Yahoo Finance FTSE 100 Live 26 February: Index closes down 0.3%, S&P slips from record high
Eight UK builders are facing an information sharing investigation after the competition watchdog concluded its review into why too few homes are being built.
The CMA said the complex and unpredictable planning system and limitations of speculative private development were to blame for the undersupply.
In today’s other corporate developments, Ryanair has issued a warning over higher prices and Bunzl and chipmaker EnSilica have posted results.
FTSE 100 Live Monday
Housebuilders face CMA investigation
Ryanair warns of price hikes
Deal-making Bunzl in profits rise
Tomorrow...
Monday 26 February 2024 16:53 , Daniel O'Boyle
Here’s what we have in store tomorrow:
Results
Abrdn, Smith & Nephew
EU Results
Puma, Munich Re
US Results
Urban Outfitters, eBay, American Electric Power
Economics
German GfK consumer confidence
US consumer confidence
City Spy: Mormon property fund praying for new tenants in the City
Monday 26 February 2024 16:50 , Daniel O'Boyle
Has God changed His mind on the outlook for London’s commercial property sector?
In 2019 Covent Garden IP Ltd— a property fund and registered charity owned by the Mormon Church — bought part of the Alder Castle office building near London Wall.
But it seems the Church’s fund managers were not omniscient enough to forsee the pandemic and its devastating impact on City property demand.
FSTE 100 closes down 0.3%
Monday 26 February 2024 16:39 , Daniel O'Boyle
The FTSE 100 has closed at 7,684.30, down 0.3%.
The index was dragged down by housebuilders - following this morning’s CMA report - and luxury stocks, amid reports of the Chancellor keeping the ‘tourist tax’ in place.
Top risers included Rolls-Royce and Bill Ackman’s Pershing Square Holdings.
Unions hit out at restoring of employment tribunal fees
Monday 26 February 2024 16:05 , Daniel O'Boyle
Unions, legal networks and rights organisations have criticised the Government’s decision to reintroduce employment tribunal fees.
In a joint statement, 48 organisations called on the Government to urgently reconsider its plans.
The groups warned that introducing fees will encourage exploitation of workers, saying: “We believe this will deter many from lodging
Berkshire Hathaway could hit $1tn market cap today
Monday 26 February 2024 14:21 , Daniel O'Boyle
Berkshire Hathaway could become the world’s seventh trillion-dollar firm when trading opens on Wall Street today.
Warren Buffet’s conglomerate is set to see its shares rise after reporting a jump in revenue and a record cash haul, that could be used for more deals.
Elsewhere on Wall Street, the Dow Jones, S&P 500 and Nasdaq are all set for roughly flat openings, remaining near record highs.
Small-cap tech investment firm Quantum Exponential says being listed is 'an impediment'
Monday 26 February 2024 14:18 , Daniel O'Boyle
Another blow was dealt to the London stock market today after a small-cap tech investment firm said its status as a public company was “an impediment” to growth and that its board unanimously agreed it should delist.
Quantum Exponential Group, which invests in quantum computing businesses, said it had received several “serious” expressions of interest from investors but that it had been “told repeatedly that the company's status as a publicly traded company has been one of the impediments to completing any investment agreements as these investors generally prefer to invest in private entities.”
The firm has seen its share price sink around 80% since its debut on the Aquis exchange in late 2021, despite an apparent surge in investor interest in quantum computing over the same period, with the technology viewed as transformative to the applications of artificial intelligence.
Blow to London stock market as small-cap tech investor says being listed is 'an impediment'
Monday 26 February 2024 13:46 , Simon Hunt
Another blow was dealt to the London stock market today after a small-cap tech investment firm said its status as a public company was “an impediment” to growth and that its board unanimously agreed it should delist.
Quantum Exponential Group, which invests in quantum computing businesses, said it had received several “serious” expressions of interest from investors but that it had been “told repeatedly that the company's status as a publicly traded company has been one of the impediments to completing any investment agreements as these investors generally prefer to invest in private entities.”
The firm has seen its share price sink around 80% since its debut on the Aquis exchange in late 2021, despite an apparent surge in investor interest in quantum computing over the same period
Coventry Building Society is latest lender to hike mortgage rates
Monday 26 February 2024 13:28 , Daniel O'Boyle
Coventry Building Society has become the latest in a series of high street lenders to increase its mortgage rates.
The mutual, which is headed by CEO Steve Hughes, said rates would go up from tomorrow for all new residential and buy to let products for new borrowers.
It follows similar moves last week from major players such as HSBC and Santander on fears that the Bank of England will cut its rate more slowly that previously thought in the battle against inflation.
Will Heathrow’s third runway ever be built? Its new shareholders may decide
Monday 26 February 2024 12:24 , Jonathan Prynn
The world has changed beyond recognition since Heathrow planners were last actively working on the airport’s third runway ambitions.
Progress was halted in early 2020 when the Covid pandemic erupted and passenger traffic collapsed by as much as 90%.
Four years on, the project is still officially “under review.” Although passenger numbers at Heathrow have bounced back, it is not yet clear how much of that is a short-term unwinding of pent-up demand. And all sorts of other factors have changed.
Wincanton eyed by second possible buyer as bidding war begins
Monday 26 February 2024 11:21 , Daniel O'Boyle
Logistics giant Wincanton has revealed it is being eyed by a second potential buyer as it becomes the latest business to become the centre of a bidding war.
Shares in the FTSE All-Share-listed company, which works with brands from Ikea and Primark to Waitrose and Wickes, jumped by more than 10% on Monday following the announcement.
Wincanton said last month that it had agreed to be bought by French shipping specialist CMA CGM, which valued the business at almost £567 million.
IAG and Rolls strengthen but FTSE 100 lower, luxury retailers under pressure
Monday 26 February 2024 10:09 , Graeme Evans
Fading hopes for a tourist tax U-turn in next week’s Budget today squeezed the shares of Rolex seller Watches of Switzerland and other luxury retailers.
The Treasury reportedly has no immediate plan to reverse the decision to axe the tax-free shopping scheme, which allowed overseas visitors to reclaim 20% VAT.
In a letter seen by The Times newspaper, minister Nigel Huddleston warned of complexities as any new scheme would now need to be open to visitors from the EU.
Hopes for a U-turn were raised when the government’s independent forecaster was asked to review the costs and benefits of VAT-free shopping in time for the Budget.
Shares in FTSE 250-listed Watches of Switzerland gave up some of their recent gains by dropping 3% or 11.6p to 414p, while Mulberry fell 5p to 120p and Burberry by 30.5p to 1273.5p.
The selling pressure came amid weak sentiment elsewhere as declines for heavyweight mining stocks left the FTSE 100 index 19.13 points lower at 7687.15.
Ocado led the fallers board, down 5% or 24.2p to 504.2p ahead of Thursday’s annual results. Traders were more upbeat on the same day’s figures by British Airways owner IAG, which added 2p to 154.75p alongside a further rise for engines maker Rolls-Royce of 5.4p to 358.5p.
Low-cost airline easyJet, which is set to rejoin the top flight in next month’s quarterly reshuffle, rose 11.2p to 557p as one of the best mid-cap performers.The FTSE 250 index, however, fell by 39.61 points to 19,139.95.
Market snapshot
Monday 26 February 2024 10:07 , Daniel O'Boyle
Take a look at today’s market snapshot with the FTSE 100 a little lower
Holidaymakers warned after £155,000 lost in reports of fraud last year
Monday 26 February 2024 10:01 , Daniel O'Boyle
Holidaymakers have been urged to be cautious after more than £155,000 was lost to fraud last year.
Some 89 reports of holiday fraud were received by police in 2023 which amounted to a total reported loss of £155,245 to scammers.
The figures, released by Action Fraud, show how important it is for those booking holidays to stop and take the time to do their research, police have said.
Hipgnosis dispute heading to High Court
Monday 26 February 2024 08:46 , Daniel O'Boyle
The Hipgnosis Songs Fund (HSF) is to take its founder Merck Mercuriadis to the High Court, in a row over a lawsuit from the music mogul’s former business partners.
Mercuriadis currently faces a lawsuit from liquidators acting on behalf of former directors of Hipgnosis Music Limited (HML), accusing Mercuriadis of stealing the idea behind the collapsed firm.
A spokesperson for Hipgnosis Songs Management and Merck Mercuriadis said both parties denied the claims and intended to defend them vigorously.
The songs fund - which owns rights to hits by artists from Barry Manilow to 50 Cent - has asked Mercuriadis to provide an indemnity against any damages the fund may be forced to pay because of the lawsuit.
It had previously warned that if this request was denied, it may take the spat to the High Court.
Today, the fund revealed that it will bring a claim against Mercuriadis, seeking a full indemnity.
It is not clear how much Mercuriadis would have to pay in the event of a lawsuit.
HSF will soon present plans for its future to shareholders, who last year voted for a motion to dissolve the fund. If shareholders don’t approve the new plans, the fund will be wound up.
Housebuilding and mining stocks under pressure, FTSE 100 steady
Monday 26 February 2024 08:40 , Graeme Evans
The CMA investigation into possible information sharing in the housebuilding industry has put pressure on share prices, with Persimmon and Taylor Wimpey down 3% in the FTSE 100 index.
Mining stocks also weighed on London’s top flight after declines of almost 2% for Rio Tinto, Anglo American and Glencore. Outsourcing firm Bunzl posted the biggest fall, off 5% or 161p to 3145p after its annual results.
IAG featured on the risers board ahead of this week’s results, with the British Airways owner up 2.75p to 155.5p. Rolls-Royce also added another 4.8p to 357.9p.
The FTSE 100 index recovered from a weak start to stand 1.69 points higher at 7707.97, while the FTSE 250 index was 17.78 points down at 19,161.78.
The mid-cap fallers board included Watches of Switzerland and the housebuilding firms Redrow and Bellway, with declines of more than 2%.
Ensilica shares pop on strong sales pipeline
Monday 26 February 2024 08:20 , Simon Hunt
Ensilica shares rose as much as 15% to 58p this morning after the British chipmaker said its opportunities pipeline surpassed $500 million.
The Oxford-based business said it had signed a new $35 million telecoms contract on top of committed supply revenues of $73 million. It posted sales of £9.6 million in the six months to end November, up 12% on the previous year.
The firm, which completed a £1.6 million capital raise in December, previously guided an opportunities pipeline of $360 million.
Bidding war looms as second suitor woos Wincanton after £764.9 million offer
Monday 26 February 2024 07:59 , Michael Hunter
Another bid-battle is on the cards in London. Wincanton, the logistics firm in receipt of a deal worth £764.9 million from French shipping giant CEVA said today it had received “an approach from a potential competing bidder”.
Wincanton said it had not received any detail on terms, “including as to terms and price”.
It said its directors “ continue to recommend unanimously to Wincanton shareholders the increased and final cash offer by CEVA Logistics”.
Shares in Wincanton rose by over 10% to 496p in opening trade
Housebuilders face CMA information sharing inquiry
Monday 26 February 2024 07:56 , Graeme Evans
Eight UK builders are facing an information sharing investigation after the competition watchdog concluded its review into why too few homes are being built.
The CMA said it found evidence during the study which indicated some housebuilders may be sharing commercially sensitive information with their competitors, which could be influencing the build-out of sites and the prices of new homes.
It said: “While the CMA does not consider such sharing of information to be one of the main factors in the persistent under-delivery of homes, the CMA is concerned that it may weaken competition in the market.”
The CMA has launched an investigation under the Competition Act 1998 into Barratt, Bellway, Berkeley, Bloor Homes, Persimmon, Redrow, Taylor Wimpey, and Vistry.
The regulator added: ““The CMA has not reached any conclusions at this stage as to whether or not competition law has been infringed.”
Bunzl unveils £340 million acquisition as profits rise 10%
Monday 26 February 2024 07:37 , Michael Hunter
Bunzl is back on the acquisitions trail, helped by news also out today to of a 10% rise in annual profit.
The FTSE 100 industrial goods firm – which distributes everything from hardhats to coffee cups and sandwich boxes – reported £968.6 million in pre-tax profit, from revenue of £11.8 billion, down 2%.
With the impact of high levels of inflation rippling out of the business, it said there was increased price competition in parts of it, with volumes down in its American foodservice division.
The £11.1 billion company is known for being highly acquisitive. It bought 19 firms in 2023, taking its total spend on deals over the last four years to £1.7 billion.
Two more deals were announced alongside the results. Bunzl is buying 80% of Nisbets, a catering equipment distributor, for £339 million.
Bunzl also announced its first move into Finland, with the acquisition of hygiene and clearing products firm Pamark. It takes the number of countries it operates in to 33.
Frank van Zanten, CEO, said: “Bunzl's consistent, compounding model drives both growth and resilience, and the progress we have made in recent years, combined with the strength of our financial position, means that we have a stronger platform than ever to drive market share, consolidate fragmented markets and continue to extend our successful track record for creating long term sustainable value.”
Ensilica says opportunities pipeline tops $500 million
Monday 26 February 2024 07:30 , Simon Hunt
British chipmaker Ensilica has said its opportunities pipeline has now topped $500 million, up from previous guidance of $360 million, amid a surge in new contracts.
The Oxford-based business said it had signed a new $35 million telecoms contract on top of committed supply revenues of $73 million.It posted sales of £9.6 million in the six months to end November, up 12% on the previous year.
CEO Ian Lankshear said: “Significant new business momentum has continued into the second half of the financial year.
“EnSilica has already signed a multi-million-pound initial mandate with an established telecoms equipment supplier, whilst we recently achieved a new milestone by securing our first customer licence with a leading semiconductor supplier through release of our Post-Quantum Cryptography accelerators IP.”
Ryanair warns of price hikes
Monday 26 February 2024 07:25 , Simon English
The cost of Ryanair flights could be 10% higher this summer due to a shortage of new planes, warns CEO Michael O’Leary.
Boeing has been in trouble since an accident in January when part of one of its jets blew up during a flight. O’Leary says Boeing now has regulators “crawling all over them” and will struggle to deliver new planes on time.
Ryanair was hoping for 57 new 737 Max 8200s by March but doubts it will get that many.
Ryanair's forecast for the year to the end of March 2025 was that it would carry 205 million passengers, up from 183.5 million in the 12 months before.
Speaking at the firm's Dublin headquarters, Mr O'Leary said: "With less aircraft, maybe we'll have to bring that 205 million down towards 200 million passengers."
"If capacity was growing, I think fares would be falling," he added.
Boeing said: "We are communicating with customers that some delivery schedules may change as we take the necessary time to make sure that every airplane we deliver is high quality and meets all customer and regulatory requirements.
They added that they "deeply regret the impact this is having on our valued customer Ryanair".
FTSE 100 seen lower as Nikkei 225 sets new record, Hang Seng falls
Monday 26 February 2024 07:18 , Graeme Evans
The FTSE 100 index is set to open lower, despite a fresh record for Tokyo’s Nikkei 225 and US markets finishing Friday’s session broadly unchanged.
IG Index expects London’s top flight to give up 13 points, having closed 0.3% higher at 7706.28 before the weekend.
The subdued trading has been in contrast to Wall Street after AI-fuelled trading lifted the S&P 500 by 1.6% last week, in spite of concerns about interest rates staying high for longer.
In Japan, the Nikkei 225 continued its record-breaking run this morning by adding another 0.35% to 39.233.71. However, the Shanghai Composite and the Hang Seng index traded in the red after their strong performances last week.
The week ahead includes the closely-watched US personal consumption expenditures measure of inflation on Thursday, as well as UK earnings reports from IAG, Ocado, Reckitt Benckiser and Smith & Nephew.
CMA has 'fundamental concerns' with housebuilding market
Monday 26 February 2024 07:15 , Daniel O'Boyle
The monopolies watchdog says it has “fundamental concerns” with the housebuilding market, claiming that the “complex and unpredictable planning system, together with the limitations of speculative private development, is responsible for the persistent under delivery of new homes”.
In a probe of eight of the UK’s top housebuilders, the Competition and Markets Authority (CMA) said the UK’s reliance on speculative private development has led to a widening gap between what the market will deliver and what communities need.
In particular, it flagged the planning system as the cause of many difficulties.
It said “the planning systems in England, Scotland and Wales are producing unpredictable results and often take a protracted amount of time for builders to navigate before construction can start”.
“The report highlights that many planning departments are under resourced, some do not have up to date local plans, and don't have clear targets or strong incentives to deliver the numbers of homes needed in their area. They are also required to consult with a wide range of statutory stakeholders - these groups often holding up projects by submitting holding responses or late feedback to consultations on proposed developments.”
It added that “private developers produce houses at a rate at which they can be sold without needing to reduce their prices, rather than diversifying the types and numbers of homes they build to meet the needs of different communities”.
Recap: Friday's top stories
Monday 26 February 2024 06:34 , Simon Hunt
Good morning from the Standard City desk.
A few days ago Donald Trump took a supposedly massive blow to his reputation when a New York judge said he had been overstating the value of his real estate empire to secure loans from banks.
Judge Arthur Engoron ordered penalties of $355 million and barred the would-be president from running any New York company for three years.
Donald Trump is awful, on his worst days looking like a menace to nearly all of us. But a balanced look at what he is supposed to have done on this occasion however provokes laughter.
He exaggerated the value of his assets in order to get a property loan, a mortgage basically.Since he was borrowing from large Wall Street banks, and since they all got repaid, it is very hard to see who the victim is here.
You could say it is the otherwise entirely honest member of the New York construction trade who might now be owner of what is called Trump Tower. But that assumes this person even exists in an industry known for producing massive chancers of which Trump is merely the most visibly successful.
And if presenting the most optimistic view of your financial circumstances in order to get a property loan is a criminal offence, well quite a few folk in both New York and London should be feeling nervous.
Here’s a summary of our top headlines from Friday:
Energy bills “set to keep falling” after mild winter and strong deliveries of gas from US
CAB Payments sacks its CEO less than a year after its disastrous London float
Standard Chartered delivers 19% profits rise to $5.09 bn, as boss gets £1.4 million pay rise to £7.8 million
Defence contractor Chemring sees orders pour in
