World stocks were on track for their longest losing streak in two years as the sight of oil prices heading for $100 a barrel compounded worries that interest rates will stay higher for longer.
The MSCI’s main global equities index which tracks 45 countries was on course for its 10th straight daily fall, a losing streak not seen since 2021.
The CAC 40 in Paris has fallen 4.2pc during that period while the Dax in Frankfurt has dropped 4.5pc.
The Dow Jones Industrial Average on Wall Street has dropped 3.6pc over the last 10 days, with the S&P 500 dropping 4.8pc and the Nasdaq Composite falling 5.5pc.
The FTSE 100 has fallen 2.1pc during that time, having been insulated from the drops because of its large number of energy companies.
US-produced West Texas Intermediate crude hit $95 a barrel for the first time since August last year while global benchmark Brent hit a one-year high of $97.69. The increase in prices has been driven by cuts to supplies by Saudi Arabia and Russia.
Marija Veitmane, head of equity research at State Street Global Markets, said the UK market “has a very large concentration of energy companies”.
He said: “Oil supply will stay tight for some time, that will support oil price and so that’s great for UK stocks in a relative sense.”
Read the latest updates below.
05:48 PM BST
FTSE in green but higher gilt yields drag down housebuilder shares
The FTSE 100 closed marginally higher but struggled against its European counterparts as housebuilder shares were brought down by gilt yields.
The biggest faller on the FTSE 100 was Britain’s biggest housebuilder Barratt Developments, down 35.7p to 432.7p.
Gilt yields rose amid concerns that interest rates could remain high for a longer period of time.
The FTSE 100 moved 0.11%, or 8.63 points, higher to finish at 7,601.85.
Michael Hewson, chief market analyst at CMC Markets, UK, said: “There’s been a slightly more positive bias for markets in Europe today although the FTSE 100 is underperforming a touch with housebuilders getting hit on the back of a surge in gilt yields across the board.”
The biggest risers on the FTSE 100 were Smiths Group, up 52p to 1,622p, Anglo American, up 71p to 2,267p and Antofagasta, up 35.5p to 1,417.5p.
04:30 PM BST
UK bonds slump as traders bet on Bank of England rate hike
UK Government bonds slumped as traders have added to bets that Threadneedle Street will keep interest rates high.
The yield on 10-year gilts rose by as much as 20 basis points to 4.56pc today.
Traders are expecting a quarter-point hike in this cycle with markets expecting The Bank of England to maintain the key rate at above 4pc in coming years.
The move is part of a sharp repricing in global bond markets that accelerated this month, and which undercut one of the market’s favoured bond trades of the year.
04:07 PM BST
Sam Bankman-Fried loses bid for release from jail
Sam Bankman-Fried, the founder of the cryptocurrency exchange FTX, lost his bid to be released from jail during his fraud trial which starts next week.
The FTX founder’s lawyers asked Judge Lewis Kaplan if he could be granted temporary release during the trial, arguing that they would not otherwise be able to properly represent him.
Bankman-Fried’s lawyers said it would be difficult to prepare him at Metropolitan Detention Centre at the end of the trial each day.
The prosecutors opposed, stating that he has two laptops of evidence in jail to help him prepare.
Bankman-Fried is on trial for allegedly stealing billions of dollars in FTX customer deposits to plug losses at Alameda Research, a crypto-focused hedge fund he controlled.
FTX was once the world’s second-largest cryptocurrency exchange and valued at $32bn.
Bankman-Fried’s trial begins on 3 October and could last up to six weeks.
03:37 PM BST
That’s all from me today. From here, Riya Makwana will be making sure that you are kept informed with everything you need to know.
My parting gift is this image of campaigners from Ocean rebellion take part in a protest outside the offices of the Department for Environment, Food & Rural Affairs today.
They gathered in response to the State of Nature report, which has warned that harvest mice and field voles are “disappearing before our eyes” among many creatures at risk.
03:21 PM BST
Russian oil prices move higher but rouble falls
Russian oil is continuing to rise, defying an increasingly redundant price cap put in place by the G7 and its allies.
Crude from the country’s western ports has rallied along with headline futures in recent days, Argus Media data show.
Russia’s flagship Urals grade is trading at $85.35 a barrel from the Baltic port of Primorsk and $86 from the Black Sea port of Novorossiysk.
G7 officials have for weeks indicated they have no intention of revisiting the cap for now despite spot prices surging far above the threshold for Russian exports, which is $60 a barrel when Western shipping or insurance services are involved.
It comes as Bulgaria today approved a motion to gradually end imports of Russian crude, bringing the country in line with other European Union members.
Kazakh president Kassym-Jomart Tokayev told German chancellor Olaf Scholz that Kazakhstan will try to help Russia circumvent Western sanctions imposed over its invasion of Ukraine.
Meanwhile, the Russian rouble has hit a more than one-week low against the dollar.
Oil prices are rising sharply, but the Ruble is not. Keep this in mind when you hear people say the G7 cap isn't working as Urals oil price rises. The cap is clearly preventing Putin from getting a substantial chunk of the gains from rising oil prices. That's why Ruble is weak... pic.twitter.com/e1KGVTffmM
— Robin Brooks (@RobinBrooksIIF) September 28, 2023
03:04 PM BST
Car makers set electric vehicle targets despite Sunak delaying petrol ban
More than a fifth (22pc) of new cars sold by manufacturers in the UK next year must be zero emission, under new rules announced by the Government.
The minimum proportion rises each year to 80pc in 2030 under the Department for Transport’s zero emission vehicle mandate.
This comes after Rishi Sunak delayed the ban on the sale of new conventionally fuelled vehicles from 2030 to 2035.
The vast majority of zero emission vehicles are pure electrics.
Transport Secretary Mark Harper said:
The path to zero emission vehicles announced today makes sure the route to get there is proportionate, pragmatic and realistic for families.
Our mandate provides certainty for manufacturers, benefits drivers by providing more options, and helps grow the economy by creating skilled jobs.
We are also making it easier than ever to own an electric vehicle (EV), from reaching record levels of chargepoints to providing tax relief for EV owners.
02:49 PM BST
Evergrande chairman suspected of 'illegal crimes'
Heavily indebted Chinese property giant Evergrande has said that its chairman Hui Ka Yan is suspected of “illegal crimes”, after reports he was being held by police.
Evergrande said in a statement to the Hong Kong Stock Exchange that its boss was “subject to mandatory measures in accordance with the law”.
Hui, who founded Evergrande in 1996 in the southern city of Guangzhou, has come under increasing pressure as his property empire is under growing risk of liquidation.
Trading in shares of the developer were suspended in Hong Kong on Thursday.
Evergrande’s total liabilities stand at more than $300bn, roughly the size of Finland’s gross domestic product.
02:36 PM BST
Wall Street falls at opening bell
The main US stock indexes opened lower amid persistent worries over prolonged high interest rates.
The Dow Jones Industrial Average fell 30.83 points, or 0.1pc, at the open to 33,519.44.
The S&P 500 opened lower by 4.86 points, or 0.1pc, at 4,269.65, while the Nasdaq Composite dropped 49.48 points, or 0.4pc, to 13,043.37 at the opening bell.
02:28 PM BST
Renewi shares rocket amid takeover offer
Shares in waste management company Renewi rocketed by as much as 44pc after it emerged asset manager Macquarie has made an offer for the business.
Australian investor Macquarie said it made a cash offer worth £636m on Monday which was rejected by the London-listed firm’s board.
Shares in Renewi, which handles 14m tonnes of waste each year, hit a one-year high of 733p after news of the offer emerged.
Bosses said they had considered the proposal of 775p per share in detail and believed it “fundamentally undervalues” the company.
The offer would have been a constitutes a 52pc premium to the group’s closing price of 509p on Wednesday.
02:04 PM BST
Poundland owner downgrades outlook amid 'worsening September'
The owner of Poundland has downgraded its expectations for the year as it warned that its markets in central and eastern Europe were becoming “increasingly challenging”.
Pepco slashed its outlook for the second time in a month as it said that customers were not as interested as expected in its clothing and general merchandise lines - both of which are key for Pepco.
The business said that revenues in August were “lower than anticipated”, and that this has been “worsening in September”.
The business now expects pre-tax earnings before charges, known as ebitda, to reach €750m (£648m) in the 2023 financial year, up only slightly from €731m (£632m) a year earlier.
Executive chairman Andy Bond said:
It is clear that we need to refocus on delivering for our customers in our core business while delivering more measured growth.
We need to improve profitability and cash generation in our established business alongside a more targeted growth plan in markets where we have an existing presence.
Shares, which are listed in Warsaw, dropped 16pc after the news. So far this year they are down more than 45pc.
01:47 PM BST
US economy grows raising hopes of 'soft landing'
The US economy grew by 2.1pc in the three months to June, extending its sturdy performance in the face of higher interest rates, the government said.
The second-quarter expansion of US gross domestic product — its total output of goods and services — was a modest deceleration from a revised 2.2pc annual growth from January to March.
Consumer spending, business investment and state and local governments drove the second-quarter economic expansion.
The economy and job market have shown surprising resilience even though the Federal Reserve has dramatically raised interest rates to combat inflation, which last year hit a four-decade high.
The Fed has raised its benchmark rate 11 times since mid-March 2022 to a range of 5.25pc to 5.5pc, leading to concerns that ever-higher borrowing rates will trigger a recession.
Yet so far inflation has eased without causing much economic pain, leading to hope the central bank can pull off a so-called soft landing — slowing the economy enough to conquer high inflation without causing a painful recession.
Growth is believed to be accelerating in the current July to September quarter, fuelled by still-free-spending consumers as many Americans flocked to cinemas to see Barbie and Oppenheimer and splurged on Taylor Swift and Beyonce tickets.
🇺🇸Moderate economic momentum in Q2
📉Real #GDP Q2 '23
📊Cons spend +0.8%: weaker
📊Biz invest +7.4%: stronger
📊Net trade +0pt
⚠️Real GDP🆚pre-#COVID19 trend: -2.0%
⤵️Headline 3.9% y/y (-1.1pt)
⤵️Core 4.6% (-0.2pt) pic.twitter.com/qZWlSSDPlp
— Gregory Daco (@GregDaco) September 28, 2023
01:36 PM BST
Diageo boss sticks by guidance despite 'ongoing cost pressure'
The new boss of Guinness maker Diageo has said that cost pressures and the economic challenges are persisting, but stuck by the company’s guidance for the year.
In one of her first public statements for the company since her predecessor Sir Ivan Menezes died in June, Debra Crew said that the company is “well-positioned” to deliver 5-7pc organic net sales growth between the 2023 and 2025 financial years.
She said the company, which owns Johnnie Walker and Smirnoff, was resilient and can navigate the headwinds caused by the economy. Ms Crew said:
As I take the helm as chief executive of Diageo, I am excited to lead our teams around the world and by the many growth opportunities we see in front of us.
Our expectations for the 2024 fiscal year are unchanged from when we reported our 2023 preliminary results on August 1.
While we expect operating environment challenges to persist, with ongoing cost pressure and geopolitical and macroeconomic uncertainty, we will move with speed and agility and continue to invest in marketing and innovation.
I am confident in the resilience of our business and our ability to navigate these headwinds while executing our strategic priorities.
Ms Crew had to step up into the chief executive position early after her predecessor Sir Ivan died following a short illness.
01:15 PM BST
German inflation lowest since start of Ukraine war
German inflation fell to its lowest level since the start of the Ukraine war, which triggered a spike in energy prices around the world.
Consumer prices rose by 4.5pc in September, the weakest growth since February 2022 and compared with 6.1pc in August, the statistics office said.
However, it remains more than double the European Central Bank’s 2pc target.
Inflation in Britain stood at 6.7pc in August.
German inflation slowed even a tad more than I had thought to 4.5% y/y in Sep with the national core rate dropping to 4.6% from 5.5.%. Base effects do the heavy lifting in both cases, but at 2.3% m/m annualized the sequential core rate also slowed markedly. 1/2 https://t.co/tegT4YsgnP pic.twitter.com/90jDNT09pL
— Oliver Rakau (@OliverRakau) September 28, 2023
12:59 PM BST
GameStop hires billionaire investor Cohen as boss
Billionaire Ryan Cohen, the largest individual investor in GameStop, is taking over as chief executive at the video game retailer which gained notoriety as a “meme stock” during the pandemic.
Mr Cohen is already the board chairman and the company’s largest individual investor.
The job at GameStop, which became one of the most well-known meme stocks to create a frenzy among retail traders on Wall Street, has become a rotating door with the company trying to survive as technology upends the gaming industry.
In June, the company fired boss Matthew Furlong, the former Amazon executive who was brought in two years ago to turn the struggling video game retailer around.
Shares of Gamestop spiked 10pc in premarket trading in New York.
Mr Cohen’s holding company RC Ventures is the biggest investor in GameStop, holding about a 12pc stake. Mr Cohen co-founded Chewy, the online pet supply company, and had hoped to modernise GameStop, founded in 1984.
Mr Cohen began snapping up large stakes of GameStop at a time when the company was being buffeted by new technology. Gamers no longer needed GameStop because they were downloading games, rather than buying digital discs.
12:42 PM BST
BBC unveils new social media guidelines after Lineker row
The BBC has set out new rules for flagship presenters after a tweet by Gary Lineker prompted an impartiality row.
The corporation has published specific guidance, as part of its social media review, for high-profile presenters hosting flagship programmes, which they must adhere to while the programme is on air and for a two-week window before and after the series.
Presenters on flagship shows must not endorse or attack a political party, criticise the character of individual politicians in the UK, comment on political debate during a UK general election or referendum, or take up an official role in campaigning groups, it said.
The BBC named Dragons’ Den’s Evan Davis, The One Show’s Alex Jones, MasterChef hosts John Torode and Gregg Wallace, and Match Of The Day’s Mark Chapman and Lineker among those who fall under the rules.
Similarly, Strictly Come Dancing hosts Tess Daly and Claudia Winkleman, The Apprentice’s Lord Alan Sugar and Antiques Roadshow’s Fiona Bruce will also have to adhere to the new rules.
BBC radio presenters Greg James, Zoe Ball and Vernon Kay and Scott Mills were also named as presenters of flagship programmes, but the full list will be “kept under review”, the broadcaster said.
12:33 PM BST
Oil prices highest in nearly a year
Oil prices have risen to the highest level in nearly a year as demand for the commodity prompts renewed worries over global inflation.
Global benchmark Brent crude surpassed $97 per barrel today, the highest level since early November, although it has fallen back 0.4pc toward $96.
It has been edging towards the $100 mark which was last hit more than a year ago.
The recent spike in oil prices comes after two of the world’s biggest producers, Russia and Saudi Arabia, announced production cuts earlier this year.
The move helped boost the price of the commodity which has been climbing steadily since mid-August. Susannah Streeter, head of money and markets at Hargreaves Lansdown, said:
Concerns about tight supplies are fuelling the rise in oil prices, reigniting worries about inflation and the need for interest rates to stay higher for longer.
Brent crude has swept past $97 a barrel as the effect of Saudi Arabia and Russia’s extended production cuts takes hold and data shows a faster than expected drawdown of crude stocks in the US.
Despite slowing economies in Europe and fragility in China, global demand for oil for now continues to ramp up, to meet the seemingly insatiable needs for transportation, power generation and other petrochemical activities.
12:01 PM BST
Wall Street poised for mixed open
US stock markets lacked direction ahead of the opening bell as soaring oil prices cemented the prospects for a prolonged period of high interest rates.
The scope for interest rates staying higher for longer than anticipated has only solidified with soaring energy prices keeping headline inflation elevated. US oil futures jumped to a more than one-year high today.
Riding on the back of higher crude prices, energy is set to emerge as the only major S&P 500 sector to notch monthly gains.
Meanwhile, rate-sensitive information technology and real estate were on track to be the worst hit.
As the 10-year Treasury yield held its 16-year high, megacap growth stocks including Apple, Microsoft, Amazon.com and Tesla shed between 0.3pc and 0.8pc.
In premarket trading, the Dow Jones Industrial Average and S&P 500 were on course to open higher by 0.1pc, while futures on the Nasdaq 100 were down 0.1pc.
11:51 AM BST
Tool business HSS Hire expects hammering
Tool and equipment firm HSS said trading slowed considerably over the past 12 weeks as the company was knocked by weak market conditions.
HSS Hire Group shares dropped 8.2pc in early trading as the London-listed company revealed a dip in profits for the first half of 2023, while sales grew by 6.3pc.
However, the group also told shareholders that “the weak macro environment has caused trading in the first 12 weeks of H2 to slow considerably to 2pc.”
HSS said its services operation saw double-digit growth but its rental operation saw a “softness” in demand.
It said this was partly caused by seasonal weakness in the demand for certain products.
Bosses at the company said they have responded quickly to this with action to reduce the group’s costs. These moves will bring around £6m of benefits for the second half of 2023.
11:16 AM BST
Covid sparks change in attitude to manufacturing, says survey
The public’s view of manufacturing has improved, with Covid seen as a turning point, according to new research.
A survey of 2,436 people by Make UK showed the majority believed manufacturing was hugely important to the future of the UK economy.
Perceptions about pay working conditions and career prospects have also undergone a “massive transformative change” for the better, according to the survey.
Make UK said when it last surveyed the British public five years ago the story was “bleak”, with people blaming negative media coverage, and an overall feeling that Britain didn’t “make things any more”.
The turning point was Covid, said the report.
Stephen Phipson, chief executive of Make UK, said: “Manufacturing is the engine of economic growth and it is pleasing that the UK public shares our view that the sector is critical for the country’s economy.”
10:55 AM BST
Pound rebounds after sell-off
The pound has bounced back after hitting a six-month low on Wednesday after markets priced in that the Bank of England will not raise interest rates further.
Sterling has risen 0.5pc today to put it back above $1.22 after five-consecutive days of declines and a fall of 7.5pc since July when investors believed interest rates were on track to hit 6pc by the end of 2023.
Last week, the Bank held rates unchanged for the first time in almost two years and the markets now believe borrowing costs have peaked at their current level of 5.25pc.
The pound is still up almost 18pc from a year ago when former prime minister Liz Truss’ mini-Budget drove it to a record low.
10:39 AM BST
British iPhone designer Sir Jony Ive explores plan for AI gadget
Sir Jony Ive defined the smartphone era with his design for the iPhone – now he could do the same for artificial intelligence.
Our senior technology reporter Gareth Corfield has the latest:
The British designer, who was behind some of Apple’s most iconic devices, is working with the creator of ChatGPT to develop a new AI gadget.
OpenAI founder Sam Altman has reportedly drafted in Sir Jony to work on “AI hardware”, according to technology website The Information.
The pair are said to be discussing what an AI device could look like and are seeking as much as $1bn in funding for the project, according to the Financial Times.
Read how Sir Jony became one of the most influential designers of this century.
10:19 AM BST
German recession will be worse than feared, economists warn
A recession in Germany this year will be worse than previously feared, leading economic institutes have warned, as high inflation and an industrial slowdown hit Europe’s top economy.
The economy will shrink 0.6pc in 2023, the institutes said in their latest joint forecast. They had all flagged in recent months that a downturn was expected, although the figure is worse than those previously mentioned.
Oliver Holtemoeller, from the Halle Institute for Economic Research, one of the five groups behind the forecast, said: “The most important reason for this revision is that industry and private consumption are recovering more slowly than we expected.”
German policymakers face challenges on multiple fronts - from still-high inflation that began surging after Russia invaded Ukraine, to weakness in manufacturing and the impact of record eurozone interest rates.
It comes as German inflation is likely to ease significantly in September based on data from five key German states today, signalling what could be the beginning of the end for high inflation that has weighed heavily on Europe’s largest economy.
Inflation in all five states - Bavaria, Baden-Wuerttemberg, Brandenburg, North Rhine-Westphalia and Hesse - fell by at least a percentage point, with Baden-Wuerttemberg recording the largest drop, to 5.1pc in September from 7pc the month before.
Good morning from #Germany for which the growth outlook is being cut further and further. Top economic research institutes now expect Germany's GDP to contract by 0.6% in 2023, compared w/earlier projection of a 0.3% growth in April. The experts noted the erosion of consumers'… pic.twitter.com/iEyhDwLRm2
— Holger Zschaepitz (@Schuldensuehner) September 28, 2023
10:01 AM BST
ChatGPT can search the internet, says OpenAI
ChatGPT can now browse the internet and is able to provide users with up-to-date information sourced online, maker OpenAI has said.
Until now, the generative AI model’s responses have been based on data up to September 2021 on which it had been trained.
In a post on X, formerly known as Twitter, OpenAI said the updated version of the model was first being made available to its Plus and Enterprise users, but would be made available to everyone “soon”.
The update means the programme will be able to accurately discuss current affairs and provide more authoritative information, OpenAI said.
The company said in its post:
ChatGPT can now browse the internet to provide you with current and authoritative information, complete with direct links to sources. It is no longer limited to data before September 2021.
Browsing is particularly useful for tasks that require up-to-date information, such as helping you with technical research, trying to choose a bike, or planning a vacation.
09:45 AM BST
PM: Old Oak Common connections to London 'are very strong'
Rishi Sunak has been doing the rounds on BBC local radio ahead of the Conservative party conference starting on Sunday.
He was asked by BBC Three Counties Radio what the point was of a HS2 service stopping at Old Oak Common railway station, which is “closer to Brentford than Trafalgar Square”.
The Prime Minister said: “Old Oak Common is on the new Elizabeth line and actually the connections to most London destinations are very strong.
“Obviously it’s a new station that people will not be familiar with but its connectivity to all those areas is very strong.”
Mr Sunak was played a clip of a “devastated” resident on the HS2 line, who said his town of Wendover “won’t be the same ever”.
The Prime Minister said:
I know how frustrating it’s been for not just Alan but for lots of communities along the line and I think that’s why they should look at these things really carefully.
But I also think the best thing we can do is make sure that people everywhere, not just in these places that HS2 connects but it’s got to be people everywhere across the country benefit from the improvements and investments we’re making.
09:38 AM BST
Mortgage lenders in 'rate war', say brokers
Average rates may be below 6pc but there are much cheaper options that the average.
HSBC’s latest mortgage rates include five-year fixed rates under 5pc while NatWest also cut rates on Wednesday.
Mortgage broker Darryl Dhoffer of The Mortgage Expert said: “HSBC are leading the way now with a 75pc loan-to-value product priced under 5pc.
“Let’s hope other lenders follow suit in the days ahead. Things are really heating up now as lenders compete for market share.”
Lewis Shaw, founder of Shaw Financial Services, added: “The rate war continues and with other lenders set to reprice in the coming few days, now is the time to get a deal locked in.”
09:29 AM BST
Mortgage rates hit lowest level since July
The average five-year fixed-rate homeowner mortgage has fallen back below the 6pc mark, according to figures from financial information website Moneyfacts.
Across all deposit sizes on the market, the average five-year fixed-rate homeowner mortgage is 5.99pc, edging down from 6.03pc on Wednesday, Moneyfacts said.
The last time the average five-year fixed deal was below 6pc was on July 3, when it stood at 5.97pc.
The average two-year fixed residential mortgage rate is 6.5pc, down from an average rate of 6.53pc on Wednesday.
Some major mortgage lenders have been cutting rates this week after the Bank of England left interest rates unchanged at 5.25pc last Thursday.
Mortgage borrowers with chunkier deposits can choose from five-year fixes at rates below 5pc.
On Wednesday, HSBC UK reduced a selection of mortgage rates by up to 0.16 percentage points.
Matt Smith, a mortgage expert at property website Rightmove, said:
Following the positive news on inflation and the Bank’s decision to hold the base rate, we have seen swap rates, the underlying costs of fixed-rate mortgages, stabilise.
The important takeaway from last week for those looking to take out a mortgage soon is that the expectation that the base rate has now peaked is now the predominant view of the market, although there is still a sizeable but decreasing risk that we may see one more increase this winter.
As we approach the final quarter of this year, we are likely to see continued stability in the mortgage market persist with rates continuing to gradually drop and more lenders likely to offer sub-5pc deals.
09:05 AM BST
Housebuilders tumble on FTSE 100
The FTSE 100 has fallen as the outlook for investors was dampened by expectations that interest rates will be higher for longer.
The UK’s blue-chip index was down 0.4pc and the FTSE 250 dropped 0.2pc as interest rate-sensitive homebuilder stocks fell more than 1.7pc. Barratt Homes was the worst performer on the the FTSE 100, down 6.3pc as it traded ex-dividend.
Further weighing on the FTSE 100 was a 6.1pc drop in Phoenix Group shares after the life insurer posted a marginal rise in its half-yearly adjusted operating profit, although the stock was trading ex-dividend.
However, energy stocks limited overall losses after rising 1.2pc off the back of surging oil prices.
US-produced West Texas Intermediate jumped above $95 a barrel to its highest in more than a year as a drop in crude stocks in the United States added to worries over tight global supplies.
Shares of William Hill-owner 888 Holdings tumbled 14.2 after the bookmaker forecast annual core profit below its prior expectations after flagging a 10pc decline in third-quarter revenue.
08:55 AM BST
PM refuses to deny plan to scrap northern leg of HS2
Rishi Sunak did not deny speculation that he intends to scrap the northern leg of HS2, speaking instead of the need to connect all northern towns and cities, fix potholes and improve roads.
Kicking off a series of local radio interviews on BBC Radio York earlier, the Prime Minister was asked whether he is betraying the North by curtailing the high-speed rail line.
Mr Sunak replied:
No. I think what people will see, I mean particularly around where we are - my home is in Northallerton, we’re investing record amounts in improving infrastructure but also delivering levelling up.
I mean making sure that our town centres and high streets get the investment that they need. That’s really important and making sure that, as I say, transport infrastructure is being improved.
When I speak to people when I’m at home or anywhere else around, what everyone tells me is that you’ve got to make it easier to get around all our northern towns and cities, whether it’s Hull, York, Leeds, Sheffield, all the way over to Liverpool. Connecting all those cities up is really important and we’re doing that.
But also investing in the local transport that people use every day, making sure that our potholes are filled, making sure that our bus services are running - particularly important in rural areas like mine.
08:49 AM BST
PM: East-west rail in North 'will drive most growth'
Rishi Sunak has said the Government is always making sure “we get value for money” when asked about HS2.
Speaking to BBC Radio Manchester, the Prime Minister said about the high-speed railway:
I’m not speculating on future things. We’ve got spades in the ground right now, we’re getting on...
Government is always making sure that we get value for money out of everything we do, but that’s just a statement of the obvious, right? But I think what people also should know because I know there’s a lot of focus on this one thing but actually, one of the journeys that people use most in Greater Manchester or across the North, it’s in their cars right now...
He later added:
East-west, west-east connectivity across northern towns and cities is important. I’ve said it for years. Now I’m over on the east side of the North. I know that that connectivity across the Pennines is not good enough. And it’s not just Liverpool to Manchester, it’s all the way across the North.
And that is probably the thing that will drive the most growth, create the most jobs if we can get that right. And that’s why we are investing in doing that. But we obviously need to do more, go further, but having greater frequency, greater capacity and shorter journey times all the way from Liverpool, all the way over to the east coast is actually I think the thing that will make the biggest difference to unlocking the massive potential across the North.
08:39 AM BST
Car manufacturing slumps amid summer slowdown
Car production fell by almost 10pc in August, following six consecutive months of growth, new figures show.
A total of 45,052 models rolled off factory lines, said the Society of Motor Manufacturers and Traders (SMMT).
August typically has the fewest number of cars built because of summer shutdowns but last month was affected by extended production pauses at some plants for planned maintenance and upgrades as car makers gear up to produce the next generation of electric vehicles.
Production for the domestic market fell by a quarter while output for export dropped by 5.5pc, driven largely by a decline in shipments to the US, China and Japan.
The EU remained the UK’s biggest global market with almost six in 10 exports heading for the bloc.
In the year to date, overall production has increased by 11.8pc to 571,671 units.
UK car production declines by -9.7% to 45,052 units in August, following six months of growth.
— SMMT (@SMMT) September 28, 2023
08:24 AM BST
Ryanair sends holiday plans into disarray as it announces flight cancellations
Ryanair has thrown winter holiday plans into disarray for swathes of its passengers as it cancelled a number of flights on its winter schedule blaming delays in the delivery of Boeing aircraft.
Europe’s largest discount airline warned that cancellations would take effect from the end of October, although it said its full-year traffic forecast was unaffected “as yet”.
The carrier had expected to receive 27 aircraft from Boeing between September and December but production delays meant it only expects to take delivery of 14 between October and December.
Chief executive Michael O’Leary said: “At this early date, we do not expect these delivery delays will materially affect our full year traffic target of 183.5m.
“But if the delays worsen or extend further into the January to March 2024 period, we may have to revisit this figure and possibly adjust it slightly downward.”
Mr O’Leary said at a press conference on Wednesday: “As long as Boeing don’t delay any more deliveries, we will get to 183.5m passengers.
“Pre-Covid we did 149m passengers so we’re operating nearly 30pc more than we did three years ago.”
08:07 AM BST
UK markets muted at open
The FTSE 100 was little changed after the open as global stocks eyed their longest losing streak in two years as worries deepened about persistently high interest rates.
The UK’s blue chip index was flat at 7,594.54 while the FTSE 250 dipped 0.8pc to 18,197.37.
07:54 AM BST
Winning bets hit William Hill owner 888
Gambling group 888 said that it had performed worse than expected in the third quarter of the year as the results of sporting bets went against it and it introduced new compliance measures.
The company, which owns William Hill, said that revenue during the quarter is expected to be around 10pc lower at approximately £400m.
It also warned that pre-tax earnings before charges, known as ebitda, would be “below our prior expectation”.
The company said that September had brought “customer friendly sports results”, which had hit its margins both in the UK and abroad.
Rules designed to make gambling safer were also impacting the business.
07:43 AM BST
Whirlpool and Arcelik tie-up at risk of competition probe
A planned tie-up between the electrical and white goods giants behind Hotpoint and Beko in Europe could reduce choice and increase prices for UK consumers, Britain’s competition watchdog has warned.
The Competition and Markets Authority (CMA) said it found competition concerns surrounding Turkish firm Arcelik’s takeover of Whirlpool’s European domestic appliances business.
The regulator said that unless Arcelik can address its worries, it will launch a full scale in-depth probe into the deal.
The CMA said the merged company would be the biggest supplier of washing machines, tumble dryers, dishwashers and cooking appliances in the UK, a market worth over £3.8bn.
“Arcelik and Whirlpool’s position is particularly strong in the low to mid-range price categories of these domestic appliances, where they would face competition from only a small number of competitors,” it said.
07:31 AM BST
VW factories resume work after IT outage
Production at Volkswagen is resuming after a problem with the German carmaker’s information technology network caused a severe disruption, the company said.
Volkswagen said on Wednesday evening that the IT disruption caused production to halt at its four vehicle manufacturing plants in Germany — its Wolfsburg headquarters, Emden, Zwickau and Osnabrueck.
It also affected some other facilities, including at subsidiary Audi.
The company said today that the IT infrastructure problems were resolved during the night and production was resuming, German news agency dpa reported.
It said there were no indications of any external cause for the disruption.
07:25 AM BST
Harvester owner confident on profits as costs ease
All Bar One and Harvester owner Mitchells & Butlers revealed growing sales and said annual profits would be at the top-end of expectations as cost rises ease.
Like-for-like sales grew by 9.1pc in the fourth quarter as its “out-performance against the market” despite the cost-of-living challenges facing consumers.
The company said it has completed 142 conversions and remodels, including two to the newly acquired Ego brand, in addition to opening four new sites.
Chief executive Phil Urban said:
We are delighted to have continued our strong like-for-like sales performance through the fourth quarter, underpinned by volume growth and reflecting increasing out-performance against the market.
Going forward we shall remain focused on executing the drivers of this strong performance, our Ignite programme of growth and efficiency initiatives and our capital investment programme which, combined with our diverse portfolio of established brands and enviable estate locations, leaves us well positioned to continue to outperform the sector and see improved profitability.
07:05 AM BST
Evergrande shares suspended after chairman put under surveillance
Trading in shares of heavily indebted Chinese property developer China Evergrande Group was suspended in Hong Kong on Thursday, according to a notice on the Hong Kong stock exchange.
The suspension comes after Bloomberg News reported that the chairman of Evergrande, Hui Ka Yan, had been taken away earlier this month and placed under police watch.
Evergrande is the world’s most heavily indebted real estate developer and is at the center of a property market crisis that is dragging on China’s economic growth.
The group is undergoing a restructuring plan, including offloading assets, to avoid defaulting on $340bn (£280m) in debt.
Shares of Evergrande closed at 32 Hong Kong cents on Wednesday. The company had resumed trading on August 28 after a 17-month hiatus. Trading in two other units, China Evergrande New Energy Vehicle Group and Evergrande Property Services Group, was also halted Thursday.
06:47 AM BST
Buyers are being tempted back to the property market by the biggest discounts on house prices in four years.
Homes are being sold for 4.2pc, or £12,125, below the asking price on average, according to Zoopla, a property website.
In September, discounts reached their highest level since March 2019 following a recent jump in mortgage rates.
The number of buyers rebounded by 12pc in September, but Zoopla said they still retain the upper hand as they refuse to compromise on price.
It remains a buyer’s market, with 80pc more homes available for sale than in September 2021.
The biggest reductions on asking prices are being achieved in London and the South East, at 4.8pc – while in the rest of the UK the rate is 2.8pc, Zoopla said.
Discounts have been on the rise since the summer and are pushing down house prices, which have slipped by 0.5pc in the past year.
Zoopla said this was the first annual drop since 2012, with prices on track to fall 2 to 3pc this year.
Richard Donnell, executive director of research at Zoopla, said: “The modest fall in prices is not enough to improve affordability to a level that will boost activity.
“Falling mortgage rates are the most likely route to improving housing affordability, and bringing buyers back into the market in the next 12-18 months.”
5 things to start your day
1) New North Sea oil field Rosebank to deliver billions for the Treasury | Rosebank, which will be in production until 2050, is expected to generate tens of billions in tax income for the Exchequer over its lifespan
2) Government borrowing binge undermining faith in OBR forecasts, says IFS | Having only one fiscal event every year will help at a time of economic volatility, think tank says
3) Zuckerberg’s AI Ray-Bans translate foreign menus as you read | The glasses, which go on sale next month, mark an attempt by Meta to maintain interest in the ‘metaverse’
4) Ryanair chief blasts British air traffic control as ‘worst in Europe’ | Michael O’Leary criticised the UK’s air traffic control network as “by far and away the least productive, most inefficient”
5) Conservatives fear Iceland chief is poised to flip to Labour | Sources close to him denied he is to be unveiled as a Labour Party candidate
What happened overnight
Embattled property giant China Evergrande suspended trading of its shares on the Hong Kong stock exchange sending Asian shares mostly lower.
The halt in trading of the heavily indebted Chinese property developer followed reports that chairman Hui Ka Yan has been taken away earlier this month and placed under police watch.
The Hang Seng index slid 1.2pc to 17,390.50 while the Shanghai Composite was up less than 0.1pc at 3,108.51.
Trading was closed in South Korea for a holiday. Japan’s benchmark Nikkei 225 dropped 1.7pc to 31,813.01. Sydney’s S&P/ASX 200 was little changed at 7,029.30.
Oil’s spike to one-year highs - with Brent crude above $87 a barrel - has poured fuel on selling in the bond market and further pumped up the dollar, while global stocks have dropped for nine sessions in a row.
The greenback stands at a 10-month high against a basket of other majors, and 10-year Treasury yields are hovering at a 16-year peak.
Shares finished mixed on Wall Street. After taking several U-turns through the day, the S&P 500 inched up 0.98, or less than 0.1pc, to 4,274.51 and remains near its lowest level since June.
The Dow Jones Industrial Average slipped 68.61 points, or 0.2pc, to 33,550.27 after earlier bouncing between a gain of 112 points and a loss of 312. The Nasdaq Composite rose 29.24, or 0.2pc, to 13,092.85.