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FTSE 100 Live 17 May: LandSec shares fall on results, GSK in £1.25bn final Haleon stake sale

FTSE 100 Live 17 May: LandSec shares fall on results, GSK in £1.25bn final Haleon stake sale

GSK and Land Securities are in the FTSE 100 spotlight after the drugs giant sold its final Haleon shares and the property firm posted results.

The sale of GSK’s remaining 4% stake raised £1.25 billion, having held 13% following its 2022 demerger of the Panadol and Sensodyne business.

Land Securities revealed a smaller full-year loss of £341 million amid “robust” rental growth across its estate.

FTSE 100 Live Friday

  • GSK raises £1.2bn in Haleon sale

  • Land Securities cuts annual loss

  • BT share price momentum continues

City Comment: Bank must not be shy on cutting rates

10:11 , Simon English

For the past three years we have been blighted by inflation and told that, however painful it may be, borrowing costs had to go higher.

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From next week we could start reading that inflation is in fact now too low, a change of direction that might make little sense to non-economists, or indeed to most people noticing just how much more expensive almost everything is. (Bills, pints of beer, insurance, taxis.)

But there is a growing feeling in the City that next Wednesday, April’s CPI (Consumer Prices Index) inflation data will come in at below the 2% target.

There’s some question whether 2% is a good target in the first place — plenty of academics say either that 3% would be better, or that we just needn’t be so wedded to the target, whatever we decide it should be.

But leaving that aside, the consensus is that inflation hovers around 2%, and maybe ticks back up above it over the next couple of years.Capital Economics is one observer which goes further than that. It thinks that the average rate of inflation between now and the end of 2026 will be 1.1%.

If it is right, then the Bank of England should surely be cutting interest rates already rather than sucking its teeth and waiting for the evidence to hit it over the head.

By common consent, the Bank was far too slow to put rates up as inflation gathered pace. It now looks like it could be too slow to cut them as inflation tumbles.

It is hard to avoid the conclusion that the Bank’s Monetary Policy Committee doesn’t want to bethe first major central bank to cut rates. It wants the cover of the US Fed or the European Central Bank cutting their rates, so it can follow suit.

If there’s anything in that suggestion, it’s faint-hearted of our rate setters. The Bank should start chopping borrowing costs as soon as it can.

BT and Vodafone continue momentum, GSK and Haleon lower

09:45 , Graeme Evans

A confidence-boosting week for long-suffering BT and Vodafone investors today ended with the duo’s shares still among the FTSE 100 frontrunners.

BT followed its results-day bounce of 17% by adding 1.6p to 134.2p, while hopes that Vodafone has also turned a corner helped it up another 0.8p to 78.3p.

London’s former biggest stock was 70p prior to Tuesday’s release of full-year figures.

The rejuvenated sector failed to inspire the wider FTSE 100 as markets settled after the buzz of yesterday’s 40,000 milestone for the Dow Jones Industrial Average.

The top flight slipped 23.56 points to 8415.09, with Auto Trader the worst performer after a decline of 5% or 36.3p to 718.7p

GSK reversed 16.5p to 1767p, despite banking £1.2 billion in its fourth and final sale of Haleon shares.

The Sensodyne consumer healthcare firm fell 0.8p to 331.5p, which compares with the 324p paid by institutions for GSK’s 4% stake and the 330p debut price in 2022.

Haleon lower after GSK stake sale, Auto Trader down 5%

08:36 , Graeme Evans

The FTSE 100 index is 2.70 points lower at 8435.95, with traders on the sidelines ahead of eurozone inflation figures later this morning.

GSK fell 11p to 1772.5p and Haleon by 2p to 330.4p after the pharmaceuticals firm raised £1.25 billion selling the rest of its holding in the consumer healthcare business.

Land Securities shares were 9.5p lower at 680.5p following annual results, with FTSE 250-listed rival British Land down by 0.8p to 404.2p.

Vodafone and BT continued their momentum in the FTSE 100, rising 1.1p to 78.6p and 1.7p and 134.3p respectively after annual results this week.

The biggest fallers are Auto Trader, down 5% or 35.2p to 719.8p, and Flutter Entertainment following a decline of 380p to 16,215p.

The FTSE 250 index is 27.06 points lower at 20,795.78.

GSK offloads remaining Haleon stake, raises £1.25bn

07:39 , Graeme Evans

GSK today said it had raised £1.25 billion selling its remaining shares in Haleon, the Sensodyne and Panadol business it previously owned with Pfizer.

The drugs giant initially held a 12.94% stake after the demerger of the consumer health business completed in July 2022.

Four disposals since then have raised a total of £3.9 billion.

The final 4.2% was sold last night at a price of 324p, which is close to the 330p when Haleon joined the London market with a valuation of £30 billion.

Property giant Landsec sees rental growth

07:29 , Jonathan Prynn

London property giant Landsec today said it was seeing “robust” rental growth across its estate, which is dominated by holdings in the West End.

Chief executive Mark Allan said: “Following a reset of values over the past two years driven by rising interest rates, the stabilisation in rates and evidence of continued rental growth is starting to attract increased investor interest for the best assets.”

The company made another pre-tax loss of £341 million following a £625 million portfolio revaluation, but this was down from £622 million the previous year. The dividend was raised from 38.6p to 39.6p.

Overall occupancy rose 140bps to 97.3%, with £35 million of lettings signed or in solicitors’ hands.

FTSE 100 seen lower as Dow Jones returns below 40,000

07:18 , Graeme Evans

The Dow Jones Industrial Average last night closed lower after a Walmart-led rally earlier took the benchmark over 40,000 for the first time.

The landmark was reached on the back of forecast-beating guidance by the world’s biggest retailer, which closed the session 7% higher.

The Dow ended slightly lower at 39,869 but had been as high as 40,051, a level that compares with around 20,000 at the onset of the pandemic in 2020.

The S&P 500 index and Nasdaq Composite both closed about 0.2% lower as traders reviewed this week’s flurry of bets on a September interest rate cut.

In London, the FTSE 100 index is forecast to open about 17 points lower after dropping 7.15 points to 8438.65 in yesterday’s session.

Recap: Yesterday's top stories

06:50 , Simon Hunt

Good morning from the Standard City desk.

Johan Lundgren will have earned a long holiday when he finally hands over the keys to the easyJet boardroom to his anointed successor Kenton Jarvis “early in 2025”.

His seven years in the corporate cockpit have been far from a smooth trip, to put it mildly.

Most importantly he navigated a path through the two torrid years of Covid lockdowns and travel restrictions that could easily have killed off a less well run business.

But he will leave it as one of Europe’s biggest airlines with full-year profits likely to punch through the £1 billion mark this year if the summer season proves as strong as hoped.

The size of easyJet — it now operates a fleet of 343 aircraft — makes it easy to forget that the business is less than 30 years old, a true disruptor in an industry that was dominated by legacy flag carriers when its first flight left Luton for Glasgow in November 1995.

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Here’s a summary of our top stories from yesterday: