On Tuesday, U.K. stocks experienced a decline as new data revealed a deceleration in wage growth to the slowest rate observed in over two years, specifically in the three months leading up to August. This development bolsters anticipations that the central bank may continue to lower interest rates in its upcoming meeting.
Average earnings, excluding bonuses, increased by 4.9% compared to the previous year during this period, a slight deceleration from the 5.1% rise noted in the three months leading to July. This marks the slowest increment since June 2022 and aligns with market forecasts. Meanwhile, the unemployment rate marginally declined to 4.0% over the same period, with payroll employment witnessing a reduction of 15,000, settling at 30.3 million in September.
The FTSE 100 index retreated by 31 points, or 0.4%, to 8,261, following a half-percent gain in the previous trading session. Energy sector leaders such as BP Plc saw a 4.2% drop, while Shell's shares fell nearly 3%, influenced by a decline in oil prices to near a two-week low. This was driven by a weaker demand outlook from the International Energy Agency (IEA) and reports suggesting Israel's planned reprisal against Iran won’t include nuclear or oil installations.
Workspace Group, a premier office rental firm, saw its stock decrease by approximately 1%, following a dip in like-for-like occupancy as an unusually high number of tenants vacated during the second quarter.
Conversely, Bellway shares soared by 7.2%, buoyed by a positive update on the recovery status of the U.K. housing market.
