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UK house prices in surprise increase; NatWest braces for slowing economy – business live | Business
Key events
Mark Sweney
Here’s more on NatWest’s economic modelling in response to the Iran war: the bank said the economic fallout from the conflict in the Middle East could cost it £140m amid slowing growth and rising inflation even as it reported profits ahead of expectations.
Overall, the FTSE 100 lender booked a £283m impairment charge and said that almost half of that was because of a reassessment of its economic forecast to “reflect increased geopolitical risk and weaker equity markets”.
The bank said it expects its base case for UK gross domestic product growth to be only 0.4% this year, half that forecast by the International Monetary Fund earlier this month.
You can read more here:
Oil prices up with no end of Iran blockade in sight
Donald Trump has said he will stick with the US’s “incredible” blockade of the strait of Hormuz, with little sign that talks over reopening it are likely. Yet oil prices look like they are off their two-year peak of more than $126 per barrel of Brent crude on Thursday.
Brent crude futures are trading at $110 today, but that does not actually mean prices have dropped. Futures prices refer to a specific month of delivery, and the contract watched by financial markets changes at the end of each month. The price of crude for the new front month, July, is up by about 1% on Friday.
The US-Israeli war on Iran has triggered a global energy crisis, as Iran responded by closing the strait and strangling about a fifth of global oil supplies. Yet despite the electoral risks to Trump from surging gasoline prices (not to mention a potential global food crisis), there appears to be little sign of movement to reopen the strait.
“Their economy is crashing, the blockade is incredible, the power of the blockade is incredible,” Trump told reporters at the White House on Thursday. “Their economy is a disaster. So we’ll see how long they hold out.”
Jim Reid, an analyst at Deutsche Bank, wrote in a note to clients:
Oil prices have continued to creep higher overnight, with no sign that the US and Iran are moving closer to a deal. Given the month-end, there’s been a contract roll, but if we stick with the July 2026 contract for consistency, Brent crude is up +1.07% this morning to $111.58/bbl. Moreover, Trump showed no sign of backing down […]
Meanwhile, there’s been no sign of comprise from the Iranian side, with new Supreme Leader Mojtaba Khamenei issuing a statement that Iran would maintain its missile and nuclear capabilities and suggesting that Iran would implement “new legal frameworks” over the Strait of Hormuz.
NatWest is now the biggest faller on the FTSE 100, down 3.7% after analysts suggested that its underlying profits were slightly weaker than expected.
Gary Greenwood, banks analyst at Shore Capital, said that profits before tax benefited from “stronger-than-expected notable items in income and slightly lower costs”, but once those were stripped out “underlying performance was a touch weaker than expected”. In a note to clients, Greenwood wrote:
While management has upgraded [2026] income guidance to the top end of the £17.2bn to £17.6bn range, this remains below current consensus of £18.0bn and may therefore disappoint, especially given the first quarter miss on this metric.
Richard Hunter, head of markets at interactive investor, an investment platform, said:
With high performance comes high expectations, and NatWest has slipped today in terms of outlook rather than delivery. The slightly bearish reaction to the numbers reflects the disappointment, although in context it does little to derail the group’s onward march. The shares have risen by 22% over the last year, as has the wider FTSE100, and by 90% over the last two years.
At the other end of the FTSE 100, AstraZeneca is among the biggest fallers after US regulators voted against recommending its new breast cancer drug. Its shares were down 1.9% in early trading.
A US Food and Drug Administration committee voted against recommending the pharmaceutical company’s camizestrant by six votes to three.
Susan Galbraith, executive vice president of oncology haematology R&D at AstraZeneca, said:
We are disappointed with the mixed outcome of today’s [committee] meeting. We strongly believe in the results of the SERENA-6 trial, and are encouraged that the committee saw camizestrant as a safe and effective potential new medicine. We remain confident in the clinical benefit the combination can bring to patients by changing therapeutic strategy at the earliest opportunity, and are committed to challenging the status quo in the pursuit of innovation that optimises outcomes for patients.
Diageo shares rise after Trump removes whisky tariffs
And we’re off, in London at least. Top of the FTSE 100 this morning is Diageo, the drinks maker. It makes brands including Guinness but also, more pertinently this morning, a bevy of Scotch bevvies.
Diageo executives will be raising a glass to King Charles, after Donald Trump last night announced that the US would drop all tariffs on Scotch whisky in the royal family’s honour.
Trump said in a post on social media:
In Honor of the King and Queen of the United Kingdom, who have just left the White House, soon headed back to their wonderful Country, I will be removing the Tariffs and Restrictions on Whiskey having to do with Scotland’s ability to work with the Commonwealth of Kentucky on Whiskey and Bourbon.
The King and Queen got me to do something nobody else was able to do, without hardly even asking!
Shares in Diageo rose by 2% in early trading above £15. Its whisky brands include Johnnie Walker, Lagavulin, Talisker, the Singleton and Mortlach. Whisky and most other UK exports had been subject to 10% tariffs.
It is likely to be a quiet morning on equity markets, as most of the major indices around Europe are closed – and on that note, happy May Day!
But London is still open for trading (and closed on Monday). Futures prices suggest the FTSE 100 is due to dip by 0.3%.
UK house prices up surprise 0.4% in April; NatWest profits up
British homebuyers defied a bleak economic mood and the Iran war to push house prices up by 0.4% in April, surprising economists who had on average expected a decline.
Annual house price growth picked up to 3.0% in April, from 2.2% in March, according to data published on Friday by Nationwide, the UK’s largest building society. That put the average price at £278,880.
Nationwide said the increase in prices reflected resilience in the housing market, despite measures of economic sentiment declining, and the backdrop of the US-Israeli war in Iran threatening inflation because of higher oil prices.
Robert Gardner, Nationwide’s chief economist, said:
Despite the uncertainty caused by developments in the Middle East and the subsequent rise in energy prices, the UK housing market has continued to regain momentum following the slowdown recorded around the turn of the year.
This is somewhat surprising given that indicators of consumer confidence have weakened noticeably. GfK’s headline index has fallen to its lowest level since late‑2023, reflecting households’ more pessimistic views of the economic outlook and their own financial position over the year ahead.
Ashley Webb, senior UK economist at Capital Economics, a consultancy, said:
The surprisingly strong rise in the Nationwide measure of house prices in April shows that house prices have continued to gain momentum despite the falls in consumer confidence and the rise in mortgage rates since the start of the Iran war. But the growing upside risks to our mortgage rate forecast from the most recent rise in oil prices suggests this strength is unlikely to last.
NatWest Group reports higher profits despite economic gloom
NatWest reported higher profits of £1.4bn in the first quarter of the year, despite the UK banking group setting aside an extra £140m in case of the economy worsening.
The bank, formerly known as Royal Bank of Scotland, said that it expects income for the year to reach the top end of its expected range of between £17.2bn and £17.6bn.
Paul Thwaite, NatWest’s chief executive, said it was a “strong performance in the first quarter of 2026”.
We have started the year with positive momentum, underpinned by healthy customer activity – growing all of our three businesses, expanding our capabilities to meet more of our customers’ needs and further improving productivity as we use AI at scale across the bank.
The agenda
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9:30am BST: Bank of England consumer credit (March; previous: £1.9bn; consensus: £1.8bn)
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9:30am BST: Bank of England mortgage approvals (March; previous: 62,580; consensus: 60,000)
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1:15pm BST: Bank of England – speech by Huw Pill, chief economist
The family of Shaun Burton, say they are “devastated” by the loss.
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Key events
In the opening half an hour against Cape Verde, Mikel Oyarzabal, the centre-forward, did not get a single touch.
Kyle Green gets in touch: “Your highlighting of Lalas and his absurdity is something that has prevented me from wanting to watch the coverage on Fox. While every channel has its pros and cons I just can’t.
“I’m 45 and probably the youngest of anyone who remembers him as a player instead of an opinionated insert insult here. As for the match this could be more competitive than it looks on paper Spain need a win the pressure is on them. Saudi Arabia could hold out for a draw and see what happens in their last match. “
News from the England camp, and it seems to be good news on Declan Rice.
“I’m ready and fit, raring to go. I was feeling a little bit of neural pain in my hamstring, which I was managing from after Christmas with Arsenal for a very long time. Obviously, not a lot of people would have known that. It was all behind-the-scenes stuff but it was a smart decision.
“In the end, that last 20 minutes is probably where you pick up the most, and it’s where you play a 70-minute match. But that last 20 is where you really feel your body going for it. And I think it was a smart decision because the last few days I felt really, really good.”
Alex Reid has penned today’s weekend special Football Daily.
Portugal v Uzbekistan on Tuesday enticingly pits the incredibly nice, incredibly 41-year-old-superstar-tolerant Roberto Martínez against Fabio Cannavaro, who’s won a Ballon d’Or as a player and the Chinese Super League as a coach. While the fixture following that game really does see the dream of Thomas Tuchel – in his first international job with England – taking on Queiroz, who is in charge of his ninth national side with Ghana.
The expected formations are 4-2-3-1 for Spain, and 5-3-2 for the Saudi Arabians.
The Saudi team features two Donis changes: Ali Lajami, a defender, and Nasser Al Dawsari, a midfielder, are preferred to Mohammed Abu Al Shamat and Mohamed Kanno. You may recall Salem Al Dawsari, the Saudi captain, as the man who scored the winner against Argentina.
An entertaining read, even for those of us who have just seen the clips.
In a conversation where his co-panelist is casually reminiscing about his days playing alongside Messi or exchanging shirts with Ronaldo Nazário at the World Cup, what exactly is Lalas going to talk about – coming on as a second-half substitute for Earnie Stewart in a friendly against Scotland in 1998? Helping the Kansas City Wizards finish last in the 1999 MLS Western Conference? Did Lalas enjoy an elite playing career? No. But does he do the background reading that could compensate for his relative lack of standing in a conversation with titans like Henry and Zlatan? Also no. But is he charming or funny or charismatic or otherwise magnetic on screen? Eh, no.
For the record, I once interviewed Alexi Lalas on the challenge of playing against Romario in the 1994 World Cup. He had this to say:
“He could kill you in so many different ways. If you remember from that World Cup, he scored so many types of goals. That ranged from solo adventures to an outside-of-the-right-foot half-volley off a corner kick. Romario was both the most difficult to play against and the best that I have faced.
“Roberto Baggio was doing his thing, but in terms of consistency and living up to the hype, he [Romario] was the best. As with all stars, there was a moment when the fans sit up in their seats, and that was a feeling I got with Romario. When it got close to him and the potential for his involvement in a play was there, everybody sat up in their seat. They knew that something spectacular would be happening.”
Saturday’s match reports here.
The Saudi Arabia coach, and Blackburn legend, Georgios Donis, spoke about the challenges facing his team: “Spain is not the same team when Yamal or Williams are on the bench.
“While they still have plenty of possession, they lack the individual one-on-one penetration when these two are missing. I’m not saying it’s a problem for Spain, but when those players are missing, they play in a different way. We saw this very clearly against Cape Verde.
“We are playing against one of the best teams in the world, and it’s very important that when you play against these kinds of teams, you should enjoy the experience and respect the opponent, but not too much.
“It is very hard for any team playing against Spain to have any time in possession. So what we must do is to be more in control of our movement and compact, and when the ball goes through the lines, be able to defend dynamically.
“It’s nice to see miracles in football, and we’ve seen favourites losing against underdogs. Of course, it’s great for Saudi football to have a great memory of the result against Argentina, but we aren’t drawing anything from that.
“I think we’ll feel more pressure in that [Cape Verde] game than we will against Spain.”
The Spain coach, Luis De La Fuente had this to say in his Saturday press conference: “This generation of footballers is highly competitive and really fired up… It’s going to be a completely different story,” he said at his pre-match press conference on Saturday. There is no drama or crisis. The bottom line is simply that we need to win tomorrow.”
Four changes for Spain: Lamine Yamal, Pedro Porro, Dani Olmo and Alex Baena also come into the side with Marcos Llorente, Fabian Ruiz, Ferran Torres and Gavi dropping out.
The teams – Lamine Yamal starts
Spain: Simon, Porro, Cubarsi, Laporte, Cucurella, Gonzalez, Rodri, Yamal, Olmo, Baena, Oyarzabal. Subs: Raya, Joan Garcia, Pubill, Grimaldo, Eric Garcia, Llorente, Merino, Torres, Fabian, Gavi, Pino, Williams, Zubimendi, Munoz, Iglesias.
Saudi Arabia: Al Owais, Abdulhamid, Tambakti, Lajami, Al Amri, Al Harbi, Nasser Al Dawsari, Al Khaibari, Al Juwayr, Al Buraikan, Salem Al Dawsari. Subs: Al Aqidi, Al Kassar, Majrashi, Yahya, Al Shehri, Al Boushal, Kadesh, Al Johani, Al Ghannam, Al Hajji, Al Hamdan, Mandash, Kanno, Thakri, Abu Al Shamat.
Referee: Raphael Claus (Brazil)
Perhaps one of the Saudi -players can write themselves into this high-grade selection?
Perhaps it can be their goalkeeper.
Madrid screening of Spain v Saudi Arabia cancelled due to heat
The public screening of Spain’s World Cup match against Saudi Arabia in Madrid on Sunday has been cancelled because of extreme heat forecast for the Spanish capital, officials said.
The match, due to kick off at 6pm local time on Sunday, had been scheduled to be shown on a giant screen installed by the Spanish football federation (RFEF) at a fan zone in Plaza de Colón in central Madrid.
Madrid city council and the federation decided to cancel the screening after national weather agency AEMET issued an orange heat warning – the second-highest level – for the Madrid region, with temperatures forecast to reach 40C.
“The decision has been taken with the aim of protecting the health of attendees, event staff and support services involved in the event,” Madrid city hall said in a statement, apologising for any inconvenience.
Officials urged supporters to watch the match indoors in air-conditioned spaces and avoid prolonged exposure to the heat.
Large parts of Spain are experiencing unusually high temperatures for June as a mass of hot air from North Africa moves across the Iberian Peninsula.
A total of 13 of Spain’s 17 regions are on orange alert for heat on Sunday, while the northern Basque Country bordering France is on red alert, the highest level.
Authorities advised residents and visitors to take precautions during the heatwave, including drinking water regularly, staying in cool environments, limiting outdoor physical activity during the hottest hours of the day and taking extra care of vulnerable people. AFP
Can Saudi Arabia repeat the magic of 2022?
Argentina arrived in Qatar on a 36-game unbeaten run. When Lionel Messi opened the scoring from the penalty spot after 10 minutes, a comfortable afternoon seemed in the offing. Saleh al-Shehri and Salem al-Dawsari had other ideas, Argentina had three goals disallowed for offside in the space of 13 minutes and the greatest comeback in Saudi Arabia football history was made. Argentina went on to lift the trophy, while defeats to Poland and Mexico meant the Saudis did not reach the knock-out stage.
Unai Simon over David Raya is a controversial choice for De la Fuentes. The Arsenal keeper could lay claim to being Europe’s best this season.
“Those at the Champions League final had a few more days, so I got there on the Wednesday night,” Raya says. “I arrived a bit before Fabián [Ruiz]. I was saying hello to some of the others in reception when he arrived. I went to say congratulations; that was almost the first thing I did. I couldn’t really talk [to him] after the final; I just didn’t have it in me. The next day we talked about the game properly. Just two mates chatting … I was happy for him that he could lift the trophy for a second time.”
A high pressure game for the European champions, as Sid Lowe reports.
“If we had scored one, the game would have changed,” Martín Zubimendi said. Immediately after the game, De la Fuente had offered a simple analysis: when the ball doesn’t want to go in it doesn’t want to go in, he insisted. Spain had racked up 27 shots, after all. Ferran Torres had hit the bar and seen another clear opportunity saved. Vozinha, the 40-year-old goalkeeper who stopped that, saved six more and was named the man of the match. “There’s nothing to reproach the team for,” Rodri said. “We generated chances but couldn’t put it away; the good thing is they created almost nothing.”
We wait to see what role Lamine Yamal will play today. His coach would surely like to be able to use him.
The worst mistake we could make would be to compare him to anyone. He is the midst of a process. He has exceptional footballing maturity and lives it all with total naturalness. He has great serenity and strength. We have to let him follow his path but those players who have something different are ready for that. They’re geniuses, like Dalí [who] can paint a picture, or Michelangelo. They’re different. What is exceptional to us, isn’t to them. In those extremes, they feel comfortable. Why? Because they are different. What we think is exceptional, they consider normal.
Preamble
Spain’s campaign did not get off to a flying start, and Luis de la Fuentes may wake up in the night to visions of Cape Verde’s Vozinha. He will have Georgia on his mind ever since Monday. Saudi Arabia are no pushovers and gave Uruguay a scare in their opening match. Memories of downing Argentina four years ago still abound, and so Spain might beware. They can ill afford to go into the final game with Uruguay at a disadvantage. All eyes on Lamine Yamal, whose fitness situation remains opaque, though Spain need their other forwards to come to the party.
Kick-off 5pm UK, 1pm ET, 2am AEST. Join me.
A topless man can be seen driving erratically in Edinburgh before abandoning his car and attacking a black man and a delivery rider.
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