Sustained falls on global energy markets took the wholesale cost of gas in the UK to its lowest level since December 2021 on Monday, The drop raised hopes that inflation rates could have peaked in a trend that could ease the worst of the cost-of-living crisis.
Record-breaking territory for the FTSE 100 index continues to be in focus after a better-than-expected start to the year for London shares.
The blue-chip index opened the week just 33 points off its all-time closing level, having rallied by more than 5% so far in 2023.
The improved performance reflects declining rates of inflation in the US and the eurozone, as well as encouragement from recent corporate trading updates.
FTSE 100 Live Monday
FTSE 100 trades near record high
Cryptocurrency value reclaims $1 trillion mark
UK house prices rose 0.9% in January
FTSE closes up 17 points as it inches closer to record high
Monday 16 January 2023 16:45 , Simon Hunt
The FTSE 100 index has closed up 17 points to 7,860 as it looked to be within touching distance of a record high.
Real Estate stocks were among the best-performing today, up an average of 1.57% amid news from Rightmove that house prices rose in January, reversing a December fall, while technology stocks also rose 1.21%.
The poind fell 0.24% against the dollar to $1.2198.Sterling fell 0.15% against the euro to 1.1275.
“it’s going to take some time to convince people we’re back to normal” -- Andrew Bailey
Monday 16 January 2023 16:21 , Simon Hunt
Andrew Bailey has told MPsthe risk premium that traders put on UK assets during the Truss admnistration has “pretty much gone” but warned investor confidence would take time to come back to where it was.
The Bank of England Governor told the Teasury Select Committee: “International partners will understand that we’re back to where we were, things have restored to normal.”
But he cautioned: “It’s going to take some time too convince people that we’re back to normal.”
UK 10-year Gilt yields rose to as much as 4.5% in the aftermath of Liz Truss’s disastrous mini-budget last year, but have since pared back to below 3.5%.
Aston Martin shares full after HSBC downgrade
Monday 16 January 2023 15:58 , Simon Hunt
Shares in luxury carmaker Aston Martin fell as much as 6.3% this afternoon after HSBC changed its rating on the stock from hold to buy.
The bank’s analysts warned there was a risk the supercar brand would begin another capital raise, as well as delay the achievement of its targets.
Aston Martin shares have fallen 68% in the past year.
‘Gaps remain’ with EU amid hopes of Northern Ireland Protocol breakthrough
Monday 16 January 2023 14:52 , Simon Hunt
Gaps still remain between London and Brussels over the Northern Ireland Protocol, Downing Street said, as the Foreign Secretary resumes talks with the European Commission vice-president.
James Cleverly will speak to Maros Sefcovic on Monday over a proposal to iron out issues with post-Brexit trade arrangements affecting Northern Ireland and Great Britain.
Speculation had mounted in recent days that the two sides could be edging towards a breakthrough on the Northern Ireland Protocol, amid suggestions that cross-Channel relations have improved since Rishi Sunak became Prime Minister.
Downing Street on Monday appeared to play down hopes of an imminent breakthrough, saying issues remain outstanding in the negotiations.
M&S unveils half a billion pound plan to overhaul store portfolio
Monday 16 January 2023 13:48 , Simon Hunt
Marks & Spencer is placing its faith in expanding its bricks and mortar footprint via a near-half a billion pound plan to invest in new and refurbished stores across the country.
The retailer said its investment between now and 2026 will create more than 3,400 jobs, including at 20 stores which will be opened in the next financial year.
Stuart Machin, chief executive of M&S, said: “Stores are a core part of M&S’s omni-channel future and serve as a competitive advantage for how customers want to shop today.”
The new store pipeline for 2023/24 includes eight full-line stores in cities such as Liverpool and Leeds, five of which will be relocated to former Debenhams sites.
In London, two new food halls at the Elizabeth Line station in Canary Wharf and at the new Battersea Power Station development have already opened.
TikTok offers to share algorithm details in bid to swerve US ban
Monday 16 January 2023 13:22 , Simon Hunt
TikTok is offering to share details of its recommended algorithms to US officials as it battles to avoid being banned in the country.
The social media giant, which is owned by Chinese tech company ByteDance, is hoping to appease regulators with the promise of greater transparency in its operations and a $1.5 billion reorganization plan in the US, according to reports in the Wall Street Journal.
Under the plans being discussed, TikTok would allow US-based tech companies like Oracle to monitor the code the app uses to choose which videos US users see, as well as how it chooses to moderate content and delete videos, the newspaper reported.
FTSE 100 midday movers: Insurance stocks at both ends of the market after broker move boots Pru
Monday 16 January 2023 12:37 , Michael Hunter
Insurance stocks were at the top and the bottom of the FTSE 100 as the index hovered near a fresh record high.
Prudential was the biggest single gainer after upbeat broker comment. Jeffries lifted its price on the stock to 1900p from 1625p.
Admiral hit the other extreme of the market, as investors shuffled their positions in the sector.
UK silicon wafer maker IQE shares tumble
Monday 16 January 2023 12:27 , Simon Hunt
Shares in Wales-based wafer-maker IQE took a tumble today after the firm warned of slower growth in 2023.
The stock has dropped 18% to 49p, wiping over £50 million from its market value.
AJ Bell investment director Russ Mould said: “Investors in silicon wafer-maker IQE are clearly disappointed by the company’s cautious outlook for 2023, as the shares are taking a hammering, but this earnings setback could also have wider implications for the global economy and financial markets, even if the company’s market cap is barely £400 million.
“The Cardiff-headquartered company is flagging a slowdown in 2023, especially in the first half. This leaves consensus estimates of 10% sales growth, and an increase in profit, looking exposed on the downside.”
Gas prices tumble to their lowest level since December 2021 adding to hopes the UK has passed peak inflation
Monday 16 January 2023 12:06 , Michael Hunter
Sustained falls on global energy markets took the wholesale cost of gas in the UK to its lowest level since December 2021 on Monday,
The drop raised hopes that inflation rates could have peaked in a trend that could ease the worst of the cost-of-living crisis.
UK wholesales Gas prices slumped to their lowest level since early December 2021, falling almost 13 per cent for the session to 143p per therm, a unit of energy equivalent to 100 cubic feet of gas, enough to run a typical central heating system for around an hour.
The trading pattern on commodities markets chimed with the positive mood on stock markets, where London’s FTSE 100 traded on the brink of a record high.
Michael Hewson, chief market analyst at CMC Markets, said: “The catalyst for this remarkable turnaround in fortunes appears to be a combination of falling prices, warmer weather, and better than expected trading statements from a host of companies, after the widespread pessimism that characterised a lot of the narrative in the lead up to Christmas.
“Last week this more buoyant tone was given added legs by better-than-expected economic numbers that showed that the UK economy may well avoid an economic contraction in Q4, and ergo, a technical recession.”
London Stansted rounds off 2022 with strong passenger performance in December
Monday 16 January 2023 11:06 , Simon Hunt
London Stansted ended 2022 with a continued strong passenger performance as the airport welcomed more than 1.85 million passengers in December.
The monthly total is more than double the number of passengers served in December last year and represents 93% of passengers that used Stansted in the same month in 2019, before the pandemic.
The total number of passengers that passed through the airport in 2022 reached 23.3million, up 226% on 2021.
Profit warning hits shares in ITM Power
Monday 16 January 2023 10:44 , Simon Hunt
Dennis Schulz took over from longstanding CEO Graham Cooley in December, who announced plan to step down around the time of the company’s annual results in September, when delays to ITM’s production plans emerged.
The one-time darling of the green energy sector designs and makes batteries and electricity generation systems using clean hydrogen technology.
Ashmore lifts assets under management, IQE shares slide
Monday 16 January 2023 10:19 , Graeme Evans
Expectations of a better year for emerging markets were backed up today when specialist fund manager Ashmore revealed an improved quarterly performance.
The FTSE 250-listed company saw 2% growth in assets under management to $57.2 billion (£46.9 billion) for the final three months of 2022, the first time it has reported a quarter-on-quarter rise since summer 2021.
Mark Coombs, the billionaire founder of the business and chief executive, expects investor risk appetite to improve over the next 12 months as 2022 headwinds recede.
He added: “China re-opening its economy will stimulate activity more broadly, and a number of emerging countries are starting to see deflation as a consequence of effective monetary policy action over the past two years.”
The positive assets under management result in the quarter was driven by investment returns that more than offset net outflows of $2.6 billion (£2.1 billion).
Ashmore’s shares have jumped 45% in the past three months, but fell back 2% or 5.2p to 266.4p today as UBS said the figures were slightly short of City expectations.
Elsewhere, Prudential shares continue to benefit from China’s reopening after it added 17p to 1310p. London’s top flight also edged closer to a new record by improving 7.18 points to 7851.25 and the FTSE 250 index added 60.53 points to 20,013.37.
Shares in second-tier science and engineering firm Qinetiq were 0.8p higher at 342.6p as it announced an £80 million contract to provide the Ministry of Defence with expertise, training and support to accelerate mission data analysis.
The strong start to the year for Capita shares continued after the outsourcing firm secured a six-month extension to a contract with the Department for Work and Pensions. The FTSE All-Share stock lifted 0.2p to 27.5p, having already risen by 8% this year.
On AIM, shares in semiconductor wafers supplier IQE lost a fifth of their value after the Cardiff-based company warned that industry-wide destocking may impact demand during the first half of the year.
IQE’s shares unwound recent strong gains to fall back 12p to 47.9p, despite the company sticking by the longer-term growth targets it set out in November. The shares had been as high as 170p in 2017 following exposure to the iPhone boom.
UK house prices rose 0.9% in January, London rose 0.2%
Monday 16 January 2023 09:51 , Simon Hunt
UK house prices rose 0.9% in January, data just out by online property portal Rightmove shows, reversing the 2.1% slump they took in December.
But London increases were significantly softer, rising up just 0.2% with the average home fetching £667,587.
The January rise means property prices are now up 6.3% since the start of last year, with London prices up 6.1%.
Pound slips back against the dollar
Monday 16 January 2023 09:39 , Simon Hunt
The pound slipped back against the dollar today, erasing some of the gains made last week as investors await the remarks of Bank of England Governor Andrew Bailey on the health of the UK’s financial system.
The pound fell 0.4% against the dollar to $1.2178. It’s still up on the $1.2083 where it began the year.
Bailey is due to appear before the Treasury Select Committee hearing on the December Financial Stability Report at 3pm today.
Cryptocurrency market value reclaims $1 trillion mark for first time in two months
Monday 16 January 2023 08:50 , Simon Hunt
This morning, the total value of global cryptocurrencies briefly reclaimed the $1 trillion mark for the first time in over two months, data from CoinMarketCap shows amid lower than expected US inflation numbers and renewed hopes of being able to skirt a recession.
The price of Bitcoin is up 25% since the start of the year, but remains well down from its peak of just over $60,000 in November 2021.
That recovery hasn’t been enough to stymie the continued waves of redundancies by the world’s leading crypto firms, however, with over 2,000 layoffs in the first two weeks of the year alone.
FTSE 100 up 15 points, step closer to record high
Monday 16 January 2023 08:04 , Simon Hunt
The FTSE 100 is up 15 points to 7,858 in the opening minutes of trade as it inches closer to a record high. Here’s a look at the biggest opening moves.
Shares in Prudential PLC climbed the most, up 2.13% to 1320.5p.
Shares in Pearson PLC were up 1.21% to 939.8p.
Shares in Associated British Foods PLC were up 0.86% to 1810.5p.
Shares in Rio Tinto PLC fell the most. They were down -1.01% to 6156p.
Shares in Ocado Group PLC dropped -0.96% to 760.8p.
Shares in Pershing Square Holdings Ltd were down -0.84% to 2970p.
ITM Power warns on profits ahead of results of full review from CEO
Monday 16 January 2023 07:57 , Michael Hunter
ITM Power, the green energy firm, warned today that its full-year loss would be higher than expected, ahead of the outcome of a full reveiw of the business being undertaken by its new CEO, Dennis Schulz.
Schulz took over from longstanding CEO Graham Cooley in December and embarked on what the company called “a detailed review” of operations. The profit warning covers the financial year ending April 30 this year. ITM designs and makes electrolyser systems that generate green hydrogen via technology involving proton exchange membranes.
It runs a factory at Bessemer Park in Sheffield and was the first hydrogen energy company to be listed on the London Stock Exchange. It has partnership agreements with , Shell, Linde, Hyundai, and Honda.
ITM will provide further guidance and “a strategic 12-month priorities plan” alongside its interim results due on January 31.
Celadon Pharmaceuticals becomes first high-THC medical cannabis maker in the UK to pass regulatory hurdle
Monday 16 January 2023 07:35 , Simon Hunt
Celadon Pharmaceuticals becomes first high-THC medical cannabis maker in the UK to pass a regulatory hurdle after it was granted a Good Manufacturing Practice (“GMP”) registration by the UK Medicines and Healthcare products Regulatory Agency.
In the UK currently, patients prescribed medicinal cannabis are reliant on imported product, often facing lengthy delays and high costs.
James Short, Chief Executive Officer of Celadon said: “With the receipt of GMP registration, Celadon has joined a very select group of cannabis-focused pharmaceutical companies globally.
“This is a tremendous milestone for the Company given the significant capital and regulatory requirements in this sector.”
FTSE 100 remains near record territory
Monday 16 January 2023 07:32 , Graeme Evans
The record intraday high for the FTSE 100 index of 7903 was set in May 2018 and the all-time high close is 7877. The top flight closed at 7844 on Friday night, having delivered back-to-back weekly gains.
Hargreaves Lansdown senior markets analyst Susannah Streeter said: “Investors appear to have fallen back in love with UK assets, after a difficult period when the FTSE 100 was the wallflower among global indices.
“Confidence has rebounded as investors eye up China’s reopening, helping commodity stocks. A stronger than expected appetite from consumers has boosted the retail, travel and hospitality sectors, while banks are still riding the wave of higher interest rates.
“Things are looking up for the UK, and the Footsie is the flavour of the month, but there is a risk this could be a short-lived crush. There are still niggles of worries which could blow up about ebbing consumer and company resilience in the months to come on both sides of the Atlantic.”
The FTSE 100 is forecast to open slightly higher this morning, but there will be no Wall Street trading later as US markets are closed for Martin Luther King Day.