Yahoo Finance FTSE 100 Live: Gold price near record highs, FTSE returns to growth, UK ‘turnaround finally on horizon’
Sterling stayed near a 10-month high at $1.25 today after a positive update on activity in the UK’s dominant services sector.
The PMI reading for March highlighted a pick-up in confidence, even though interest rates have continued to rise.
On the corporate front, FTSE 100-listed components supplier RS Group and the car showroom business Lookers have posted figures.
FTSE 100 Live Wednesday
Services sector back to growth in Q1
Ofcom refers cloud market for CMA probe
Franco Manca owner gets takeover offer
FTSE finshes at 7663
16:38 , Daniel O'Boyle
The FTSE 100 returned to gains today, closing at 7663.
the index of London blue-chips fell yesterday after an afternoon dip, ending a six-day-long streak of gains. However, it returned to growth today, as stocks continue to get further from the lows experienced amid last month’s banking crisis.
Pharamaceuticals led the way, with AstraZeneca and GSK among the top risers.
Dignity interim CFO steps down
15:57 , Daniel O'Boyle
Dean Moore has stepped down as interim CFO of funeral business Dignity.
Moore will be replaced by Angela Eames, who was Dignity’s group financial controller.
Despite his interim designation, Moore was in the role for more than two years.
"We are delighted to welcome Angela onto the Board in an interim role,” chairman John Castagno said. “Her knowledge of the group and experience has been and continues to be invaluable. We continue the process to recruit a permanent chief financial officer which has been postponed awaiting the outcome of the recommended offer for Dignity PLC by Yellow (SPC) Bidco Limited.
“We are also extremely grateful to Dean for his wise counsel in the interim role, which he has performed since 1 January 2021 and now wishes to dedicate more time to his other non-executive roles and business interests.”
Later shop and café openings urged to revive night economy
15:38 , Jonathan Prynnn
LATER shop and café opening hours and a 24-hour cultural centre could help revitalise central London’s night-time economy as it struggles to bounce back fully from the ravages of the pandemic, a new action plan recommends today.
The Heart of London Business Alliance, which represents traders around Piccadilly, Leicester Square and St James’s, makes more than 70 suggestions in a major report into boosting the West End economy between 6pm and 6am published this week.
It shows that the value of the West End’s £14 billion-a-year sector, which employs 160,000 people, is still lagging slightly behind 2019 levels.
Other ideas in the report include commissioning “a trail of light artworks, leading from Green Park to Piccadilly Circus” , a major overhaul of frontages overlooking and leading onto Leicester Square and turning St Martin’s Lane into “a pedestrian priority street with timed vehicular access”.
Most stocks down on Wall Street, but biggest players fare better
15:13 , Daniel O'Boyle
Shares in American companies are down this morning, after data showed slower-than-expected growth in service sector output.
The S&P 500 is down 0.3% to 4088. However, big companies have performed better, with the Dow Jones up by 0.2% to 33458, led by pharma giant Johnson & Johnson.
The S&P Global US Services PMI came to 51.2 for the month, which means the service sector grew, but the figure was significantly below the expected 54.4.
US shares set for small declines
13:46 , Daniel O'Boyle
US stocks are set to open just below yesterday’s close, according to futures markets.
Dow futures are at 33531, down 46 points. S&P 500 futures are down eight points to 4120 and Nasdaq futures are down 15 points to 4120.
Paint business Sherwin-Williams is the biggest premarket faller, down almost 8%.
Vodafone shares jump amid reported £3.2 billion Spanish arm sale
13:40 , Daniel O'Boyle
Vodafone shares jumped this afternoon on reports that the telecoms giant received approaches about a possible $4 billion (£3.2 billion) sale of its Spanish business.
Bloomberg said Vodafone had been contacted by private equity businesses and “strategic suitors”, who believe the London-llisted giant would be receptive to offers evenn though it is not currently running a sale process.
Vodafone shares jumped from 87.4p to 89.8p on the news.
ADP Research: US job growth below expectations in March
13:22 , Daniel O'Boyle
The US added 145,000 jobs in March, well below analysts’ expectations, according to the ADP Research Institute.
US job growth had consistently come in higher than expected over the past year, defying expectations of a cooldown. However, if the official statistics released on Friday match ADP’s estimates, it would suggest that the Fed’s recent rate hikes are finally filtering through to the wider economy.
“Our March payroll data is one of several signals that the economy is slowing,” ADP chief economist Nela Richardson said. “Employers are pulling back from a year of strong hiring and pay growth, after a three-month plateau, is inching down.”
City Comment: Fixed mortgage rates prolong bad news on inflation
13:16 , Daniel O'Boyle
In the old days it was simple.
When interest rates went up you could look forward to paying a lot more for your mortgage the very next month.
It was a painful but effective anti-inflationary tool that instantly sucked huge levels of demand out of the economy.
But in an era when more than 80% of home loans are on fixed rates — and about half of those for five years — the impact of a rate rise is heavily muzzled.
Office fit out costs across Europe rise 9%, with London most expensive
12:42 , Daniel O'Boyle
Businesses wanting a high quality office revamp as they seek more attractive workplaces post-pandemic will find London is the most expensive place in Europe to do so, research shows.
London has topped a list of the most expensive places in Europe to carry out high end ‘all in’ fit out projects, which look at most interiors including furniture and meeting rooms for example.
Jeweller Vashi calls in liquidators
12:21 , Daniel O'Boyle
Jewellery shop Vashi - which has four London stores - has gone bust, according to reports.
Sky News reported that the high-end jeweller called in Teneo Restructuring to act as liquidators after landlord the Canary Wharf Group filed a winding-up order.
Vashi - which has stores in Covent Garden, Westfield and the City’s Royal Exchange as well as Canary Wharf and a head office and manufacturing centre in the West End - employs more than 250 people.
Retail footfall drops in “sharp shock” to the high street
11:29 , Daniel O'Boyle
UK retail footfall fell by 2.8% month-on-month in March, in a “sharp shock” to the high street, according to new data from MRI Springboard.
Aside from months affected by Covid-19 lockdowns and the ‘Beast from the East in 2018, this was the first month-on-month decline in March since records began in 2009.
High street footfall was down 18.7% compared to pre-pandemic levels.
MRI said that “shoppers have started to rein in on leisure-based trips,” instead traveling only for essentials.
Co-op calls future ‘challenging’ as labour and energy costs soar
11:14 , Simon English
Rising labour and energy costs are likely to hit returns at the Co-op, it warned today.
While the mutual saw sales up by £300 million to £11.5 billion for the year to December and profits steady at £100 million, the near future is likely to be challenging.
It has “absorbed” £100 million of extra pay and power costs , but warned: “We expect the volatile external environment and turbulent economic headwinds, including inflationary pressures to continue”.
Rival mutual John Lewis is considering an at least partial sale of shares to provide a cash injection. The Co-op is unlikely to follow suit.
Chairman Allan Leighton, left, said: “The inflationary challenges are well known, so for our Co-op to have delivered this level of performance is encouraging. The future focus on growing membership is vital.
Gold above $2000 an ounce, defensive stocks lift FTSE 100
10:29 , Graeme Evans
Gold continues to trade above $2000 an ounce as evidence of a weakening US economy bolsters the appeal of the safe haven metal.
The spot price peaked today at $2027 an ounce, having yesterday surged through the $2000 barrier on the back of the worst figures for new US job openings in almost two years.
The evidence of a weaker jobs market raised hopes the US Federal Reserve may now be in a position to pause interest rate hikes, boosting speculation that the precious metal could soon exceed the all-time high of $2075 set in August 2020.
London-listed gold miners benefited from the latest commodity market developments as West Africa-focused Endeavour Mining rose 42p to 2090p in the FTSE 100 index and Egypt-based Centamin lifted 4.3p to 108p in the FTSE 250.
The defensive theme was seen elsewhere, with shares in water companies Severn Trent and United Utilities up 2% and consumer healthcare firm Haleon up 6.45p to 337.45p.
Their contributions helped the FTSE 100 index to climb 14.84 points to 7649.36, whereas the UK-focused FTSE 250 slipped 44.99 points to 18,770.05.
The biggest top flight fall came from RS Group as the company previously known as Electrocomponents reported slower revenues growth in the final quarter of its trading year. Full-year profits were slightly ahead of City hopes, but shares fell 4% or 39.6p to 855.4p.
In the second tier, Direct Line Insurance got a welcome boost when Citi analysts switched from a “sell” to “buy” recommendation with a new price target of 188p. Shares responded by adding 7.3p to 150.75p, still well short of the 232p seen in January prior to the insurer’s decision to pause dividend payments.
Consulting and engineering business Wood Group rose 4% or 7.4p to 207.4p after takeover suitor Apollo yesterday increased its proposed offer price to 240p a share.
And in the FTSE All-Share, retailer Topps Tiles lifted 1.5p to 48p amid cheer over record first half revenues.
'White label’ betting site behind top football sponsors to pay penalty
10:29 , Daniel O'Boyle
The Gambling Commission has handed out its third penalty in three weeks, this time to the company behind several Premier League sponsors.
TGP Europe will pay a £316,250 penalty after the Commission uncovered a number of anti-money laundering and social responsibility failures. These included allowing customers to continue to gamble after hitting multiple safer gambling alerts without intervention.
TGP holds a “white label” licence, which allows other companies to operate in the UK on its behalf.
A number of TGP partners that avail of the white label system are current or former sponsors of Premier League football clubs. These businesses often set up a UK site on TGP’s licence in order to agree a sponsorship deal, while their main operations are in other countries - often in Asia - where Premier League football is popular and online gambling is unregulated.
Like all Gambling Commission regulatory action, the size of the penalty will be based on the operator’s UK revenue.
Services sector back to growth in Q1
10:01 , Daniel O'Boyle
New business volumes in services industries rose at the fastest pace in a year in March, according to the S&P Global / CIPS UK Services PMI, while the sector grew in Q1 after a decline in Q4 of last year.
The report found that business activity rose for the second month running, albeit at a slower pace than February, resulting in a PMI figure of 52.9. Any figure over 50 represents growth.
The Q1 figure, meanwhiile, was 51.7, after a decline to finish 2022.
Dr John Glen, chief economist at the Chartered Institute of Procurement and Supply (CIPS) said the strong figures could suggest the economy is recovering.
"The biggest surge in new business for 12 months in the dominant services sector could trigger hopes that a turnaround is finally on the horizon for the UK economy,” he said. “Underlined by the continuing upward trend from last month’s robust levels of overall activity and March’s strong business optimism amongst respondents also had a positive effect.”
Franco Manca owner’s shares soar 32% on takeover over
09:38 , Joanna Bourke
Shares in AIM-listed Fulham Shore are currently 32.38%, or 3.4p higher, at 13.9p.
That comes after the company, the restaurants business behind The Real Greek and Franco Manca brands, got a £93.4 million takeover offer.
Read the full story HERE.
Electric vehicles drive rebound in car sales
09:19 , Daniel O'Boyle
The car market is roaring back to life as new registrations grew by 17% in March, while car dealership Lookers raised its full-year profit guidance on the back of strong Q1 figures.
Electric cars drove much of the growth, as registrations hit a record high.
Lookers, which has 150 dealerships in the UK and Ireland, has reaped some of the benefits of the market rebound. It said its profit for the year is now set to beat previous expectations. CEO Mark Raban noted that the dealership outperformed the market on EV sales, while used cars and after-sales services also performed well.
“Customers are interested in electric vehicles,” he said. “When customers get their hands on them they really really do love them.”
The group’s profit dipped slightly in 2022 as supply chain issues limited the availability of cars, though Raban said those issues eased as the year went on.
With £66 million in net cash, Raban said Lookers may turn to M&A in order to expand its electric car operations further.
Banks lead FTSE 100 higher, upgrade for Direct Line
08:34 , Graeme Evans
The FTSE 100 index is 12.38 points higher at 7646.90, aided by progress in the banking sector after Barclays rose 2.7p to 149.2p and Lloyds Banking Group lifted 0.4p to 48.5p.
Yesterday’s surge in the gold price to over $2,000 an ounce helped Endeavour Mining to rise 30p to 2078p.
The precious metal today steadied at around $2,020 amid concern over the slowing of the US economy and signs that the Federal Reserve may be in a position to pause interest rate hikes.
RS Group, which used to be known as Electrocomponents, was at the top of the FTSE 100 fallers board as shares dropped 4% or 35.8p to 859.2p following the company’s end of year trading update.
The FTSE 250 index was 16.67 points lower at 18,798.37. Direct Line Insurance shares jumped 6% after analysts at Citigroup switched from a “sell” to “buy” recommendation, while Wood Group rose 4% or 7.4p to 207.4p after takeover suitor Apollo yesterday increased its proposed offer price to 240p a share.
Record first half for Topps Tiles
08:21 , Joanna Bourke
Topps Tiles has notched up record first half revenues, with sales at the retailer’s shops well ahead of pre-pandemic levels.
The UK’s largest tile retailer, which has 300 shops including around 50 in London, recorded revenues of £130.5 million for the six months to April 1, up 9.5%.
Trading benefited from the purchase of tiling supplies business Pro Tiler Tools last year and the launch of online-only Tile Warehouse.
The company added that sales per Topps Tiles branch were around 30% higher than in the year ending September 2019. Figures were boosted by transferring sales from closed stores as the chain rationalised its estate, as well as underlying sales growth.
The firm said whilst gross profit has been rising in recent years, gross margin percentage has trended down owing to factors such as cost inflation.
In the first half, gross margins were lower year on year, however margins improved over the course of the period.
Chief executive Rob Parker said: “The economic outlook remains uncertain but early signs of easing supply chain pressures, allied to the group’s strong balance sheet, world class customer service, specialist expertise and growth strategy give us confidence in our ability to drive value for all stakeholders over the medium term.”
De La Rue activist investor steps up pressure
08:03 , Graeme Evans
Banknote printer De La Rue is facing another vote on the position of chairman Kevin Loosemore.
Crystal Amber, the company’s second largest shareholder, said it had sent a requisition notice requiring De La Rue to convene a general meeting. It wants Loosemore removed from his post, with automotive industry chief executive Pepyn Dinandt stepping in as chair.
The activist investor wrote to shareholders today telling them that the turnaround plan instigated by Loosemore and chief executive Clive Vacher in 2020 has failed. Since March 2021, De La Rue’s share price has fallen by 75%.
Loosemore was given the backing of shareholders in December, when De La Rue held a general meeting in response to pressure from Crystal Amber.
Franco Manca owner Fulham Shore to be snapped up by Japanese food company Toridoll in £93 million deal
07:58 , Simon Hunt
Fulham Shore, the owner of the Franco Manca and The Real Greek restaurant brands is to be snapped up by Japanese food conglomerate Toridoll in a £93 million deal.
Fulham Shore board members have voted unanimously to approve the takeover and put it to a vote by shareholders, who will be offered 14p per share, a premium of 35% on yesterday’s closing share price.
Takaya Awata, President and CEO of TORIDOLL, said: ”Fulham Shore has two exciting and fast growing brands that are aligned with TORIDOLL's slogan of “Filling Our Planet with Dining Experiences that will Move You”. We are confident that both have the potential for significant future growth, domestically and internationally.
“Together with the strength of these brands and our partnership with restaurant sector specialist fund Capdesia, we have the opportunity to leverage our combined expertise and significant resources to accelerate their growth even further. We look forward to working closely with Fulham Shore’s management and employees as we embark on the next stage of the company's growth.”
Entain makes Brazilian push with media site acquisition
07:58 , Daniel O'Boyle
Ladbrokes owner Entain has bought football news site 365scores, in a deal that could be a key springboard for its operations in Brazil.
The deal extends Entain’s operations into the media space for the first time, but also offers it a local presence in Brazil, which could become a requirement when the country introduces new sports betting laws this year. Brazil is 365Scores’ top market according to Similarweb and the company has an office in São Paulo.
An Entain spokesperson said the betting group had no indication of whether the deal will have an impact on licensing.
Entain will pay £120 million up front, plus £8 million in contingent payments.
“The combination of 365scores' deep expertise in data-driven sports media content alongside Entain's global scale and market leading platform capabilities will provide customers with a broader offering of interactive content and experiences,” the Entain board said.
“The acquisition unlocks further growth opportunities and supports our global strategic ambitions.”
Services sector in focus, FTSE 100 seen flat
07:31 , Graeme Evans
Stock markets fell yesterday after it emerged that the number of US job openings in February fell below 10 million for the first time since 2021, raising concerns about the world’s biggest economy.
The Dow Jones Industrial Average and the S&P 500 both closed down by around 0.6%, while the FTSE 100 index also surrendered earlier gains to finish in negative territory.
London’s top flight is expected to open broadly unchanged at 7638 this morning as attention turns to various PMI releases from Europe’s services sector.
The reading for the UK, which is due to be disclosed at 0930, is expected to show further expansion in activity.
Michael Hewson, chief market analyst at CMC Markets, said: “While manufacturing has been struggling, and is in large part contracting, services activity has been picking up across the board, whether it be in the US, Europe, or the UK.
“Energy prices have also been falling, notably petrol prices, as well as that of natural gas, consumers have had more disposable income than expected.
“This has had the effect of exerting upward pressure on services inflation which is prompting concerns over stickier than expected prices.”
Ofcom refers cloud market to CMA after probe
07:14 , Simon Hunt
Ofcom is to refer the cloud market to the UK competition watchdog after uncovering what it called “concerning practices” by key market players during an investigation.
Ofcom said it was calling in the Competition and Markets Authority because it was “particularly concerned about the practices of Amazon and Microsoft because of their market position.”
Charging customers to leave the cloud, restrictions on interoperability between different providers and offering discounts to move all their cloud services to one provider were among the issues raised during the probe.
Ofcom director Fergal Farragher, said: “We’ve done a deep dive into the digital backbone of our economy, and uncovered some concerning practices, including by some of the biggest tech firms in the world.
“High barriers to switching are already harming competition in what is a fast-growing market. We think more in-depth scrutiny is needed, to make sure it’s working well for people and businesses who rely on these services.”
Recap: Yesterday’s top stories
06:50 , Simon Hunt
Good morning. Here’s a summary of our top stories from yesterday:
Richard Branson’s Virgin Orbit filed for bankruptcy after failing to get enough funding to continue operations.
Rathbones bought up the wealth and investment division of rival Investec Group in a deal worth about £839 million.
JPMorgan boss Jamie Dimon said the current banking crisis is “not yet over”, as he took aim at the US Federal Reserve’s role in the collapse of Silicon Valley Bank.
TikTok was fined £12.7 million by a UK watchdog for mishandling children’s data.
Today we’re expecting:
Lookers annual results
EnQuest annual results
Hilton food group annual results
RS Group trading update
UK PMI data
