Unemployment and wage figures are in focus as the City looks for signs that Bank of England interest rates have peaked.
The UK’s unemployment rate remained at 4.2% in the three months to September, while wages excluding bonuses rose in line with expectations.
With Vodafone, Imperial Brands and Land Securities among those reporting, the FTSE 100 is slightly lower ahead of this afternoon’s US inflation reading.
FTSE 100 Live Tuesday
Glencore strikes £5.6bn coal deal
BT reveals big drop in pension deficit
Wage and jobs numbers in line with forecasts
FTSE closes at 7,440.47
Tuesday 14 November 2023 16:37 , Daniel O’Boyle
The FTSE 100 closed up 0.2% at 7,440.47 today, getting a boost from better-than-expected US inflation figures.
Ocado was among the big risers, with its shares soaring on the US CPI release.
Markets will hope to see more good news tomorrow morning when UK inflation figures are published.
Asda sales growth slows after poor weather hits clothing
Tuesday 14 November 2023 16:26 , Daniel O’Boyle
Asda has revealed a slowdown in sales for the latest quarter, as poor summer weather hit clothing and general merchandise sales.
The UK’s third largest supermarket chain revealed that like-for-like sales, excluding fuel, grew by 2.8% over the third quarter of 2023, compared with the same period last year, as it reported revenues of around £5.4 billion for the period.
However, the sales growth represented a significant slowdown after posting a 9.6% sales increase in the second quarter.
It came as the company was dragged back by a fall in clothing and general merchandise, which includes homeware and technology.
Read more here
Sephora UK’s Pauline Dolle-Labbe on the new Stratford store and how the beauty giant is doing in London
Tuesday 14 November 2023 15:28 , Daniel O’Boyle
Pauline Dolle-Labbe is the marketing and ecommerce director at Sephora UK. She has been at the beauty retailer for just over a year and had previously been working within the parent company LVMH where she had been for over four years as the chief marketing officer at 24S.com- the fashion and luxury multi-brand e-commerce platform of LVMH.
Click here to read about how the reception to Sephora in London has been since opening its White City branch in March- its first UK physical store since exiting its last ones here by 2005, and how big the latest Westfield Stratford store will be that opens to the public on November 15.
Seven arrested as SFO launches probe into suspected fraud at law firm Axiom Ince
Tuesday 14 November 2023 15:18 , Daniel O’Boyle
Seven people have been arrested by fraud investigators as part of a criminal investigation into collapsed law firm Axiom Ince and around £66 million of missing client money.
The Serious Fraud Office (SFO) said over 80 of its investigators, accompanied by Metropolitan Police officers, conducted nine raids across the South East early on Tuesday morning to bring people in for questioning and search for possible evidence.
It comes after Axiom Ince was shut by the Solicitors Regulation Authority last month, when about £66 million of client money was found to be missing from its accounts and had been spent.
Read more here
US stocks to soar
Tuesday 14 November 2023 14:24 , Daniel O’Boyle
Shares on Wall Street are set to jump when markets open this morning, as traders’ confidence grows that the Federal Reserve’s next rate change will be down.
Dow Jones futures are up 1% to 34,750.00 and S&P 500 futures are up 1.3% to 4,483.75. Nasdaq futures, containing some of the most rate-sensitive stocks, are up 1.7% to 15,808.75.
Among the stocks set to surge are Tesla, up 5% premarket, and Palantir, up 2.3%
FTSE 100 up on improved global interest rates outlook
Tuesday 14 November 2023 13:52 , Daniel O’Boyle
The FTSE 100 is up and gilt yields are down after the latest US inflation data suggested cuts to US interest rates may be within sight.
Ocado shares, among the most sensitive to interest rates, skyrocketed on the release.
Take a look at our market snapshot
US inflation stays at 3.2%
Tuesday 14 November 2023 13:40 , Daniel O’Boyle
Inflation in the United States remained at 3.2%, defying expectations of a rise.
Core inflation was also below expectations, at 4.0%.
That will boost hopes that global interest rates have peaked, and that the Federal Reserve may think about cuts soon.
On a month-on-month basis, prices were unchanged.
Richard Flynn, managing director at Charles Schwab UK, said the numbers make “the prospect of a soft landing ever more likely”.
He said: “The numbers revealed today indicate the Fed is inching closer to its 2% CPI target.
“This good news reinforces the likelihood that the Central Bankers will hold off from further rate hikes in this cycle, which is the direction they seem to be leaning in any case. With wage growth slowing and sectors such as manufacturing losing pace, there is a risk that further tightening could trigger a problem in the economy.
“Higher rates in the US would also make it more expensive to borrow in US dollars, creating difficulties for emerging-market economies that do so. All in all, ‘higher for longer’ looks like a much more sensible move than ‘even higher’”
Halifax, First Direct and HSBC UK among lenders cutting mortgage rates
Tuesday 14 November 2023 13:12 , Daniel O’Boyle
Major lenders have announced new mortgage rate cuts, widening the choice for borrowers searching for deals under the 5% mark.
First Direct announced rate cuts of up to 0.40 percentage points from Tuesday.
Halifax also announced cuts to its mortgage rates by up to 0.46 percentage points from Wednesday.
This includes cutting a five-year fix for borrowers with a 10% deposit by 0.24 percentage points to reach 4.97%.
Read more here
Imperial Brands sees weaker first half growth amid heavy spend in vaping arm
Tuesday 14 November 2023 12:29 , Daniel O’Boyle
Tobacco giant Imperial Brands has said it expects earnings to edge higher in the next financial year but will be held back in the first six months due to pricing action and investment in cigarette alternatives.
The maker of Winston and John Player Special cigarettes said it expects to grow underlying operating profits by “close to the middle of our mid-single digit range” in 2024 on revenues up by a low single digit.
Price hikes helped drive underlying earnings higher in the year to September 30, up 3.8% on a constant currency basis to £3.9 billion.
Read more here
West End is full, Land Sec says
Tuesday 14 November 2023 11:31 , Daniel O’Boyle
Property giant Land Securities today declared its West End offices are “full” and in another sign that London is roaring back to business, latest industry data showed that firms are in talks to let even more space – enough to fill six Gherkin towers.
Landsec said today that its overall central London occupancy rate hit 96.5%. And the West End fared even better – with 99.6% of it let – meaning that the capital’s cultural heartland was “effectively full”, at least as far as the FTSE 100 group’s portfolio was concerned.
Mark Allen, CEO of the owner of the Lucent office development behind the iconic Piccadilly Lights advertising site, became the latest big name in the industry to point to the trend driving demand since Covid: “Customers concentrating on best-in-class space.” He added:
“In London, our well-located, sustainable offices in vibrant, amenity-rich areas continue to see growing occupancy, growing utilisation, growing customer space requirements and hence growing rents.”
Read more here
Glencore agrees to acquire Teck’s coal arm in biggest City deal of 2023
Tuesday 14 November 2023 10:29 , Daniel O’Boyle
Miner Glencore ended a months-long takeover saga with the City’s biggest acquisition of the year today, agreeing to buy Canadian rival Teck’s steelmaking coal business for $6.9 billion (£5.6 billion).
Glencore initially planned to buy the entire Teck business for $22.5 billion, but after that offer was rebuffed, it set its sights on just its coal arm.
The miner intends to spin out the combined coal operations, which post strong profits but have made Glencore’s shares less appealing to sustainability-focused investors.
In a blow to the City, that coal arm is set to be listed in New York. In June, Glencore boss Gary Nagle said European investors are too focused on ESG.
The deal overtakes private equity group EQT’s plan to buy Dechra Pharmaceuticals as the biggest City acquisition of 2023 – a year where blockbuster mergers have been rare.
Glencore shares gained 14.2p to 444.6p this morning.
DCC and Informa lead FTSE 100, Babcock dividend returns
Tuesday 14 November 2023 10:28 , Graeme Evans
A landmark dividend helped Babcock International shares today as the turnaround of the defence services firm continues to show progress.
Plans for January’s award of 1.7p a share will be the first distribution in four years after a long-running drive by Babcock to bolster its balance sheet.
The efforts under chief executive David Lockwood have involved £400 million of disposals and a focus on higher quality, lower risk and more predictable business.
Today’s interim results revealed an order backlog of £9.6 billion, alongside revenues 2% higher at £2.2 billion and an operating profit up 27% to £154 million.
The results by the owner of the Rosyth and Devonport dockyards follow last week’s four year £750 million MoD contract to support and sustain the UK’s submarine fleet.
Babcock’s shares were as low as 272p in July but today stood at 417.6p after their 2% or 8p post-results improvement.
The performance came in a stronger session for the FTSE 250 index, which added 0.4% or 66.72 points to 17,980.37.
The best mid-cap was Oxford Instruments, with the scientific research partner up 6% or 121p to 2045p thanks to a 6.5% dividend hike and 10% growth in order book to £332 million.
The FTSE 100 index crept 6.63 points higher to 7432.46, led by three of the top flight’s lesser lights.
They included business events and academic knowledge business Informa, which jumped by 6% or 40p and has now risen 25% in the past year to 742p after today’s latest upgrade to 2023 guidance.
Dublin-based conglomerate DCC, whose operations span healthcare to heating oils, also surged 7% or 323p to 4989p after reporting a 12% rise in operating profits during its seasonally quieter first half.
It accompanied the results with the £140 million acquisition of Germany’s Progas in a move targeting Europe’s largest energy market.
And medical products firm Convatec added 3% or 6.2p to 214.8p after sweetening its guidance on 2023 revenues growth to between 6.75% and 7.5%.
On the fallers board, Imperial Brands dipped 7.5p to 1780.5p after the Lambert & Butler cigarettes maker hiked its dividend by 4% alongside a 5% rise in operating profit to £3.9 billion. The shares have fallen by around 15% this year.
BT slashes pension deficit
Tuesday 14 November 2023 10:24 , Daniel O’Boyle
âBT today revealed it has cut its pension fund’s deficit by more than half since 2020, and that it should be fully funded by 2030.
The liabilities of the scheme, the UK’s largest corporate retirement plan with 270,000 members, were £8 billion more than its assets in 2020. But after a number of payments from the telecoms firm, that deficit has been cut to £3.7 billion.
The pension’s administrators have been moving assets into lower-risk investments. By 2034, the fund should be “predominantly” made up of bonds and “bond-like investments”
BT finance boss Simon Lowth said cutting the deficit would help the business focus on investing in infrastructure improvements.
Informa leads flat FTSE 100, Vodafone shares struggle
Tuesday 14 November 2023 08:34 , Graeme Evans
Events and academic knowledge business Informa is the top performing stock in the FTSE 100 index after its latest boost to results guidance.
The shares lifted 5% or 32p to 734p, just ahead of Glencore’s 14.3p improvement to 444.5p as the commodity trading giant revealed a deal to buy a 77% stake in the steelmaking coal business of Teck Resources.
Vodafone share remain under pressure after half-year results, falling 0.8p to 76.6p despite the mobile phone giant’s unchanged dividend.
The FTSE 100 index is 13.67 points lower at 7412.16, with the FTSE 250 index down by just 1.81 points at 17,911.84.
One of the best performing mid-caps stocks is defence firm Babcock International, which lifted 4% or 16.8p to 426.4p after highlighting turnaround progress through the first dividend payment in four years.
Wages and jobs data land as expected ahead of D-Day for Sunak’s inflation pledge
Tuesday 14 November 2023 08:28 , Daniel O’Boyle
Wages and jobs numbers have hit forecasts this morning, in news likely to soothe nerves at the Bank of England into its last rate call of the year and in Downing Street, where the prime minister’s pledge on inflation faces a vital moment later in the week.
The national unemployment rate held steady at 4.2% for September, while average earnings excluding bonuses rose 7.7%, also as expected. Including bonuses, wages were up 7.9%, more than City experts had predicted at 7.4%, but down from the 8.2% last time.
Meanwhile, the number of people out of work and claiming benefits rose by a little more than the 15,2000 forecast at 17.,800 in October, But for the three months to the end of September, it was down 207,000, about 9,000 more then expected.
Read more here
FTSE 100 seen lower ahead of US inflation reading, oil price higher
Tuesday 14 November 2023 07:20 , Graeme Evans
Investor caution ahead of this afternoon’s US inflation reading means that the FTSE 100 index is expected to open about 0.2% lower at around 7410.
The annual rate of the consumer prices index is forecast to fall from 3.7% to 3.3% but with core inflation unchanged at the previous month’s 4.1%.
Evidence that inflation is resisting higher interest rates will fuel worries on Wall Street that the Federal Reserve may have to take further action.
US markets posted a flat session yesterday, while the FTSE 100 index rose 0.9% or 65.28 points as the top flight put back some of Friday’s big losses.
Meanwhile, the stronger week for oil continued today after Brent Crude futures rose 0.3% to $82.77 a barrel. Gold traded at $1945 an ounce.
Unemployment remains at 4.2%
Tuesday 14 November 2023 07:03 , Daniel O’Boyle
The UK’s unemployment rate remained at 4.2% in the three months to September, defying expectations of a rise as markets continue to hope for a “soft landing” from the recent sky-high inflation.
The rate was slightly lower than the expected 4.3%.
Wages excluding bonuses rose in line with expectations,, though still close to historic highs, at 7.7%. But including bonuses, wages rose by 7.9%, ahead of the expected 7.3%.
Yesterday’s top stories
Tuesday 14 November 2023 06:48 , Daniel O’Boyle
Good morning from the City desk of the Evening Standard, here’s a selection of some of yesterday’s top stories.
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