“Following a slight pullback on Wall Street last night and in Asia on Friday, European stocks bucked the trend to trade higher on the last trading day of the week.
After yesterday’s Autumn Statement-driven fall the pound managed to claw back some of its losses versus the US dollar as investors had time to digest the information and the new economic outlook for the UK.
Russ Mould, investment director at AJ Bell, said: “The message from the event was simple – taxes are going up, there will be big spending cuts, and the economy is looking a bit fragile near-term. None of that should be a surprise, hence why there is relative stability on the markets. A plan is in place to sort out the Government’s finances and consumers and businesses will have to grit their teeth while it is enacted.
“Legal & General topped the list of FTSE 100 risers after it gave a reassuring trading update. Commodity producers were in demand, extending a recent rally for the mining and oil sectors as investors hope the global economic slowdown won’t be as bad as previously feared.
“The housebuilding sector had started to show some cracks in recent weeks and MJ Gleeson has certainly added fuel to the fire. Its cancellation rates have shot up to 41% over the past six weeks and reservation rates have fallen.
“MJ Gleeson is pinning its hopes on the Autumn Statement having provided some clarity to the public on what will happen to taxes and household bills, thereby removing some of the uncertainty around whether it was worth risking a house purchase.
“There remains the problem of affordability which could stop many people from making a property transaction, even if they really wanted to move. However, Gleeson’s properties are already at the more affordable end of the housing market, so it is better placed than many of its peers to push on through.”