below $1.25 after Bank of England governor Andrew Bailey yesterday signalled that interest rates may be near their peak.
House prices in steepest drop since November
The UK’s average house price fell by 1.9% in August, the steepest drop since November as the property market feels the heat from Bank of England interest rate rises.
The average home recorded by lender Halifax now costs £279,569, down by around £5,000 since July, and back to the level seen at the start of last year. On an annual basis prices fell by 4.6%, from 2.5% in July and the biggest year-on-year decrease since 2009 amid comparisons with the record-high property prices seen last summer.
Halifax Mortgages director Kim Kinnaird said: “It’s fair to say that house prices have proven more resilient than expected so far this year, despite higher interest rates weighing on buyer demand.
“However, there is always a lag-effect where rate increases are concerned, and we may now be seeing a greater impact from higher mortgage costs flowing through to house prices.
“Increased volatility month-to-month is also to be expected when activity levels are lower, though overall the pace of decline remains in line with our outlook for the year as a whole.”
London had an average property price of £529,814, down by 4.1% over the last year. Southern England and Wales have seen the most downward pressure on property prices, withScotland showing greater resilience.