London shares are trading higher after the FTSE 100 index lost 5% of its value during an eventful May for global markets.
Today’s session includes results from Auto Trader and Dr Martens, as well as the latest monthly updates on activity levels in the UK manufacturing sector.
Meanwhile, building society Nationwide said house prices fell 0.1% last month to leave the average value 3.4% lower than a year ago.
FTSE 100 Live Thursday
FTSE 100 higher on US debt deal progress
Profits steady at Auto Trader as sales top £500 million
Pennon profits hit by higher costs
In today’s Standard...
15:20 , Simon Hunt
In today’s Evening Standard, why the world’s richest are getting less rich, disappointment at Dr Martens, the problem of universal rules on ESG and much more.
Pick up a paper now from your nearest tube station.
Stocks open lower in New York
14:47 , Simon Hunt
Shares fell in the opening minutes of trade on Wall Street as a surge in enthusiasm for AI-related stocks ran out of steam.
Software business C3.AI was among the biggest losers, with its stock plunging 20% as its sales outlook failed to live up to investor expectations.
The Nasdaq fell 8 points to 12,929, while the S&P 500 also shed a few points.
Here’s a look at the key market data.
World’s richest suffer biggest wealth drop in a decade
13:43 , Simon Hunt
The world’s richest individuals have seen the biggest annual decline in the size of their wealth for a decade, new research has revealed, in signs even internationally mobile billionaires are taking a knock from soaring inflation and a slowdown in economic growth.
The global high net worth individual (HNWI) population declined by 3.3% 21.7 million in 2022, according to a report by Paris-based consulting firm Capgemini, while the value of its wealth slipped by 3.6% to $83 trillion (£67 trillion).
Those based in North America suffered the steepest wealth decline with a 7.4% fall, while Europeans suffered a more modest drop of 3.2%. By contrast, HNWIs in Africa, Latin America and the Middle East saw their wealth rise as they benefitted from rising oil and gas prices.
“Unprecedented government stimulus, low-interest rate environments, increased liquidity and stock market rallies accelerated high net worth individual wealth and population growth in 2021 and as a result, HNWIs entered 2022 in a position of strength, only to be confronted by geopolitical crises, a steep market decline, and unprecedented inflation, imposing a bleak ending to 2022,” Capgemini said.
Lunchtime update: stocks move higher, pound rallies
12:47 , Simon Hunt
Midway through the day’s trading session in London, the FTSE 100 has made gains while the pound has rallied against the dollar.
Here’s a look at your key market data:
City comment: Climate change deniers threaten firms’ green goals
11:21 , Simon Hunt
TO most minds the fact so many large companies have signed up to near-identical pledges on global warming must be a good thing.
Public pressure has told and big polluters, their insurers and others will have to push towards net zero as promised.In America, some see it differently. A group called Consumers’ Research regards this general agreement not as a nod to scientific reality, but as evidence of collusion.
That so many companies have signed up to the same ESG (environmental, social, governance) concerns puts them in breach of anti-trust laws, they believe. Where is the consumer who thinks global warming is a hoax to go?
This sounds like a joke, but sadly is not. Will Hild, executive director of Consumers’ Research. said of the ESG “scam”: “We’re going to be pushing back on the entire conspiracy to enforce environmental policy through corporate collusion rather than the democratic process.”
It’s tempting to think that these people are mad. They are also committed and well organised.
Consumers’ Research calls itself an “independent educational non-profit organization” with a mission to “promote freedom”.
It is having an effect, the FT reports, and may well become part of the dialogue in what will already be a highly contentious US election campaign next year.
Expect some big companies to quietly, at least, pull back from green promises to avoid lawsuits accusing them of acting in uncompetitive ways.
For the climate change movement, this could become seriously problematic.
FTSE 100 regains ground, B&M continues progress
10:27 , Graeme Evans
The rally for B&M shares continued today, with the FTSE 100 stock up 2% or 10.8p to 520.6p on top of yesterday’s 8% results-day rise.
Goldman Sachs upped its target price by 50p to 650p and Barclays opted for 565p, encouraged by B&M’s forecast of further earnings growth this year as shoppers continue to trade down during the cost-of-living crisis.
The company, which operates more than 700 B&M stores in the UK, yesterday revealed a like-for-like sales rise of 8% in the first nine weeks of its new financial year as well as earnings of £573 million for the year just ended.
Alongside B&M, stronger mining stocks including Antofagasta and Anglo American helped the FTSE 100 to achieve an improved performance after falls of more than 1% in the previous two sessions and 5% across May.
The top flight rallied 50.18 points to 7496.32, with sentiment given a boost after the Biden-McCarthy deal ceiling deal cleared a major hurdle in Congress. Other stocks on the front foot included hotels chain IHG with a rise of 90p to 5358p, while British Airways owner IAG cheered 2.6p to 157p.
Centrica gained 2p to 119.7p but fellow utilities National Grid and Severn Trent lost 3% after they began trading without the right to their latest dividend awards.
Paddington Central owner British Land added 1.9p to 344.9p but the improvement came too late to preserve its blue-chip status after two decades in the FTSE 100. Engineer IMI, which is taking British Land’s place in the quarterly reshuffle, rose 19p to 1613p.
Its performance helped the FTSE 250 index up by 105.28 points at 18,828.18, with media group Future among others doing well after a rise of 2% or 17.5p to 739.5p.
Pennon profits plummet
08:57 , Simon Hunt
Profits plummeted at Pennon as the water utility company was hit by increased costs and a bout of extreme weather.
The firm, which provides water and sewerage to South West England, said it had seen record-breaking prolonged dry and hot weather which led to extremely low water storage levels in the Cornwall region, with water-saving measures for the South West Water region issued for the first time since 1995.
“In addition to the drought conditions, this was also a year in which we experienced some of the worst storms on record, with freezing temperatures, followed by rapid thawing and flooding,”Pennon said.
“It is clear to see that the impact of climate change is upon us.”
Pre-tax profits for the year to end March sunk 88% to £16.8 million, while revenue climbed 4.1% to £825 million.
Pennon shares fell 2.3% to 756p.
FTSE 100 steadies, Auto Trader and Dr Martens lower after results
08:40 , Graeme Evans
Stronger mining stocks have helped to steady the FTSE 100 index, with Rio Tinto and Anglo American among those more than 1% higher.
London’s top flight is up by 24.15 points at 7470.29, having fallen by more than 1% in the past two sessions and 5% in May.
Other risers included discount retailer B&M European Value Retail, which enjoyed another strong session following the 8% surge seen yesterday on the back of the company’s robust start to the new financial year.
Shares lifted 2% or 12.2p to 522p, with analysts at Deutsche Bank raising their target price by 20p to 600p this morning.
National Grid and Severn Trent dropped by more than 3% at the top of the blue-chip fallers board after they began trading without the right to their latest dividend award. Online car marketplace Auto Trader also lost 14.4p to 615.6p in the wake of its annual results.
The FTSE 250 index stood 28.39 points higher at 18,751.29, with media group Future among the best performing stocks after a rise of 2%. However, Dr Martens was back under pressure after annual results left its shares more than 10% lower at 140p.
Key data as market opens
08:20 , Simon Hunt
A few minutes into the start of the day’s trading session in London, the FTSE 100 is making gains.
Here’s a look at your key market data.
British Land loses FTSE 100 place, Capita added to FTSE 250
07:40 , Graeme Evans
Ocado has kept its place in the FTSE 100 index after the results of the June quarterly reshuffle were announced by FTSE Russell last night, with property owner British Land relegated instead.
The Paddington Central and Broadgate owner loses the top flight status it has held since 2001 after the company’s shares lost a third of their value over the past year.
British Land’s place in the FTSE 100 will be taken later this month by valves and flow control engineer IMI, which returns to London’s premier index after an absence of nearly a decade.
Grocery delivery technology firm Ocado had been the frontrunner for relegation, having seen its valuation fall more than 50% since last summer.
Additions to the FTSE 250 index include outsourcing firm Capita and the windows and doors hardware supplier Tyman, with ASOS and Tullow OIl among those relegated from the second tier benchmark.
The changes take effect from the start of trading on Monday 19 June.
FTSE 100 steadies, US braced for another interest rate hike
07:18 , Graeme Evans
The FTSE 100 index is forecast to open higher this morning, having fallen 1% yesterday and by more than 5% across the month of May.
The prospect of further interest rate rises by the Bank of England and Federal Reserve, as well as the threat of a US debt default have derailed sentiment in recent sessions.
Last night, the House of Representatives cleared the Biden-McCarthy compromise deal by a comfortable margin as the bill now moves to the Senate for approval.
US markets were lower at last night’s close after figures showed an unexpectedly big increase in the number of job openings, fuelling Wall Street expectations for another rate hike by the Federal Reserve in two weeks’ time.
The downbeat performance left the Dow Jones Industrial Average more than 3% lower in May and the S&P 500 index broadly flat. The tech sector-focused Nasdaq Composite rallied by 5.8% in the month thanks to strong gains by semiconductor firm Nvidia and other AI-related stocks.
Asia stock markets, which fell sharply yesterday on the back of disappointing manufacturing figures in China, posted a steadier performance this morning. In London, CMC Markets expects the FTSE 100 index to open 22 points higher at 7468.
Profits steady at Auto Trader as sales jump 16% to top £500 million
07:15 , Simon Hunt
Profits held steady at online car marketplace Auto Trader and sales climbed 16% to top £500 million in the year to end March.
Auto Trader said its used car Retail Price Index saw a 12% like-for-like year-on-year increase in prices over the past 12 months, which has contributed to favourable trading conditions for our customers. Pre-tax profits dipped 2% to £293 million.
But the company warned business are likely to perform within a range of flat to low single digit growth in the year ahead.
CEO Nathan Coe said: "The prospects for our marketplace are as strong as they have ever been, underpinned by the significant number of car buyers and retailers using Auto Trader.
“We have also made good progress on improving the new and used car buying experience by moving more of the journey online, on Auto Trader.
The company announced Greggs Chair Matt Davies would be also be joining Auto Trader as chair.
Recap: Yesterday’s top stories
06:49 , Simon Hunt
Good morning. Here’s a summary of our top stories from yesterday:
An industrial materials maker, WE Soda, is behind FTSE’s first major IPO this year, raising hopes a nadir in public listings could be ending soon.
The CBI has pledged its ‘renewal’ as it fights for survival.
Property giant British Land has been ejected from the FTSE 100 while Ocado managed to swerve relegation.