In recent trading sessions, British equities have witnessed a notable downturn, primarily driven by escalating apprehensions about the US economy which triggered a widespread global stock selloff. By the time the market closed on Monday, the FTSE 100 index had plummeted by 2.04%. This decline is part of a broader regional retreat affecting European blue-chip indices, marking the third consecutive day in which the index has closed in negative territory. This situation is notably concerning for investors, given that the prevailing sentiment had initially been supported by encouraging data from S&P Global Market Intelligence.
This data indicated that the UK private sector economy expanded at a quicker rate in July compared to the previous month. Specifically, the S&P Global UK PMI Composite Output Index increased to 52.8, up from 52.3 in June. This figure reflects a slight upward revision from the flash estimate of 52.7, suggesting an overall positive sentiment for the UK economy at the start of the second half of 2024. Furthermore, the expansion can be largely attributed to the UK’s services sector, which demonstrated a marked increase in growth rate for July.
The S&P Global UK Services PMI Business Activity Index recorded a rise to 52.5, surpassing the flash estimate of 52.4 and significantly higher than June’s figure of 52.1. This consistent growth trajectory indicates a solid foundation for economic recovery, despite the recent woes. “July's accelerated expansion in sales activity crucially suggests that there has been a boost in both business and consumer confidence,” remarked Joe Hayes, Principal Economist at S&P Global Market Intelligence.
He further added that “although it's only one month into the second half of 2024, the latest survey findings are optimistic, indicating a potential for reasonable GDP growth in Q3.” On the corporate front, the financial scene has also been buzzing with activity. Hargreaves Lansdown, a notable player in the financial services sector, announced that a consortium has received an extension for the put-up-or-shut-up deadline regarding a potential bid for the company.
This latest extension pushed the deadline to Friday, initially set for Monday. The consortium includes CVC Advisers, Nordic Capital XI Delta, and a subsidiary of the esteemed Abu Dhabi Investment Authority, adding intrigue to the unfolding corporate developments. Consequently, at the close of the trading day, Hargreaves Lansdown's stock dipped by 4.41%, reflecting the uncertainties influencing investor sentiments in a volatile market..