London-listed shares concluded Monday's trading session with minimal fluctuations, showing a slight positive momentum. This marked the third consecutive day of closing in the green as investors and analysts speculate that the Bank of England (BoE) may implement adjustments to its monetary policy later this week. At the close of trading, the blue-chip FTSE 100 index recorded a modest gain of 0.08%, reflecting the cautious optimism in the market as stakeholders await significant announcements from the BoE. The Monetary Policy Committee (MPC) of the BoE is set to reveal its decision on Thursday.
It is widely anticipated that the MPC will opt to decrease the interest rate by 25 basis points. However, market analysts emphasize that this decision is expected to be closely contested among committee members. In comments made by ING, it was highlighted, "We know that this week's decision will hinge on a handful of committee members who felt the June decision was 'finely balanced.' Since the general election was called in June, we have not received substantial updates from officials, making it challenging to interpret their perspectives on the recent positive developments concerning services inflation.
This metric has significantly exceeded the BoE's latest forecasts, but much of this appears to be superficial noise." In the context of interest rates, the US Federal Reserve is also poised to make its own monetary policy decision on Wednesday, with expectations that it will maintain the current interest rates without change. In other notable economic updates, data released by the BoE revealed that the UK's M4 money supply registered a 0.5% increase month over month in June, contrasting the 0.1% decline observed in May.
Additionally, the central bank's figures indicated a reduction in net consumer credit borrowing for June, dropping to £1.2 billion from £1.5 billion in May. Turning to the retail sector, the Confederation of British Industry's latest distributive trades survey unveiled that the balance of retail sales volumes significantly decreased to -43% in July, down from -24% in June.
Retailers anticipate an ongoing decline, albeit at a slower rate, predicting a drop to -32% for August. On the corporate landscape, shares of Entain ($ENT), a prominent British sports betting and gambling company, plummeted by 8.07% by the day’s close. This decline followed the company’s announcement regarding its North American joint venture, BetMGM, which reported a substantial loss of $123 million in the first half of the year.
The company has indicated that losses are expected to persist into the second half of the year..