Sector movers: Industrial Support Services, Real estate names pace gains

A rebound in shares of Rentokil was the standout feature in the UK investing landscape in the middle of the week.

Triggering the pop higher was news that activist investor Nelson Peltz’s Trian Management has taken a significant stake in the pest control company.

In turn, that highlighted the ongoing attraction for US investors of investing in UK companies.

Nonetheless, investors' focus was on the latest consumer price data released earlier in the States, which fed rate cut hopes and interest in the more interest rate sensitive areas of the market.

"Just when all hope of a rate cut in 2024 seemed lost, today's CPI reading has provided fresh reasons to expect a cut this year," said IG chief market analyst Chris Beauchamp.

"While the Fed decision is still to come, and might surprise with hawkish commentary, markets might well choose to ignore tonight and hope today marks the resumption of the downward trend in inflation that gave such hope in the second half of 2023."

According to the US Department of Labor, in May headline CPI was flat month-on-month, marking the first unchanged reading since October 2021.

The resulting decline in the year-on-year rate of increase in CPI from 3.4% for April to 3.3% saw Fed funds futures shift towards putting a September rate cut by the Federal Reserve back on the table - although it was not yet by any means certain.

Nearly as interesting, the data appeared to open the door to a similarly soft reading for producer prices figures due out the next day and for the next PCE inflation numbers.

The latter, of course, were the Fed's preferred inflation gauge.

On a related note, earlier PIMCO economic advisor and former Fed vice-president, Richard Clarida, predicted that the Fed would return inflation to target although "it will take time".

"It may take a while but the progress has been remarkable," he said, according to Dow Jones Newswires.

Clarida however added that PIMCO was only anticipating one Fed rate cut in 2024 "but not with much conviction" while the country's unsustainable fiscal trajectory would continue to be kicked down the road.

Top performing sectors so far today

Industrial Support Services 11,639.06 +3.88%

Personal Goods 15,637.54 +3.57%

Real Estate Investment & Services 2,306.19 +2.58%

Household Goods & Home Construction 14,156.70 +2.47%

Real Estate Investment Trusts 2,357.16 +2.33%

Bottom performing sectors so far today

Life Insurance 5,700.28 -0.46%

Telecommunications Service Providers 1,965.30 -0.42%

Leisure Goods 24,393.13 -0.35%

Food Producers 7,968.68 -0.21%

Medical Equipment and Services 11,618.77 -0.20%