The FTSE 100 ticked higher on Friday as traders continued to move into UK stocks after this week’s budget.
The measures announced on Wednesday were much better than some had first feared. Investors will be encouraged by the lack of immediate impact on consumer spending, and the absence of immediate impact on the economy will be negligible.
The longer-term picture is much harder to gauge, but reaction from business hasn’t been overly negative, with JPMorgan even pledging to build a brand new 12,000-person headquarters in Canary Wharf.
This mild confidence was reflected in UK equities, with the FTSE 100 edging higher.
“The FTSE 100 looks set to end the week in decent fashion and US futures point to post-Thanksgiving gains when Wall Street opens for business,” says AJ Bell head of markets Dan Coatsworth.
“UK housebuilders remain in decent fettle after the Budget – which didn’t contain any nasty surprises in terms of property taxes, bar the so-called ‘mansion tax’.
“The exception to the sector’s positivity is Berkeley which has greater exposure to the premium end of the market where the new supplementary council tax charges are more relevant.”
Berkeley Group Holdings shares slipped 0.7% while Persimmon added 0.1%. Rightmove was also marginally higher, with the housing market left largely unscathed by the budget.
Whitbread was the top faller after being hit by two broker downgrades.
“Broker ratings changes don’t always grab investors’ attention but a double downgrade from analysts on Premier Inn owner Whitbread has sparked a big reaction,” Coatsworth said.
“The share price has been shaken to its foundations by Bernstein making a handbrake turn from a positive to a negative view on the hotels group.”
Whitbread shares were down 4.5% at the time of writing.
Weir Group was the top riser, adding 1.9%, after Exane BNP reinitiated the stock with an outperform rating.