Fed interest rate decision and stocks

Mulberry shares were 9.3% lower at 1:56 p.m. in London after the British retailer, known for its luxury handbags reported a 4% fall in revenue and 3.2% decline in retail sales in a full-year trading update.

“While we achieved positive revenue growth in the first half, Mulberry has not been immune to the broader downturn in luxury spending experienced in recent months, particularly in the UK and Asia. This decline was partially offset by positive trading in the US, where we have benefitted from increased brand awareness,” CEO Thierry Andretta said in a statement.

Andretta said the trading environment in the U.K. and key luxury market China remained challenging and was not expected to change in the short-term.

“We are therefore managing the business prudently, focusing on executing our strategy and vision to become a global sustainable luxury brand,” Andretta said.

The company has in recent years shifted more of its production to the U.K. after facing ongoing supply chain challenges.

— Jenni Reid

Haig Bathgate, head of investments at Atomos, comments on the state of the economy and investing in bond markets.

U.K. house prices slid for a second straight month in April, according to an index published by lender Nationwide.

Prices declined 0.4% month-on-month, following a 0.2% fall in March. Economists polled by Reuters had expected another reading of a 0.2% drop.

On an annual basis, prices were 0.6% higher in April, marking a slowdown from 1.6% growth in March.

Robert Gardner, chief economist at Nationwide, said that the figures likely reflected ongoing affordability pressures on buyers due to higher interest rates.

Seasonally-adjusted U.K. house prices are now around 4% below the all-time highs reached in the summer of 2022, Gardner added.

Mortgage rates have ticked higher in recent months, as markets have pulled back their expectations over the breadth of Bank of England interest rate cuts this year. The average 2-year fixed residential mortgage rate was 5.91% on May 1, according to Moneyfacts data, up from 5.8% at the start of April.

— Jenni Reid

Next shares were 0.3% lower at 10 a.m. in London after the British clothing and homewear retailer maintained its full-year profit and sales guidance.

The company, viewed by some as an indicator of U.K. consumer demand, reported a 5.7% rise in year-on-year sales for the first quarter in a trading update.

In-store sales were flat, while online sales rose 8.8%.

Economists expect an improvement in the U.K. retail environment this year amid rising real household incomes and potential interest rate cuts.

— Jenni Reid

Aston Martin shares fell more than 11% in early deals, after the luxury carmaker said its adjusted loss before tax nearly doubled to £110.5 million ($137.8 million) in the first quarter. The results were worse than the market forecast.

Shares pared losses and were 7% lower by 9:05 a.m. London time.

Analysts at Jefferies said the results were a “big miss across metrics,” flagging a 26% drop in sales volumes.

Aston Martin said the delivery of four new models in 2024 would power “significant growth” in the second half of the year and beyond, and that the quarter represented an “expected period of transition.”

Read more here.

— Jenni Reid

The U.K.’s FTSE 100 was 0.2% higher at 8:30 a.m. London time.

Most European bourses are closed for the May Day public holiday. The regional Stoxx 600 index closed lower Tuesday as it clocked its first monthly decline since October.

GSK reported a 27% rise in core operating profit in the first-quarter, coming in above expectations in a company-compiled consensus, as the pharmaceutical giant raised its growth outlook for the full-year.

The British company said it now expects core operating profit growth of 9% to 11% in 2024, up from a previous outlook between 7% and 10%. It now also anticipates core earnings per share will expand by between 8% and 10%, from a previous guidance of 6% to 9% growth.

— Jenni Reid

Only two European stocks have positively surprised markets every quarter for the past five quarters, according to analysis by CNBC Pro.

CNBC Pro screened for Stoxx 600 stocks that report EPS figures and have analysts’ estimates available on FactSet.

One of the stocks stood out for several large share price jumps following quarterly earnings releases. Most recently, the company beat earnings estimates by 6.1% and shares rallied by more than 8% in the following session. Similarly, the stock rallied by 12.8% in a single session four quarters ago.

CNCB Pro subscribers can read more about the stocks here.

— Ganesh Rao

Oil prices have fallen for a third straight day as U.S. inventories rise as well as optimism for a ceasefire agreement in the Middle East.

Brent contracts slid 0.88% to $85.57 per barrel, while U.S. West Texas Intermediate crude saw a larger loss of 1.03% to $81.09 per barrel.

Reuters reported that U.S. crude oil inventories swelled last week by 4.906 million barrels, while gasoline and distillate stockpiles fell, according to market sources citing American Petroleum Institute figures on Tuesday.

— Lim Hui Jie

The outlook is starting to look bright for biotech stocks, according to some.

With markets now expecting the first rate cut to be in September rather than June or July, as previously thought, biotech stocks could start to do well.

Biotech encompasses many different areas, but Citi has identified one with a $2.9 billion market — which it says is set for even more growth. According to Citi, the market for it is set to grow by mid-single digit over the next five years.

CNBC Pro subscribers can read more here.

— Weizhen Tan

Only London’s FTSE index is open today with the German DAX, French CAC and Italian FTSE MIB closed for the May Day/Labour Day holiday.

The FTSE 100 index is expected to open 11 points lower at 8,132, according to data from IG.

Earnings come from GSK, Next, Abrdn, Metro Bank, Aston Martin Lagonda and Domino’s Pizza Group.

— Holly Ellyatt