FTSE 100 ends September at 7,608.08
The FTSE 100 closed at 7,608.08 today, roughly where it started this morning, despite rising as high as 7673. The index fell int he afternoon to close up only six points.
London’s top flight ends the week down 1%, never recovering from a big fall on Monday. But for the month, it is up 1.8%, thanks mostly to good news on inflation and an end to the Bank of England’s cycle of interest rate hikes.
JD Sports was today’s top riser, following a strong update from Nike in the US last night. Severn Trent and Ocado were also up more than 4%. Hargreaves Lansdown and Shell were the top fallers.
Three quarters of the way through the year, the FTSE is up 0.7% on where it started on 1 January.
Tesco to reveal sales performance as cost of living still in focus
Tesco’s pricing and efforts to stop customers switching to discount rivals will be in the spotlight again as the supermarket giant updates shareholders next week.
The UK’s largest grocery chain has appeared resilient and seen volumes continue to grow over the past year despite pressure from the cost-of-living crisis.
However, intense competition in the industry means the group is coming under continued pressure to preserve profitability as some higher costs persist.
Big drop in number of nightclubs, study suggests
The number of nightclubs has almost halved in the past decade – including a 30% fall since the start of the pandemic, a new study suggests.
The impact of Covid, coupled with changing consumer habits have led to a sharp drop in the popularity of Britain’s nightclubs, according to a report.
Research company CGA NIQ said its study found that 10 years ago, Britain had around 1,700 nightclubs, but in June this year the total stood at 873.
US Fed’s favourite inflation indicator eases down
The US Federal Reserve’s favourite measure of inflation, the core PCE price index, edged further down today, to 3.9%, in news that should help to ease ‘higher for logner’ global interest rate fears.
The decline was in line with expectations, but represents further progress towards the 2% target.
It follows a sharp drop in Eurozone inflation that fuelled hopes that ECB interest rates have peaked.
City Comment: The doom mongers have spoken. Now the City bounces back
For a long while the complaint was all about these swaggering foreigners coming over here, stealing all our big companies.
Morrisons – our Morrisons – fell to US private equity. Sky fell to Comcast. There were loads of others, Americans, Qataris and Scandinavians, grabbing our corporate heroes on the cheap.
Lately, the complaint is that there isn’t enough of this action, even though London shares are, bankers in the capital say, plainly undervalued.
That might soon change, as our reporting today on top buyout targets shows. Deal-making has been moribund lately, for sure, but not just here.
Nasdaq up more than 1%: US markets open
A few minutes into the day’s trading session on Wall Street, the Nasdaq is up more than 1%.
Here’s a look at your key markets data.
Vultures circle over UK firms where bargains are to be found
Fifteen UK stock market listed companies with a combined market value of nearly £170 billion could be vulnerable to takeover analysis for the Evening Standard shows, deals that would kick start the City and the moribund stock market.
City bankers says big money rivals, often in the US, are taking a close look at some of Britain’s best known businesses, driven by the strength of the dollar against the pound, fresh certainty about interest rates that influence borrowing costs and low share values.
For months City experts have been complaining that London listed shares are unloved compared to similar firms in the US. With both economies now likely to avoid recession, bankers say clients are casting their eye over what could be some huge deals.
Competition watchdog clears £1.2bn health tie-up
The competition watchdog has cleared a proposed £1.2 billion tie-up between two data management and software companies.
The Competition and Markets Authority (CMA) said that it would allow UnitedHealth to take over Emis after finding no competition concerns.
The deal was announced in June 2022 and would combine UnitedHealth’s subsidiary Optum with Emis in the UK.
Eurozone inflation falls to 4.5%
Inflation in the Eurozone fell much more quickly than expected, to a two-year low of just 4.3%.
The figures show that the European Central Bank’s rate rises are having an effect, and will add to hopes that interest rates within the currency union have peaked.
Core inflation fell to 4.5%.
Clemence Dachicourt, Senior Portfolio Manager, Morningstar Investment Management Europe Limited, said: “Today’s drop in headline inflation back to levels last seen in October 2021, is very good news for the European Central Bank, which currently faces a difficult conundrum. While the ECB has shown a strong determination in bringing down inflation closer to its 2% target after it raised interest rates for a tenth consecutive time in September, its efforts are precipitating the Eurozone into a potentially deep and long-lasting recession. The latest economic numbers published in the Eurozone clearly indicate that the region currently sits in contractionary territory, however, the labour market remains strong.”
“While we feel the ECB is very close to the end of its tightening cycle, it will need to be convinced that the ‘inflationary psychology’ has been extinguished before it can declare victory against inflation. Markets will therefore be carefully watching the possible spill-over effects that higher energy prices may have on prices of consumer goods or services. In a world of a tight labour market, higher than expected inflation will likely lead to workers pushing for higher wages, which could reignite the inflation spiral.”
Soaring wage bill hits profits at Groucho Club as new owners take charge
Soaring labour costs and inflation have resulted in a big drop in underlying profits at the Groucho Club, latest accounts reveal today.
Earnings at the Soho haunt fell 41% from £1.7 million to £1 million last year, despite the venue being able to return to near normal trading after the pandemic.
Accounts for Groucho Club Ltd filed at Companies House show that turnover jumped 47% from £5.4 million to £7.9 million in 2022.
But it blamed wages and other costs for a decline in profits from operations.
