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FTSE 100 Live: UK retail sales drop 1.2%, index avoids lowest close of 2023

 (Evening Standard)
(Evening Standard)

The FTSE 100 index narrowly avoided its lowest close of the year after a grim week for global stock markets.

London’s top flight fell again by 0.7% today, leaving it down by 3.5% since Monday as worries mount globally over higher-for-longer interest rates. It has lost 350 points over the course of a six-day losing streak.

For much of the day, the index appeared set for the lowest close since November 2023, but it rallied slightly in the last hour of trading.

Rising borrowing costs have added to pressure on the retail sector, resulting in today’s 1.2% fall in sales during washout July.

FTSE 100 Live Friday

  • Blue-chip index on course to close at 2023 low

  • Retail sales fall sharply in July

  • Great Portland in £70m Soho Square deal

FTSE 100 avoids lowest close of year

Friday 18 August 2023 16:38 , Daniel O'Boyle

A late rally helped the FTSE 100 close at 7,262.43 today, less than seven points more than its lowest close of the year.

The index fell as low as 7220, but rallied in the last hour before markets closed in London.

However, it was still down 0.7% today, and in its longest losing streak since 2020.

Airtel Africa and RS Group were among the biggest fallers.

FTSE picks up from lows

Friday 18 August 2023 16:28 , Daniel O'Boyle

The FTSE 100 has picked up from its lows and appears set to avoid the lowest close of the year.

However, the index is still down 0.6% today, and set for its sixth consecutive day of declines.

It is currently at 7,265.34, nine points ahead of the lowest close it reached this year, in July.

Councils and police urged to ‘turn a blind eye’ to pubs opening early for World Cup final

Friday 18 August 2023 16:26 , Daniel O'Boyle

Councils and police are being urged to “turn a blind eye” to pubs opening early for the women’s football World Cup final.

MPs have called on the authorities to ignore instances of publicans serving outside of their usual Sunday hours, after warnings that licensing rules mean leave some venues unable to serve pints or open early for excited fans on the day.

In Cornwall, the local council and police have already announced they will not take enforcement action for early opening during the big match.

Read more here

Investors’ eyes on tax bill as Harbour Energy to report

Friday 18 August 2023 16:02 , Daniel O'Boyle

The biggest official fuel producer in the North Sea will present its results next week, with investors likely keen to know more about its plans for the future and the impacts of the windfall tax.

Harbour Energy has been complaining about its UK tax bill since the Government introduced a special charge for energy companies as prices soared following Russia’s full-scale assault on Ukraine.

The company said in March that its profit had been “all but wiped out” by the windfall tax. But that was based on writing off last year’s profit against what the company expects to pay over the five-year period of the tax, a move that brought criticism at the time.

Read more here

US stocks lower as retail rises but tech falls

Friday 18 August 2023 15:47 , Daniel O'Boyle

Wall Street shares have started the day lower, following Asia and Europe down.

The S&P 500 is down 0.3% to 4,356.29, while the Dow Jones is down 0.1% at 34,436.86. The tech-led Nasdaq index is down 0.6%, to 13,235.35.

Big risers included retailers ROss Stores, Dollar Generaland Walmart. Fallers include tech beghemoths Nvidia, Meta and Alphabet.

Energy bills expected to fall £150 a year from October, say analysts

Friday 18 August 2023 15:09 , Daniel O'Boyle

The amount that an average household is expected to pay for its energy bills will fall by around £150 per year from the start of October, according to a new forecast.

Ofgem’s next price cap, which will be announced on Friday next week, will drop to around £1,925, according to the latest forecast from Cornwall Insight, an energy consultancy.

It is a reduction of 7%, and the lowest the cap has been since March 2022.

Read more here

Offices giant IWG plans to create ‘series of 15-minute cities’ as it announces Battersea hybrid workspace

Friday 18 August 2023 14:31 , Daniel O'Boyle

The boss of offices giant IWG said “more and more workers want to live in a 15-minute city”, as the firm’s Regus arm announced a new flexible 5,500 sq ft workspace in Battersea.

The business said the new office is part of a “series” of 15-minute cities that IWG is establishing across London, and comes just days after it reported a surge in demand for workspace in the suburbs, as demand in typically popular locations like the City cools. IWG hopes to add as many of 1,000 new locations to its network this year to serve the growing number of hybrid workers in the capital.

The Battersea office is set to open in the fourth quarter of the year

Read more here

FTSE now down more than 1%, approaching intraday year-low

Friday 18 August 2023 13:45 , Daniel O'Boyle

The FTSE 100 has fallen even further today, and is now down more than 80 points, or 1.1%, at 7,229.00.

That brings it close to the lowest it has reached all year, when it fell to 7206 on 20 March amid fears about the global banking sector, before rebounding later that day.

The index has now lost nearly 400 points in the space of just six trading days.

Big fallers today include RS Group, Airtel Africa and Antofagasta. British American Tobacco is the only FTSE 100 firm to rise by more than 0.5%.

Deliveroo to let customers mix groceries and takeaway orders

Friday 18 August 2023 13:37 , Daniel O'Boyle

Deliveroo customers can now enjoy champagne with their kebab or prosecco with their pizza under new order options introduced on its app.

The feature, which is to be made available to customers across the UK following a trial phase in London, allows app users to combine takeaway food with grocery shopping in a single order.

Deliveroo said the new functionality was introduced after data showed large numbers of customers ordered restaurant food and supermarket essentials within a few minutes of each other.

Read more here

City Comment: West End sees green shoots from new investment

Friday 18 August 2023 13:15 , Jonathan Prynn

If some of the recent reports are to be believed Oxford Street has been reduced to a Mad Max-style dystopia where feral criminal gangs smash store windows at will and tacky Candy stores fill virtually every retail unit from Marble Arch to Centre Point.

The truth is very different as our report today shows. There is no doubt that the 1.2 mile-long canyon of consumerism has had a tough time since 2020 and it is looking a little battered. There are certainly too many candy stores, although firm action being taken by Westminster council should thin their ranks.

But there is investment too. Today’s encouraging figures from CBRE show there is no shortage of retailers hoping to open new space on Europe’s busiest shopping street, which still has a vitality unmatched nearly anywhere else in the world.

Read more here

FTSE slips back further at lunchtime

Friday 18 August 2023 12:26 , Simon Hunt

Halfway through the day’s trading session in London, the FTSE 100 has slipped further and is now down 0.8%.

Here’s a look at your key market data.

Train strikes: Aslef announces fresh walk-out in September

Friday 18 August 2023 11:55 , Daniel O'Boyle

Train drivers are to stage a fresh strike next month amid their long-running dispute over pay, threatening more travel chaos for passengers.

Members of union Aslef will walk out on September 1 and will ban overtime on September 2 - the same day as a strike by the Rail, Maritime and Transport union (RMT).

Announcing the strike on Friday, Aslef said its walk-out will force train companies across England to cancel all services, while the ban on overtime will “seriously disrupt” the network.

Read more here

Retailer demand for Oxford Street shops picks up pace again after turbulent period

Friday 18 August 2023 11:15 , Daniel O'Boyle

Oxford Street was given a big boost earlier as figures showed retailers are queuing up to open new stores there, with more than 100,000 sq ft of deals in advanced negotiations.

After a challenging three and a half years for the famous shopping destination since the start of the pandemic —not helped by disruption last week when some social media videos urged people to turn up and cause disorder — the research shows that space there is still in hot demand.

Property consultancy CBRE found there are at least 10 stores under offer in Oxford Street. Firms set to sign leases are in a variety of retail sectors including fashion, tech and food and beverage.

Read more here

FTSE 100 down 1% and set for 2023 low close, Hang Seng falls 2%

Friday 18 August 2023 10:31 , Graeme Evans

The FTSE 100 index is in danger of setting its lowest close of the year after falling 1% or 71.77 points to 7,238.44.

London’s top flight is on a six session losing run that has cost the benchmark more than 250 points since Monday and 6% across August.

Today’s mood wasn’t helped by the crisis in China’s debt-laden property sector after Evergrande last night filed for bankruptcy protection in the United States.

The Hang Seng index in Hong Kong closed 2% lower and is now down by more than 10% this year amid China’s disappointing economic recovery.

On Wall Street, the recent optimism over a soft landing for the US economy has been punctured by signs the Federal Reserve is not yet done raising interest rates.

The speculation yesterday pushed the US 10-year Treasury yield, which is used as a benchmark for global borrowing costs, to its highest daily close in 15 years.

Traders fear the uncertainty could continue for another week until Federal Reserve chair Jerome Powell addresses the Jackson Hole symposium next Friday.

The S&P 500 index and Nasdaq Composite closed around 1% lower last night, a performance that set the FTSE 100 index towards a nine-month low.

Big fallers in London include the mining stocks Antofagasta and Anglo American, down by 3% as traders revised expectations for China demand.

Other big fallers included the luxury goods group Burberry, which has lost more than 4% of its value in the past week and today dropped another 48p to 2137p.

BAE Systems put back 7p to 962.8p after falling 4% yesterday on jitters over the £4.4 billion deal for Colorado-based Ball Aerospace, a move that will boost the UK company’s capabilities in spacecraft and missile development.

The bleak mood was mirrored in the UK-focused FTSE 250 index, which fell 1% or 188.87 points to 18,167.20. Stocks down by more than 2% included the US-focused retailer WH Smith, National Express owner Mobico and the property firm British Land.

Qatari royal mulls sale of luxury Knightsbridge homes for £370 Million

Friday 18 August 2023 09:56 , Daniel O'Boyle

A Qatari sheikh, whose son is fronting a bid for Manchester United Football Club, is mulling the sale of two luxury houses in London’s most exclusive districts with a combined asking price of £370 million.

Sheikh Hamad bin Jassim bin Jaber Al Thani is potentially planning to sell a triplex penthouse at the One Hyde Park project in London’s upscale Knightsbridge district for about £220 million, as well as a property he owns nearby at Belgrave Square for about £150 million, according to people familiar with the matter.

Sheikh Hamad may decide against a sale if offers fall short of the asking price, the people said. Efforts to reach the royal for comment through his private investment firm Al Mirqab Capital and several family members were unsuccessful.

Read more here

Kingspan delists from London Stock Exchange

Friday 18 August 2023 09:32 , Daniel O'Boyle

The future of Irish companies in the City was in focus today, as building materials firm Kingspan officially delisted from the London Stock Exchange.

Kingspan was one of three Irish companies to deliver a blow to London in the space of two months, joining rival building supplies firm CRH and betting giant Flutter when it announced plans to delist in April.

The business faced widespread criticism for supplying 5% of the insulation used at Grenfell Tower. The public inquiry into the Grenfell fire heard Kingspan’s K15 product became a “raging inferno” in internal tests. Kingspan says K15 was “misused” in an unsafe manner at the tower, and noted that the inquiry said the exterior cladding provided by other firms was “the principal reason” the fire spread.

Today, Kingspan also revealed its profits ticked up in the first half of the year, to €435.5 million £372.2 million) despite high interest rates deterring construction. It said it expects to see deflation in the costs of building materials during this quarter.

The shares continue to trade in Dublin, where they are down 3.5%.

Wilko union reassures staff as administrators mull bids

Friday 18 August 2023 09:17 , Daniel O'Boyle

The GMB union, which represents around a third of Wilko’s 12,000 staff, reassured staff and confirmed that administrators were weighing multiple bids to save the retailer, as reported in the Standard yesterday.

Andy Prendergast, GMB national secretary, said: “GMB has met with administrators and the company as part of the formal consultation process.

“We can confirm there have been expressions of interest from organisations who are considering taking over at least some parts of the business.

“These are still at an early stage, but means there are genuine grounds for hope.

“Whilst this process continues staff will continue to be paid and kept on. All stores are continuing to trade, and deliveries of new stock will continue.”

It is not expected that any firm will by the entirety of Wilko, but there is hope that a number of the more profitable stores can be saved.

Poll: One in three London homeowners think they will struggle with mortgage costs in next six months

Friday 18 August 2023 09:12 , Daniel O'Boyle

One in three London homeowners say they will struggle to meet their mortgage payments in the next six months, new polling reveals.

The survey, conducted by YouGov and commissioned by City Hall, showed that 11 per cent of the capital’s mortgage payers think they will “definitely” struggle to keep up with payments and a further 23 per cent will “probably” struggle.

The combined total of 34 percent saying they expect to struggle is up from 21 per cent in January.

Read more here

FTSE 100 extends losing streak, BAE steadies

Friday 18 August 2023 08:34 , Graeme Evans

The London market’s run of losses rolled into a sixth session today as the FTSE 100 index fell another 28.10 points to 7,282.11, taking the deficit for this week to 244 points.

Stocks in the red included Rolls-Royce, which fell 2.45p to 199.95p, and the luxury goods group Burberry after a decline of 26p to 2159p.

BAE Systems rose 4.6p to 960.4p after shares fell heavily yesterday on jitters over the scale of the £4.4 billion acquisition of Colorado-based Ball Aerospace.

The FTSE 250 index fell 0.5% or 97.05 points to 18,259.02, with cyber security firm Darktrace and National Express owner Mobico among the stocks 2% lower.

Capital Economics: 0.5% fall in real consumer spending expected

Friday 18 August 2023 08:31 , Daniel O'Boyle

Bad retail sales in July were mostly driven by bad weather, but also represent weakening appetite for consumer spending, Capital Economics deputy chief UK economist Ruth Gregory said.

“The 1.2% m/m fall in retail sales volumes in July probably had more to do with the unusually wet weather than the impact of higher interest rates on consumer spending,” she said. “But with the Bank of England’s interest rate hikes still feeding through and consumer confidence falling, we remain downbeat on the outlook for overall spending this year.

“Overall, the figures were a bit worse than we had expected. And our view is still that the growing drag on activity from higher interest rates will eventually generate a 0.5% peak to trough fall in real consumer spending.”

FTSE drops and Bitcoin down 5%

Friday 18 August 2023 08:20 , Simon Hunt

A few minutes into the day’s trading session in London, the FTSE has opened lower, while Bitcoin has fallen 5% since yesterday.

Here’s a look at your key market data:

‘Barbenheimer’ boost reverses first-half decline at cinema chain Everyman

Friday 18 August 2023 08:06 , Daniel O'Boyle

High-end cinema chain Everyman’s revenue and profits fell in the first half of the year, but it said the joint releases of Barbie and Oppenheimer on 21 July boosted sales and shows “cinema remains as relevant as ever”.

The cinema - known for its comfortable seats and food options like pizza and hot honey halloumi - brought in revenue of £38.3 million in the six months to 30 June, down slightly from 2022. Profit, meanwhile, fell by 22.7% to £5.8 million.

But things pickwed up in July, which the business put down to ‘Barbenheimer’, which drove a record week for admissions. Revenue for the month came to £10.6 million, while profit doubled July 2022’s total at £2.6 million.

Read more here

Great Portland snaps up property in Soho Square in £70m deal

Friday 18 August 2023 07:55 , Simon Hunt

Property group Great Portland Estates has acquired land in London’s Soho Square in a £70 million deal.

The company has bought the freehold interests at 16/19 Soho Square, 29/43 Oxford Street and 7 Falconberg Mews from Belgravia & Chelsea Property Services.

The deal values the properties at £772 per square foot and includes planning permission to demolish some buildings and construct up to 90,000 square foot of office and retail space.

Alexa Baden-Powell, Senior Investment Manager, said, "This acquisition represents a fantastic opportunity for us to develop a strategic West End freehold site into a best-in-class headquarters building with excellent sustainability credentials."

 (Daniel Lynch)
(Daniel Lynch)

Treasury plans to assure access to cash facilities

Friday 18 August 2023 07:47 , Daniel O'Boyle

People and businesses should be no more than three miles away from the ability to withdraw or deposit cash under plans set out by the Treasury.

The financial services watchdog will be given the power to fine banks and building societies which fail to maintain standards on protecting access to cash.

Treasury Economic Secretary Andrew Griffith said cash had “an important and continuing role to play” despite the shift away from reliance on coins and notes.

Read more here

FTSE 100 stuck in reverse as Asia markets fall

Friday 18 August 2023 07:13 , Graeme Evans

The FTSE 100 index is set for another session in the red after Wall Street closed sharply lower last night and selling pressure continued during Asia trading hours.

Sentiment has been hit by concerns over China’s property sector and the prospect that interest rates are likely to stay higher for longer in the US and elsewhere.

Wall Street declined for the third consecutive session as the S&P 500 index and the Dow Jones Industrial Average lost 0.8% and the Nasdaq Composite fell by 1.2%.

The declines came as the US 10-year Treasury yield, which is used as a benchmark for global borrowing costs, posted its highest daily close since 2008.

In Asia, the Hang Seng index is 1.4% lower after it emerged that developer Evergrande had filed for bankruptcy protection in the United States.

The FTSE 100 index closed 0.6% lower last night and is down by around 5% in August, the majority of this decline coming in the past week. CMC Markets expects the top flight to open another 25 points lower at 7285.

Retail sales fall sharply in July

Friday 18 August 2023 07:02 , Daniel O'Boyle

UK retail sales fell by -1.2%, as some of the wettest July weather in history and the impact of higher interest rates put customers off the high street.

Sales had been expected to decline, by 0.5%, after a strong June in which sales climbed, due to the heavy rainfall during the month. But the fall was much worse than expected, suggesting that higher interest rates and continuing inflation are having a notable effect as well.

London Skyline (AFP via Getty Images)
London Skyline (AFP via Getty Images)

Josh Graham, Co-Founder and Chief Marketing Officer at Airtime Rewards, said: “Today’s retail sales figures show that shoppers are prioritising financial resilience over spending, as rising interest rates prompt them to tighten their purse strings. Add to this the wet weather which dampened demand for summer clothing, and it’s hardly surprising we’ve seen retail figures slump. Our own data shows that spending in July was down 10%, with bars and offline clothing impacted most notably.

“Stubbornly high inflation and rising interest rates are testing consumers’ ability to spend, and retailers must brace themselves for scarcer spending. Having a clear value proposition that focuses on the wants and needs of customers, as well as a multi-channel approach, will be critical to attracting and retaining shoppers.”

Recap: Yesterday’s top headlines

Friday 18 August 2023 06:52 , Simon Hunt

Good morning. Here’s a summary of our headlines from yesterday.