Yahoo Finance FTSE 100 Live: blue-chip shares close down 1%, Hotel Chocolat and City Pub in takeover deals
Dealmaking action returned to the Square Mile today as Hotel Chocolat and City Pub Group revealed takeover agreements.
The flow of corporate updates also continued, with Burberry among the stocks struggling after its warning about weakening demand in the luxury goods sector.
Investors also heard from the Royal Mail owner IDS, CMC Markets and Premier Foods.
FTSE 100 Live Thursday
Hotel Chocolat backs Mars takeover
Burberry warning hits shares
Young's to buy City Pub Group
London Stock Exchange Group plans £1 billion of buybacks, AI-driven data tools, as it ups focus on analytics
17:16 , Daniel O'Boyle
London Stock Exchange Group set out plans to return £1 billion to shareholders via buybacks today, with financial data powered by AI at the centre of its growth plan.
The business, which has become less reliant on the fate of the London Stock Exchange itself, focusing more on data services through arms such as Refinitiv, laid out its medium-term plans today. While the stock exchange the group is named for has struggled amid a dearth of new floats and some high-profile departures this year, Refinitiv - currently in the process of being rebranded under the LSEG name - has continued to grow.
It sees revenue growing by a mid-to-high single digit percentage annually, and its margins improving over time.
Closing market snapshot
16:54 , Daniel O'Boyle
Take a look at the key market data after the FTSE closed down 1%
FTSE closes down 1% at 7,410.97
16:36 , Daniel O'Boyle
The FTSE 100 closed at 7,410.97 today, down 1% and erasing all of the gains from the last two days.
Among the fallers was Ocado, on a profit warning from US delivery firm HelloFresh. Big risers included Halma and National Grid.
Crest signals job cuts could be on the horizon as housing market slows
16:05 , Daniel O'Boyle
Housebuilder Crest Nicholson has signalled it could start cutting jobs soon as a slowdown in the construction sector hit its business.
The company said that it would “align headcount” in its divisions to their “expected level of output” in the next financial year.
The announcement follows a trading update in August which warned that Crest would have to start reducing its overhead costs.
Chief executive Peter Truscott said: “Given the challenging trading backdrop we have experienced this year, the group has acted decisively in streamlining its operations to align our cost base with the operating environment."
Comment: Dear Nationwide, don’t go changing to try and please us
15:19 , Daniel O'Boyle
Simon English explains why he wants Nationwide to be its boring self
The City joke goes like this. You can be absolutely certain what a bank with spare capital will do next. The only question is: up which wall.
Nationwide Building Society is not like that. It is an institution for the ages, a force for good in a world not overburdened with them.
It doesn’t chuck our money about willy-nilly. It is a steward of it.
Since 1884 it has been true to its roots. Its mission is to make it possible for ordinary folk to build up savings, to get a house they can afford, and to keep them in it, whatever the economic weather.
US shares to open flat
14:20 , Daniel O'Boyle
US shares are set to open flat when trading begins on Wall Street today.
S&P 500 futures are down by less than two points at 4,517.50, while Down Jones futures are down 56 points to 34,994.00. Nasdaq futures are down 30 points, to 15,859.25.
Many of the world's biggest firms, including Tesla, Alibaba and Wal-Mart are among the big fallers today. Risers include Macy's and a number of pharma firms.
Early afternoon snapshot - gilt yields return to earth
14:00 , Daniel O'Boyle
Take a look at our latest market snapshot, as gilt yields continue to move back down from the highs they had reached in recent months.
US rate cut hopes as jobless claims come in ahead of forecasts
13:54 , Daniel O'Boyle
US weekly jobless claims came to 231,000, the highest in two years, in figures that could prompt central bankers across the Atlantic to think about interest rate cuts.
The figures were ahead of the expected 220,000. It is the latest sign of a cooling in the US economy, after inflation came in below expectations. The US Federal Reserve's interest rates are almost certainly at their peak, leading traders to wonder when it can think about cuts again. Continued evidence of a slowdown might be what prompts Jerome Powell to bring rates back down.
Wowcher asked to stop use of pressure sales tactics ‘to avoid court action risk’
13:39 , Daniel O'Boyle
The competition watchdog has asked Wowcher to stop using pressure selling tactics “to avoid the risk of court action”.
The Competition and Markets Authority (CMA) said Wowcher’s extensive use of countdown clocks and marketing claims such as ‘Running out!’ or ‘In high demand!’ could be putting unfair pressure on customers to make quick purchases.
It has called on the site to “agree to change the way they do business to avoid the risk of court action”.
Energy price cap to rise again in January, Cornwall Insight predicts
12:47 , Daniel O'Boyle
The Energy Price Cap is to rise again, according to sector expects Cornwall Insight, in a sign that cost pressures haven’t gone away despite recent good news.
Consultancy Cornwall insight published its latest predictions for the price cap today, based on wholesale energy prices yesterday. The price of energy at the midpoint of a cap period, which was yesterday, is a key factor in deciding the price for the period that follows.
The analysis suggests that the cap will be set at £1,931.25 from January to March 2024, up by nearly £100 on the current level of £1,834. The listed figure for the cap is based on the amount a typical household would pay based on a year’s energy use. However, the cap itself is charged on a per-unit basis, meaning that a household that uses more energy will always be charged more: it is not a maximum amount that a household can pay.
City Comment: Boring politicians and loads of Twix lift the mood in the City
11:18 , Daniel O'Boyle
For months, and certainly since Gaza, the mood in the City has been glum. No one was hitting the dancefloor. The music had stopped.
A better tune arrives this morning in at least three ways. Mars bought Hotel Chocolat for more than £500 million, which is a lot of Twix.
More encouragingly for London, Young’s thinks Clive Watson’s City Pub Group is worth £162 million, suggesting the future for the capital’s boozers is better than you might have read.
Best of all, Investec, the South African banking giant, had warm words to say about London and its London businesses.
Profits, just in the UK, jumped 41% to £235 million. Which ought to mean that the 1600 staff based on Gresham City opposite the Guildhall can at least count on keeping their jobs for Christmas.
Market snapshot as shares slip back
11:07 , Daniel O'Boyle
Take a look at the latest market snapshot after blue-chip shares lost a little ground this morning
Cruddas' CMC swings to loss
10:50 , Daniel O'Boyle
CMC, the spread betting house founded by Boris backer Lord Cruddas, swung to a £2 million loss in the first half as “uncertain market conditions” put off retail traders.
Trading revenue fell by a third, but Cruddas said the company did well given the circumstances.
He said: "I am pleased with the resilience the business has demonstrated in the first six months of the year in what has been a tough market environment, with low volatility offering fewer opportunities for clients of our trading business.”
CMC Markets shares were steady today at 94p. They have crashed 60% in the last year, taking tens of millions of pounds of the value of the Cruddas family fortune.
He has been a major donor to the Conservative Party and is president of the pro-Boris Johnson Conservative Democratic Organisation.
FTSE 100 slips back, upgrade boosts easyJet in FTSE 250
10:25 , Graeme Evans
Shares in Royal Mail owner International Distributions Services have fallen 7.3p to 237.4p after reporting wider half-year losses of £186 million.
New IDS chief Martin Seidenberg, who previously ran the company’s profitable GLS logistics arm, said Royal Mail’s performance had stabilised after the end of industrial action but that the wider change agenda will take time.
He said: “We are transforming our business every day, but we can’t do it all on our own. We also need the regulator and the Government to do their bit.
“It's simply not sustainable to maintain a network built for 20 billion letters when we're now only delivering seven billion.”
The poor session for IDS came as the FTSE 250 index retreated 129.44 points to 18,547.04, with today’s return of City dealmaking action unable to inspire a third successive session of mid-cap buying.
Low-cost-airline easyJet rose 7.4p to 435.4p as Morgan Stanley upgraded its target price to 670p. In contrast, Wizz Air fell 2% or 39.6p to 183.59p after the same firm downgraded its recommendation.
The FTSE 100 index also lost ground, off 32.53 points to 7454.38.
The downbeat mood limited the upside for Aviva and Melrose Industries after their encouraging trading updates, with the insurer 3.3p higher at 417.3p and the engines business 0.6p stronger at 533.2p.
Royal Mail reveals staff bonus of up to £500 as half-year losses mount
10:11 , Daniel O'Boyle
More than 100,000 frontline workers at Royal Mail are in line for a bonus worth up to £500 each if they hit targets over Christmas as the group presses ahead with turnaround efforts in the face of mounting losses.
Royal Mail said the one-off payment will be made to staff at the start of the new year, based on whether they hit weekly quality targets over the peak season.
The move – which will cost Royal Mail around £61 million – comes as the new boss of owner International Distributions Services (IDS) is pushing on with an overhaul to address poor service performance and widening losses.
Premier Foods to cut Super Noodle price as inflation eases
09:05 , Daniel O'Boyle
Premier Foods boss Alex Whitehouse said today a cup of Super Noodles will cost less than a pound again, as a slowdown in food inflation allows the company behind some of Britain’s best-known food brands to start cutting prices.
The cost of many of Premier Foods’ products, from Bisto Gravy and Oxo stock cubes to Mr Kipling cakes and Ambrosia custard, soared in the past year as food inflation surged ato nearly 20%. But today, the firm said that falling inflation meant it could start cutting prices again. That starts with Batchelors Super Noodles and Mr Kipling Slices.
Whitehouse said a cup of the instant noodle brand popular with students had been selling for £1 at most retailers, but customers should expect to see the price come back down to 80-90p. A pack of six Mr Kipling slices should come down from £2 to around £1.75.
A slowdown in costs also allowed Premier Foods to up its full-year guidance after first-half profits rose by 19% to £67.5 million. The shares gained as much as 4.1% to 136.4p.
Burberry warning hits shares, Premier Foods higher in FTSE 250
08:38 , Graeme Evans
Burberry shares have fallen 11%, down 184p to 1560.5p after It warned that conditions in the luxury goods sector meant it may not meet full-year revenues guidance.
The slump came during an otherwise steady session for the London market, with the FTSE 100 index following yesterday’s strong performance with a decline of 2.88 points at 7484.03.
GKN engines business Melrose Industries rose 7.8p to 540.4p after upgrading full-year expectations, while Spirax-Sarco Engineering lifted 176p to 9114p as it forecast a return to revenues growth next year.
Aviva improved 5.4p to 419.4p as boss Amanda Blanc reiterated 2023 guidance and said the insurer is on track to exceed medium-term targets.
The FTSE 250 index is down 12.47 points at 18,664.01, with Royal Mail owner IDS down 4.7p to 240p after its half-year results. Premier Foods rose 2.7p at 133.7p following an upgrade to guidance in its interim figures.
Market snapshot as FTSE starts flattish
08:25 , Daniel O'Boyle
The FTSE 100 is close to flat in the opening minutes of trading, but Burberry shares have tumbled.
Take a look at our full market snapshot
Sweet payout for Hotel Chocolat founders as Mars agrees to buy chain for £534 million
07:51 , Daniel O'Boyle
High-end chocolate company Hotel Chocolat is to be bought out by US behemoth Mars for £534 million, in a deal that’ll offers a sweet nine-figure payout for the chain’s founders.
But it also marks another company being taken off the London stock exchange, bought out by foreign capital that saw its London-listed shares as undervalued.
The all-cash deal, at 375p per share, is well over twice yesterday’s closing price for the chain, which has about 150 shops.
Young's to buy City Pub Group in £162 million deal
07:22 , Simon Hunt
Pub chain Young's is set to buy its smaller rival City Pub Group in a £162 million deal.
City Pub Group shareholders will be given cash and Young's stock, in a deal which values City at a 46% premium above its closing share price yesterday.
The deal is set to close in the first quarter of next year.
City Pubs CEO Clive Watson said: "Mindful of the uncertain economic climate, high interest rates and inflation in particular, and our plans for long term growth as an independent company, initial approaches were rejected.
"However, following careful consideration, we believe the transaction is in the best interests of City Pubs shareholders."
Watson sold a previous chain, Capital Pubs, to Greene King in 2012 in a £93 million deal.
FTSE 100 seen flat as Asia markets reverse, Target shares jump 18%
07:19 , Graeme Evans
Asia markets have fallen and the FTSE100 index is set for a flat start as the benefit of encouraging US and UK inflation figures begins to fade.
The S&P 500 index and Nasdaq both finished last night’s session broadly unchanged, having rallied sharply in previous sessions. Retail giant Target was the best performing stock as a better-than-expected trading update sent shares 18% higher.
The Dow Jones Industrial Average rose 0.5% after retail sales figures offered further signs of resilience in the US economy.
The FTSE 100 index last night closed 0.6% or 46.44 points higher at 7486.92, which is roughly where futures markets are indicating the top flight will trade this morning.
The mid-cap FTSE 250 has been a bigger beneficiary of the improved outlook on borrowing costs, up another 0.8% or 140.35 points to 18,676.48 following the 3.5% jump seen on Tuesday.
The Hang Seng index put back some of the previous session’s big jump, falling 1.4% after new home prices in China dropped for the fourth month in a row.
Yesterday's top stories
06:51 , Daniel O'Boyle
Good morning from the City desk of the Evening Standard, here is a recap of some of yesterday's top stories
Inflation fell to 4.6%, low enough to meet Rishi Sunak’s target of halving the rate of price rises this year...
....but economists say it’s not enough for the Bank to think about cutting rates any time soon
Experian profits up 48% in sign people are watching their credit scores more closely amid higher interest rates
Small and independent retailers are much more optimistic this Christmas than they were last year, according to a new survey - Amex independent retail monitor finds 30% jump in sentiment compared to last year when strikes threatened to derail Christmas on the high street
UK consumer spend for Black Friday could plunge by £1.5 bn (from 7.1bn to 5.6bn), with interest in the shopping extravaganza waning amid cost of living pressures and other factors, a PwC survey has found.)
Efforts to revive Oxford Street after a turbulent period paying off, with new research forecasting the number of empty stores will reduce by half over the next year and retailers cheering strong footfall.
More evidence of pick up in offices sector as landlord CLS reports improvements since summer and says “rental growth is evident in all our markets for the right quality offices and floor plate sizes”.
Nurofen to Durex maker Reckitt Benckiser says Sir Jeremy Darroch to become chairman next year. Seasoned non exec with former board roles at Burberry and M&S
City pubs are becoming a 'seven-day operation', Fuller's says
And.... why today's mortgage rates might look very attractive soon
Today, we have results or updates from:
Burberry, Premier Foods, CMC Markets, Great Portland Estates, Young & Co, Liontrust Asset Management, United Utilities, Aviva, Crest Nicholson, Kier, Melrose, Norcros and Close Brothers
