FTSE 100 Live: House price rise biggest since 2007, NatWest guilty of money laundering, gas prices ease

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 (ESI)
(ESI)

Vladimir Putin's intervention in the gas market and a short-term deal on the US debt ceiling look to have calmed the nerves of traders after yesterday's wild session.

The FTSE 100 index rallied 1%, helped by natural gas futures easing to 227p a therm from the 400p seen yesterday when investors were spooked by inflationary fears and the prospect of earlier-than-expected rises in interest rates.

House prices, meanwhile, remain on an upward path after Halifax reported a new record monthly average figure of £267,587as the race for space continues.

FTSE 100 Live Thursday

Markets wrap: bouncing off the ceiling

19:47 , Simon Freeman

London’s top index regained lost ground on Thursday as it bounced back from a bruising performance on Wednesday.

The FTSE 100 added 82.17 points, a 1.2% gain, after energy prices eased, taking pressure off traders.

It pushed the index up to 7,078.04, just over the 7,077 that it had ended on Tuesday, erasing the losses of Wednesday’s brutal session.

The rise was fuelled in London by mining giants like Rio Tinto, Anglo American and Antofagasta, who were cheered by events in Washington and on energy markets.

Fears that Republicans in the US Senate might block the debt ceiling from being raised – a potentially disastrous situation for the global economy – were allayed after a deal was announced.

This coupled with an easing of gas price rises helped boost confidence in the global economy, boosting the mining companies that supply many of the building blocks for that growth.

“Global economies still need a safety net, and the US has just stitched a hole in a big one,” said AJ Bell financial analyst Danni Hewson.

“Wall Street’s seen all indices push higher after a temporary agreement was struck to raise the debt ceiling.

“The news followed another boost to shares from decent jobs figures which suggest the labour market is getting back on track after putting the disruption from Hurricane Ida and a summer spike in Covid cases behind it.

“Stocks that have suffered falls in recent days are enjoying a resurgence of attention, with some investors undoubtedly bagging a bargain.”

In New York the S&P 500 was trading up 1.4%, just behind the Dow Jones index, which had gained 1.5%.

Europe’s big indexes were even further ahead, the Cac in Paris closed up 1.7% while the Dax in Frankfurt gained 1.9%.

In currency markets the pound would buy 1.3633 US dollars or 1.1789 euros by the end of trading in London, a rise of under 0.1% against both.

On an otherwise good day for its banking rivals, NatWest lingered close to the bottom of the FTSE 100 by the end of the day.

Earlier on Thursday the bank admitted it failed to live up to the requirements of anti-money laundering legislation.

The bank is facing a fine of up to £240 million for not properly monitoring the £365 million that was deposited into one of its customer’s accounts between 2013 and 2016. Sentencing is in December.

Shares in the company dropped by 1.4% on Thursday following the news.

The only worse performer on the FTSE 100 was IAG, which owns British Airways, down 1.9%. The airline group also had a run-in with a regulator, this time the Competition and Markets Authority (CMA).

The competition watchdog has closed its investigation into whether Ryanair and British Airways broke consumer law by failing to offer refunds for flights customers were unable to take during lockdown.

The CMA said it was not certain it could ensure refunds, blaming “a lack of clarity in the law”.

The biggest risers on the FTSE 100 were Antofagasta, up 68p to 1,350p, Anglo American, up 130.5p to 2,656.5p, Standard Chartered, up 21.5p to 472p, Johnson Matthey, up 96p to 2,614p, and BHP, up 65.4p to 1,900.6p.

The biggest fallers on the FTSE 100 were IAG, down 3p to 176.82p, United Utilities, down 3p to 225p, Admiral Group, down 40p to 3,072p, Ocado, down 21p to 1,637p, and Hargreaves Lansdown, down 16p to 1,399p.

Businesses blast Boris

14:55 , Oscar Williams-Grut

Furious business bosses have lined up to accuse Boris Johnson of leading Britain into a “cost of living catastrophe” without a credible plan to tackle the crises piling up for the economy.

Even former Tory loyalists such as Brexiteer Wetherspoon pubs boss Tim Martin joined the attack saying the Prime Minister headed a Government “lurching from one unpredictable initiative to another” with the least “commercial savvy” or “guiding philosophy” of any administration for 40 years.

The extraordinary row between a Tory leadership and captains of industry, normally seen as natural allies, was first triggered by an article in the Evening Standard on Monday, written by Leave-supporting Next chief executive Lord Wolfson.

Read the full story, which leads today’s paper.

BA and Ryanair boosted as probe abandoned

14:35 , Oscar Williams-Grut

The Competition and Markets Authority (CMA) has ditched a probe into whether Ryanair and British Airways broke consumer law by failing to offer refunds for flights customers were unable to take during lockdown.

It blamed legal issues. CMA chief executive officer Andrea Coscelli said: “We strongly believe people who are legally prevented from taking flights due to lockdown laws should be offered a full refund. We have concluded that the length of time that would be required to take this case through the courts, and the uncertain outcome, can no longer justify the further expense of public money.”

During the pandemic BA offered vouchers or rebookings, while Ryanair provided the option to rebook on flights that operated but should only have been used for essential travel, the CMA said.

BA said it offered refunds for all flights that were cancelled.

Legally, customers are entitled to a cash refund within 14 days if flights are cancelled but this does not clearly cover when flights take place but customers are legally prohibited from travelling.

Ryanair said: “We operated a limited schedule during UK lockdowns for customers who travelled for essential reasons. Passengers had the option to change their bookings without paying the flight change fee.” BA said: “During this crisis we have acted lawfully at all times, issuing nearly four million refunds and offering highly flexible booking policies.”

Shares in International Consolidated Airlines Group (IAG), BA’s owner, are up 0.2% in afternoon trade. Ryanair is 0.6% higher.

FTSE strongly higher in afternoon trade

14:09 , Oscar Williams-Grut

The FTSE 100 is up 1.1% or 80 points this afternoon at 7075. Investors are piling back into stocks amid signs that the debt ceiling crisis in the US could be avoided.

“Bargain hunters have emerged after Wednesday’s heavy selling, encouraged by strong trading in Asia overnight and apparent progress in the US on an extension to the debt ceiling,” says AJ Bell investment director Russ Mould.

“Some of the heat was taken out of the gas market after an intervention by Russian premier Vladimir Putin yesterday, cooling inflationary fears for the time being.”

Stelrad Radiator Group plans London float

13:39 , Joanna Bourke

Radiators manufacturer Stelrad is looking to go public on the London stock market, in move that could value it at around £350 million.

Stelrad Radiator Group, which is considering floating on the main market of the London Stock Exchange, sells products to a range of retailers, as well as housebuilders.

More details HERE.

London reopening boosts Robert Walters and Workspace

12:34 , Oscar Williams-Grut

Headhunter Robert Walters and landlord Workspace are both riding high thanks to London’s reopening.

Robert Walters today upgraded its profit forecasts, while Workspace boasted of an uptick in occupancy at its London sites.

Robert Walters saw a 26% jump in third quarter gross profits to £91.8 million. Business was up across the UK and Europe, with particularly strong demand in Asia. Momentum “accelerated” in London, with lawyers, techies, and commercial finance experts most in demand across the economy.

Shares rose 28p, or 3.8%, to 760p.

Meanwhile, FTSE 250 firm Workspace said occupancy across its 60 London sites was up 2.7% to 85.6% in the second quarter of its financial year.

Shares gained 32p, or 4%, to 830p.

Read more here.

Gas price crisis: ‘This is far from over'

12:15 , Oscar Williams-Grut

UK gas prices spiked to record levels yesterday before dropping around 100p per therm after Russian president Vladimir Putin agreed to pump more supply to Europe. He had at first been reluctant and tied more supply to European approval of the new Nordstream 2 pipeline.

Day-ahead gas futures were down 13p to 218p per therm this morning. The price had climbed as high as 355p per therm on Wednesday.

Experts said upward pressure on prices was likely to continue despite increased supply.

“The winter season is barely a week old and global demand remains strong, supply tight — this is far from over,” said Henry Edwardes-Evans, an energy expert from S&P Global Platts. “Nobody can say where prices will settle — price movements are too volatile and reactive to even relatively modest news flow.”

NatWest faces huge money laundering fine

11:24 , Simon English

NATWEST today pled guilty to three accounts of money laundering and can expect a huge fine from watchdogs keen to clamp down against crime.

The bank, previously Royal Bank of Scotland admitted that it failed to comply with the rules over a four-year period between November 2012 and June 2016.

That’s a blow to Alison Rose, the newish chief executive trying to reinvent the bank that went bust under the leadership of Fred “The Shred” Goodwin and had to be bailed out by the taxpayer.

Read more here

Risk appetite returns

10:26 , Graeme Evans

The clouds lifted for stock markets today after US politicians heeded warnings of a “catastrophic outcome” should they fail to raise the country's debt ceiling in time.

The move by Senate leader Mitch McConnell offering a short-term debt limit increase in order to avoid a national default provided some relief for Wall Street, despite the truce doing little more than delay the issue until December.

Treasury secretary Janet Yellen earlier warned their failure to agree an extension would likely trigger a recession, putting added pressure on sentiment at a time of rising global jitters over the inflation and interest rate outlook.

The S&P 500 and Nasdaq closed almost 0.5% higher, encouraging bargain hunters back into the London market after Vladimir Putin's intervention in the gas market.

The FTSE 100 index rose by more than 1% at one point and later stood 51.94 points higher at 7047.81 following gains of more than 3% for miners including Anglo American.

Tomorrow's all-important jobs report in the United States means the respite may not last long as a strong figure will be seen as the green light for the Federal Reserve to begin plans to taper economic stimulus.

A particularly weak number has the potential to stoke stagflation fears through the toxic combination of rising prices and low growth.

FTSE 100-listed packaging and paper giant Mondi revealed that its input costs were significantly higher in the September quarter but that it has so far been successful in passing on these energy, resin, transport and chemical overheads.

Shares rose 19p to 1,807p after Mondi allayed fears that demand for its products might be affected. Fellow packaging firm Smurfit Kappa also rose 88p to 3,850p.

The FTSE 250 index improved 95.22 points to 22,481.84, with British Gas owner Centrica among those 2% higher. Rising gas prices appear to have done it no harm with shares now up 18% over the past month as smaller rivals fall by the wayside.

On AIM, Victorian Plumbing fell further from June's debut price of 262p after the bathroom products firm said revenues growth moderated over the summer. Shares fell 19p to 221p, even though full-year earnings are ahead of market expectations.

Cheers: Revolution Bars reports strong trading performance

10:40 , Joanna Bourke

People heading out to enjoy cocktails post-lockdown has helped Revolution Bars to enjoy trading well ahead of expectations.

The bar chain said between July 19 and October 2 it recorded comparable sales that were 17% above the same period two years ago, before the Covid-19 crisis.

The hospitality sector was able to reopen in July.

Read the full story HERE.

Workspace sees SMEs flock back to London offices

09:07 , Joanna Bourke

SMEs are leading the way back to the office, the boss of landlord Workspace said as he reported a pick-up in lettings and building use.

Workspace has a number of office sites across London (Workspace)
Workspace has a number of office sites across London (Workspace)

Graham Clemett said “there are positive signs of momentum”, with over 1000 enquiries, 633 viewings and 175 lettings agreed at his sites last month. He added that was better than what was seen pre-pandemic.

The company, which has offices across 60 locations in London, offers flexible leases, typically two years with options to exit after six months, and scope to take on extra space when needed. It is popular with start-ups and SMEs.

Read the full story HERE.

Debt deal lifts FTSE 100

08:19 , Graeme Evans

The FTSE 100 index has opened more than 1% higher at about 7070.

Richard Hunter, head of markets at Interactive Investor, said: “Risk appetite has briefly returned for investors, although sentiment remains delicately poised.”

The mood has been helped by progress on debt ceiling talks in the US after Senate leader Mitch McConnell offered a short-term debt limit increase to avoid a national default.

London-listed mining stocks benefited from the improved sentiment, with Anglo American shares 3% higher and Glencore up 2%.

Inflation fears

08:03 , Graeme Evans

Gas prices came off their record high yesterday after Russia announced it was ready to increases supplies to help Europe avoid an energy crisis.

But with gas futures still remaining at elevated levels, there's every chance households will see a sharp spike in their living costs this winter as companies pass on much higher overheads.

Bank of America's UK economist Robert Wood now expects the CPI measure of inflation to peak in April at 5.1% alongside a figure of 5.8% for the RPI benchmark, which is still used to set train fares and student loan rates.

His note published yesterday forecasts a 45% hike in Ofgem's price cap in April, rather than previous expectations for a 25% rise.

UK house prices climb, as ‘race for space’ continues

07:54 , Joanna Bourke

House prices rose in September 2021 (PA Archive)
House prices rose in September 2021 (PA Archive)

UK house prices increased “sharply” to add more than £4,400 in value in the final weeks where stamp duty help, aimed at giving the residential market a turbo-boost during the pandemic, was available.

Halifax said that average prices in September hit a record £267,587, which was up 1.7% month on month, and 7.4% higher than the same time last year.

Russell Galley, the mortgage lender’s managing director, said: “This rate of monthly growth was the strongest since February 2007.”

Read the full story HERE.

Bitcoin latest

07:48 , Graeme Evans

Even Bitcoin was put in the shade by the spectacular gas price volatility yesterday, with the cryptocurrency up a comparatively modest 7% to above $55,000 yesterday.

It continues to trade at close to that level this morning, having yesterday received more institutional endorsement when billionaire George Soros's investment firm said it owned some coins.

Bitcoin is now at a five-month high after rallying by as much as 27% during this month.

Gas prices steady

07:30 , Graeme Evans

The London market is set for a calmer session after yesterday's intervention of Russian president Vladimir Putin helped to peg back soaring natural gas prices.

Gas futures for November delivery soared above 400p a therm at one point yesterday, fuelling inflation fears and sending the FTSE 100 index down 1%. The gas figure is now back at 266p, while Brent crude has eased slightly to just above $80 dollars a barrel.

Hopes of a US debt ceiling compromise are also helping sentiment after Wall Street reverse losses to finish in positive territory, with the S&P 500 and Nasdaq both close to 0.5% higher.

The prospect of tomorrow's jobs report in the United States means the uncertainty hasn't gone away, however, as a strong figure will be seen as the green light for the Federal Reserve to begin plans to taper economic stimulus.

A particularly weak number has the potential to stoke stagflation fears, which is the toxic combination of rising prices and low growth.

After yesterday's wild session, the FTSE 100 index is expected to open about 60 points higher at 7055.

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