NatWest today bolstered guidance and shareholder returns as the state-backed lender reported first-half profits of £1.9 billion.
The bank now expects annual underlying income of about £12.5 billion, which compares with more than £11 billion forecast in April.
Chief executive Alison Rose said the bank had a range of measures to help families and businesses as costs surge. She added: “Our strong levels of profitability and capital generation mean we are well positioned to provide this support.”
FTSE 100 Live Friday
NatWest boosts dividend in strong results
Markets higher after Apple and Amazon earnings
Fund manager Jupiter reports profit fall
Buyers click onto Rightmove despite housing slowdown
12:21 , Simon Hunt
The UK housing market may be cooling, but that hasn’t stopped online house-hunters from scoping out potential properties.
Rightmove, the FTSE 100 property portal, said its users clocked up “1.5 billion minutes every month” as it reported operating profit of £121.3 million for the six months to June 30, up 6% from the same period a year ago. It makes money via property listings on its site via local estate agents.
The activity on its website passed pre-pandemic levels and helped it up average revenue per advertiser, a key industry measure, to £1290 per month, a rise of 11%. The firm — which provides information on house market transactions and pricing — is often the first place would-be buyers start their research.
It has also set its sights on the rental sector, with a “lead-to-keys” tenancy strategy designed to help letting agents set up and sign contracts online.
ASOS, Boohoo and Asda face CMA greenwashing probe
11:22 , Simon Hunt
ASOS, Boohoo and Asda are to be investigated by the competition watchdog over whether they’re overstating their eco-friendly credentials to customers amid a wider probe into greenwashing.
The Competition and Markets Authority said some firms claimed their products were sustainable with “little to no information” about the basis of those claims.
Language used in sustainability is too vague, the CMA said, while some products advertised as ‘green’ only contain 20% recycled materials.
Interim CMA chief exec Sarah Cardell said: “Should we find these companies are using misleading eco claims, we won’t hesitate to take enforcement action – through the courts if necessary.”
Shares rally as FTSE 250 tops 20,000
10:22 , Graeme Evans
Tech titans Apple and Amazon triggered more stock market buying as Wall Street’s trend of better-than-expected earnings continued.
Their shares rose 3% and 13% in extended hours trading last night, with their resilient performances contrasting with figures yesterday showing US GDP fell 0.9% in the second quarter on top of a weaker first three months of 2022.
Two declines in a row is the usual definition of a recession, but America’s economists prefer to assess other indicators before declaring an official downturn. President Biden added that strong levels of job creation and corporate investment “doesn’t sound like a recession to me”.
The weaker GDP figure did no harm to Wall Street as it added to expectations that the Federal Reserve is closer to slowing the pace of interest rate hikes Those hopes of a Fed pivot have fed into a much improved month for stock markets after the S&P 500’s worst first half since 1970 and the Nasdaq’s weakest quarter since the dotcom crash.
Trading has also improved in Europe, where markets are on their best month in over a year despite the continent’s energy crunch.
The FTSE 100’s June performance showed a drop of more than 5% but the top flight has rallied 3% since then and today stood at 7394.69 after adding another 49.44 points.
NatWest set the pace as its bumper dividend sent shares up by as much as 9%, while there was momentum among tech and growth stocks as Ocado rebounded 38p to 823.8p and Scottish Mortgage Investment Trust gained 21.4p to 857p.
The UK-focused FTSE 250 index is also back over the 20,000 threshold for the first time since mid-June, lifting more than 1% or 227.18 points to 20,082.37 in trading today on the back of a week of resilient earnings.
Top performers included the metal flow engineer Vesuvius, whose shares surged another 9% or 28.6p to 353.6p after upgrading guidance earlier this week.
Jupiter crashes to earth
08:59 , Simon English
THE strife in the fund management sector was laid bare today when Jupiter reported that assets slumped by £8 billion.
That is partly due to nervous client pulling money out, but also a sign of poor performance.
Leading stock pickers across the City have struggled this year, with most funds failing to keep up with their benchmark.
Research this week by AJ Bell showed that only 30% of “active” funds beat the passive alternatives that simply track stock markets.
Jupiter’s half year profits crashed from £57 million last time to £18.8 million.
Chief executive Andrew Formica said: “The first half of 2022 has been particularly challenging for both the industry and Jupiter, as the continued impact of the coronavirus pandemic, the war in Ukraine, and rising inflation have created turbulent markets and heavily impacted investor sentiment.”
Assets under management are down £8.1 billion to £48.8 billion. Formica said last month he would step down after just three years by October.
He called today’s results “disappointing”.
Jupiter shares fell 7p to 121p. They have more than halved this year.
NatWest surges on dividend boost, FTSE 100 higher
08:32 , Graeme Evans
NatWest shares have surged 9%, up 20p to 250p, after the lender announced a 17% rise in interim dividend to 3.5p a share and a special dividend of 16.8p a share.
Interactive Investor head of markets Richard Hunter said: “ NatWest’s continued progress has left the bank awash with cash, which has resulted in a bumper return for shareholders.”
Other big risers in the FTSE 100 index included British Airways owner IAG as it reported a return to quarterly profit for the first time since the pandemic and said that forward bookings showed “sustained strength”.
IAG shares were 3p higher at 124.9p and helped engine giant Rolls-Royce improve 3p to 89.45p. AstraZeneca was on the blue-chip fallers board as shares declined 208p to 10,662p in the wake of interim results.
The FTSE 100 index rose 24.31 points to 7369.56 and the FTSE 250 improved 108.62 points to 19,963.81.
Amazon and Apple shares surge after updates
07:49 , Graeme Evans
Better-than-expected results from tech giants Amazon and Apple last night helped ease some of Wall Street’s worries over the latest contraction in the US economy.
Amazon shares jumped 13% in extended trading as sales grew ahead of forecasts by 7% to $121.2 billion (£99.1 billion), driven by a jump of a third in revenues at Amazon Web Services and 10% growth in the company’s North American arm.
The improvement failed to offset rising costs as operating profits more than halved to $3.3 billion (£2.7 billion). Sales in the third quarter are expected to be between $125 billion and $130 billion and operating profit between breakeven and $3.5 billion.
Hargreaves Lansdown analyst Laura Hoy said: “Big tech’s been a mixed bag this earnings season, but Amazon proved that the strong can survive even the toughest environments.”
Apple squeezed further growth in its most recent quarter after sales rose 1.9% to $83 billion (£67.9 billion), but operating profits fell by $1 billion to $23.1 billion (£18.9 billion).
Apple shares were 3% higher in after-hours trading, leading to a 1% rise in Nasdaq futures ahead of today’s Wall Street opening.
Major US indices were higher yesterday as a second consecutive negative reading for US GDP boosted hopes that the Federal Reserve will relax the pace of interest rate rises.
The FTSE 100 index was broadly flat yesterday, with CMC Markets expecting the top flight to open 19 points higher at 7,364 today.