Falling oil prices and economic data weigh on the FTSE 100

Friday’s eurozone’s inflation data climbed to 2.9% year-on-year, while nonfarm payrolls in the US exceeded expectations, which cooled down investors’ hopes of early rate cuts. The FTSE 100 fell by 0.4 on Friday and by 0.6% for the week.

However, the US services data, also published on Friday, was unexpectedly weak, which sent a contradictory signal. Overall investors have lowered their expectations for rate cuts this year, with more believing that they will start from May instead of March.

The FTSE 100 remained in the red on Monday morning, weighed down by energy stocks, as oil prices eased due to sharp price cuts by Saudi Arabia in a bid to overcome a weak market.

Shell dropped 2.2% after it unveiled impairment charges of up to $4.5 billion for the fourth quarter, linked to its Singapore Chemicals & Productions assets that it is looking to sell.

Investor focus is now turning to earnings season, which kicks off later in the week with JPMorgan and Bank of America. 

Things to read today:

• 5 predictions on how AI will (or won't) affect the 2024 US election (The Information).
• What the Carrefour-Pepsi war says about the price/volume effect (On the Street).
• Bank regulation on capital has made financial system more fragile (FT)