Yahoo Finance FTSE 100 Live: Shares hold gains, Easyjet and Royal Mail post updates
The brighter mood for shares following yesterday’s inflation surprise has continued, with the FTSE 100 index trading higher.
In corporate updates, easyJet said profits hit £203 million in the three months to the end of June while the owner of Royal Mail announced the appointment of a new chief executive.
Other mid cap stocks in the reporting spotlight today include Babcock International, Dunelm and Premier Foods.
Key Points
Wall Street slips as earnings season sours after Netflix and Tesla updates
14:48 , Michael Hunter
New York’s S&P 500 fell in opening trade as the mood took a cautious turn following weak-looking quarterly updates from two of the biggest names in the tech sector.
Netflix, the internet TV giant lifted its subscriber numbers thanks to a crackdown on password sharing, but revenue came in under forecasts. In early Thursday trade, the stock dropped 8%.
Tesla, the electric car maker, fell 5% after its CEO, Elon Musk, said prices of its vehicles could fall further, with the company already fighting price war at the expense of its margins.
Overall, Wall Street’s broad stock gauge eased back by 5 points to 4560.67.
Chapel Down says climate helping English wine sparkle
13:12 , Simon Hunt
The boss of English winemaker Chapel Down has said the UK is increasingly proving a great destination for vineyards amid reports of heatwaves in southern Europe.
Andrew Carter told the Standard: “This is an established wine region but it’s still in its infancy.
“Our climate is increasingly perfect for award-winning wines [and] we’re predicting a very strong harvest for 2023 so it’s the place to grow grapes. We really feel for our neighbours in Europe at the moment.”
Total wine volumes increased 6% to 732k in the first six months of the year with traditional method sparkling volumes up +32% to 428k, as the company hailed the success of sales at new duty-free locations in Gatwick and Heathrow airports. Overall revenues jumped 21% to £8.37 million.
Chapel Down has hiked average prices by around 16% over the past year, but renewing hopes that inflation had started to cool, Carter said: “Our cost base is now stable – we’ve passed our cost increase to the consumer.”
FTSE 100 up 0.7%: Lunchtime update
12:19 , Simon Hunt
Midway through the day’s trading session in London, the FTSE 100 is up 0.7%. Here’s a look at your key market data:
IG’s revenue breaks over £1 billion
11:30 , Michael Hunter
Profits from day traders betting on the financial markets cooled at broker and spread-betting firm IG, but more income from the US and rising interest rates helped annual revenue break over £1 billion today.
The pioneering trading platform boomed during the pandemic, when lockdowns prompted people to try trading stocks, bonds and commodities. Total Net trading revenue for the year to May 31 fell 3% to £941 million and adjusted profit before tax slipped 1% to £490.5 million.
Charlie Rozes, acting CEO of IG, told the Standard that equities were “not as popular with our traders in the past year,” while “foreign exchange continued to be popular … more so in the first half of the year.”
The £1 billion milestone – a 5% rise – came with the London-based firm’s US business on the up. Transatlantic revenue was up by almost half to over £191 million. Income from rising interest rates surpassed £80 million.
Royal Mail shares 3% higher, Anglo American leads FTSE 100
10:40 , Graeme Evans
Royal Mail shares rose again today as the appointment of a new boss got the City’s stamp of approval following a year of strike turmoil.
Martin Seidenberg takes charge of owner International Distributions Services from next month, with one of his first tasks to find a new boss for the Royal Mail division.
Seidenberg has been promoted from logistics arm GLS, which now accounts for 40% of group revenue and has delivered significant profit in his three years in charge.
Alongside his appointment, IDS said Royal Mail revenues fell 4% to £1.8 billion in the June quarter but that addressed letter volumes had been more robust than expected.
The developments meant shares added another 3% or 8.3p to their highest level since last August at 275.1p, a level that compares with 173p last autumn and the 330p when Royal Mail shares listed ten years ago in October.
The postal business slumped to a £419 million loss in its last financial year, but City confidence has improved since a union ballot in favour of ending industrial action.
The mail firm’s momentum came during a robust session for the FTSE 250 index, which followed yesterday’s inflation-led 3.8% jump by rising 35.87 points to 19,358.39.
In a busy session for mid-cap updates, shares in homewares chain Dunelm rose 4% or 40p to 1153p after it said fourth quarter sales growth of 6% should mean annual profits slightly ahead of City expectations. It has also been pleased with trading so far in July.
The FTSE 100 index, meanwhile, followed yesterday’s 1.8% improvement by adding another 55.58 points to 7,643.78 as investors returned to the mining sector.
Anglo American jumped 5% or 124.5p to 2427.5p as it said the ramp-up of its new Quellaveco mine in Peru led to a 56% surge in copper production for the June quarter.
On the fallers board, Baillie Gifford investment trust Scottish Mortgage lost 11.2p to 700.6p after portfolio company Tesla last night disappointed Wall Street with its margin guidance.
Diageo also fell 46.5p to 3400.5p after Morgan Stanley gave the Guinness maker an “underweight” recommendation and new 3000p target price.
City Comment
09:23 , Simon English
EVERY once in a while hands are wrung over the great unbanked – what can be done for those poor folk who are so unappealing to the banking industry that they can’t get an account?
In a development that owes little to common sense and much to hubris, those people turn out to include Nigel Farage.
Coutts might have legitimate reasons for no longer wanting to extend him a mortgage, but the clear motivation for closing his account was that they just don’t like the cut of his jib.
This is a huge misjudgement on so many levels and it makes life awkward for Alison Rose, the boss of Coutts parent NatWest.
For one, Coutts, founded in 1692 had a snob appeal based on its commitment to privacy. The Queen was supposed to bank with Coutts, but it would never be so crass as to confirm this fact.
If it had just kept quiet, no one would have known who Nigel Farage banks with, or cared less. Instead it chose a fight with a man who picks them for a living. For the rest of us, awkward issues are raised. Does my bank want to know how I vote? My views on abortion? If I shower regularly?
Rishi Sunak probably regards Farage as one of his many pains in the neck.
And NatWest is a vital cog in how he hopes to rebuild the economy ahead of an election he already looks like he has lost.
Even he has come out in support of Farage and against NatWest. “This is wrong,” he said. “No one should be barred from using basic services for their political views.”
This is the same as saying that you can’t have free speech only for people you agree with. A basic point that Coutts apparently has to learn.
Fullers hails strong demand for pints in London
09:16 , Simon Hunt
Pints are in full flow at London’s top pubs as the boss of Fuller’s hailed strong signs of recovery in the capital and unveiled a one million share buyback scheme.
The 178-year-old family business, which operates the Churchill Arms in Notting Hill, the Admiralty in Trafalgar Square and The Banker on Cannon Street, reported a 15.1% rise in like-for-like sales over the past 15 weeks compared to the same time last year.
City and central London pubs showed even stronger growth, up 17.9%, thanks to “increased tourism and events, along with workers returning to their offices.”
Chief Executive Simon Emeny said: “We are very pleased to have delivered a strong start to the year. The hard work of our teams, coupled with London’s continued recovery, is driving strong sales momentum.”
The firm gathers shareholders at the George IV pub in Chiswick today for its AGM.
Fuller’s shares rose 1.7% to 590p.
Key market data as FTSE rises
08:48 , Simon Hunt
The FTSE 100 is up in the opening minutes of trade in London. Here’s a look at your key market data.
FTSE 100 holds on to big gains, Dunelm up 2% in FTSE 250
08:26 , Graeme Evans
London’s leading shares have consolidated Wednesday’s gains to leave the FTSE 100 index 11.14 points higher at 7599.34, with the FTSE 250 broadly unchanged after jumping 3.8% on the back of yesterday’s inflation surprise.
In a busy session for mid-cap trading updates, Dunelm shares rose 2%, Premier Foods by 1% and Royal Mail owner International Distributions Services by 1.5p to 268.3p as it also announced the appointment of a group CEO.
Low-cost airline easyJet drifted 3.8p to 491.1p after its update, while the housebuilder and Partnerships firm Vistry fell 4.5p to 786p following a strong recent run for shares. It reported half-year trading in line with expectations.
New boss for Royal Mail owner, postal revenues lower
07:58 , Graeme Evans
Royal Mail has a new boss after its parent company International Distributions Services (IDS) promoted Martin Seidenberg to become group chief executive.
He currently runs the Europe-based logistics business GLS, which accounts for 40% of group revenue and has delivered significant profit during his time in charge.
One of his first tasks will be appointment of a new Royal Mail chief executive to take the postal firm forward after it recently settled a long-running pay dispute.
Today’s boardroom developments were announced alongside a trading update showing that Royal Mail revenues fell 4% to £1.8 billion in the three months to 30 June. GLS rose 7.4% to £1.2 billion.
IDS said Royal Mail addressed letter volumes were more robust than expected, but added that their 30% decline since the pandemic highlighted the need for Ofcom and Government to take urgent action to reform the Universal Service.
Netflix and Tesla shares lower, FTSE 100 seen flat
07:18 , Graeme Evans
Wall Street’s tech sector is under pressure after updates by Netflix and Tesla left their shares sharply lower in dealings following last night’s closing bell.
The electric car maker fell 4% despite a 47% jump in second quarter revenues, with investors focused on the weaker outlook for margins.
Streaming giant Netflix missed sales estimates for the quarter and gave lower-than-expected guidance for the current period, sending its shares 8% lower.
The updates left future markets in the US pointing lower after yesterday’s positive session, when the S&P 500 index rose for a third day in the row to set a fresh 15-month high.
London shares delivered the strongest performance on Wednesday after interest rate expectations were revised lower on the back of June’s softer inflation reading of 7.9%.
A weaker pound contributed to the FTSE 100 index rising 1.8% to 7588, while the UK-focused FTSE 250 jumped 3.8%. Today’s session is likely to be less interesting, with IG Index forecasting a flat start for the FTSE 100.
Easyjet profits soar past expectations as it looks to expand aircraft fleet
07:13 , Simon Hunt
Easyjet is preparing to expand its aircraft fleet to deliver future growth as it posted a surge in profits that beat expectations.
The airline said it currently has 163 aircraft on order for delivery though to 2028, but was now “running a process to secure additional firm order positions for our longer-term fleet plan.”
Pretax profits hit £203 million in the three months to the end of June, turning around a loss of £114 million in the previous year and coming in well ahead of City expectations of around £160 million.
Revenue swelled 34% to £2.36 billion, while full-year profits were on course to hit a fresh record.
Morning refresh: What you need to know to start the day
06:47 , Simon Hunt
Good morning from the City desk of the Evening Standard.
Tesla shares slipped back around 4% in after-market trading overnight, after profitability slid in the second quarter and investors prepared for it to fall further after Elon Musk said he expected to continue to cut the prices of electric vehicles if interest rate rises persist.
But Musk insisted the smaller profits were a blip and the company could one day be as much as ten times its current size.
Here’s a summary of our top headlines from yesterday:
Inflation fell more than expected in June, falling below 8% for the first time in a year. City analysts revised down their bets for interest rate peaks and the pound slipped back against the dollar as a result.
One of the biggest tech deals in history, between Broadcom and VMware, was provisionally given the green light by the UK competition regulator.
Jaguar Land Rover owner Tata confirmed speculation that it was planning a new battery giga-factory in Somerset after announcing a £4 billion investment.
This morning we’re also expecting trading updates from airline easyjet, winemaker Chapel Down and international defence company Babcock. In the afternoon, we’ll report on earnings numbers from private equity giant Blackstone and pharma firm Johnson & Johnson.
