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FTSE 100 Live: FTSE closes up 0.4%, OPEC oil cuts to be voluntary, EU inflation falls to 2.4%

FTSE 100 live (Evening Standard)
FTSE 100 live (Evening Standard)

Key Points

  • Dr Martens sinks on new downgrade

  • Eurozone inflation falls to 2.4%

  • Metro Bank in cost cutting plan

FTSE closes at 7,453.75

Thursday 30 November 2023 16:49 , Daniel O'Boyle

The FTSE 100 closed at 7,453.75 today, up 0.4%, despite starting lower.

The index fell as low as 7389 and hit as high as 7495 at points in the day, as traders reacted to data from the EU and US.

Smurfit Kappa was the top riser, while Severn Trent and United Utilities were the biggest fallers.

OPEC+members to announce supply cuts, Brazil to join

Thursday 30 November 2023 15:58 , Daniel O'Boyle

OPEC+, a collection of most of the world's top oil-producing nations, is set to announce further supply cuts, while Brazil is also set to join the alliance.

Members are set to announce the 1 million barrels a day of cuts individually, rather than OPEC+ announcing it itself.

Brent crude is up $0.32 for the day at $83.42. It reached $84.74 earlier in the day before it was revealed that the cuts would be announced by members rather than the union.

Church pensions board publishes climate plan to align portfolio with net zero

Thursday 30 November 2023 15:16 , Daniel O'Boyle

The Church of England Pensions Board has published its first Climate Action Plan to align its investment portfolio with net zero.

The Pensions Board said the framework focusses on transitioning the economy away from fossil fuels and aligning financial flows with the aims of the Paris Agreement.

It said it will address these aims through six strategic pillars, starting with a commitment to establishing targets and governance to oversee the strategy.

Read more here

Mulberry boss hits out at tourist tax as losses widen

Thursday 30 November 2023 14:17 , Daniel O'Boyle

The boss of Mulberry renewed his warning of the impact of the “tourist tax” on the UK economy, as losses widened at the iconic handbag maker.

CEO Thierry Andretta said the lack of VAT-free shopping for tourists  “is creating challenges for all sectors”, not just luxury businesses like Mulberry. The A-List’s favourite handbag designer closed its Bond Street store this year, blaming the decision to restore VAT for tourists.

In the six months to 30 September, losses grew to £12.8 million, as revenue in the UK fell by 22.7%, while international sales were up.

Andretta said: “I continue to believe that offering VAT-free shopping in the UK would be one of the most effective ways to encourage business growth in this country. The fact this has not been reinstated is creating challenges for all sectors; impacting not only the luxury players, but also hospitality, travel and tourism.”

Mulberry shares lost 25p, or 15%, this morning to 140p, valuing the business at £84 million. The shares are down 39% for the year.

Little surprise in US jobless claims, PCE inflation

Thursday 30 November 2023 13:52 , Daniel O'Boyle

US jobless claims are roughly in line with estimates this week, at 218,000.

The total is up slightly from last week's 209,000.

New figures also show that the core PCE measure of inflation, closely watched by the Federal Reserve, was in line with expectations at 3.5%.

Business leaders pay tribute to ex-Chancellor Darling

Thursday 30 November 2023 13:48 , Daniel O'Boyle

Business leaders are among those paying tribute to former Chancellor Alistair Darling

Darling was responsible for much of the UK's response to the Global Financial Crisis while he was in 11 Downing Street from 2007-10.

A statement issued on behalf of Mr Darling's family said: “The death of Alistair Darling, a former Chancellor of the Exchequer and long-serving member of the Labour cabinet, was announced in Edinburgh today.

“Mr Darling, the much-loved husband of Margaret and beloved father of Calum and Anna, died after a short spell in Western General Hospital under the wonderful care of the cancer team.”

Read more here

Microsoft commits £2.5 billion to build UK AI datacentres

Thursday 30 November 2023 13:14 , Daniel O'Boyle

Microsoft has unveiled plans to invest £2.5 billion into building datacentres for AI in the UK in a boost to the country's credentials of becoming a major European artificial intelligence hub.

The funding, which will be spread over three years will involve bringing more than 20,000 advanced Graphics Processing Units (GPUs) - which are crucial for machine learning and the development of AI models - to the UK by 2026, across sites in London, Cardiff and 'potential expansion into northern England'.

The development of AI models requires vast amounts of information on which they are trained, for which large-scale data centres are essential. The UK lags well behind the US in terms of data centre capacity, with only around a sixth of the number of centres, according to a 2021 study by the US government.

Read more here

Is the fall in Eurozone inflation as good as it sounds?

Thursday 30 November 2023 12:46 , Daniel O'Boyle

Michael Field, European Market Strategist at Morningstar, says the fall in inflation in the Eurozone is good news, but not quite as much of a causefor celebration as it might initially seem.

“The news that HICP inflation came in below economists’ expectations is something to be celebrated. In a normal year core prices rising 3.6% year over year would be something to be concerned about; however, in light of the double digit inflation rates we saw in 2022, this is a very positive development.

“That said, looking at the breakdown of inflation, it is clear that the fall in energy prices was the overwhelming driver of the headline rate falling to 2.4%.  However, energy prices can be volatile, therefore they can easily rise again in the coming months. Meanwhile inflation in areas where consumers spend much of their hard-earned cash, such as food, still rose by almost 7% year over year. Costs of housing, which have been rising rapidly, are actually excluded from the HICP calculation.

“Despite the large, and welcome, fall from the dark inflation days of 2022, we are still a way off the ECB’s targeted 2% inflation rate, and it could be well into 2025 before we get there. However, in the meantime the easing that we are seeing in inflation rates should eventually feed its way into the economy. It still remains to be seen whether lower prices will be enough by itself to stimulate the Eurozone’s struggling economy.”

 

Microsoft commits £2.5 billion to build UK AI datacentres

Thursday 30 November 2023 12:35 , Simon Hunt

Microsoft has unveiled plans to invest £2.5 billion into building datacentres for AI in the UK in a boost to the country's credentials of becoming a major European artificial intelligence hub.

The funding, which will be spread over three years will involve bringing more than 20,000 advanced Graphics Processing Units (GPUs) - which are crucial for machine learning and the development of AI models - to the UK by 2026, across sites in London, Cardiff and 'potential expansion into northern England'.

The development of AI models requires vast amounts of information on which they are trained, for which large-scale data centres are essential. The UK lags well behind the US in terms of data centre capacity, with only around a sixth of the number of centres, according to a 2021 study by the US government.

The move adds to Microsoft's expanding AI presence in the UK, after Open AI, in which it is a major investor, opened its first overseas office in London earlier this year.

read more here

Contractor Laing O’Rourke sinks to biggest ever loss

Thursday 30 November 2023 12:22 , Daniel O'Boyle

Britain’s biggest privately owned contractor Laing O’Rourke has crashed to its biggest ever loss following problems with projects in London and Australia.

The Dartford based business said it fell £288 million into the red in the year to end March on turnover up £500 million to £3.6 billion. Its previous biggest deficit was the £246 million loss in 2016.

The company said business in the UK had been hit by “continued inflationary pressures, challenging delivery on projects experiencing significant change and delays to capital investment in UK public sector work”.

Read more here

Barclays offers 90% mortgage with sub-5% interest rate after slashing prices twice in four days

Thursday 30 November 2023 12:00 , Daniel O'Boyle

Barclays has slashed its mortgage rates for the second time in four days, with rates now coming under 5% for mortgages with a 10% deposit.

The banking giant announced a swathe of cuts to its products today, as a global bond buying spree has sent gilt yields, used to price mortgages, down.

The new rates include a 4.38% deal for those able to stump up the deposit for a 60% LTV mortgage. But even lower-deposit mortgages are much cheaper, as the five-year fix with a 90% LTV has been cut to 4.95%.

Read more here

Lloyds, Halifax and Bank of Scotland to shut another 45 branches

Thursday 30 November 2023 11:17 , Daniel O'Boyle

Lloyds Banking Group is shutting another 45 branches across its network and the Halifax and Bank of Scotland brands amid the ongoing shift away from high street banking.

The group is closing 22 Halifax branches, 19 Lloyds branches and four in the Bank of Scotland business.

Lloyds stressed that all affected branch staff will be offered other roles at another branch or in a different part of the business, with no compulsory redundancies planned.

It comes just a week after NatWest Group said it plans to shut another 19 branches, mostly in the early part of next year.

Read more here

Auction Technology slides in FTSE 250, Rolls-Royce continues strong run

Thursday 30 November 2023 10:23 , Graeme Evans

Auction Technology Group shares were today below their 2021 flotation price after the digital marketplace’s annual results got a cool reception.

The FTSE 250 company, whose brands include BidSpotter and The Saleroom, slumped 17% or 105p to 525p amid a small decline in total hammer value in the second half.

Softer markets in art and antiques contributed to the dip, although boss John-Paul Savant still expects revenues growth in the range of 5-8% in the current year.

Today’s fall leaves Auction below its 600p listing price, having mostly traded at a premium since the February 2021 IPO.

Its slide was one factor in the FTSE 250 index falling 98.64 points to 18,368.94, in contrast to the FTSE 100’s gain of 15.14 points to 7438.60.

Energy stocks drove the top flight improvement after Brent Crude rose on speculation that the OPEC+ alliance was today planning to announce further production cuts.

BP jumped 2% or 9.3p to 481.25p and Shell by a more modest 16.5p to 2570p, while Rolls-Royce added another 6p to a fresh four-year high of 269.4p as analysts revised price targets following Tuesday’s strategy update.

Euro inflation falls to just 2.4%

Thursday 30 November 2023 10:10 , Daniel O'Boyle

Inflation in the Eurozone fell to 2.4%, less than half a percentage point from the 2% target, in November, new figures show.

Economists had predicted the headline rate to stay at 2.9%.

Core inflation remains hotter, at 3.6%.

Mathieu Savary, Chief European Strategist at BCA Research, said: “The Eurozone’s core CPI is falling even faster than market participants expected. Traders will be tempted to bring their expectations of the first rate cut forward, but this would be a mistake.

"The ECB is too concerned by the tightness of the labor market, which implies later rather than sooner rate cuts.”

French economy in surprise decline

Thursday 30 November 2023 09:41 , Daniel O'Boyle

The French economy unexpectedly contracted in the third quarter, newly revised figures show.

France’s GDP slipped  by 0.1%, despite initial figures showing 0.1% growth..

Inflation declined to 3.8% from 4.5% in October. That follows a decline in German inflation revealed yesterday.

Following the slowdown and lower inflation, traders now expect the European Central Bank to cut interest rates by April.

Metro Bank axing fifth of workers and reviewing seven-day opening

Thursday 30 November 2023 09:38 , Daniel O'Boyle

Metro Bank is cutting around 850 jobs and reviewing whether to stay open seven days a week under plans to slash costs.

The troubled high street lender said it is set to axe 20% of its 4,266-strong workforce as part of aims to ramp up cost savings to £50 million a year.

It said it is in talks with the City regulator, the Financial Conduct Authority, about cutting back its branch opening days and extended store hours and the impact this could have on customers.

Metro Bank is currently open from 8.30am until 5pm Monday to Saturday and 11am to 5pm on Sunday.

Read more here

Thursday 30 November 2023 09:38 , Simon Hunt

Shares in Mitchells and Butlers sunk 7% as markets opened this morning after a nine-figure write-down of the pub operator’s property portfolio helped it swing to a loss.

The firm, which operates over 1700 sites in the UK including the Nicholson's, O'Neill's and Toby Carvery brands, said the value of its property portfolio had declined by £192 million, on top of a £282 million write-down last year.

That led to a pre-tax loss of £13 million for the year to end September, compared to a profit of £8 million the previous year. Overall sales were up 9% to £2.5 billion.

The firm said it had been encouraged by sales growth and said that “a reduction in energy prices and slowing food inflation, in particular, mean that anticipated overall cost headwinds for the year ahead are expected to reduce.”

(Yui Mok/PA) (PA Wire)
(Yui Mok/PA) (PA Wire)

Dr Martens in fresh slide, BP shares support FTSE 100

Thursday 30 November 2023 08:37 , Graeme Evans

Dr Martens has lost 20% of its value in the FTSE 250 index after the bootmaker issued another profit warning due to the tougher US trading outlook.

The shares, which started the year near to 200p, fell 23.7p to 91.1p even though figures for the first half of the financial year met expectations.

Others on the FTSE 250 fallers board included Auction Technology Group, which dropped 75p to 555p on the back of its annual results.

The FTSE 250 fell 84.43 points to 18,383.15, while it was a steadier session for blue-chip shares as the FTSE 100 index held firm at 7423.60.

The best performing stock was NatWest, which lifted 3.2p to 209.6p, while BP rose 6p to 477.95p on the back of a stronger oil price.

Market snapshot

Thursday 30 November 2023 08:29 , Daniel O'Boyle

Take a look at our latest market snapshot with the FTSE 100 flat and oil prices higher

Revenue plunges at Zoo digital as Hollywood strikes hit

Thursday 30 November 2023 07:44 , Daniel O'Boyle

Revenue plummeted by 58% at subtitling business Zoo Digital, as the Hollywood actors’ and writers’ strikes pushed the business to a $10m loss.

Revenue fell to just $21.4 million in the half-year to 30 September, as production of American film and television - which Zoo provides subtitles for - stalled.

The strikes ended  this autumn, but it will take time for new films and programmes to be completed. Zoo expects to make a loss for the full year.

The action has caused major disruption to Hollywood productions (Chris Pizzello/AP) (AP)
The action has caused major disruption to Hollywood productions (Chris Pizzello/AP) (AP)

Stuart Green, CEO of ZOO Digital, said: "The year to date has been overshadowed by the first joint strike of Hollywood actors and writers in more than 60 years. This temporary disruption has had a significant impact across our sector and the wider media and entertainment industry, resulting in artificially low production volumes in the short-term. While this has had a significant impact on our financial performance, we have taken targeted measures to conserve cash while positioning the business to recover rapidly once orders return to more usual levels.”

Oil price higher ahead of OPEC+ meeting, FTSE 100 steady

Thursday 30 November 2023 07:24 , Graeme Evans

Brent Crude futures have risen to $83 a barrel, driven by speculation that the OPEC+ alliance will announce further big production cuts later today.

The meeting has been delayed from Sunday amid signs that smaller countries may be unwilling to back reduced output quotas.

The price of Brent rose 2% yesterday after a report by the WSJ said a production cut of up to one million barrels a day is being considered.

Elsewhere, stock markets continue to trade in a narrow range after the three major Wall Street indices finished broadly flat last night.

However, the S&P 500 is on track to achieve its best month of gains since November last year as investors focus on the outlook for interest rate cuts.

Asia markets are moderately higher, while CMC Markets expects the FTSE 100 index to open up nine points at 7432 after a fall of 0.4% in yesterday’s session.