London’s FTSE 100 index has made a strong start to the week, with China-sensitive stocks at the forefront of the buying.
The momentum came as China’s latest property support measures led to a surge of more than 2% for the Hang Seng index.
Private equity giant Permira’s £703 million deal to buy life sciences firm Ergomed is one of the day’s other major developments.
FTSE 100 Live Monday
FTSE 100 lifted by China optimism
Permira deal for £700m life sciences firm
Ryanair breaks monthly passenger record
NatWest and HSBC cut mortgage interest rates again, and brokers predict other top lenders will follow
Monday 4 September 2023 17:27 , Daniel O'Boyle
The recent easing in mortgage rates shows no sign of slowing, as HSBC and NatWest both announced a range of interest rate cuts only hours apart, while brokers predicted the rest of the “Big Six” could soon follow suit.
This morning, HSBC revealed that it it will cut its mortgage rates from Tuesday, 5 September, across a range of its most popular products.
Just hours later, NatWest followed with cuts of its own of up to 0.35 percentage points for fixed-rate loans and 0.55 percentage points for trackers.
The UK’s top lenders have now been cutting mortgage rates for six weeks, after they skyrocketed to record highs in mid-July amid fears the Bank of England would raise its own interest rates to levels not seen this century.
End-of-dat market snapshot
Monday 4 September 2023 17:02 , Daniel O'Boyle
Tkae a look at our closing market data
FTSE closes at 7,452.76 following afternoon decline
Monday 4 September 2023 16:38 , Daniel O'Boyle
The FTSE 100 closed at 7,452.76 today, losing 70 points after its initial rise.
Shares started strong after new Chinese stimulus helped to lift markets in Asia. However, shares faded as the day went on, leaving the FTSE in negative territory.
Ladbrokes owner Entain was the day’s biggest riser, followed by Glencore and Pearson, while insurer Admiral was the day’s biggest faller, ahead of Johnson Matthey and Endeavour Mining.
Market snapshot as FTSE dips into red
Monday 4 September 2023 16:09 , Daniel O'Boyle
The FTSE 100 fell into losing territory this afternoon, despite being up by as many as 60 points at one point this morning.
Restaurant chain Bill’s rebounds from pandemic with record first-half sales
Monday 4 September 2023 15:29 , Daniel O'Boyle
Richard Caring’s restaurant chain Bill’s has staged a strong recovery after racking up huge losses during the pandemic and closing dozens of sites.
The company, which grew from a single greengrocer in Lewes, reported record first-half sales of £45.3 million from its still trading locations, up 4.5% on a like-for-like basis.
Underlying earnings of £2.45 million compared with a £0.1 million loss last year, and trading is said to be “ahead of expectations”.
Market snapshot with FTSE still slightly up
Monday 4 September 2023 14:37 , Daniel O'Boyle
Take a look at today’s market snapshot, as some of the FTSE 100’s early gains have faded, but the index remains up for the day.
Superdry shares sink
Monday 4 September 2023 13:13 , Simon English
SUPERDRY shares resumed trading today after being suspended over an accounting snafu – and immediately plummeted.
The already out of fashion shares lost another 11% to 49.9p. That leaves the company, once worth £1.6 billion, valued at just £48.5 million.
The shares were suspended because auditors said they needed more time to finalise the accounts.
While that in itself may not be significant, it added to concerns in the City about the future of the business.
Founder and CEO Julian Dunkerton floated the business in 2010.
He returned as CEO in 2019 in anger at what other bosses had done to the brand. He felt they had tarnished the clothes with an over reliance on garish logos and fewer product lines.
Dunkerton admits it has been a “difficult year” for the company, but insists it is improving.
A new flag ship store on Oxford Street is well stocked. He complains that the area needs “serious help” to thrive as a shopping destination however.
Superdry has had to raise money at high rates of interest and sold brand rights in the Asia-Pacific.
City analysts say the middle market is particularly tough for retailers at the moment. Ted Baker was sold to the US giant behind Reebok. Joules was rescued by Next.
Dunkerton owns about 25% of the stock himself. Last week the group reported an annual loss of £22 million. Sales looked healthy however, up 2% at £622 million.
No net zero target among reasons 21% voted against re-electing Grafton chair
Monday 4 September 2023 12:28 , Daniel O'Boyle
Grafton Group said the company’s record on climate and gender diversity were among the reasons 21% of shareholders voted against re-electing its non-executive chair.
The Irish DIY retail giant launched a consultation after more than a fifth of investors chose not to support the resolution to re-elect Michael Roney at the firm’s annual general meeting in May.
In a statement on Monday, the FTSE 250 firm said “a mix of factors” were behind the shareholder rebellion.
Redundancies set to start at Wilko offices on Monday as hopes remain for shops
Monday 4 September 2023 11:49 , Daniel O'Boyle
The first round of potentially thousands of layoffs at failed retailer Wilko is expected to start on Monday even as hopes of a rescue deal for parts of the business remain.
Administrators confirmed last week that 269 people in the company’s Worksop support centre would be having their last day with the business.
Redundancies at the company’s Worksop and Newport warehouses are also due to start early this week.
Wetherspoons dropping food and drink prices for one day only
Monday 4 September 2023 11:15 , Daniel O'Boyle
Wetherspoons pubs are cutting the prices of all food and drinks for one day this week in a bid to highlight the tax burden on the hospitality industry.
The chain will reduce prices by 7.5% in pubs across the UK and Ireland on Thursday.
It means that, for example, a customer spending £10 on food and drinks will pay £9.25 for one day only.
The move is being done to mark Tax Equality Day, by highlighting the benefit that a permanent VAT reduction would have on pubs and restaurants across the UK.
FTSE 100 higher amid China focus. Watches of Switzerland rallies
Monday 4 September 2023 10:31 , Graeme Evans
London’s top flight today rose 0.7% or 53.34 points to 7517.88 as traders welcomed fresh support for China’s property sector and the restructuring of debt repayments at troubled developer Country Garden.
The Hang Seng index, which was closed on Friday due to Typhoon Saola, jumped 2.5% in a boost for several London-listed stocks.
Risers included Hong Kong-based insurer Prudential with a gain of 14.6p to 984.4p and luxury goods group Burberry after a rise of 43p to 2225p. Stronger mining stocks included Glencore and Anglo American, with shares in both up by 2%.
In the FTSE 250 index, Watches of Switzerland rallied 3% or 17p to 606.5p after it emerged that finance boss Anders Romberg, chair Ian Carter and two non-executive directors bought shares on Friday at around 585p.
They made their moves after a slide in valuation triggered by Rolex buying one of Watches of Switzerland’s major rivals. Last month, the UK-listed company fell 26% to a three-year low even though Rolex said the purchase of Bucherer would have no bearing on its current distribution arrangements.
On AIM, property firm Belvoir jumped 4% or 8.4p to 228.4p as it praised its “entrepreneurial” franchisees and self-employed financial services advisers for overcoming a tough market with 10% higher half-year profits at £4.4 million. The performance was driven by a strong lettings market and remortgaging activity.
Advanced Medical Solutions shares plummet on US insurer warning
Monday 4 September 2023 09:53 , Daniel O'Boyle
Life sciences firm Advanced Medical Solutions Group saw its share price plummet by nearly 30% as it warned of the impact of US insurers opting not to cover its ulcer treatments.
Organogenesis, which licenses the patent for Advanced Medical Solutions’ foot and leg ulcer treatments, withdrew its profit guidance last month, blaming the “uncertainty” created by a number of insurers not covering the products.
Now, AMS says it has removed all royalty income from Organogenesis for these products from its guidance.
“Given that Organogenesis has withdrawn its own guidance and that we have no control of, and minimal insight into its sales, we are unable to quantify the financial impact on AMS at this stage,” AMS said. “We therefore believe it to be prudent to remove this royalty in its entirety from Q4 2023 guidance onwards.”
That change means AMS’ profit guidance for this year is now £2 million lower, at between £25 million and £27 million. Profit for 2024 and 2025 is now expected to be £4 million lower.
Shares lost 66p, or 26%, to 184p.
Building society’s new mortgage aims to get renters back on property ladder
Monday 4 September 2023 09:31 , Daniel O'Boyle
Former homeowners turned renters can now get a helping hand back onto the property ladder, according to a building society.
Skipton Building Society is expanding the pool of aspiring homeowners who can apply for its track record mortgage, to support more “trapped renters”.
The move could potentially help people who have previously moved out of homeownership back into the rental sector due to a divorce or needing to relocate, for example.
Prudential leads FTSE 100, Hammerson shares 3% higher
Monday 4 September 2023 08:42 , Graeme Evans
European shares have made a strong start to the week, with the FTSE 100 index up 0.6% or 42.29 points at 7506.83.
Hong Kong-based insurer Prudential rose 2% or 17.6p to 987.4p and mining stocks Rio Tinto and Glencore lifted 1.5% following a strong session for Asia markets.
On the fallers board, Centrica shares gave up half a penny at 153p after a recent strong run for shares in the British Gas owner.
The FTSE 250 index rose 0.3% or 61.12 points to 18,598.02, with shopping centre owner Hammerson the best performing stock after a rise of 3% or 0.8p to 24.8p.
Hang Seng index rallies amid property support
Monday 4 September 2023 08:20 , Graeme Evans
Under-pressure property stocks have led a rally for Hong Kong’s Hang Seng index after troubled developer Country Garden secured a deadline extension for onshore debt payments.
The agreement with bondholders came as authorities in China unveiled more measures to support the economy, including a cut in banks' currency reserve requirement ratios.
UBS Global Wealth Management said: “We have been looking for more significant property rescue measures for some time to shore up sentiment and consumer confidence, and this now appears to be materialising in a more convincing way.
“Alongside a pending drop in mortgage interest rates, housing demand may finally turn around, albeit gradually.”
The Hang Seng index, which was closed on Friday due to Typhoon Saola, rose 2.4%. Country Garden shares were 18% higher.
Ryanair breaks monthly passenger record again despite bank holiday chaos
Monday 4 September 2023 08:02 , Daniel O'Boyle
Ryanair broke its monthly record for passengers again in August, even despite the chaos of last weekend, when a computer error shut down thousands of UK flights.
The low-cost carrier flew 18.9 million passengers, up from July’s record of 18.7 million and 11% more than in August 2022. However, it said that more than 350 flights, with 63,000 passengers, were cancelled “due to NATS ATC computer ‘failure’ which has still not been explained”.
Rival low-cost airline Wizz Air carried 6.1 million passengers, up 23.9% from last year, with new flights including Luton to Cairo.
Harbour Energy and Wood strike North Sea oil partnership worth $330 million
Monday 4 September 2023 07:48 , Michael Hunter
Oilfield services firm Wood and major North Sea oil producer Harbour Energy have signed a $330 million operations and maintenance deal.
It covers engineering, procurement and construction as well as “digital and decarbonisation solutions” and will run for an initial five years.
Steve Nicol, Wood’s Executive President of Operations, said: “We are incredibly proud to have been selected and trusted by Harbour Energy to partner with them across their North Sea assets. We share a commitment to ensuring safe, reliable and sustainable energy production”.
The partnership will cover assets that Harbour says are critical to UK energy security. It will support hundreds of jobs r. rom Wood’s Operations business in Aberdeen.
Life sciences firm Ergomed to be taken private in £700 million deal
Monday 4 September 2023 07:31 , Simon Hunt
Life sciences firm Ergomed is poised to be acquired by London private equity business Permira in a £703 million deal.
The board of the Surrey-based business has unanimously recommended the deal, which values Ergomed shares at a 28% premium of Ergomed shares as at market close on Friday.
John Dawson, Senior Independent Director of Ergomed said: “The offer from the Permira Funds, which follows multiple rounds of negotiations and extensive discussions on valuation, represents a highly attractive valuation and offers shareholders the certainty of cash today.”
FTSE 100 seen higher, Brent Crude above $88 a barrel
Monday 4 September 2023 07:21 , Graeme Evans
Asia stock markets are higher after Friday’s jobs market report kept alive hopes for a pause in interest rate hikes by the Federal Reserve.
Hopes of further stimulus measures in China also helped the mood, with the Hang Seng index 2.4% higher after being closed on Friday due to a typhoon. The Shanghai Composite is up by more than 1%.
CMC Markets expects the FTSE 100 index to lift by 38 points at 7502, although the Labor Day holiday in the United States means it is likely to be a quiet session.
On Friday, the Dow Jones Industrial Average closed 0.3% higher after the US jobs report showed a jump in the unemployment rate from 3.5% to 3.8% in August.
The report appears to have eased the pressure on the Federal Reserve ahead of its next interest rates decision on 20 September, particularly after downward revisions to the previous two months of payrolls figures.
Inflation pressures are continuing, however, after Brent Crude futures started the week near to a nine-month high of $88.57 a barrel. The price has been lifted by expectations that Saudi Arabia will continue with its voluntary one million a barrel a day output cut.
Recap: Friday’s top news
Monday 4 September 2023 06:41 , Simon Hunt
Good morning. Here’s a summary of our top headlines from Friday:
Superdry falls £148 million into the red amid “challenging” market conditions and “extreme weather.”
Nationwide sees property prices fall 5.3% in steepest decline since 2009
Revised figures show thr UK economy bounced back from the pandemic much faster than previously thought
Consultation on controversial John Lewis Ealing homes development ends with 90% of comments in opposition after it emerges 35% affordable target may not be met
Listed blockchain investor KR1 sees the value of its portfolio sink 30% since April
Direct Line makes £30 million provision for refunds after overcharging customers