British shares closed lower on Tuesday, with the FTSE 100 index down 0.14% as business activity growth in the UK slowed. Schroders ($SDR) experienced the steepest decline of 13.7% among London-listed blue-chip companies following its third-quarter update. RBC Capital Markets commented, "Overall, the update is an incremental negative with net flows for Private Assets, Wealth Management and JVs coming in below consensus expectations, albeit with total AUM ex JVs being only slightly weaker than consensus.
However, in addition, SDR has flagged a continuing mix shift in Mutual Funds, but has not quantified the margin impact and notified of c. [10 billion pounds sterling] of outflows in 4Q24 across Solutions/Institutional." In economic news, the seasonally adjusted S&P Global UK PMI Composite Output Index decreased to 51.8 in October 2024 from 52.6 the month before, indicating a slowdown in business activity.
The UK's services sector also slightly lost steam, with the S&P Global UK Services PMI Business Activity index at 52, compared with 52.4 in the previous month. This latest reading marked the slowest expansion for the sector since November 2023. S&P Global noted, "The wait for clarity on government policy ahead of the Autumn Budget was widely reported to have weighed on business confidence and spending.
Broader geopolitical concerns and forthcoming US elections also added to a sense of wait-and-see on business investment decisions in October. At the same time, cost of living pressures remained a constraint on household spending," said S&P Global Market Intelligence Economics Director Tim Moore. Meanwhile, data from the Society of Motor Manufacturers and Traders showed that new car registrations decreased 6% year over year in October to 144,288 units, marking a second decline for 2024..