- FTSE 100 adds 54 points
- Marston’s and SSP rise as results impress
- UK retail sales fell in November, BRC says
- But UK entertainment spending up, Barclaycard finds
2.49pm: Wall Street starts flat
It’s another mixed start for Wall Street this week, with the S&P 500 just below flat, the Nasdaq Composite just above.
The Dow Jones Industrial Average is up 0.2% and the Russell 2000 is flat.
Among the notable movers, Super Micro Computer Inc (NASDAQ:SMCI) is up another 3%, adding to its near-30% gain yesterday.
Biggest climbers on the S&P are AT&T Inc (NYSE:T, ETR:SOBA), up 4.7%, and Micron Technology Inc (NASDAQ:MU), up 3.8%.
2.06pm: Martial law declared in South Korea
Futures for Korea’s Kospi index are down 0.7% after the president of South Korea, Yoon Suk Yeol, declared martial law.
In an unannounced televised speech in the past hour (it’s just gone 11pm in Seoul), he said the move was necessary to “protect a liberal South Korea from the threats posed by North Korea’s communist forces and to eliminate anti-state elements”.
“I hereby declare emergency martial law,” Yoon said.
Less dramatic, but closer to home, French lawmakers will hold a no-confidence vote tomorrow, with far-right leader Marine Le Pen expected to join forces with a left-wing coalition to try and topple the government of Michel Barnier.
1.43pm: FTSE lifted by oil prices
Oil prices are picking up from yesterday’s two-week lows, with Brent crude up 1.5% to above $73.
This is helping the FTSE, as it is lifting the index’s second- and eighth-largest companies, Shell and BP, 2.1% and 2.5% respectively.
The North Sea crude market “just witnessed its largest trading frenzy in at least 16 years,” reported Bloomberg, saying this adds to uncertainty over oil prices in the year ahead.
Eight cargoes, amounting to almost 6 million barrels of crude, were bought in a pricing window run by Platts, the most since 2008 when the newswire first started compiling the data.
Traders are also looking ahead to the Opec+ meeting on Thursday, where the group of oil-producing nations is expected to U-turn on its previous pledge to ramp up production from December.
Looking across the Footeie index, all but four of the 20 largest names are also in the green, with drugmakers AstraZeneca and GSK, and banks HSBC and Barclays all up between 1.4% and 2%.
1.05pm: UK jobs data to remain unreliable
Earlier the Office for National Statisticians warned that its planned switch to a new, more accurate jobs market survey by mid-2025 should be pushed back to 2027.
Having suspended its Labour Force Survey last year after a plunge in response rates due to shifts in the jobs market, the ONS said its move to a new Transformed Labour Force Survey in mid-2025 “is now unlikely given current quality concerns”.
It said the new data, which is based on self-completed online questionnaires rather than the interviewer-based household data collection survey it used before, might not be ready until 2027.
The ONS plans to address significant quality concerns before replacing the existing LFS, with a 2027 deadline allowing time for, further testing and redesign of the survey, quality assurance and user consultation, and a phased “parallel run” to ensure reliable comparisons between LFS and TLFS.
This is a problem for the Bank of England, as governor Andrew Bailey has publicly complained that long-running problems with the LFS make it hard for policymakers to tell how tight the jobs market is.
12.40pm: Were you not entertained?
UK consumer spending on entertainment, hospitality and leisure spending took off in November, according to the latest Barclaycard data.
Cinema spending alone saw a dramatic 22.8% yearly increase thanks to blockbusters Gladiator II and Paddington in Peru (or Gladdington, since portmanteaus are all the rage).
Overall entertainment spending rose 10.8%, while the broader hospitality and leisure sector recorded a 4.7% increase, with bars, pubs, and clubs reporting their strongest month since the summer, fueled by early festive season gatherings.
Conversely, a 2% decline in retail spending, marking the lowest year-on-year growth since June, backed up the BRC figures earlier.
12.16pm: Flat start for US stocks expected
European markets remain on the front foot, while Wall Street futures are indicating a flat start.
Dow Jones futures are flat, while those for the S&P 500 and Russell 2000 are just above flat and for the Nasdaq 100 are slightly below.
This comes a day after the S&P 500 notched its 54th all-time high of the year, with the Nasdaq Composite also bagging a record high, rising 0.2% and 1% respectively.
Meanwhile, the Dow Jones fell 0.3% and the Russell 2000 was just below flat.
Pre-market movers on Tuesday include Super Micro Computer Inc (NASDAQ:SMCI), up another 5% to add to its near-30% gain at the start of the week.
The dollar has stabilised after gains on Friday and Monday, with the dollar index (DXY) down a little at just over 106 points.
David Morrison, market analyst at Trade Nation, said: “It could go either way, and much will depend on where US Treasury yields trade ahead of the Fed’s FOMC meeting on 17th/18th December.”
In cryptocurrencies, he notes that bitcoin “failed to clear $100,000”, which is “proving to be a major frustration for the crypto-bros, particularly as upside momentum fades with every unsuccessful attempt”.
Today there are speeches from Federal Reserve members Adriana Kugler and Austan Goolsbee, with economic data including the JOLTS job openings, the first major release of a week of jobs market data, which culminates with Friday’s Non-Farm Payrolls.
Back in Europe, the FTSE 100 is up 0.7%, the DAX 0.2% and CAC 0.3%.
11.05am: Currys slips on downgrade
Looking at the fallers this morning, big tobacco and other defensive names are bottom of the FTSE, including BAT, Imperial Brands, BT, SSE and Bunzl.
Currys PLC (LSE:CURY) is the bottom of the FTE 350, down 2.5%.
This follows a downgrade from Deutsche Bank as part of a wider retail sector note considering “positioning for 2025”.
Analyst Alison Lygo, who cut her rating on Currys to ‘hold’ from ‘buy’ and her target price to 85p from 95p, said there are two “predictable” themes dominating the narrative: how retailers manage wage pressure from the Budget and the wider expectations for consumer’s discretionary spending into the new year.
“We haven’t downgraded our estimates on the basis of wage headwinds, driven by our view that much is still to play for in terms of offsetting.
“However, as retailers reach for levers of price and cost control, we view some as much better positioned than others.”
10.46am: European markets on front foot despite French political concerns
The 0.7% gain for the FTSE 100 is around the middle of the pack among Europe’s big stock markets.
Italy’s FTSE MIB has jumped 1.3% thanks to more gains for Stellantis and the banking sector , while Spain’s IBEX is up 1% on gains for construction giant ACS.
France’s CAC is up 0.5% and Germany’s DAX is 0.2% higher.
European markets are on the front foot despite continued political uncertainty in France, says market analyst Joshua Mahony at Scope Markets, as Michele Barnier looks set to face a vote of no confidence after using legislation to force through a social security budget that is likely to see the both the right and left wing parties unite in a bid to remove the PM in the coming days.
The French public deficit is likely to have risen to 6% this year, and Barnier wants to drive it back down to 5% in 2025, but his plan is being questioned and the political jitters seen throughout the region “provide further cause for EUR weakness”, says Mahony with EURGBP currently on track for its sixth down day today.
But the rises for stocks are off the back of an “incredibly welcome” US ISM manufacturing report yesterday, he adds, with a sharp collapse in manufacturing prices to assuage some inflation fears and increase “hope that Trump’s Presidency will provide the basis for a manufacturing recovery”.
Looking to other economic data ahead, today is the first of a four-day period where US jobs move front and centre for traders, with the JOLTS job openings expected to improve after last month saw the worst reading in over three years.
10.10am: EasyJet higher as blue chips push new five-week highs
The FTSE 100 was up almost 60 points or 0.7% a few minutes ago at above 8,370 for the first time in five week – the highest since the 8,390 levels on 21 October, with the index last seeing 8,400 in August.
Topping the blue-chip leaderboard is easyJet PLC, which looks to be up on the back of updates from rivals Ryanair Holdings PLC (LSE:RYA) and Wizz Air Holdings PLC (AIM:WIZZ).
The Irish budget carrier’s November traffic showed improved growth of 11% in passengers carried, compared to 7.0% and 9.8% growth in October and September.
Analyst Alexander Paterson at Peel Hunt says the 13 million passengers is higher than his forecast of 12.7 million passengers but at a lower load factor.
“We see Ryanair as being more reliant on OTA distribution than it has acknowledged and see natural demand across its network as lower than its peers, which were built more for leisure and business travel. We therefore prefer easyJet and Jet2 amongst the low-cost carriers and IAG from the integrated carriers.”
Similarly, Wizz Air carried more passengers in November despite capacity issues due to problems with the Pratt & Whitney engines that power its fleet.
Wizz said booking has remained healthy in November and into December which has helped yields.
9.57am: NatWest on the hunt for deals
Talking of M&A, NatWest Group PLC (LSE:NWG) is on the “front foot” in looking for more acquisitions, according to its boss.
Paul Thwaite said the lender is looking for “strategically congruent” and “financially compelling” deals to splurge some of its cash pile on.
Ahead of the final government stake being sold, which is expected in the first half of 2025, Thwait told the FT Global Banking Summit this morning that he had “lots of potential uses” for the bank’s excess capital.
He said deals will aim to support growth in existing businesses or “tuck-ins” such as the purchase of Sainsbury’s Bank in June.
9.40am: UK dealmaking down in Q3
There were 436 mergers and acquisitions in the UK in the third quarter of this year, down from 479 in the previous three-month period.
The monthly totals were 179 in July 2024, 130 in August and 127 in September.
Inward M&A, where foreign companies take over UK companies,was £7.8 billion, up from the previous quarter’s £6.7 billion.
Outward M&A also dropped to £4.0 billion from £4.2 billion in the second quarter.
9.20am: DiscoverIE tops the leaderboard
Shares in discoverIE Group PLC (LSE:DSCV) are topping the FTSE 350, up 14.5% as the custom electronics group delivered what CEO Nick Jefferies described as a resilient first-half performance against the backdrop of industry de-stocking.
Operating margins grew to a record 13.8% in the period, putting it well on course for its 15% target.
Jefferies said: “Our flexible operating model allows us to control costs in response to lower production volumes, which along with ongoing efficiency initiatives and accretive acquisitions, has more than offset lower sales.”
Broker Stifel says it was already known that sales were “soft” in the first half but that the second quarter was ahead of the first and orders are picking up, with incremental news since the October update being that margins are strong and ahead of the FY target and that gearing is down to 1.45X, below target.
“We view the fact that DSCV has delivered good margin progress even in weak markets as proof of the group’s operational strengths. It now looks well-placed for recovery, and inexpensive”.
9.09am: Musk pay deal blocked again
Bad news for multi-billionaire Elon Musk last night, as a Delaware judge denied a motion to revise a previous ruling that rescinded the Tesla Inc (NASDAQ:TSLA) boss his 2018 compensation package that would have seen him get another $56 billion.
Tesla stockholder Richard Tornetta successfully sought to block the compensation package through a court action this January
The initial decision to block the compensation package was met with outrage by Musk, who swiftly moved Tesla’s legal headquarters from Delaware to Texas in protest.
9.01am: Upper Crust owner SSP flies higher
More on those results from Upper Crust and Le Grand Comptoir owner SSP Group plc (LSE:SSPG), which have sent the shares flying 12% higher.
Trading was been strong in all regions bar continental Europe, with revenues also well ahead in the first eight weeks of this year to 25 November.
Chief executive Patrick Coveney said action is being taken to improve the performance in Europe, with the UK expected to grow sales and margins despite the additional costs from the tax and wage hikes announced in the recent Budget.
Analysts at Peel Hunt note that underlying PBT of £157 million were below consensus forecasts of £177 million, due to higher depreciation and interest costs.
But the shares, which had been down by almost a third from the start of the year, are reacting to lower debt than expected and a 40% dividend hike that reflects optimism about future cash flows.
8.31am: Retail sales ‘should bounce back strongly’
The fall in UK retail sales shown by the BRC data earlier was likely to be due to Black Friday falling in the December reporting period this year compared to November last year, which “helps explain the sharp drop in non-food sales” says economist Elliott Jordan-Doak at Pantheon Macroeconomics.
“The hangover from the October 30 Budget and Ofgem’s energy price increase in October probably also weighed on spending,” though he notes that the GfK consumer confidence measure increased in November, so Black Friday timing seems to be the main explanation.
Non-food sales could also have been impacted by the weather, he says, with unusually warm temperatures for much of the month deterring consumers from buying warm weather clothing.
“Accordingly, retail sales growth should bounce back strongly in December,” he says, noting that retail sales data are volatile generally but the 3.3% year-on-year fall in retail sales values drags the three-month average down to -0.2%, which is well below the paltry average of 0.4% from the first half of the year.
Jordan-Doak says he expects retail sales growth to “continue gradually improving as real incomes gain ground and the MPC cuts interest rates”.
8.12am: FTSE flies to positive start
The FTSE 100 is striding higher in initial trading, gaining 31 points or 0.4% to 8,344.
Housebuilders are providing a boost, rebounding from the falls yesterday on reports of a new tax, while miners and banks are also among the risers.
And the FTSE 250 is also up 0.4% to 20,847, led by airports retail specialist SSP Group plc (LSE:SSPG), up 10% on the back of full-year results.
Marston’s is up 4% on the back of its annual results.
7.59am: Retail sales hit by later Black Friday
The UK retail sector saw sales fall 3.3% last month, the first decline in the yearly growth measure since June, according to the British Retail Consortium.
This was mainly because of a later Black Friday this year, having been in the November reporting period last year.
Like-for-like sales shrank 3.4% year-over-year, below the consensus forecast for a 0.6% drop.
The later Black Friday period led to non-food sales decreasing 3.3% in the month of November and online non-food sales tumbling 10.3%, while over the three months to November non-food sales fell 2.1%.
Food sales increased 2.4% over three-month period but was in growth in the month.
7.43am: Marston’s serves up strong results
Marston’s PLC (LSE:MARS) has also unveiled something cool this morning, if you like big improvements in profits that is.
The pub company has reported a £42.1 million underlying pre-tax profit for the year to 28 September, a 64.5% increase on the year before.
Revenues of £898.6 million were up 3% on the year before, with like-for-like sales up 4.8% to outpace the broader market as both food and drink sales bubbled higher.
Investors and analysts in pub companies have been fretting over the reaction to the Autumn Budget, but Marston’s said it “puts some additional pressure on costs, but the overall package of measures is considered manageable” in the context of the strategic targets it set at its capital markets day in October…read more
7.24am: Jaguar unveils ‘pretty cool’ new EV
Jaguar has unveiled its new electric car – and as one younger colleague says, “I honestly think it’s pretty cool”.
The Jaguar Type 00 will be an electric four‑door GT – to be revealed in late 2025 and built in the UK.
The British carmaker, owned by India’s Tata Motors, says the launch of the recaptures its original ethos to “copy nothing” and is “a fearless statement. An object of desire. A concept with bold forms and exuberant proportions to inspire future Jaguars.”
What do you think?
Potential buyers have two colours, dubbed Miami Pink and London Blue, with the model using dedicated Jaguar electric architecture (JEA) and targeting a range of over 430 miles.
7.16am: FTSE to extend gains
The FTSE 100 looks set to extend its gains on Tuesday following a mixed session overnight for US stocks as the White House announced new restrictions on China’s semiconductor sector.
London’s blue-chip index has been called 10 points higher on the futures market, following a solid start to the week where it added almost 26 points or 0.3% to reach 8,312.9.
On Wall Street, the S&P 500 and Nasdaq Composite both hit new highs, rising 0.2% and 1% respectively, while the Dow Jones fell 0.3% and the Russell 2000 was just below flat.
Asian markets are all in green this morning, led by Japan’s Nikkei, up 1.9%, while the Hang Seng and Shanghai Composite are both up around 0.4%.
5am: What to look out for on Tuesday
Marston’s will be among those to report on Tuesday, while retail sales figures for November from the British Retail Consortium will also be in focus.
The Budget’s impact on pubs will once again be in focus when Marston’s updates… Read more
Announcements due:
Interims: Altitude Group PLC, DiscoverIE Group PLC, Mind Gym PLC, Personal Assets Trust PLC, Sysgroup PLC, Vianet Group PLC, Ondo InsurTech PLC
Finals: Gooch & Housego PLC, Greencore Group PLC, Oxford Metrics PLC, On the Beach Group PLC, Paragon Banking Group PLC, SSP Group plc (LSE:SSPG), Marston’s PLC
US earnings: Salesforce Inc
AGMs: Brand Architekts Group PLC, Cordel Group PLC, CQS New City High Yield Fund Ltd, PRS REIT, Rosslyn Data Technologies PLC, Schroder Oriental Income Fund, The Revel Collective PLC, Tungsten West PLC
Economic announcements: BRC Retail Sales (UK)