Airline stocks are under pressure in London today after Ryanair trimmed profit guidance and the price of oil rose on the back of Middle East events.
Shares in oil and defence companies meant the FTSE 100 index held firm, in contrast to the weaker performance by the UK-focused FTSE 250 index.
The moves came at the start of a week featuring results by GSK, Shell and several US technology stocks, as well as the latest US and UK interest rate decisions.
FTSE 100 Live Monday
Ryanair cuts profit guidance
Superdry plans cost savings
Oil price rises on Middle East risks
FTSE 100 closes flat at 7,632.74
16:37 , Daniel O'Boyle
The FTSE 100 finished the day roughly flat at 7,632.74, despite a strong start to the day.
The index hit as high as 7663 before falling in the late morning and afternoon.
Fresnillo was by far the biggest riser, up almost 10%. RS Group and Entain were also winners today.
Big dfallers included Airtel Africa and St James's Place.
Luxury development in heart of Mayfair falls into insolvency
15:59
A luxury development in the heart of Mayfair has collapsed into administration, after defaulting on its loans.
60 Curzon, a set of 32 apartments designed by the French architect Thierry Despont, has appointed insolvency experts from Interpath Advisory. The project, which was developed by Brockton Capital and financed by funds managed by Apollo Global Management Inc., will continue to be marketed.
It is majority owned by two Chinese investment firms, Citic Capital and Cindat which bought their stake from Brockton in 2016.
Amazon terminates takeover of iRobot over EU regulatory issues
14:41 , Daniel O'Boyle
Amazon and robot vacuum cleaner firm iRobot have agreed to terminate their planned merger in the face of opposition from EU competition regulators.
Amazon had agreed a proposed 1.7 billion US dollar (around £1.3 billion) acquisition of the robot firm in August 2022.
But, in November 2023, the European Commission said its preliminary view of the deal was it could harm competition for iRobot’s rivals on Amazon’s online marketplace, particularly in France, Germany, Italy and Spain.
The investigation said it had concerns that Amazon could reduce the visibility of competitor products on its marketplace if the deal went through.
Over 6,000 incomplete ‘ghost houses’ across London as property market takes downturn
14:40 , Daniel O'Boyle
Thousands of homes under construction have been left abandoned at stalled “ghost housing developments” across London as a result of last year’s sudden downturn in the property market, the Standard has learned.
At the year end, construction work at 61 house-building sites where at least 20 homes are due to be completed had been halted with the gates padlocked. Together they accounted for just over 6,000 half-built homes at a time of severe housing shortages across London.
Industry experts say the number of schemes on hold is unprecedented in recent history, apart from the early months of the first pandemic lockdown. By contrast, in the wake of the financial crisis in 2008 and 2009 only 10 schemes were put on hold.
Bank of England to hold interest rates this week, but may 'lay the groundwork' for cuts
13:24 , Daniel O'Boyle
The Bank of England is all but certain to keep interest rates at 5.25% this week, according to economists and City traders, but there is hope that the Monetary Policy Committee will signal that it is now thinking about cuts.
The Bank will announce its latest decision at noon on Thursday, but the outcome is seen as close to a foregone conclusion. City interest rate swap markets suggest that there is about a 98% chance that interest rates are held at the highest level since 2008.
Yet economists have predicted that this week could mark a turning point, as the Monetary Policy Committee’s language turns more ‘dovish’.
Flutter boss: US is 'natural home' of Flutter shares
13:22 , Daniel O'Boyle
The boss of betting giant Flutter has called the US the 'natural home' for the firm's listing, in the latest sign that the Paddy Power owner no longer sees London as the ideal location to sell its shares.
Flutter shares start trading in New York in an hour, in a secondary listing, but the firm has made clear that it hopes to switch to a primary US listing in the future.
It will put a resolution on a primary US listing to shareholders in May, with a plan for the listing to come into effect by "early Q3" next year.
Flutter CEO Peter Jackson said: “With our NYSE listing effective today, this is a pivotal moment for the Group as we make Flutter more accessible to US based investors and gain access to deeper capital markets. We believe a US primary listing is the natural home for Flutter given Fanduel’s #1 position in the US, a market which we expect to contribute the largest proportion of profits in the near future.”
Tribunal hears of BT’s ‘abusive’ pricing practices towards landline customers
12:28 , Daniel O'Boyle
A hearing has heard allegations that BT carried out “abusive” pricing practices against landline customers in a class action seeking £1.3 billion in compensation.
Customers could be in line for between £300 and £400 depending on the length of their contract with BT if Collective Action on Land Lines (Call) founder Justin Le Patourel is successful.
Ronit Kreisberger KC, acting for Mr Le Patourel, told the Competition Appeal Tribunal that the claim was that BT had been charging these customers “excessive and unfair” prices for standalone landlines and calls in violation of its special responsibility as a dominant firm under section 18 of the Competition Act.
Surge in London businesses filing for administration in 2023 as costs rise
12:01 , Joanna Hodgson
The number of London companies falling into administration soared 37% last year, with key sectors such as property, hospitality and retail particularly hard hit, new figures show.
The 364 corporate failures in the capital last year accounted for 22% of the 1641 national total, according to data from law firm Shakespeare Martineau. The UK number was a 22% jump from 2022 and 91% up on 2021.
The surge suggests many weakened companies that survived the pandemic and the energy price spike are finally being forced to throw in the towel under the weight of a cocktail of pressures.
City Comment: If Julian Dunkerton can't save Superdry, no one can
11:04 , Simon English
A few years back satirical website The Daily Mash had a pop at Superdry.
A middle-aged man at a middle-class barbecue dares not to wear a Superdry t-shirt. “Onlookers described the mood… growing increasingly hostile, until a hot dog was thrown at his back… that was the trigger for the primal rage.
The other, normal, Superdry dads starting hooting and lobbing things.” The joke being made was that Superdry had become too ubiquitous for its own good. For a while, it was cool. Then it was everywhere.
BAE Systems and oil stocks support FTSE 100, Aston Martin shares fall
10:12 , Graeme Evans
Oil and defence stocks today kept the FTSE 100 index higher as investors began a significant week focused on events in the Middle East and China.
Shell and BP rose 1.5% after Brent Crude hit a three-month high near $83 a barrel in response to a weekend attack on an oil tanker in the Red Sea.
Alongside the worsening geopolitical situation, markets paid close attention to China’s debt-hit property sector after a court in Hong Kong ordered the liquidation of Evergrande.
The developments in the long-running saga were offset by China's curb on short-selling, meaning the Hang Seng index closed 0.8% higher.
Leading European markets also showed some resilience in a week featuring results from GSK, Shell and the US tech giants Apple and Amazon, as well as interest rate decisions by the Federal Reserve and Bank of England.
The FTSE 100 index followed Friday’s 100 point improvement by adding 12.09 points to 7647.18, with BAE Systems up 2% on expectations the events in the Middle East will further bolster defence budgets. Its shares rose 25p to 1193p.
GKN Aerospace business Melrose Industries added 4.6p to 586p, while the cautious stance of investors helped National Grid lift 15p to 1058.5p.
The fallers board included declines of over 2% for Ocado and the Asia-focused insurer Prudential, while B&Q owner Kingfisher lost 4.8p to 220.3p after analysts at RBC removed their “outperform” recommendation.
Meanwhile, Flutter Entertainment fell 50p to 16,275p as New York dealings in the gambling group shares got underway today.
The FTSE 250 fell 125.81 points to 19,212.21, with Dr Martens, Aston Martin Lagonda and Watches of Switzerland all down 4%.
Eyewear manufacturer Inspecs slid 27% or 23.5p to 63p on AIM after it said softer December trading left 2023 results short of expectations.
The company, which produces eyewear under brands including Barbour and O’Neill, said its broadly flat revenues of £200.3 million more than offset margin progress.
London shares 'brushing off' latest Evergrande twists
09:35 , Daniel O'Boyle
Susannah Streeter, head of money and markets, Hargreaves Lansdown, says: ‘’The FTSE 100 has eked out small gains at the open with investors largely brushing off the latest twists in China’s Evergrande saga, while heightened tensions in the Middle east added to expectations of further defence spending.
"Evergrande, China’s property ‘house of cards’ is a nudge closer to total collapse. A court in Hong Kong has ruled that a line has to be drawn given the high numbers of unfinished properties its repeated failure to pay interest on its debts and has ordered its liquidation in the special administrative region. While its operations in mainland China will continue for now, how Evergrande’s Hong Kong assets are frozen and sold off will be closely watched. It could act as a test to a bigger disposal of the property giant’s entire portfolio. Shares plummeted by 20% until their suspension, with investors losing any hope that there will be a way back from its web of troubles it is ensnared in. It’s again concentrating minds on China’s beleaguered property sector, which has dented wealth perceptions particularly among the middle classes and cast a cloud of consumer caution over the economy."
Market snapshot: Blue-chips slightly higher
08:54 , Daniel O'Boyle
Take a look at today's market snapshot as the FTSE 100 rises slightly higher following big gains on Friday
Airline stocks under pressure, Flutter rises ahead of New York listing
08:22 , Graeme Evans
Ryanair’s cut to profit guidance and the latest rise in the price of oil today put pressure on the shares of London’s leading airline stocks.
British Airways owner IAG fell 2.95p to 151.1p, while FTSE 250-listed easyJet dropped 7.8p to 521p and Wizz Air by 48p to 2002p.
The FTSE 100 index recovered from a weak start to stand 10.04 points higher at 7645.13, aided by gains of around 1.5% for energy companies BP and Shell.
B&Q owner Kingfisher fell 5.4p to 219.7p after analysts at RBC removed their “outperform” recommendation.
Meanwhile, Flutter Entertainment rose 40p to 16,365p as the gambling firm awaits the start of New York dealings in its shares later today.
The FTSE 250 fell 80.34 points to 19,257.68, with Aston Martin Lagonda among the stocks under pressure after a decline of 2% or 3.5p to 186.5p.
Chill Brands shares tumble 40% on vaping ban
08:17 , Simon Hunt
Shares in vape supplier Chill Brands sunk as much as 40% when markets opened as the stock was hit by news that the UK would impose a ban on disposable vapes.
The firm, which said it did not expect the ban to be implemented until toward the end of this year, said it was "already preparing to launch a fully compliant reusable pod system vapour device and will accelerate its efforts to bring this product to market.
"The Company will work with its existing contracted retailers to prepare them to stock this range extension," it said.
CEO Callum Sommerton said: "Chill Brands Group is an agile company, and we are prepared to adjust to any legislation that may be enacted."
Many vapes contain addictive nicotine (PA) (PA Wire)
Air Astana valued at nearly $1bn in first big London IPO of 2024
08:01 , Daniel O'Boyle
Air Astana plans to raise $120 million (£94.4 million) in the first big London IPO of the year, valuing the business at close to $1 billion.
The Kazakh airline has set a price of between $9.50 and $11 for its shares, with a final price to be decided on 9 February.
Peter Foster, Air Astana Group President and CEO, said: "We are pleased to announce the significant progress made for our initial public offering on the LSE, AIX and KASE. The response to the offering and strong investor interest have been very positive.
As one of the fast-growing airline groups, we firmly believe that Air Astana represents an attractive investment proposition, supported by strong financial and operational track record, significant growth opportunities, and an experienced, disciplined management team. We look forward to continuing our success while creating long-term value for our future shareholders."
Superdry admits cost cuts are on the cards
07:48 , Simon English
Embattled fashion house Superdry today confirmed it is in talks with advisors to explore "various cost saving options".
That is highly likely to include store closures and job losses following a weak Christmas trading period.
PricewaterhouseCoopers is looking at plans that could include a company voluntary arrangement that would protect the business from creditors to an extent while it structures.
The statement today said: " Whilst there is no certainty that any of these options are progressed, they aim to build on the success of the cost saving initiatives carried out by the Company to date and position the business for long-term success."
On Friday finance chief Shaun Willis said he would step down. CEO and founder Julian Dunkerton has fought hard to save the business after returning to the company in a boardroom coup.
Superdry shares open today at just 16p, which values the equity at £16.3 million. They were over 500p four years ago.
The statement today added: "As set out in the Company’s H1 FY24 results last week, the Company has continued to prioritise driving forward its cost reduction agenda. It is set to deliver in excess of £40m in savings this financial year, ahead of the initially stated target of £35m, with more than £20m of those savings already achieved in H1."
One option is to take the company off the stock market altogether. Dunkerton owns about a quarter of the shares.
Ryanair cuts guidance with Boeing deliveries set to fall short
07:37 , Daniel O'Boyle
Irish low-cost airline Ryanair has cut its profit guidance, as it faces a slowdown in demand and questions over its orders of Boeing planes.
Profit tumbled from €211 million a year earlier to €15 million in the year to 31 December, amid higher fuel costs.
Looking ahead, the business says it expects “weaker than previously expected load factors and yields” , suggesting weaker demand. It also faces higher staff costs after agreeing new pay deals with pilots’ unions. Ryanair’s profit for the year is now expected to be between €1.85 billion and €1.95 billion, having previously projected profits of as much as €2.05 billion.
The airline expected 57 new Boeing aircraft to arrive by late June for the summer holiday season, but now says it only expects 50.
“There remains a risk that some of these deliveries could slip further,” it added.
Last year, the airline agreed to buy 400 of Boeing’s 737 Max 10 planes, which will be delivered between 2027 and 2033.
(PA)
Tritax Big Box Reit UK lettings in line with pre-Covid average
07:31 , Joanna Bourke
Warehouses firm Tritax Big Box Reit is seeing rental growth, but it said UK lettings last year returned to more pre-pandemic levels.
Tritax said it secured 22.1 million sq ft of UK lettings in 2023 with a further 11.1 million sq ft under offer at the year end. The prior year 38 million sq ft of deals were signed.
Lacklustre start for FTSE 100, Evergrande in focus but Hang Seng higher
07:19 , Graeme Evans
Brent Crude is near $84 a barrel, its highest level in two months after the weekend attack on an oil tanker in the Red Sea raised supply disruption fears.
Traders are also focused on China’s property sector amid the potential fallout from this morning’s decision of a court in Hong Kong to order the liquidation of Evergrande.
Its shares plunged 20% before their suspension, although Hong Kong’s Hang Seng index traded higher after China’s securities regulator announced short selling curbs.
Wall Street closed broadly flat on Friday but futures are pointing to a weaker start later ahead of Wednesday’s Federal Reserve policy decision and results from Magnificent Seven stocks including Apple and Amazon.
The FTSE 100 index rose more than 100 points to 7635 on Friday but is forecast by IG Index to open slightly lower this morning.
Superdry confirms cost-cutting plans amid store closure reports
07:17 , Daniel O'Boyle
Superdry says it is looking at "the feasibility of various material cost saving options", following weekend reports that it could close shops and cut jobs
The struggling brand reported a 23% drop in revenue on Friday. The next day, reports in Sky News said the business was considering job cuts and store closures.
Today, Superdry did not say whether it would close shops or lay off staff, but it did say that it was “working with advisors to explore the feasibility of various material cost saving options.”
The business added: “Whilst there is no certainty that any of these options are progressed, they aim to build on the success of the cost saving initiatives carried out by the Company to date and position the business for long-term success.”
Shares closed at 16.4p on Friday, valuing the business at only £16.3 million. it was once worth more than £2 billion.
Recap: Friday's top stories
06:43 , Simon Hunt
Good morning from the Standard City desk.
The advert on the seat of the London black cab features pictures of the Eiffel Tower, the Statue of Liberty and the Kiyomizu-dera – a temple in Japan.
The strap: “We may have London in our name, but we create possibility in 190 markets.”
To critics, that ad serves as an example of exactly what is wrong with the London Stock Exchange Group. It is downplaying London rather than promoting it.
Since 1571 the Royal Exchange has been at the heart of the Square Mile. A source of wealth, and pride. Not everyone in the City thinks the operators of the market – the LSEG – is giving it proper attention.
For the LSEG – a worldwide seller of data to investors – the LSE is only 4% of revenues.
The old LSE fended off foreign takeovers for decades, notably from Germany and the US.
Since the LSEG’s major shareholders are US private equity giant Blackstone and Qatar, and it is run by former US Goldman Sachs banker David Schwimmer, some say it might as well be sold to foreigners who care more for the future of the market.
Here's a summary of our top headlines from Friday:
