House prices fell for the first time in six months in March amid rising mortgage rates, according to a lender.
Property values declined by 1pc last month when compared to February, the Halifax house price index showed.
The survey found that the average house price in Britain dropped to £288,430, around £2,900 less than last month.
Compared to the same month last year, house prices have risen by 0.3pc.
Halifax Mortgages director Kim Kinnaird said: “Financial markets have also become less optimistic about the degree and timing of Base Rate cuts, as core inflation proves stickier than generally expected.
This has stalled the decline in mortgage rates that had helped to drive market activity around the turn of the year.”
Purplebricks chief executive Sam Mitchell added: “The blip in house prices was caused by a small increase in rates at the start of March, since then we have seen banks compete more aggressively, rates reduce further, inflation come down ahead of expectations, and both viewings and offers levels are ahead of expectations.”
A separate survey by rival lender Nationwide also showed a decline in monthly house prices by 0.2pc between February and March.
Ms Kinnaird added:
That a monthly fall should occur following five consecutive months of growth is not entirely unexpected particularly in view of the reset the market has been going through since interest rates
began to rise sharply in 2022.Despite this house prices have shown surprising resilience in the face of significantly higher borrowing costs.
Affordability constraints continue to be a challenge for prospective buyers, while existing homeowners on cheaper fixed-term deals are yet to feel the full effect of higher interest rates.
This means the housing market is still to fully adjust, with sellers likely to be pricing their properties accordingly.
Thanks for joining me. House prices unexpectedly fell last month, according to the Nationwide house price index.
Prices were down 0.2pc between February and March as mortgage approvals remained subdued.
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What happened overnight
Asian stocks rose while currencies stayed strong against the yen amid concerns about a possible intervention by the Bank of Japan.
Hong Kong’s Hang Seng was the standout, piling on more than 2pc on the first day of trading since Thursday as investors cheered data showing China’s manufacturing grew more than forecast last month.
Sydney, Seoul, Singapore, Taipei and Manila were in positive territory. Shanghai was slightly lower with Wellington and Jakarta.
Japan’s Nikkei was volatile. It reclaimed the 40,000 points mark in the morning session but was last flat, below the mark.
The yen was slightly weaker at 151.76 per dollar, not too far from the 34-year low of 151.975 it touched last week, with traders keenly watching for hints of intervention from Japanese authorities.
Meanwhile, expectations the Federal Reserve was close to cutting interest rates faded as data on Monday showed US manufacturing grew for the first time in one and a half years in March as production rebounded sharply and new orders increased, highlighting the strength of the economy.
The robust manufacturing data sent yields on US Treasuries higher, with two-year and 10-year yields climbing to two-week peaks, boosting the dollar.
Thanks for joining us. Retail sales came in better than expected last month in a sign Britain’s economy is moving out of recession.
Sales remained flat in February as food and fuel sellers saw a decline during the month, according to data from the Office for National Statistics (ONS).
However, economists had predicted sales to fall by 0.4pc, down from growth of 3.6pc the month before, the ONS said.
Online sales had grown during the month, especially for clothing, as last month’s wet weather pushed down the footfall of people heading out to the shops.
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What happened overnight
The yuan fell sharply and Chinese shares skidded, dragging down markets broadly in Asia and dampening an equity rally spurred by a surprise rate cut in Switzerland that had investors wagering on who will ease policy next.
Traders also were on high alert as the yen crept back toward multi-decade lows despite jawboning efforts from Japanese government officials to shore it up and the central bank’s historic policy pivot earlier this week.
China’s yuan weakened sharply to a four-month low and breached the psychologically important 7.2 per dollar level. It was last nearly 0.4pc lower at 7.2243.
The fall prompted the country’s major state-owned banks to sell dollars for yuan in an attempt to slow its decline, sources told Reuters.
The yuan has been pressured by growing market expectations that Beijing needs to roll out more stimulus to stabilise the world’s second-largest economy, and by the weaker yen. The state bank buying did little to soothe investors’ nerves.
The mainland blue-chip CSI300 index and Shanghai Composite index each fell 1pc, while Hong Kong’s Hang Seng Index slid 2pc.
Elsewhere, Tokyo’s key Nikkei index ended at another record on Friday after Wall Street stocks also hit fresh highs on optimism about the US economy and Fed policy.
The benchmark Nikkei 225 index was up 0.2pc, or 72.77 points, to end at 40,888.43, while the broader Topix index added 0.6pc, or 17.01 points, to 2,813.22.
In America, US stocks extended their push to record highs yesterday, led by big gains for chipmakers.
The S&P 500 rose 0.3pc, to 5,241.53, and set an all-time high for a third straight day. Three out of every four stocks in the index gained ground.
The Dow Jones Industrial Average gained 0.7pc, to 39,781.37, and the Nasdaq Composite rose 0.2pc, to 16,401.84. Both indexes added to records set a day earlier.
The yield on benchmark US 10-year Treasury bonds was down 0.2 basis points to 4.269pc.
Published: March 5, 2024 at 10:02 a.m. ET
Story developing. Stay tuned for updates here.
The numbers: U.S. factory orders fell 3.6% in January large due to fewer contracts for Boeing passenger planes, but there was not much sign of a broad revival among manufacturers.
Economists surveyed by the Wall Street Journal had forecast a 3.1% decline.
…
Story developing. Stay tuned for updates here.
The numbers: U.S. factory orders fell 3.6% in January large due to fewer contracts for Boeing passenger planes, but there was not much sign of a broad revival among manufacturers.
Economists surveyed by the Wall Street Journal had forecast a 3.1% decline.
If transportation is excluded, orders for manufactured goods dropped a smaller 0.8%.
Big picture: Manufacturers have struggled to achieve robust growth for the past few years because of shifting consumer spending habits and higher interest rates orchestrated by the Federal Reserve to quell inflation.
Large subsidies and incentives by the Biden administration have helped to prop up industrial spending to some extent, but manufacturers could get a boost later in the year if the Fed cuts interest rates as expected.
That could help increase business investment once borrowing costs get cheaper.
Key details: Businesses are investing plenty in new computing power, an offshoot of Bide subsidies and the budding artificial-intelligence revolution. Spending is up sharply compared to a year earlier.
All other major areas of the industrial sector are quite weak, however.
Core capital goods orders, a proxy for broader business investment, was flat in January. These orders dropped 0.6% in the prior month and are down slightly compared to a year earlier.
Shipments of manufactured goods already produced fell almost 1% and have declined in four of the past five months.
These figures are factored into gross domestic product report — the official scorecard of the U.S. economy — and suggest GDP in the first quarter might not get much help from business investment.
The Dow Jones Industrial Average
DJIA
and S&P500
SPX
fell in Tuesday trades.
Thanks for joining me. We begin the day with the latest figures showing house prices increased for the first time in more than a year in February.
The average price of a home grew by 1.2pc in the year to February, rising for the first time since January 2023, making properties typically worth £260,420, according to the lender Nationwide.
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What happened overnight
Facebook parent Meta announced it would no longer pay Australian media companies for news, prompting a government warning that the tech giant was in “dereliction” of past promises.
Extending a global retreat from news content, Meta said it would scrap the Facebook News tab in Australia and would not renew deals with news publishers worth hundreds of millions of dollars.
The decision had been on the cards, but will come as a hammer blow for Australian news outlets already struggling to stay afloat.
However, Australian shares hit fresh record highs – as did markets in Japan – as the key US PCE price index – the US Federal Reserve’s preferred measure of inflation – kept up hopes for a June rate cut.
Australia’s resources-heavy shares ASX 200 rose 0.6pd to a new record high of 7,745.6.
In Japan, the key Nikkei index almost touched 40,000 for the first time, rising 1.9pc, or 744.63 points, to close at 39,910.82, while the broader Topix index added 1.3pc, or 33.69 points, to 2,709.42.
China’s mainland markets were higher. The bluechips rose 0.4pc and Shanghai Composite index edged up 0.2pc, after rebounding nearly 10pc last month on the back of Beijing’s efforts to stop short-selling in the market.
Hong Kong’s Hang Seng index also reversed earlier losses to be up 0.6pc.
In America, the S&P 500 rose 0.5pc, to 5,096.27 to top its record set last week. The Nasdaq Composite index rose 0.9pc, to 38,996.39 and surpassed its all-time high that had stood since 2021. The Dow Jones Industrial Average of 30 leading US companies finished just below its record set last week after rising 0.1pc, to 38,996.39.
The yield on benchmark US 10-year Treasury bonds was little changed at 4.27pc.
Hong Kong, a British colony from the 1840s to 1997, grew into an international finance center just off the coast of mainland China.
Anthony Kwan | Bloomberg | Getty Images
Asia-Pacific markets were mostly higher Friday, with China stocks rising for the ninth straight session as investors digested property prices data.
The CSI 300 index ended 0.09% higher at 3,489.74, extending its winning streak for nine days in a row. Hong Kong’s Hang Seng index was 0.13% lower in volatile trading.
Data showed sales prices of newly built commercial housing in first-tier cities fell 0.3% month-over-month in January, with declines narrowing by 0.1 percentage points from the previous month.
At the end of last year, the country’s troubled property market clocked its worst declines in new home prices in nearly nine years.
South Korea’s Kospi ended 0.13% higher at 2,667.70, while the smaller-cap Kosdaq closed 0.18% lower at 868.57.
In Australia, the S&P/ASX 200 closed 0.43% higher at 7,643.60.
Japan stocks were closed for trading on Friday for the Emperor’s Birthday holiday. Japan markets led gains in the previous session, with the Nikkei 225 closing at a new all-time high of 39,098.68, surpassing the previous record of 38,915.87 set in 1989.
Wall Street’s main indexes surged on Thursday, with the S&P 500 hitting a record high after chip giant Nvidia posted quarterly results that far exceeded estimates, boosting the tech sector.
The benchmark index gained 2.11% to close at 5,087.03, its best day since January 2023. The Nasdaq Composite jumped 2.96%, recording its best day since February 2023, while the Dow Jones Industrial Average gained 1.18%, to close above 39,000 for the first time and at a new high of 39,069.11.
— CNBC’s Pia Singh and Yun Li contributed to this report.
Thanks for joining us. To kick off the week, we have figures showing that the asking prices for homes has increased for the first time in six months in a sign of confidence returning to the property market.
Rightmove said the average price of a property listed on its website has increased by 0.1pc compared to the same month last year, which was the first annual increase since July.
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What happened overnight
Shares were mostly higher in Asia after Chinese markets reopened Monday from a long Lunar New Year holiday.
Hong Kong’s Hang Seng fell 0.9pc to 16,192.24 on heavy selling of technology and property shares despite a flurry of announcements by Chinese state banks of plans for billions of dollars’ worth of loans for property projects.
Major developer Country Garden dropped 5.6pc and Sino-Ocean Group Holding plunged 6.5pc. China Vanke lost 4.6pc.
The Shanghai Composite index gained 0.8pc to 2,889.32.
Tokyo’s benchmark Nikkei index closed flat, as Nintendo shares tumbled after reports said its next console would be delayed.
The benchmark Nikkei 225 index edged down 16.86 points to end at 38,470.38, while the broader Topix index climbed 0.57 percent, or 14.96 points, to 2,639.69.
Nintendo’s shares sank 5.1pc following unconfirmed reports that the successor to the Switch console would not be delivered within this year.
Goldman Sachs said it expects the US stock market rally to surge even higher. In a note to clients, analysts forecast the S&P 500 would reach 5,200 by the end of 2024.
This would mean growth of 3.9pc on top of Friday’s close, after it dipped 0.5pc following a fresh record high on Thursday.
A rise in the US producer price index on Friday triggered a small rise in Treasury yields, which climbed by seven basis points to 4.65pc.
Thanks for joining me. House prices declined at their lowest rate in a year in the 12-months to January amid hopes that the Bank of England will start cutting interest rates soon.
The Nationwide house price index showed that property values declined 0.2pc annually last month, having declined by 1.8pc across 2023.
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What happened overnight
Asian stocks mostly declined as markets awaited a decision on interest rates by the Federal Reserve, while China reported manufacturing contracted in January for a fourth straight month.
Official data showed China’s manufacturing purchasing managers index, or PMI, rose to 49.2 in January, up from 49.0 in December, but still below the critical 50 mark that indicates expansion rather than contraction. Weak demand in the world’s second largest economy is dragging on growth.
South Korea’s Kospi shed 0.2pc to 2,494.30 after Samsung Electronics reported reported an annual 34pc decline in operating profit for the last quarter.
Hong Kong’s Hang Seng dipped 1.1pc to 15,536.00, while the Shanghai Composite shed 0.4pc to 2,819.91.
Tokyo stocks closed higher, with the benchmark Nikkei 225 index gaining 0.6pc, or 220.85 points, to 36,286.71, while the broader Topix index rose nearly 1pc, or 24.17 points, to 2,551.10.
Australia’s S&P/ASX 200 added 0.8pc to 7,657.20 after a survey showed Australia’s inflation rate fell to a two-year low in the December quarter, with the consumer price index at 4.1pc, leading to bets that the Reserve Bank may consider an interest rate cut in the next move.
American indexes saw little change on Tuesday, at least outside the technology heavy Nasdaq.
The S&P 500 dropped 0.1pc, from its record to 4,924.97. The Dow Jones Industrial Average of 30 leading US companies gained 0.3pc, reaching 38,467.31, while the Nasdaq Composite index fell 0.8pc to 15,509.90.
The yield on 10-year US Treasury bonds, the centerpiece of the bond market, fell to 4.04pc from 4.09pc late on Monday.
House prices bounced back further last month as lower mortgage rates fuelled a revival in the property market.
The average home increased in value by 1.1pc in December compared to November, according to the Halifax house price index.
It was the third monthly gain in a row after six consecutive falls before that.
It means a typical home is worth £287,105, up more than £3,000 on the previous month.
The increase in prices comes as lenders cut mortgage rates amid expectations that the Bank of England will cut interest rates this year, with several major banks starting the year by offering rates below 4pc.
However, Kim Kinnaird, director at Halifax Mortgages, said: “The growth we have seen is likely being driven by a shortage of properties on the market, rather than the strength of buyer demand.
“That said, with mortgage rates continuing to ease, we may see an increase in confidence from buyers over the coming months.”
Halifax said that overall property prices increased by 1.7pc in 2023 but predicted prices will fall by between 2pc and 4pc this year.
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What happened overnight
Asian shares mostly declined, after a mixed finish on Wall Street, although export-related Tokyo stocks got a boost from a weakening yen.
Benchmarks rose in Tokyo but fell in Sydney, Seoul, Hong Kong and Shanghai.
The yen has weakened amid speculation that the Bank of Japan might go slowly on changing its lax policy stance as it assesses the impact of Monday’s major earthquake in central Japan.
The US dollar rose to 145.23 Japanese yen from 144.63 yen. The euro fell to $1.0930 from $1.0947. It dropped 0.4pc to 184 to the pound.
Japan’s benchmark Nikkei 225 added 0.3pc to 33,377.42.
Hong Kong’s Hang Seng shed 0.9pc to 16,490.92, while the Shanghai Composite sank 1pc to 2,926.32.
Australia’s S&P/ASX 200 shed nearly 0.1pc to 7,489.10. South Korea’s Kospi lost 0.4pc to 2,578.08.
American shares are having a tricky start to the year, with the S&P 500 experiencing its worst new year since 2015 with three consecutive days of decline.
The index lost 0.3pc to end at 4,688.68 points on Thursday, while the Nasdaq Composite index (heavily weighted towards technology companies) lost 0.6pc, closing at 14,510.3. The Dow Jones Industrial Average of 30 leading US companies was flat at 37,440.34.
The yield on 10-year US Treasury bonds jumped to 4pc in a sharp reversal from last week, when the benchmark note slid to a five-month low of 3.78pc on recent data showing inflation by some measures had declined close to the Fed’s 2pc target.