Yahoo Finance FTSE 100 Live: Pound falls below $1.19; Standard Chartered shares jump after takeover report
The financial sector lit up the FTSE 100 after a report of international bid interest in Standard Chartered, which sent shares in the emerging markets lender up by around 20%. First Abu Dhabi bank said it was no longer evaluating a possible takeover.
Shares in retailers have surged after Next and B&M lifted their annual profits guidance in Christmas trading updates.
Next’s full-price sales growth of 4.8% in the nine weeks to 30 December was some £66 million better than the company’s previous guidance that sales would fall 2%.
Despite the cost of living crisis and the impact of weather and strikes, bakery chain Greggs also reported that fourth quarter like-for-like sales grew by 18.2% on a year earlier.
FTSE 100 Live 05 January
Festive sales updates boost retail shares
Next ups profit guidance after strong Christmas
Amazon to cut 18,000 jobs
That’s all folks. Tomorrow: Halifax house price data
Thursday 5 January 2023 17:20 , Simon Hunt
That concludes our liveblog coverage for today.
The Evening Standard City desk will be back at 7am tomorrow, where we’ll be covering house price data from Halifax, a key barometer for the health of the London property market as we move into 2023.
Standard Chartered’s wild price action
Thursday 5 January 2023 16:30 , Simon Hunt
Here’s a look back at the wild price action for Standard Chartered, which saw almost £5 billion being added to its market cap before being swiftly erased.
Bloomberg News reported that Abu Dhabi Bank was preparing to bid for the City stalwart, but following the report, First Abu Dhabi bank issued a statement saying it was no longer evaluating a possible takeover.
Pound falls below $1.19 for first time in six weeks
Thursday 5 January 2023 15:17 , Simon Hunt
The pound dipped below $1.19 this afternoon to hit its lowest level against the dollar since the 23rd of November, after the dollar rallied against its European and Asian peers.
Here’s a look at how sterling has performed over the past six months:
WPP acquires US-based Fēnom Digital
Thursday 5 January 2023 15:09 , Simon Hunt
Advertising business WPP has announced the acquisition of FÄnom Digital, one of the fastest growing digital transformation agencies in North America.
Founded three years ago in New York, FÄnom Digital specializes in order management systems, supply chain, marketing, and customer experience services to retailers and brands across North America.
Mark Read, CEO of WPP, said: “Expanding our business in high-growth commerce areas continues to be a high priority for WPP as we enter 2023. The FÄnom team brings a proven track record of success paired with deep industry expertise and I’m delighted to welcome them to WPP.”
The terms of the acquisition were not disclosed. WPP shares rose 1% to 860p on the back of the announcement.
Wall Street burned by red-hot jobs numbers which keep the heat on Fed rate hikes
Thursday 5 January 2023 14:45 , Michael Hunter
New York’s S&P 500 fell in initial trade -- losing 35 points, or 1% to 3817.66 -- after strong jobs numbers looked to give the Federal Reserve more room to stick with aggressive rate hikes in its fight against inflation.
The private sector payroll report for a month to mid-December showed a rise of almost twice November’s level, coming in at 235,000 also much higher than the 150,000 expected in consensus forecasts. The leisure and hospitality businesses led the rises. Jobless claims were also softer than forecast.
While one of the main talking points on the market in the new year has been mass layoffs at big-name tech stocks, the wider picture for employment shows that overall job creation is staying strong as policymakers fight inflation, meaning rate hikes could stay bigger for longer.
London’s banks rally after reports of bid for Standard Chartered from Abu Dhabi
Thursday 5 January 2023 13:36 , Simon Hunt
The financial sector lit up the FTSE 100 after a report of international bid interest in Standard Chartered, which sent shares in the emerging markets lender up by around 20%.
Bloomberg News reported that Abu Dhabi Bank was preparing to bid for the City stalwart, which was set up in 1853 in South Africa before opening its first branches in India a few years later.
It has been a major presence in emerging markets ever since, and operates in 59 countries from almost 800 branches.
The Bloomberg report did not identify sources, citing “people familiar” with the potential bid.
Following the Bloomberg report, First Abu Dhabi bank issued a statement saying it was no longer evaluating a possible takeover.
Boots joins retail party
Thursday 5 January 2023 13:29 , Simon English
BOOTS joined the Christmas retail party today, becoming the latest to defy expectations that hard-up Brits would play Scrooge over the festive period.
Next and Greggs already reported that they had done well.
This afternoon Boots says UK sales were up 8.7% in the last quarter a year ago – a strong point of comparison.
The chemist put the strong figures down to a record-breaking Black Friday and a focus on value.
Many analysts thought shoppers would constrain spending in the face of high energy bills and talk of an inevitable recession.
Some still say the strong retail sales are a blip, a final blow out, before households impose austerity on their spending.
Seb James, the former Dixons Carphone man who is now Managing Director of Boots UK & ROI, said: “It has been another positive quarter for Boots. Our focus on giving customers our best ever value to help with cost of living pressures, as well as continued investment in our digital capability and in updating our store estate, has resulted in increased retail sales and market share growth for the seventh consecutive quarter. Our Black Friday and Christmas performance was particularly pleasing.”
Other firms to report record Christmas sales include Aldi, which saw revenues up 26% to £1.4 billion in December.
Aldi and its arch rival Lidl were expected to do well as customers sought out bargains however. The performance of Boots and Next has come as more of a surprise.
Figures due soon from the other supermarkets might put a different gloss on the economic situation, however.
New York stocks set to cool as investors eye jobs cull in tech sector
Thursday 5 January 2023 13:25 , Michael Hunter
Wall Street stocks were expected to make only a steady start to trade, with investors looking unwilling to extend the strong start to 2023 as news of job cuts at Amazon was the main talking point.
Layoffs in the tech sector looked to be turning into a theme the online retail giant’s CEO. Andy Jassy, said 18,000 posts would go, more than the 10,000 figure that featured in leaks from the company last year. The news followed Salesforce’s warning of mass layoffs earlier this week.
In the run up to the start of full trade, futures markets were pointing to a flat start for the S&P 500, with the broad stock index expected to edge around 2 points lower to 3872.75.
London fintech unicorn Zopa hits £3 billion deposits
Thursday 5 January 2023 13:11 , Simon Hunt
Zopa Bank has reached £3 billion ($4.2 billion) in deposits and has opened 150,000 accounts in an effort to make UK current account "zombie money" work harder
The milestone by the London fintech unicorn, which last month vowed to continue hiring and raise minimum salaries more than 20% to £27,000 to attract and retain talent, gets it a step closer on its path to become a major player in the British banking industry.
Merve Ferrero, Chief Strategy Officer at Zopa, said the achievement showed that the company’s "proposition centred around fairly priced credit and attractive returns on savings has become a lot more relevant in today’s environment".
FTSE 100 midday movers: Investors mark Pearson down
Thursday 5 January 2023 12:51 , Michael Hunter
Education company Pearson was sent to the bottom of the class on London’s main stock market index after analysis from Bank of America marked down the one-time conglomerate that is now focused on the classroom.
The broker cut its rating on the stock to “underperform” from “neutral”, and set a price target of 865p, lower than today’s level on the shares of 911p, even after a fall of 43p after the research circulated in the City.
Next made the biggest single gain after its upbeat trading statement, which alongside positive updates from discount chain B&M and bakery train Greggs, stoked hopes that the high street has had a good Christmas.
London tech firms lose £20 billion in 2022
Thursday 5 January 2023 12:12 , Simon Hunt
London’s top-10 listed tech firms lost a combined £20 billion in value since the beginning of last year, an Evening Standard analysis has found, as soaring inflation, rising interest rates and stagnant economic growth took their toll on tech sector valuations.
Takeaway app Just Eat was among the hardest-hit of the UK’s tech stocks, losing around £4.8 billion from its market value, while rival Deliveroo lost around £1.9 billion and cybersecurity business Darktrace lost just shy of £2 billion.
The roughly 20% drop in value of the UK’s top-10 biggest tech stocks stands in stark contrast to the FTSE 100 as a whole, which has fallen little more than 1% since January 2022. However, the fall is more modest compared to the sharper drops for their bigger US counterparts, with the Nasdaq-100 technology sector index down 36% over the same period.
Airlines rally after Ryanair upgrade, FTSE 100 higher
Thursday 5 January 2023 10:14 , Graeme Evans
Ryanair’s boost to profit guidance following a better-than-expected holiday season ensured investors swept up airline stocks as well as retailers today.
The Dublin-based carrier last night revealed that strong pent-up demand following two years of disruption to Christmas travel plans had left profits for the December quarter near to 200 million euros (£176 million), much higher than analysts had forecast.
It still expects a loss in the current quarter and warned that there had been some signs of softening in UK outbound traffic and pricing.
Liberum transport analyst Gerald Khoo moved his recommendation on Ryanair’s shares to “buy”, adding that the recent holiday season may have been “a final binge of revenge travel ahead of financial belt tightening”.
Despite the uncertain outlook for 2023, airline stocks were boosted by the update as easyjet shares jumped 4% or 13.4p to 368.1p and eastern Europe-focused carrier Wizz Air surged 5% or 108p to 2203p in the FTSE 250 index.
They jostled for position on the risers board alongside several retailers as Marks & Spencer surged 6.9p to 138.55p and Dunelm lifted 27p to 1048p in the wake of today’s better-than-expected festive update by Next.
The FTSE 250 index improved 85.24 points to 19,476.31, in line with the 0.4% rise of 27.23 points to 7612.42 for the FTSE 100 index.
The progress continues the strong start to the year after rate rise expectations cooled in Europe on the back of encouraging inflation figures in Germany and France.
Next led the FTSE 100 after a rise of 7%, with British Airways owner IAG up 4% or 4.8p to 139.3p following the Ryanair profits guidance.
Asia-focused banking giant HSBC also rose 12.7p to 556.2p after analysts at Jefferies moved to a “buy” recommendation with a new 770p price target. They said the market “underappreciated” the potential benefits of the re-opening of the Hong Kong border and the bank’s capital return prospects.
Prudential shares, however, fell back 23p to 1216.5p after Exane BNP downgraded the insurer to an “underperform” rating.
Next shares up 7%, M&S and Dunelm higher
Thursday 5 January 2023 08:38 , Graeme Evans
Next shares have jumped 7% at the top of the FTSE 100 index, with a number of other retailers also higher in reaction to today’s strong Christmas update from the high street bellwether.
Next rose 458p to 6556p, a move that continues the upward momentum for shares since they fell to 4383p in mid-October.
In the FTSE 250 index, Marks & Spencer shares lifted 5% or 5.95p to 137.6p, ASOS cheered 17.5p to 587.5p and homewares business Dunelm improved 18p to 1039p.
B&M European Value Retail added 8.7p to 453.9p after it had earlier nudged up profit forecasts, while Greggs improved 13.9p to 2455.9p following its Christmas update.
The FTSE 100 index edged up 5.43 points to 7590.62, with British Airways owner IAG and silver miner Fresnillo among other big top flight risers. Prudential fell 25p to 1214.5p after Exane BNP downgraded the insurer to an “underperform” rating.
The FTSE 250 index was 32.70 points lower at 19,358.37, with molten metal flow engineering firm Vesuvius the biggest faller with a decline of 5%.
London economy to prove resilient in recession thanks to tech and business services says fresh research
Thursday 5 January 2023 08:28 , Michael Hunter
London’s economy is expected to prove more resilient as the UK enters recession, outperforming the rest of the UK in 2023 according to new research out today.
CoStar Market Analytics, a leading provider of information from the commercial real estate sector, said the hit to the national economy would come through consumer-driven sectors via squeezed disposable incomes. But London’s “large and diverse tech and business services sectors” should help it weather the storm better than in other regions.
Less than a quarter of the capital’s economic activity is associated with sectors that are heavily reliant on consumer spending, compared with around a third in the regions looking the most vulnerable -- the East Midlands and Yorkshire and the Humber.
FTSE 100 down 11 points in opening trade
Thursday 5 January 2023 08:06 , Simon Hunt
The FTSE 100 is down 11 points to 7,572 in the opening minutes of trade. Here’s a look at the biggest opening moves.
Shares in JD Sports Fashion PLC climbed the most, up 2.81% to 139.05p.
Shares in Associated British Foods PLC were up 2.63% to 1716.5p.
Shares in B&M European Value Retail SA were up 1.98% to 454p.
Shares in Prudential PLC fell the most. They were down -2.86% to 1204p.
Shares in Pearson PLC dropped -2.22% to 933.2p.
Shares in Natwest Group PLC were down -1.28% to 271.1p.
Amazon ups layoffs to 18,000
Thursday 5 January 2023 08:00 , Simon Hunt
Amazon is set to increase its layoffs to 18,000, boss Andy Jassy said in a statement last night as the the company seeks to slash costs amid worsening global economic conditions.
The firm said the layoffs would largely impact the e-commerce and human resources wings of the company.
Amazon shares rose 2% in after-hours trading last night.
There were over 150,000 layoffs at tech companies in 2022, according to tracking website layoffs.fyi.
US markets higher after Fed minutes, FTSE 100 seen flat
Thursday 5 January 2023 07:47 , Graeme Evans
The Federal Reserve’s December meeting minutes last night failed to prevent US markets from closing higher, with the S&P 500 and Nasdaq up by around 0.7%.
With policymakers reiterating their intention to keep interest rates restrictive for as long as it takes to curb inflation, there was little change to Wall Street expectations that interest rates will rise by another 0.5% over the next couple of months.
In Europe, interest rate expectations have been revised lower after this week’s better-than-expected inflation figures in Germany and France.
The developments provided new year support for European shares as the FTSE 100 index overcame weakness in the oil sector to rise 0.4% and the FTSE 250 lifted 1.3%. The Stoxx index excluding the UK improved 1.7%.
IG Index expects the FTSE 100 index to consolidate this week’s gains after forecasting a broadly unchanged performance at today’s opening bell.
B&M to pay special dividend after Christmas sales rise in ‘golden quarter’ and ups full-year guidance
Thursday 5 January 2023 07:46 , Michael Hunter
FTSE 100 discount retail chain B&M reported strong sales from the peak festive period retail season, with revenue up by over 12% to £1.56 billion.
The company also said its supply chains “executed well” in the 13 weeks to Christmas Eve, which it called “the golden quarter” with like-for-like sales, from stores open over a year, up by over 6%. It upped its full-year profit guidance to to a range of £560 million to £580 million, up from current analysts forecasts of £557 million.
It said it would pay a special dividend of 20p per share to investors.
Alex Russo, CEO, said: “Our strong momentum throughout the Golden Quarter across the businesses demonstrates the strength of our unchanged strategy to relentlessly focus on price, product and excellence in retail execution. Despite the challenging macroeconomic environment, we will continue to work hard to help both existing and new customers manage the cost-of-living crisis.”
B&M began in Bradford in 1978 and now employs over 35,000 people in over 700 stores, selling cut=price groceries and homewares to over 4 million customers a week.
Next on the up in boost to retail sector
Thursday 5 January 2023 07:37 , Simon English
NEXT offered some festive cheer for the high street today, reporting a strong rise in sales and another profit uplift in guidance to the City.
Under the mercurial Simon Wolfson, Next has a habit of beating expectations.
Today was no different. In the nine weeks to December 30, full price sales were 4.8% higher than a year ago.
Full year profit guidance is upped by £20 million to £860 million.
While it insists it remains “cautious in our outlook for the year ahead”, the Next figures will give a boost to the wider retail sector.
The statement said: “Forecasting for the year ahead at this early stage comes with a high level of uncertainty.”
On inflation, it had some good news.
“We now expect the cost price inflation on like-for-like goods to peak at around 8% in the Spring Summer season. However, we expect inflation to be no more than 6% in the second half. This Autumn Winter figure is only an estimate at this stage, as we are still negotiating prices; but it does appear that cost pressures are now easing through a combination of reducing freight costs and lower factory gate (dollar) prices.”
Next shares are down 25% this year, but could get a boost when trading starts today.
Next upgrades, sales growth at Greggs and B&M
Thursday 5 January 2023 07:25 , Graeme Evans
The first Christmas trading updates from the retail sector have struck a positive tone despite the cost of living crisis and the impact of weather and strikes.
Next reported full-price sales growth of 4.8% in the nine weeks to 30 December, which was some £66 million better than previous guidance that sales would fall 2%.
The performance has prompted it to increase profit guidance for the year to the end of January by £20 million to £860 million, an increase of 4.5% on last year.
Greggs said fourth quarter like-for-like sales in company-managed shops grew by 18.2%, an increase that partly reflected disruption in 2021 caused by Covid.
At B&M, UK like-for-like revenues were up 6.4% in its third quarter, with customer transaction numbers said to be “strong and positive” year-on-year.
Greggs upbeat about 2023 after sales grow 18%
Thursday 5 January 2023 07:22 , Simon Hunt
High street bakery chain Greggs sounded a note of optimisim for its 2023 prospects this morning after reporting an 18% jump in like-for-like sales in the fourth quarter of 2022.
The firm opened 186 new shops in 2022 and has plans to open a further 150 before the end of the year.
Greggs boss Roisin Currie said: “While market conditions in 2023 will remain challenging, our value-for-money offer of freshly-prepared food and drink is highly relevant as consumers look to manage their budgets without compromising on quality and taste."
