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FTSE 100 Live: New year optimism as IAG shares jump 10%, Apple hits $3tn

·10-min read

City traders are back at their desks in upbeat mood after the FTSE 100 index surged more than 1% in the first session of the year.

Hopes that the Omicron variant will not derail the global economic recovery meant shares in British Airways owner IAG jumped 10% and oil giant BP rallied 4% as the FTSE 100 index built on the 22-month high seen in the last trading session of 2021.

Wall Street markets set new records last night, with iPhone giant Apple the first US company to be valued at more than $3 trillion. Tesla shares also jumped 13.5% after it reported better-than-expected delivery figures for the fourth quarter.

Shares keep flying...

15:57 , Simon English

The futures markets were earlier predicting that US shares would keep rising even though indices are at record highs.

The futures were wrong, or at least, understating the case.

In New York, the Dow Jones is presently up another 324 points at 36,909.

The FTSE 100 is doing even better than that, up towards 2%, with a 127 point rise taking the index to 7511.

BA owner IAG is the biggest gainer, as I think it has been all day. Its shares are up 12%, 17p, at 160p.

Nationwide hit by computer glitches -- again

15:40 , Simon English

More payments chaos at Nationwide, the building society where the service is oh, so-much-better than you get at those beastly banks.

There was a payment glitch at the end of December which saw some customers deprived of their wages. Happy New Year!

Today there’s more.

A Nationwide spokeswoman said: “As a result of extremely high volumes of transactions on the first working day of the year we took the decision to temporarily queue inbound faster payments.

“This has been done to ensure we can manage and process those payments, which were taking much longer than normal due to the numbers received.”

It was, presumably, impossible to predict any of this.

US markets to keep on going...

14:28 , Simon English

Can the Dow Jones and the S&P 500 rise further? Both closed at all time highs last night, so you might expect some profit taking, some caution.

The futures market says otherwise. It thinks the Dow might add another 150 points when New York opens for business shortly.

We’ll see....

UK still needs oil and gas as it pushes to net zero

13:59 , Simon English

An interesting comment piece for us today from former Centrica boss Sam Laidlaw.

Our energy problems “may be symptoms of the current market, but their cause can be traced back to repeated failures of energy policy that have left the UK over-exposed to global markets and less attractive for investors,” he writes.

You can read it here

Bank of England: Consumer credit getting back to normal

12:18 , Oscar Williams-Grut

Consumer spending and borrowing patterns are normalising after being warped by government support during the pandemic.

New data published by the Bank of England showed a pick up in credit card spending, a drop in household savings and mortgage levels returning to more normal levels. All three were distorted by the pandemic and government subsidies during the early stages.

Read the full story.

UK manufacturing production increases at the quickest pace in four months

11:31 , Joanna Bourke

The manufacturing sector showed signs of life in the run up to Christmas, with new orders, production levels and employment all rising.

The IHS Markit/CIPS PMI index was at 57.9 in December – any number above 50 signals growth.

Rob Dobson, director at IHS Markit, said: “UK manufacturing production rose at the quickest pace in four months in December, supported by increased intakes of new work, efforts to reduce backlogs of work and higher employment. Although supply chains remain severely stretched, there are at least signs that the situation is stabilising, with vendor delivery times lengthening to the weakest extent for a year in December.”

Burger King UK launches its first ever vegan nuggets in time for Veganuary

11:26 , Naomi Ackerman

Burger King UK has launched its first vegan nuggets in time for Veganuary.

The firm said its latest offering, made from soy and plant proteins and available nationwide from tomorrow, will “taste the same as their meat originals”.

The UK arm of Burger King, which has 505 stores and is reportedly eyeing a London stock market listing that could value it at £600 million, has committed to make half of its British menu meat-free by 2030.

Last year Veganuary — the annual charity event seeing people go vegan in January — registered nearly 600,000 signups, up from 400,000 in 2020. The actual number of Britons taking up the challenge is believed to be far higher.

Read more here

Plan B curbs leave nasty taste for Wildwood-owner over Christmas

11:12 , Naomi Ackerman

DIM T and Wildwood owner Tasty today became the latest hospitality group to count the cost of Plan B restrictions on peak festive trading.

The AIM-listed company, which operates 54 pizza joints and Asian fusion eateries, told investors trade was “considerably weaker than anticipated” after work from home advice from December 13 onwards “deterred the larger Christmas bookings”.

Tasty has been forced to shut four branches due to labour shortages and weak demand.The group said 2022 “will not be without its challenges” but management are optimistic given “strong” demand for takeaway and delivery services.

The casual dining firm said trading for the six months up to December 2021 was “extremely encouraging” before restrictions hit.

Shares were unchanged at 5.1p this morning.

Many other hospitality businesses have been hit by Plan B restrictions over Christmas. Industry group UK Hospitality said December trade at its members’ pubs, bars and restaurants was down 40% to 50% on 2019 levels.

Ask Italian founders Adam and Sam Kaye own a 40% stake in the group. Both have stepped down from the company's board since Covid hit.

Amigo to pay off bonds early

10:11 , Oscar Williams-Grut

Troubled subprime lender Amigo Loans will repay millions of pounds of debt two years early as part of plans meant to save the business.

Amigo will redeem £184.1 million of bonds due in 2024 on 15 January. The early redemption of the 7.625% coupon bond will save Amigo £28 million in future interest payments.

That money will instead go towards a redress scheme for the estimated 82,000 customers who were missold loans in the past.

The redirection forms a key part of Amigo’s rescue plan, which creditors are being asked to approve. Amigo has pledged an initial £113 million in redress payments if mis sold customers agree to let it restart lending. The alternative is shutting down the business, a scenario the company says would leave creditors with less.

The bond repayment comes after a better-than-expected performance last year left Amigo with £280 million of cash on hand. Amigo will still have £50 million of 2024 bonds after the redemption.

Wizz Air passenger numbers soar

09:41 , Joanna Bourke

Wizz Air saw passenger numbers last month reach 2.6 million, marking a large rise from the 665,722 recorded in December 2020.

Carriers had a difficult period last year with various travel restrictions in place, but there were gains in some travel stocks this morning.

AJ Bell investment director Russ Mould said: “The gains for oil firms, airlines and hotel, pub and restaurant operators reflect diminished investor concern about the Omicron variant of Covid-19 amid hopes it is milder, if more transmissible, and therefore may have a limited impact on the economy and won’t require onerous or long-lasting restrictions.”

Tesla rally nets Musk $30 billion

09:34 , Oscar Williams-Grut

Tesla chief Elon Musk has seen his personal wealth soar by over $30 billion in a day.

Musk gained $33.8 billion on Monday, according to the Bloomberg Billionaires Index, after the value of Tesla stock soared.

The electric vehicle maker closed 13.5% higher on Wall Street after reporting record quarterly delivery numbers. 308,600 models were shipped in the fourth quarter, more than analysts were expecting.

Musk owns around 17% of the business. Already the world’s richest man, Tesla’s share price rise helped push his net wealth to $304 billion.

Evergrande shares resume trading

09:07 , Graeme Evans

Uncertainty over the future of Chinese property developer Evergrande continues to cast a cloud over global markets at the start of 2022.

Those jitters were fuelled yesterday when Evergrande's shares were suspended pending a statement from the firm, which has liabilities of more than $300 billion.

It later confirmed that it had been ordered to demolish 39 buildings on its Ocean Flower Island development, but that other plots within the project are unaffected.

Evergrande also revealed a 39% drop in sales for 2021 and said it continues to actively maintain communications with creditors over its liquidity position.

Shares resumed trading in Hong Kong at lunchtime, finishing the session just over 1% higher. It has missed bond repayment deadlines and investors fear wider contagion in the region if the firm collapses.

Rolls, BP shares fuel FTSE 100 surge

08:20 , Graeme Evans

The FTSE 100 index, which rose 14.3% in 2021, is up another 75 points or 1% to 7458 in its first session of the year. Big risers included Rolls-Royce, BP and Lloyds Banking Group with gains of about 3%.

Richard Hunter, head of markets at Interactive Investor, said the strength of the US dollar continued to provide an earnings boost for overseas-facing stocks in the FTSE 100.

He is now looking towards the imminent corporate reporting season for further detail on the earnings impact of both the Omicron variant and inflationary pressures.

Hunter said: “The early signs are that the consequences may be less detrimental than in previous cases of lockdowns and restrictions. In the meantime, the premier index remains well placed on valuation grounds to attract further international buying interest.”

FTSE 100 set for positive start to 2022

07:34 , Graeme Evans

The FTSE 100 index is to pick up where it left off at the end of 2021 as traders in London catch up on a strong start to the year for markets in Europe and the United States.

London's top flight finished at a 22-month high of 7384 on New Year's Eve and is expected to surge another 70 points to 7457 in early dealings. The Dow Jones Industrial Average reached another all-time high yesterday, but the FTSE 100 is still some way short of the 7900 peak set in the middle of 2018.

Stock market optimism at the start of 2022 has been aided by more signs that the Omicron variant should not derail the global economic recovery. It was a strong session last night for US-listed airlines and leisure firms, with London-listed counterparts poised to follow suit.

Other risers on Wall Street included Apple after adding another 2.5% to become the first US company to be valued at $3 trillion. Tesla shares also surged 13% after disclosing that it delivered 936,172 vehicles in 2021, including 308,600 in the fourth quarter.

There was also cheer for Asia markets as shares in Chinese property developer Evergrande rose on their return to trading following yesterday's suspension. The debt-laden company revealed overnight that sales had fallen 39% last year.

The price of Brent crude is just below $79 a barrel ahead of today's meeting of OPEC+, when it is expected that the oil cartel will stick to existing plans on monthly output.

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