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FTSE 100 Live: Plan B fears slow London rally, Taylor Wimpey boss to step down, Berkeley profits soar

·13-min read
 (ESI)
(ESI)

The rebound for the London market has continued after yesterday returning above the level seen before the Black Friday sell-off.

The FTSE 100 index added another 0.3% amid hopes that symptoms associated with the Omicron variant are not as severe as first feared.

In London corporate news, Taylor Wimpey announced chief executive Pete Redfern is to step down after more than 14 years at the helm. Games Workshop shares fell after a trading update, while there are results from holidays giant TUI and railway station caterer SSP.

FTSE 100 Live Wednesday

  • FTSE 100 turnaround continues

  • Taylor Wimpey boss to step down

  • Games Workshop shares fall

Squeaky bum time for the FTSE

16:27 , Oscar Williams-Grut

Just minutes ahead of the close and the FTSE 100’s gains for the day are all but gone: the bluechip index is up just a measly 2 points.

As former Manchester United manager Sir Alex Ferguson once said, it’s squeaky bum time.

Elsewhere, Mark Haefele, chief investment officer at UBS Global Wealth Management, has this to say in a note sent to clients: “Today’s developments are consistent with our base and bull cases – that omicron is a mild rather than a particularly virulent strain, and that the market is willing to shift focus away from COVID-19 and toward economic data. Recent moves are also a reminder of the importance of building a well-diversified portfolio, both geographically and across asset classes.”

Tepid open on Wall Street

14:43 , Oscar Williams-Grut

Stock markets have had a mixed open in New York, with not much to report. The S&P 500 and Dow Jones index are both up an uninspiring 0.1%, while the Nasdaq is down an earth shattering 0.1%. As you were.

Meanwhile, the FTSE 100’s gains have narrowed even further. The index is just 12 points in the green at writing time. Will it hang onto the gains until close?

Centrica offloads Norwegian oil business

14:16 , Oscar Williams-Grut

British Gas owner Centrica is selling a Norwegian oil and gas business for £800 million, the latest deal that sees energy giants quit businesses once regarded as central to their purpose.

Centrica will get £560 million for its 69% stake in Spirit Energy’s Norway arm, the buyer being Sval Energi.

Chief executive Chris O’Shea said: “With the disposal of these largely oil- producing assets to buyers who will be able to meet the material decommissioning costs, we can now focus on realising value for our shareholders from Spirit’s remaining gas reserves.”

He added: “We will not explore for new hydrocarbon reserves.”

Like rivals, Centrica is moving to “de-carbonise” its business. Oil majors are selling out of the North Sea in what some have called a “death knell” for a once proud industry. Shell recently backed out of plans to develop the Cambo oilfield.

Sval Energi said that the acquisition, the largest on the Norwegian Continental Shelf since 2019, is expected to be completed in the second quarter of 2022.

Centrica shares rose slightly to 68p. They were 230p five years ago.

FTSE hangs on to gains despite Plan B fears

14:06 , Oscar Williams-Grut

The FTSE 100 is still in the green this afternoon despite a knock from reports that the Prime Minister could be about to introduce restrictions meant to curb the spread of Omicron.

Reports that so-called Plan B restrictions, including vaccine passports and work from home guidance, could be introduced have hit shares in travel and leisure companies.

However, London’s topflight index is still up 16 points as I type. It is being helped higher by Berkeley, which is off its intraday highs but still up 3%. Companies that could do well in lockdowns or semi-lockdowns are also on the up, with online grocer Ocado gaining 2.5%.

Nightclubs tell PM: ‘Don’t throw us under the bus'

13:19 , Oscar Williams-Grut

Nightclubs have told the Prime Minister not to reintroduce restrictions, amid reports that the government is considering bringing in ‘Plan B’ restrictions including vaccine passports to curb the spread of the Omicron variant.

Michael Kill, CEO of the Night Time Industries Association, says: “Vaccine passports have a damaging impact on Night Time Economy businesses, as we seen in other parts of the UK where they have been implemented. Trade is down 30% in Scotland and 26% in Wales following their implementation. The UK Government have twice ruled out Vaccine Passports before twice changing their mind. The pre-Christmas period is absolutely crucial for our sector and reports today that Plan B including Vaccine Passports will have a devastating impact on a sector already so bruised by the pandemic.

“The Government’s own report on the subject concluded that vaccine passports wouldn’t even have a significant impact on virus transmission. You do, therefore, have to question the timing and rationale for this announcement. Is this sound evidence-based public policy making, or is this an attempt to move the news agenda on from a damaging story about the Downing St Christmas party? Nightclubs and bars must not be thrown under the bus for the Prime Minister to save his own skin.”

Read the full story.

Plan B: Travel and pubs shares tumble on Covid report

11:36 , Simon English

TRAVEL, leisure and pub shares are taking a hammering following a report that the public face new restrictions in an attempt to curb the spread of the Omicron coronavirus variant.

The FT is reporting that three senior Whitehall officials have briefed that the government has decided to implement the “Plan B” restrictions, including the order to work from home.

In response, investors sold off shares in certain firms.

BA owner IAG tumbled 5%, while Premier Inn owner Whitbread was off 3%.

Cineworld tumbled 7%, with Wizz Air, TUI, easyJet and JD Wetherspoon all taking losses.

Some are fearful of what new restrictions could do to the economy.

read more here

London property market powers Berkeley to top of the FTSE

10:47 , Oscar Williams-Grut

London-focused house builder The Berkeley Group invested in the capital during the pandemic and is now reaping big rewards from its decision.

Berkeley today said profits were up 26% to £290.7 million in the six months to the end of October as income soared by 36% to £1.2 billion. The company sold 1,828 homes in the period, up from 1,104 last year, at an average price of £647,000. Shareholder returns in the period nearly tripled to £486 million in the period.

The business upgraded its full-year earnings forecasts by 5% and said pre-tax profits were likely to rise by around 5% each year for the next three years.

Shares in Berkeley jumped 5.3% to the top of the FTSE.

Read the full story.

Tui winter break warning sparks tumble in travel shares

10:42 , Naomi Ackerman

A warning from Europe's biggest holiday company that Omicron fears are already hitting winter bookings sent shares in airlines and package getaway firms tumbling this morning.

The German-owned tour operator told investors that the emergence of the new, highly-transmissible variant and "increased media coverage of rising incident rates" has weakened previously positive momentum, "particularly for winter".

Tui had planned to ramp up capacity over the winter holidays and reach up to 80% of pre-Covid volumes, but today said if current trends continue it will strip this back to around 60%. Its stock fell as much as 6% on the update.

Shares in fellow package holiday group On The Beach fell as much as 2.3%, EasyJet was down nearly 3%, Ryanair down 2.2% and British Airways owner IAG down 1.8% after the update from Tui this morning - despite a wider rally for stocks. Rolls-Royce, which makes jet engines and earns revenue when they are in the air, slipped 2.5%.

Read the full story here

FTSE 100 recovery continues

10:35 , Graeme Evans

The Black Friday rout for stock markets already appears to be a distant memory for investors after blue-chip shares continued their rebound today.

Having surged this week to back above the level prior to the Omicron-led sell-off, the FTSE 100 index defied expectations again today by adding another 21.93 points at 7361.77.

It is now back within sight of the highest figure since the start of the pandemic, aided by further signs that symptoms associated with the new Covid-19 strain appear to be mild.

Asia markets were also higher despite more uncertainty over the fate of Evergrande after the Chinese property developer reportedly missed another debt repayment deadline.

AJ Bell investment director Russ Mould said: “A few months ago, Evergrande’s failure to make bond repayments spooked global markets and led to speculation of a potential crisis in China’s property and financial system.

“Now it seems as if markets have just accepted that Evergrande could collapse and there is no panic.”

Housebuilding stocks aided today's top flight performance after Berkeley shares jumped 4% on the back of a strong update.

London Stock Exchange also got a much-needed boost, lifting 72p to 6784p as analysts at Jefferies said the shares had been unfairly targeted since the deal to buy financial data provider Refinitiv.

The City firm initiated coverage with a buy recommendation and 8,500p target price. Jefferies wrote: “We think the stock is undervalued and see a path to a re-rating as management continue to deliver on guidance.”

The FTSE 250 index rose 103.05 points to 23,340.16, ensuring its return to back above the level it was prior to the 26 November sell-off.

Investment manager Man Group was the biggest riser, up 6% or 13p to 228.8p, while Trustpilot also continued its recent improvement by adding 10.8p to 349p.

Stagecoach rose 2.65p to 79.3p in the FTSE All-Share after it said passenger journeys in its regional bus business were back at over 70% of 2019 levels during November.

It reported a big jump in half-year profits to £18.4 million and said talks are continuing with National Express about a potential merger.

Pay at City broker Numis soars

10:27 , Simon English

Numis is on the up -- staff pay hit an average of £320,000 this year.

Many of the 319 staff will have earnt much, much more than that.

read more here

Redfern denies departure linked to Elliott position

09:00 , Oscar Williams-Grut

Taylor Wimpey’s outgoing CEO Pete Redfern has denied his exit is linked to Elliott Advisors, the activist that has reportedly recently taken a position in the company’s stock.

Elliott is well known for its aggressive pushes for change at companies it invests in and is currently waging campaigns at GlaxoSmithKline and SSE.

Redfern said he “never comment[s] on individual investors,” but said his departure “doesn’t relate to any conversations with any investor.”

Read the full story.

Berkeley upgrade boosts housebuilding stocks

08:36 , Graeme Evans

The rally for the FTSE 100 index has continued after the top flight added another 0.3% or 20.52 points to 7360.42.

Berkeley is the biggest riser, up 4% or 202p to 4837p, after the London-focused housebuilder increased its earnings guidance for the current financial year by 5%.

Asset manager Abrdn rose 2%, or 5.7p to 246.3p, as analysts at HSBC described the recent acquisition of retail trading platform Interactive Investor as a “game-changer” that should help it achieve high-single-digit compound earnings growth.

Shares in British Airways owner IAG fell back 3.6p to 138.48p, while oil giants BP and Royal Dutch Shell were 1% cheaper.

The FTSE 250 index rose 44.97 points to 23,283.14, aided by a strong session for housebuilders after the Berkeley update.

Games Workshop reveals bonus, shares fall

08:34 , Graeme Evans

Games Workshop, the firm behind Warhammer fantasy miniatures, is handing a £2,500 cash bonus to staff this month in a move worth £6.9 million.

Details of the awards under the company’s profit share scheme were revealed in an update on recent trading.

The FTSE 250-listed stock was at a record high above 12,000p in September, only to lose a quarter of its value amid stock market fears over freight and currency impacts.

The retail business said today it continued to trade in line with expectations after sales of at least £190 million in the six months to November 28. Operating profits are broadly in line with last year's “exceptional“ performance.

Having recovered in recent sessions, the shares today fell 3% or 255p to 9505p.

Taylor Wimpey looks for new boss

07:52 , Oscar Williams-Grut

One of the longest serving bosses in the housebuilding industry is stepping down after Taylor Wimpey announced that Pete Redfern is to leave the business.

He has been chief executive for more than 14 years and will go once a successor is found and a full handover has taken place.

Redfern, who took the helm just as housebuilding shares crashed in the face of the 2007 credit crunch, said he left the company in “excellent health” and well positioned for strong future growth.

Shares are still a long way short of where they were before the pandemic, despite a robust year for the housebuilding industry.

Read the full story.

FTSE 100 steady after two-day rally

07:37 , Graeme Evans

The resurgence of the London stock market is set to hit pause today after two sessions of big gains left the FTSE 100 index at its highest level since 15 November.

The top flight has now recovered all its Omicron-led losses after traders drew comfort from signs that the symptoms associated with the new variant are mild.

Wall Street markets followed Europe's positive lead last night, with the Nasdaq posting its biggest one day gain since March.

CMC Markets sees the FTSE 100 index opening five points lower at 7,335.

Its chief markets analyst Michael Hewson said: “We are almost two weeks from when the first reports started to come out of South Africa, and thus far there appears to have been no direct causal links to any deaths.

“This doesn’t, of course, change the dynamic when it comes to how Europe is battling against the increases being seen in Delta cases, and which is likely to hamper the recovery across the likes of Germany, Austria and the Netherlands where restrictions and lockdowns have been re-imposed.”

Hewson added that this week's gains for stock markets were all the more surprising given the backdrop of increasing inflationary risk. The key focus on this front will be Friday's US CPI number for November, having jumped sharply the previous month to 6.2%.

The fate of China's Evergrande is also a concern after the property developer missed another debt repayment deadline. Its shares are now at an all-time low.

Oil prices, meanwhile, have steadied following their strong gains earlier in the week. Brent crude futures are at $75 a barrel, a fall of 0.5% in trading today.

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