FTSE 100 Live Nov 07: China reopening hopes fade, UK house prices fall

FTSE 100 Live Nov 07: China reopening hopes fade, UK house prices fall
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FTSE 100 Top Engines: Ocado Leads the Way

Six hours into today’s trading session, here’s a look at some of the biggest moves on the FTSE 100 in London.

The biggest rise in the top category came from grocery technology shares Ocado, which rose more than 8% or 51.2p to 685.2p as sentiment continues to improve following its recent partnership with South Korean retailer Lotte. .

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Paypoint seals £83m takeover of Christmas savings club firm

Christmas savings club and gift card firm Appreciate Group has been acquired by payments firm PayPoint in a deal worth around £83m.

Offering bill payments at over 28,000 retail outlets across the UK, PayPoint offers cash and shares valuing Appreciate Group shares at 44 pence each, 69% higher than the closing price of 26.05%. of Friday.

Shareholders of the appreciated group will acquire a stake of around 5% in PayPoint after the agreement.

PayPoint wants to tap further into the consumer and corporate gift market, worth around £8bn a year, while boosting Appreciate Group’s Christmas savings club offering at a time when households are under strong financial pressure in the cost of living crisis.

Nick Wiles, CEO of PayPoint, said: “The proposed acquisition of Appreciate Group provides a compelling opportunity to acquire a highly complementary business with well-established offerings in the prepaid savings and gift card and voucher sector for businesses and consumers.”

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Home prices plummet at fastest pace for 18 months after mini-budget

Median house prices fell at the fastest monthly rate for more than 18 months in October as the chaotic fallout from the mini-budget rattled the housing market, new figures reveal today.

Britain’s biggest mortgage lender Halifax said the median UK home price fell 0.4% to a five-month low of £292,598, the biggest drop since February 2021.

The annual rate of growth decreased from 9.8% to 8.3%. Property prices for first-time buyers fell more sharply, from 10.1% in September to 7.5% in October.

Kim Kinnaird, director of Halifax Mortgages, said: “While a post-pandemic slowdown was expected, there is no doubt that the housing market took a significant hit as a result of the mini-budget which saw a sudden acceleration in increases. of mortgage rates.

“While those rates have likely peaked by now, following the reversal of previously announced tax measures, it appears recent events have encouraged those with existing mortgages to consider their options, and some prospective homebuyers to make a decision. pause. Understandably, we have also seen consumer caution grow as industry data shows mortgage approvals and loan demand decline.”

Prices in London were once again the slowest rise of any region in the country on an annual basis rising 6.8% to a new record average of £551,320.

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Flutter Stocks Boosted by FanDuel Fault, FTSE 250 Rises

A favorable court ruling today helped boost the FTSE 100-listed shares of gambling giant Flutter Entertainment.

The owner of Paddy Power and Betfair jumped 5% or 545p to 12,055p when it emerged that an arbitration hearing had indicated a current valuation of $22bn (£19.3bn) for the FanDuel sports betting business with US headquarters of Flutter.

Fox Corporation initiated proceedings in April 2021, arguing that its 10-year option to acquire an 18.6% stake in FanDuel should be at the same price that Flutter acquired a 37% stake in Fastball Holdings in December 2020.

That deal involved a valuation of $11.2bn (£9.8bn), but the US court determined a fair market value of $20bn (£17.5bn) plus a 5% annual book value adjustment.

London-listed gaming company Entain, which operates BetMGM as a US joint venture with MGM Resorts, also cheered 33p to 1,317p, but the broader market failed to advance as the FTSE 100 moved 6.37 points to 7,328. .47.

China’s insistence at the weekend that it will stick to its zero-Covid policy meant there was no repeat of Friday’s strong session, when the top flight bounced back on rumors of a move to ease restrictions.

Figures showing the first contraction in both China’s exports and imports since May 2020 contributed little to the mood, as Asia-focused stocks HSBC and Prudential fell around 1%.

The biggest gain in the top category came from grocery technology stock Ocado, which rose 8% or 51.2 pence to 685.2 pence as sentiment continues to improve following its recent partnership with South Korean retailer Lotte. .

A stronger pound helped the FTSE 250 Index rise 1% or 186.47 points to 18,528.04, with cybersecurity firm Darktrace among the beneficiaries after gaining 12.1 pence to 361 pence.

Aston Martin Lagonda led the second tier, rallying 11% or 12.3 pence to 124.5 pence as the luxury car firm recoups losses seen after last week’s third quarter trading update.

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Apple cuts iPhone production amid falling consumer demand

Apple has cut its target for iPhone production amid a drop in consumer demand and protracted supply chain problems in China.

The California-based tech giant aims to make 87 million phones this year, down from its previous target of 90 million, according to Bloomberg, after canceling plans to ramp up production as hopes faded of a surge in sales. sales.

It comes as the company had to cut iPhone production in November by as much as 30% after manufacturing facilities in Zhengzhou, China, came under tighter Covid restrictions.

An Apple spokesperson said: “We continue to see strong demand for the iPhone 14 Pro and iPhone 14 Pro Max models. However, we now expect lower iPhone 14 Pro and iPhone 14 Pro Max shipments than we previously anticipated.”

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FTSE 100 falls in frustration in China, Aston Martin recovers

China’s insistence that it will stick to its zero covid policy means the FTSE 100 Index is down 14.74 points at 7320.10.

The main flight drops included Prudential, which fell 10.4p to 903.2p. Homebuilders Taylor Wimpey and Persimmon are also down more than 1% after the latest Halifax house price release showed a 0.4% drop in October’s headline figure.

Other widely-watched stocks on the decline board included GSK, which fell 39.2 pence to 1,406.4 pence, and HSBC after falling 3.5 pence to 486.5 pence.

Gaming company Flutter Entertainment rose 425 pence to 11,935 pence after a US arbitration hearing placed a current valuation of $22 billion (£19.3 billion) on its FanDuel business in case the Media giant Fox would like to take an option to buy an 18.6% stake.

The FTSE 250 Index rose 31.37 points to 18,372.94, with Aston Martin Lagonda rising 6% or 7 pence to 118.95 pence as it recovered more of the losses seen after last week’s trading update.

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Ryanair returns to health with record half-year profit

Ryanair has posted its biggest after-tax profit in the first half of its fiscal year after a recovery in traffic and profitability.

The airline said it had made 1.37 billion euros in profit in the six months to the end of September, well above its previous first-half record of 1.29 billion euros in the same period in 2017.

“Concerns about the impact of the recession and rising consumer price inflation on Ryanair’s business model have been greatly exaggerated in recent months,” chief Michael O’Leary said in a statement.

“We expect these strong fundamentals to continue to underpin solid traffic and average rate growth for the next 18 months at least.”

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Median home price at five-month lows

Median house prices fell 0.4% in October, the third decline in the last four months and the largest recorded by the Halifax mortgage lender since February 2021.

It takes the price of the typical property to a five-month low of £292,598, while the pace of annual growth also continued to decline to 8.3% from 9.8% in September.

The slowdown follows the government’s mini-budget in late September, which caused a sudden acceleration in mortgage rates.

Halifax Mortgages director Kim Kinnaird said: “The rising cost of living, coupled with already stretched mortgage affordability, is expected to continue to weigh on activity levels.

“With tax increases and spending cuts expected in the Fall Statement, economic headwinds point to a much slower period for home prices.”

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China trade figures disappoint, FTSE 100 looks lower

China’s exports and imports have contracted simultaneously for the first time since May 2020, reflecting the impact of the country’s zero-Covid policy and falling demand for Chinese goods as the global economy slows.

Exports fell 0.3% in October, well below forecasts for 4.3% growth, and imports fell 0.7% after growing 0.3% the previous month.

The figures came as the Chinese government reiterated over the weekend that it would stick to its ‘covid zero’ strategy, debunking stock market speculation on Friday that it is preparing to relax restrictions.

Apple is feeling the pinch of these restrictions as it warned of longer wait times for its iPhone 14 models due to the outage at an assembly plant in Zhengzhou.

In addition to developments in China, the market will be looking this week for more signs that headline inflation in the US continues to ease.

The FTSE 100 Index was up 2% on Friday, but CMC Markets expects the top notch to open 18 points lower at 7316. Sterling is just above $1.13 this morning.

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Joules blames good weather for poor sales

British luxury designer Joules has blamed better-than-expected autumn weather for the drop in sales.

The brand, which is a favorite of Prince William and the Princess of Wales, said trade had fallen short of expectations in recent weeks amid a drop in consumer confidence.

Joules said in a statement: “While dresses, menswear and more formal product categories have performed well, the larger core categories such as outerwear, wellies and knitwear have all been outperformed. They have been affected, in part, by the milder climate than expected.”

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