London hits record high as global stocks cheer best September since 2013

The FTSE 100 (^FTSE) outperformed against its European peers on Wednesday, hitting a new intraday high as investors shrugged off concerns about the US government shutdown.

It comes as global stocks enjoyed their best September since 2013, while the S&P 500 (^GSPC) share index had its best September in 15 years.

It follows strong trading in the third quarter of the year, with the FTSE 100 gaining 6.7% in the July to September period, its best quarter since the end of 2022.

The London stock market has had a strong 2025, with defence companies, miners and banks all in demand. So far this year, the FTSE 100 has risen by almost 15%, on track for its strongest year since 2009.

Traders will be keeping an eye on the US government shutdown, after Republicans and Democrats failed to agree a funding plan for federal departments.

Previous shutdowns have been resolved fairly quickly, but it does mean that traders will not see US economic data until the situation is resolved.

Kyle Rodda, senior financial market analyst at Capital.com, said typically, “a shutdown is immaterial for markets.”

“In fact, the 2018-2019 shutdown, which lasted for over a month, actually saw Wall Street rise. The issue for markets here is twofold. One, it could delay the release of Friday’s non-farm payrolls data, which is going to be a nuisance, if nothing else, especially as market participants search for insights on the health of an ailing US labour market.

“US president Trump has also threatened to permanently lay off workers, which could turn the shutdown into a mini labour market shock.”

London’s benchmark index (^FTSE) was 0.4% higher in early trade as investors entered the final quarter of the year.
Germany's DAX (^GDAXI) dipped 0.4% while the CAC (^FCHI) in Paris headed 0.2% into the green
The pan-European STOXX 600 (^STOXX) was up 0.1%
Wall Street is set for a negative start as S&P 500 futures (ES=F), Dow futures (YM=F) and Nasdaq futures (NQ=F) were all in the red.
The pound was 0.2% against the US dollar (GBPUSD=X) at 1.3468, with the dollar index slipping to a one-week low

Follow along for live updates throughout the day:

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UK house prices rise by 0.5% in September

UK house prices rose more than expected in September, despite concerns about affordability as mortgage rates edged higher in recent weeks.

The average cost of a home climbed 0.5% on a month-on-month, according to Nationwide's latest house price index, released on Wednesday. This was more than the consensus forecast of a 0.2% monthly increase, according to Capital Economics.

On an annual basis, price growth was steady at 2.2%, only marginally higher than the 2.1% recorded in August.

The average price of a residential property now stands at £271,995, compared to £271,079 in August.

Robert Gardner, Nationwide's chief economist, said:
Investors shrug off US government shutdown worries

The first federal government shutdown in years began early Wednesday morning after lawmakers and President Trump stopped negotiations and spent the final hours before the stoppage largely focused on trying to set up the other side to take the political blame.

The victory of gridlock was sealed Tuesday evening when twin Senate votes failed to advance either a Republican bill (even as three members of the Democratic caucus crossed party lines to vote yes) or a Democratic plan. No compromise plan was offered, ensuring the funding lapse.

The shutdown — the first since a seven-week stoppage during Trump's first term — began at 12:01 a.m. ET as the new fiscal year began. That last shutdown took place in 2018-19 and broke the record for the longest in American history.

Federal agencies will now implement their contingency plans and send hundreds of thousands of government workers home to wait out a stalemate.

Previous shutdowns have been resolved fairly quickly, but it does mean that traders will not see US economic data until the situation is resolved.

Kyle Rodda, senior financial market analyst at Capital.com, said typically, “a shutdown is immaterial for markets.”
Asia and US overnight

Asian equity markets were quiet overnight, due to holidays in China and Hong Kong for National Day. Markets in mainland China will remain closed until the middle of next week.

Throughout the region, Japanese stocks are underperforming, with the Nikkei (^N225) and down 0.9% amid concerns over potential interest rate hikes after a survey showed increasing confidence among the country’s largest manufacturers.

Sentiment among Japan's major manufacturers showed improvement for the second consecutive quarter, increasing 1 point to +14 compared to June's results. The index for large non-manufacturers held steady at 34, close to its peak level since the early 1990s.

In addition, large enterprises across various sectors intend to raise their business investments by 12.5% for the current fiscal year, an increase from the previously projected 11.5%.

Markets are pricing in around a 70% chance of an interest rate hike in October with two big events to come later this week — a speech from Kazuo Ueda, governor of the Bank of Japan, on Friday and the conclusion of the LDP leadership election over the weekend.

Meanwhile, the Kospi (^KS11) bucked the regional negative trend, adding 1.9% on the day.

Across the pond on Wall Street, markets brushed off some initial shutdown jitters, with the S&P 500 (^GSPC) rising 0.4%, recovering to close less than 0.1% from its all-time high. The tech-heavy Nasdaq (^IXIC) was 0.3% higher and he Dow Jones (^DJI) gained 0.2%.

Overall investors remained hopeful that the issues will be sorted over the coming days, with little wider impact on the economy or earnings.

The Mag-7 were mixed with Nvidia (NVDA) up 2.6% reaching another all-time high, but Meta (META) slipped. 1.2% and Amazon (AMZN) likewise losing ground by around the same amount.
Coming up

Good morning, and welcome back to our markets live blog. As usual we will be taking a deep dive into what's moving markets and happening across the global economy.

To the day ahead we have data releases from the US including the ISM manufacturing, and the ADP’s report of private payrolls for September. In the Euro Area, we’ll get the flash CPI print for September. Globally, there’s the September manufacturing PMIs as well.

From central banks, we’ll hear from ECB Vice President de Guindos, the ECB’s Kazimir, Kocher, Simkus, Nagel, the Fed’s Barkin, and the BoE’s Mann.

Here's a snapshot of what's on the agenda:

7am: Trading updates: Greggs, James Halstead, Topps Tiles

7am: Nationwide’s UK house price index

9am: Eurozone manufacturing PMI report for September

9.30am: UK manufacturing PMI report for September

10am: Eurozone inflation report for September