UK stocks finished in the red on Wednesday, with the FTSE 100 index declining by 0.73%, mirroring a regional retreat of major European indices. This drop coincided with the Labour government's announcement of its 2024 Autumn Budget, presented by Rachel Reeves, the first female UK Chancellor of the Exchequer, at the House of Commons.
Reeves aimed to deliver on her party's commitment to change after a prolonged period of economic stagnation spanning over fifteen years. The Budget outlined a strategy to raise taxes by 40 billion pounds sterling while boosting investments through increased borrowing. Citing insights from the Office for Budget Responsibility, Reeves indicated that the Budget aims to bolster the UK's long-term growth by enhancing the economy's supply capacity.
Additionally, she announced an increment in the windfall tax on energy firms, raising it from 35% to 38%, effective from November 1, 2024. The government will extend the energy profits levy until March 2030 and eliminate the 29% investment allowance. In the context of the ongoing earnings season in Europe, several companies reported updates.
GSK experienced a decline of 3.07% at closing after announcing a third-quarter loss exacerbated by a decreased turnover. Barclays noted, 'Overall, FY24 guidances are maintained, although the company expects to land in the middle of the range. GM was a significant beat this quarter, but the company flagged potential headwinds expected in 4Q24 concerning COGS efficiencies.
Given the bear thesis predicated on deteriorating Vaccines performance, we anticipate shares to remain weak today.' Meanwhile, AstraZeneca's president for China, Leon Wang, is currently under investigation, and the company confirmed it would cooperate with local authorities. AstraZeneca's shares fell by 2.84% at closing..