- Flat open for FTSE 100 as investors look for catalysts.
- UK house price growth slows.
- S&P 500 closes at a fresh all-time high.
- OpenAI is the tide lifting all AI boats.
- Oil rises for the third day.
- Imperial Brands trading as expected.
Matt Britzman, senior equity analyst, Hargreaves Lansdown:
“The FTSE 100 is flat again in early trading, mirroring yesterday’s muted performance as investors adopt a wait-and-see approach amid a lack of clear catalysts. Imperial Brands released a trading statement that was broadly in line with expectations, offering little to shift sentiment (more on this below).
Halifax’s latest data shows house price growth easing to 1.3% year-on-year in September, with a second monthly dip hinting at a market losing momentum. While lower mortgage rates and steady wages are helping to steady sentiment, affordability remains a headwind. Housebuilder shares have been under pressure all year, and underperformance looks set to continue with no obvious driving force as we move into the final quarter of 2025.
The S&P 500 notched its seventh straight gain, closing at a fresh all-time high as US markets received a fresh dose of AI mania, with AMD and OpenAI joining forces. Fears of a prolonged government shutdown are taking a back seat to a market buoyed by enthusiasm over a potential rate-cutting cycle and the fast-approaching earnings season.
OpenAI’s Sam Altman is reshaping the AI landscape with infrastructure plans that dwarf anything seen before. OpenAI now has 16GW of data centre commitments tied to Nvidia and AMD, a scale that could demand more than $800 billion in capital on these two deals alone. His ability to pull in partners and cash has turned OpenAI into the industry’s gravitational centre, but the sheer size of these bets raises real questions about how they’ll be financed and whether returns can keep pace. For now, Altman looks unstoppable, yet the funding challenge will quickly become the next big test for the AI boom.
Oil prices nudged higher this morning, marking the third straight day of gains. Recent moves come after OPEC+ stuck to a modest production hike for November, well below what many had feared, keeping supply tight. Adding to the bullish tone, reports of damage at a major Russian refinery over the weekend have raised short-term supply concerns, even as broader worries about weak demand continue to temper enthusiasm.”
Derren Nathan, head of equity research, Hargreaves Lansdown:
“Investors in tobacco giant Imperial Brands won’t need to inhale too deeply after digesting today’s full year trading update. The company behind the likes of Rizla, Golden Virginia and blu vapes is set to deliver results in line with guidance. That translates to low single-digit growth in underlying revenue and mid-single digit growth in underlying operating profit, implying a step up in margins over the second half of the year.
The group’s been charging smokers more to satisfy their habit, in order to offset volume declines. And demand for Next Generation Products (NGP) such as vapes is proving to be more robust, with revenue expected to increase 12-14%. However, given the relatively small contribution to the mix, a key question for incoming CEO Lukas Paravicini, is how to accelerate growth in this category. Imperial’s certainly got the financial firepower to make the required investments.
But, by announcing a further £1.45 billion instalment in its ‘evergreen’ share buyback programme, it’s setting high expectations for generous shareholder payouts to continue. The shares should respond positively today but the new boss will need to show strong leadership if he’s to assure a bright future in this rapidly evolving and highly regulated industry.”
