- FTSE 100 drops 31 points
- Royal Mail bid clears security check
- Retail sales edge up in November
8.23am: Government borrowing hits lowest level for November since 2021
Government borrowing dropped to its lowest level for November in three years last month, according to the Office for National Statistics.
Borrowing totalled £11.2 billion in November, down £3.4 billion year on year and was the lowest level for the month since 2021.
“Central government tax receipts grew compared with last year, while increased spending on public services and on benefits were offset by lower debt interest payable,” ONS public sector finances deputy director Jessica Barnaby noted.
Tax receipts climbed by £3.8 billion to £61.8 billion year on year, as more was collected through income, corporation and value added tax.
Expenditure came to £0.2 billion less at £88.2 billion in the meantime, with interest payments on government debt dropping by £4.7 billion to £3.0 billion.
8.11am: FTSE 100 heads even lower
London’s blue chips extended a sharp decline for the week as trading got underway on Friday.
The FTSE 100 shed 33 points to sit at 8,071 following Friday’s open, following a 93-point drop on Thursday.
Barclays PLC (LSE:BARC) led the early fallers, having also dropped on Thursday, followed by the likes of Standard Chartered PLC (LSE:STAN) and United Utilities Group PLC (LSE:UU.).
8.06am: Tencent and Honor launch partnership for cloud and AI
Tencent Holdings (HKG:0700, OTC:TCEHY) Ltd and Honor Devices Co have unveiled a long-term partnership around cloud and artificial intelligence (AI) development.
Chinese smartphone maker Honor will adopt Tencent’s cloud infrastructure under the deal, including for the likes of analytics and search tools.
Tencent, China’s most valuable company, and Honor will also jointly develop a coding assistant to aid the latter’s software engineers.
Tencent shares had surged earlier this week on reports it was in discussions with Apple Inc (NASDAQ:AAPL, ETR:APC) to provide generative AI tools for iPhones.
Tencent shares climbed by 2.8% on Friday.
7.50am: Royal Mail takeover bid clears national security laws
Czech billionaire Daniel Kretinsky’s bid to buy Royal Mail’s has passed another major milestone towards completion with approval under national security laws.
Kretinsky’s EP Group noted on Friday that the Chancellor of the Duchy of Lancaster had conditionally approved its bid for Royal Mail owner International Distribution Services PLC (LSE:IDS) under the National Security and Investment Act.
“The order approves the acquisition, subject to the parties ensuring that Royal Mail remains able to and continues to provide services that are in support of UK national security,” it said.
EP had tabled the £3.6 billion bid in May, paving the way for Royal Mail to be taken into foreign ownership for the first time in its 500-year history.
However, national security concerns had been raised over the offer, threatening to slam the breaks on the takeover
IDS and EP were separately granted approval to move forward with the takeover from the government earlier this week, marking a key moment in Kretinsky’s bid to buy the postal service.
Approval under the act was separate to the government’s support, EP noted, with the deal expected the be completed in the first quarter of next year.
7.24am: Retail sales edge higher in November
Sales across Britain’s retail sector edged upwards in November as a drop at clothing stores was partly offset by growth at supermarkets.
Volumes increased by 0.2% month on month, following a 0.7% decline in October, according to an estimate by the Office for National Statistics.
Clothing and footwear sales dropped by 2.6%, while department store and automotive fuel sales were down by 0.7% and 0.9% respectively.
Sales at food stores increased by 0.5% in the meantime, as other non-food store volumes grew by 2.5% and household goods shops enjoyed a 1.1% increase.
“For the first time in three months there was a boost for food store sales, particularly supermarkets,” ONS statistician Hannah Finselbach commented.
“It was also a good month for household goods retailers, most notably furniture shops.
“Clothing store sales dipped sharply once again, as retailers reported tough trading conditions.”
7.11am: FTSE 100 set to drop further
London’s blue chips appeared on course for another drop ahead of trading on Friday, with futures showing the FTSE 100 down 30 points at 8,131.
The FTSE 100 had shed 93 points over the course of Thursday’s session, following a blow to Wall Street after the Fed signalled fewer rate cuts ahead earlier in the week.
The Bank of England’s rate call on Thursday, which saw interest held at 4.75%, did little to move the dial, after Monetary Policy Committee members voted six to three in favour of maintaining.
Overnight, Asian markets faced a largely negative showing, with South Korea’s Kospi down 1.3% and the biggest mover.
Back in London, attention on Friday was set to be on a key shareholder vote over Fraser’s spat with Boohoo, while Carnival was among those due to update.
5.00am: Friday’s schedule
Carnival will be among those to update on Friday, while Boohoo’s spat with Frasers over Mike Ashley’s bid to gain a seat on the formers board will reach a climax.
Carnival’s update should reflect plain sailing once again… Read more
Boohoo shareholders will decide whether Frasers boos Mike Ashley gets a seat on its board… Read more
Announcements due:
Trading update: Carnival Corporation & PLC
AGMs & EGMs: Boohoo Group PLC
Economic news: Retail Sales (UK), Consumer Confidence (EU), CBI Distributive Trades (UK), Core PCE Price Index (US)