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FTSE 100 Live: Gas prices drop to lowest levels in almost a year; Blue-chip shares make strong start to 2023

 (Evening Standard)
(Evening Standard)

Wholesale gas prices fell today to levels not seen since the run-up to Russia’s invasion of Ukraine, stoking hopes for a softer impact from energy bills on hard-pressed households and stretched government finances.

London’s FTSE 100 index today made better-than-expected progress in the first trading session of the year. Risk appetite has been boosted by the reopening of China’s Covid-hit economy, with Shell, IAG and Rolls-Royce all posting big gains.

The improved mood also lifted housebuilders and stocks focused on the UK economy, including electricals retailer Currys.

FTSE 100 Live Tuesday

  • Oil and travel stocks lead FTSE 100 rally

  • Cineworld says not in talks to sell its theatres to AMC

  • China factory activity weakens

That’s all folks. Tomorrow: inflation and grocery market share

Tuesday 3 January 2023 17:30 , Simon Hunt

That concludes our coverage today on a strong first day of trading for the FTSE 100 in 2023 in what may prove to be a turbulent year for the economy.

The Evening Standard City Desk will return tomorrow at 8am, where we’ll get the latest grocery market share figures and update on inflation from Kantar, for the 12 weeks ending 25 December 2022, in an early sign of how well the UK’s biggest supermarkets have performed in the run-up to the crucial Christmas trading period.

FTSE 100 closes up 106 points: Evening wrap

Tuesday 3 January 2023 16:40 , Simon Hunt

The FTSE 100 closed up 106 points or 1.4% at the end of today’s session to 7,558 in a strong start for the London index amid a global stock rally.

Real estate stocks made the biggest gains today, led by house builder Persimmon up 4.6% and Barratt Developments up 4.4%.

The pound dipped below $1.20, largely thanks to the US dollar on course to complete one of its strongest one-day rallies in over three months.

US stocks have so far bucked the global rally, with the Nasdaq dropping 0.6%, and the S&P sliding 0.3% after the opening bell on Wall Street.

New York stocks make showbiz gains but Tesla stalls

Tuesday 3 January 2023 14:51 , Michael Hunter

Wall Street’s S&P 500 made a positive start to 2023 after a bleak finish to the old year, and a rough wider run for global markets during 2022.

The broad New York index added around 30 points to 3,866.88, a rise of 0.6%, with big-name entertainment stocks lighting up the leaderboard, on hopes that the holiday season went well for the sector. Paramount Global was up over 4% , with DISH Network rising over 3%, with Warner Bros up just under 3%.

Tesla was the biggest single faller on the index -- down 7% -- as worries over stalling demand and slowing deliveries amid supply chain problems.

Wall Street set for gains and dollar rallies

Tuesday 3 January 2023 13:27 , Michael Hunter

New York stocks were set to start 2023 with gains according to futures trade, turning around from losses made at the end of a bleak December on Wall Street.

The broad S&P 500 share gauge was expected to rise by around 13 points to 3874.50. a gain of 0.4%. The trading week is likely to be defined by investors’ impressions of minutes from the Federal Reserve’s December interest rate meeting, at which it adopted a 0.50% hike, down from its previous rises of 0.75%. Policymakers accompanied the decision with a statement seen as revealing a lingeringly aggressive stance for future hikes, even as they voted for a smaller rise.

The dollar also made a strong start to the new year, with the index tracking it against a range of rivals up over 1%.

FTSE 100 midday movers: Ocado back at the top

Tuesday 3 January 2023 12:32 , Michael Hunter

Ocado has started the new year at the top of the FTSE 100, after frequently appearing at both ends of the market throughout 2022. The online grocer and retail technology platform is often one of the biggest movers -- be it up or down -- in a tussle between the bulls and the bears over its investment case.

Some see the warehouse operator’s tech as the key to a bright future, while others voice concern at its relatively limited number of clients. Either way, it has found enough support on the first trading day of 2023 to take the mid-session crown as the biggest single gainer.

Travel stocks are also doing well on hopes for strong demand and a continued move away from Covid-era restrictions, helping Rolls-Royce , which earns revenue for the number of hours its engines are airborne, into second place, IAG, the parent of British Airways and Iberia, took third place on the leaderboard. Wizz Air, the budget carrier, issued an upbeat trading statement on December.

Energy utility SSE was among the biggest fallers. While h declines in wholesale gas prices provideda talking point in the market, there was also a ratings downgrade on the stocks from Jeffries, as the broker reshuffled its views on the sector, taking SSE to “hold” from “buy”.

Fund managers Abrdn posted the biggest single decline.

Gas prices back under levels seen before Russia’s invasion of Ukraine

Tuesday 3 January 2023 10:49 , Simon Hunt

Wholesale gas prices fell today to levels not seen since the run-up to Russia’s invasion of Ukraine, stoking hopes for a softer impact from energy bills on hard-pressed households and stretched government finances.

Driven lower by relatively mild winter weather in the UK and Europe, the price of the commodity was down by over 4% to 178p a therm. It was last under 180p on January 21, before rising steadily during the military build-up and hitting 329p on February 24, when tanks crossed the border. It peaked at over 875p a therm in August, on fears of supply interruptions in Europe into autumn and winter.

A therm is a unit of energy equivalent to 100 cubic feet of gas, which generally should be enough to run a typical central heating system for around an hour.

read more here

FTSE 100 up 2% in strong start to year

Tuesday 3 January 2023 10:25 , Graeme Evans

The stock market year opened with a bang today as investors shrugged off their 2023 worries to leave Rolls-Royce, Shell and Barratt Developments up by 4% or more.

The unexpected progress ensured the FTSE 100 index stood 2% or 158.34 points higher at 7610.08, with the UK-focused FTSE 250 up 317.44 points at 19,170.44.

The flurry of buying came despite a warning from the head of the IMF that one third of the global economy will be hit by recession in the coming year.

Investors preferred to focus on the potential of higher demand from China after the world’s second largest economy moved to relax Covid-related travel restrictions.

Oil stocks were among the beneficiaries, with Shell up 97p to 2423p and BP 20.2p higher at 495.1p after the Brent crude price consolidated its position near $85 a barrel.

Among travel-related stocks, British Airways owner IAG surged 5% or 6.4p to 130.3p and Rolls-Royce improved 5.8p to reach the 99p mark for the first time since April.

Asia-focused insurer Prudential also gained 53p to 1180.5p amid the re-opening of China’s economy, while luxury goods group Burberry added 2% or 35p to 2073p.

The improved risk appetite meant investors were also happy to snap up some of last year’s most-sold stocks, particularly those in the housebuilding sector.

Persimmon and Barratt Developments led the rebound as their battered shares rose 65p to 1282p and 19.7p to 416.5p, while grocery technology stock Ocado topped the blue-chip risers board following a gain of 6% or 39.4p to 656.2p.

In the FTSE 250 index, the strongest performances included fast fashion business ASOS after a rise of 32p to 542.5p and electricals retailer Currys as shares were marked 3p higher at 56.6p.

Investors also returned to Moonpig, with the greetings card retailer bouncing off a recent record low to stand 5.5p higher at 115.8p.

Blow for Ferrexpo as owner forced to quit on charges of embezzlement

Tuesday 3 January 2023 09:50 , Simon Hunt

London-listed iron ore miner Ferrexpo found itself mired in controversy today as its billionaire Ukrainian owner was forced to quit the board after being arrested on charges of embezzlement.

Last week, the majority shareholder and former CEO, Kostyantyn Zhevago, was arrested in France at the request of Ukraine’s State Bureau of Investigation after being charged with embezzling $113 million in connection with Finance and Credit, a Khiv-based commercial bank he owned which was liquidated in 2015 after losing its license.

Ferrexpo said Zhevago, who was a member of the Ukrainian parliament until 2019, maintained a right to appoint a board member as his representative.

Ferrexpo shares climbed 4.5% to 164p. Zhevago controls a 50.3% stake in the company worth £484 million, according to Refinitiv data.

Oil and airline stocks surge, FTSE 250 higher

Tuesday 3 January 2023 08:34 , Graeme Evans

The FTSE 100 index is up by more than 1% during a better-than-expected start to the year for London-listed shares.

The rise of 88.74 points to 7540.48 was driven by oil and airline-related stocks following China’s recent lifting of Covid travel restrictions.

Shell and BP shares rose 4%, while British Airways owner IAG and engines giant Rolls-Royce rallied by more than 3%.

The upbeat session extended to the FTSE 250 index, where gains of 5% for electricals retailer Currys and Aston Martin Lagonda contributed to a rise of 253.13 points to 19,106.13.

Tesla deliveries jump to new record, still short of hopes

Tuesday 3 January 2023 07:59 , Graeme Evans

Electric car maker Tesla last night said it delivered 1.31 million vehicles in 2022 for growth of 40% on a year earlier. Production lifted 47% year-on-year to 1.37 million.

The performance included the production of 439,000 vehicles and the delivery of over 405,000 vehicles during the final three months of the year. Despite the record quarterly figures, the update came in short of Wall Street estimates.

The former trillion dollar company has lost around two-thirds of its value over the past year as investors worry about supply chain challenges, the demand outlook and the potential distraction of boss Elon Musk’s Twitter ownership.

Cineworld says it was not in talks to sell its theatres to AMC

Tuesday 3 January 2023 07:51 , Michael Hunter

Cineworld, the movie theatre chain which is in bankruptcy protection in the US, has denied that it has been in talks over the sale of its cinemas with rival AMC.

Reports about initial discussions between Cineworld’s lenders and AMC circulated before Christmas, before AMC said they ended without progress. Responding today, Cineworld said neither the company itself nor its advisers had been involved in the talks.

It added that it was “focused on proposals for the group as a whole,” and any separate sale of parts of the company or restructuring “will result in a very significant dilution of existing equity interests in Cineworld and there is no guarantee of any recovery for holders of Cineworld’s existing equity interests.”

Cineworld, which has its flagship multiplex at Leicester Square, sought protection from creditors in the US in September.

China factory activity weakens, FTSE 100 seen higher

Tuesday 3 January 2023 07:43 , Graeme Evans

London traders are braced for a mixed session, with the FTSE 100 index set to open marginally higher after outperforming other global benchmarks during the last year.

The FTSE 100 index was marginally higher in 2022, whereas the S&P 500 endured its worst performance since 2008 after losing almost a fifth of its value.

Deutsche Bank reported today that only nine out of the 38 non-currency assets in its coverage made gains over 2022 as stronger-than-expected inflation caused central banks to embark on their most aggressive tightening cycle in a generation.

Ahead of today’s session, China’s Covid-hit manufacturing sector reported a decline in activity to the lowest point since September. The PMI reading of 49 is the fifth fall in a row, with new orders and export sales among the measures in decline.

According to IG, the FTSE 100 index is set to open 11.8 points higher at 7,463.54.

Hotel Chocolat seeks to turn around Japanese expansion woes with new partnership

Tuesday 3 January 2023 07:39 , Simon Hunt

Hotel Chocolat today reaffirmed its committment to its Japanese expansion despite taking a £30 million hit from earlier plans, after announcing that it has signed a new strategic partnership agreement with Tokyo-based Eat Creator Corporation.

Under the partnership, Eat Creator will operate 21 branded Hotel Chocolat stores while Hotel Chocolat will hold 20% equity in the venture, with brand royalty revenues going to Hotel Chocolat PLC.

It comes after the Hertfordshire-based chocolate maker was forced to write off almost £30 million after its Japanese business went through insolvency. The firm blamed the collapse on pandemic restrictions in Japan and supply chain woes and said it was seeking to localise supply chains in the country through working with local manufacturers.

Hotel Chocolat boss Angus Thirlwell told the Standard: “We thought we should take that on the chin and write the cost off and change the way we approach international opportunities and contain the capital spend and work with partners rather than try to do it ourselves.

“Nobody gets international right the first time straight out of the blocks – it’s very much a case of adapting and taking the learnings and making your work smarter as you go on.”