- FTSE 100 climbs 60 points to 8298
- Prudential tops leaderboard on buyback announcement
- Insulation group SIG warns on profits
4.02pm: FTSE 100 to close higher
London's blue chips are set to continue on from last week's strong finish after the FTSE 100 surged this afternoon.
Both US and European markets have appeared to of shrugged off some of the investor concerns, with the Dow Jones up 1%, the European-focused Stoxx600 up 0.85% and France's Cac 40 up 1.2%.
Over the past few weeks, worries on both sides of the Atlantic have grown but for different reasons. In Europe, the fears have been largely tied to political uncertainty on the back of Macron's snap election. In the US, concerns are largely geared towards interest rates taking longer than expected to be reduced.
"Just as worries about poor market breadth hit the mainstream, breadth begins to recover," said Chris Beauchamp at IG.
"Despite a lack of news today it seems that investors remain content to buy the dip.”
In London, the biggest movers today were Prudential (+7%), Antofagasta (+3.75%) and Frasers (+3.25%).
3.44pm: Commodities and currencies today
While the FTSE 100 looks to close out the first day of the week nearly 0.75% higher, here's a look at how commodities and currencies have done today.
- Bitcoin/USD: -3% at $61,257
- GDP/USD: +0.5% at $1.26
- GDP/EUR: flat at €1.18
- EURO/USD: +0.5% at $1.07
- Brent Crude: +0.5% at $85.65
- WTI Crude: +0.6% at $81.21
- Gold: +0.6% at $2,332
- Silver: +0.9% at $29.65
3.20pm: L&G price target cut by Deutsche Bank
While Prudential continues to lead the FTSE 100 risers today with a 7% jump, analysts aren't as confident about other financial groups.
Legal & General Group PLC (LSE:LGEN) has had a lower price target repeated by analysts at Deutsche Bank, seemingly for those who might have missed it the first time.
Deutsche first cut is target to 275p from 300p on 18Th June, due to a reduction in total EPS forecasts by 6% across 2024-2026.
Dividend forecasts for 2025 were also reduced by 3% and 6% in 2026 to reflect the insurer’s new dividend growth guidance.
The new price also reflects a valuation cut to some of the assets within the corporate investments unit, said the bank.
The FTSE 100 continues a strong start to the week up, up around 65 points to 8303.
2.35pm: US stocks open flat
Wall Street has opened flat on Monda, with all three of the main indexes failing to register moves of more than 0.2%.
Despite the indexes remaining subdued, several stocks have started the week making significant moves, including Nvidia, which dropped 2% after becoming the world's largest company last week.
Budweiser and Bud Light owner AB InBev opened nearly 2.5% higher after it was upgraded by UBS to a 'buy' from 'neutral'.
Medical device developer ResMed fell close to 8% after reports that Eli Lily's weight loss drug reduced the severity of obstructive sleep apnea, posing a threat to the group's products.
Ferrari (NYSE:RACE) started the day close to 1.5% higher as it continued to benefit from the announcement of a new production factory and the pricing of its upcoming EV model.
2.15pm: Barclays to cut mortgage rates
Barclays is cutting rates on several mortgage offerings, opening the door for other lenders to follow suit.
Starting tomorrow, some of the bank's new deals include:
Two-year fixed deal with 90% LTV and no product fee at 5.48% from 5.76%
Two-year fixed deal with 60% LTV and no product fee at 4.88% from 5.13%
Five-year fixed deal with 90% and a £999 product fee at 4.85& from 4.90%
Riz Malik at R3 Mortgages said: "Barclays is the first lender of the week to improve selected mortgage products but my suspicion is that it won't be the last."
Meanwhile, Simon Bridgland at Release Freedom thinks these "sizzling hot" deals will be echoed by rival banks.
"Things look set to heat up not just in our skies but in mortgage rates, too. Expect more lower fixed rates to continue to appear in the days ahead," he said.
1.58pm: Shein bosses meet with Labour business secretary
Bosses at Shein, the Chinese fast-fashion giant, have met with shadow business secretary Jonathan Reynolds to discuss details about its potential listing in London.
The Labour Co-op MP said that if Britain wants to allow new companies into the country then “we should seek to regulate them in the UK”.
He claimed that regulating them here would allow the highest standards to be enforced, pointing out that London-listed businesses have a "pretty extensive set of compliance standards applied to them”.
Current business secretary Kemi Badenoch has avoided meeting with the clothing group as she holds concerns about its ability to avoid customs duties and the reports of slave labour in Xinxiang.
Shein, if it does list, would be the UK's largest-ever IPO, if based on its £52 billion valuation last year.
12.58pm: Mixed open for US stocks
Wall Street is heading for a mixed start, futures markets are indicating, with a 2% premarket falls for Nvidia weighing on expectations for the Nasdaq.
Nasdaq 100 futures are down 0.1%, while those for the S&P 500 are flat and the Dow Jones and Russell 2000 are both pointing to a 0.3% gain.
After Nvidia became the largest company in the world last Tuesday and then opened over 3% higher on Thursday, from this peak it fell around 10% by Friday's close.
The chip colossus is a key stock to watch today, says Deutsche Bank strategist Jim Reid.
"Is this a brief hiccup, or the start of some air being let out of the ballon? Interestingly our very prescient equity strategists have put out a note over the weekend arguing for a breather in US markets partly due to stretched positioning and a buy back black-out starting next week ahead of Q2 earnings."
There is some US macro data today, the Dallas Fed manufacturing activity survey, while Federal Reserve officials Waller and Daly both speak.
Later in the week we have US consumer confidence index, new home sales, retail inventories, durable goods orders, initial jobless claims and on Friday the Fed's preferred inflation gauge, the PCE index, plus personal income and spending data.
12.14pm: Barclays suggests Britvic price for Carlsberg
Barclays says the Britvic Carlsberg deal "lacks fizz" for the Copenhagen company.
"Whilst our analysis suggests the deal does have financial merits we are conscious of execution difficulties around integrating beer and soft drinks companies, as shown by similar deals historically."
They think a valuation "between 1,300-1,350p would be more attractive", with the second offer of 1,250p on Friday representing 13.1 timesEBITDA multiple, "which is above recent precedent transactions".
11.56am: THG 'heading in right direction'
On the THG trading update and Frasers partnership, Liberum analyst Wayne Brown said "things continue to head in the right direction".
And he concludes: "The bears will call out lack of detail in the update today, but this is an AGM update and full details due at the time of the interims."
11.46am: Hedge fund Muddy Waters takes short in Eurofins
A big faller in Europe this morning is Eurofins, which was down over 24% earlier after US hedge fund Muddy Waters revealed a short position in the Paris-listed product testing group.
In a social media post, Muddy Waters said it was short because Eurofins "seems optimized for malfeasance" and accused its controlling shareholder of being "parasitic".
The hedge fund, known to UK investors for its battle with Burford Capital, criticised Eurofins' cash accounting and said its capex was also "highly questionable".
11.12am: Whoever wins election 'will inherit a challenging economic environment'
On that CBI industrial trends survey, Ben Jones, the CBI's economist, says: "We’ve seen a stop-start recovery in manufacturing output in recent months, with higher activity over the last quarter concentrated in a relatively small number of manufacturing sub-sectors.
"But it’s encouraging to see that manufacturers remain confident the economy is heading in the right direction and our June survey suggests that the recovery should broaden out over the summer.
"One note of caution is that order books remain soft. The sharp deterioration in export order books is particularly striking and is something to keep an eye on in the coming months."
He says whoever wins next's week's general election "will be inheriting a challenging economic environment".
11.08am: CBI manufacturing survey
The UK manufacturing sector showed an improvement in the latest CBI Industrial Trends Survey, with a reading of -18 for June, an improvement from the previous -33, also better than the estimated value of -26.
Manufacturing output volumes were "broadly unchanged" in the three months to June, after rising for the first time in a year and a half in the quarter to May.
Output is expected to rise modestly in the three months to September, the survey found.
Total order books improved in May, even though there was a sharp deterioration in export order volumes.
On inflation, expectations for selling price inflation picked up, with prices expected to rise at an above-average pace over the three months to September, after having softened in the May survey after a pick-up earlier in the year.
10.27am: If a company called London can't list in London...
Another setback for London's IPO scene, this time from a company with London in its actual name.
The London Tunnels PLC, the company developing a new tourist attraction based on the largely unknown and unused subterranean network of Second World War walkways under the capital's streets, has opted to list on Euronext Amsterdam rather than the stock exchange with which it shares a key word.
In an update, it said it will raise £30 million, valuing it at £130 million.
Back in January, having raised £10 million in pre-IPO funding, the startup said it was looking to list in the Square Mile at a £123 million valuation.
10.16am: Carlsberg has 'no track record of significant M&A'
Local press says Carlsberg is preparing an improved, third bid for Britvic, despite the negative share price reaction on Friday, of 9%, though this followed the shares rising to a new high on Thursday.
Today the FTSE 250 drinks group's shares have hit a new all-time high of 1,214p, which is still below the 1,250p per share offer price from Friday.
Here's the thoughts of UBS analyst Sanjeet Aujla on the impact for Carslberg: "On the positive side, we think a potential deal could; 1) unlock significant synergies, particularly in the UK, where Carlsberg remains subscale; 2) diversify the portfolio; 3) deliver cross-selling opportunities.
"On the negative side, we note: 1) Carlsberg has no track record of significant M&A integration; 2) higher leverage means no buybacks for the foreseeable future; 3) the higher multiple Asia exposure would be diluted; and 4) Britvic is not topline growth accretive."
Carlsberg said it "will only proceed with a transaction that is strategically and financially attractive."
10am: Britvic up as Carlsberg shows commitment to deal
London's blue-chips and mid-caps are getting into their stride, it seems, both up 0.5% this morning so far.
Top of the FTSE 350 risers is Britvic PLC (LSE:BVIC), up 7.6%, after it turned down a bid from Danish beer giant Carlsberg last week but with new developments today.
The latest bid was at 1,250p per share, a 29% premium to the 19 June closing price.
Carlsberg's new attempt to help it acquire the British drinks company is to get its bottler Pepsico to waive a change of control clause in its contract.
“This waiver will come into effect should an acquisition of Britvic by Carlsberg, which has the recommendation of Britvic's board, proceed to completion,” said the statement.
On Friday, Britvic revealed Danish brewer Carlsberg had made two bid approaches this month with the latest one priced at 1,250p per share or a 20% premium to the market price.
Britvic's board said that the offer, and the earlier one of 1,200p a share, both significantly undervalued the business.
The shares are in demand as the market waits for the bid situation involving Carlsberg to play out, say analysts.
“This is a demonstration of Carlsberg’s commitment to the deal and, given the commercial attractiveness of this bottling contract, could give it the leeway necessary to come back with a more generous offer after being rejected twice so far,” says Russ Mould at AJ Bell.
9.46am: EU China talks on EVs
China has agreed to negotiate with the EU on the increased tariffs on electric vehicles following discussions between China's commerce minister, Wang Wentao, and EU trade commissioner Valdis Dombrovskis.
The decision emerged during a visit to Beijing by Germany’s vice-chancellor, Robert Habeck, aimed at easing tensions.
The EU's decision to impose tariffs up to 48% on Chinese EVs is under review after last year's anti-subsidy investigation. Habeck welcomed the talks but emphasised the need for further steps, according to various media.
9.36am: Wages fall for first time in seven months
Some encouraging news on the jobs market for Bank of England watchers, in the latest Adzuna jobs report.
UK monthly salary figures fell 0.1% month-on-month in May, down for the first time since October 2023, despite the recent introduction of the National Living Wage. Versus last year, salaries were up 2.7%.
The jobs market remained flat in terms of job vacancies, on a month-on-month basis, though annual vacancies continued to decline, down 18.7% on the same time last year.
On salaries, Adzuna said the slightly month-on-month weakness "could help relieve some of the tightness in the UK labour market, [but] may also suggest increasing vacancies for entry or junior-level roles with lower salaries".
Meanwhile the FTSE 100 is now going well, with the FTSE 250 also up, both ahead 0.4% so far.
8.58am: FTSE breaks into the green
The FTSE 100 has climbed into positive territory, up almost 16 points or 0.2%, in line with gains on the continent.
What's helped the London equity benchmark is that commodities stocks have reversed or pared earlier losses, with oil heavyweights Shell and BP now in green, while miners share price losses have been reduced.
"Oil has pulled back from its most recent high, but has edged up slightly and is still trading above $85 dollars a barrel," says Susannah Streeter at HL.
"Price momentum lost some steam amid concerns about the effects of higher interest rates lingering for longer, given how strong business activity is in the US."
However, concerns about supply continue to swirl, she says, with heavy rains having led to a temporary shutdown of a key oil pipeline and wells in Ecuador, affecting exports of Napo heavy crude deliveries.
"The potential for an escalation of violence in the Middle East and the ongoing conflict in Ukraine, with Zelensky’s forces attacking Russian oil refineries, is also keeping a floor on prices."
8.38am: Apple probed in EU
European Union regulators have opened an investigation into Apple Inc (NASDAQ:AAPL) for stifling competition, saying its App Store rules breach the bloc's Digital Markets Act (DMA), preventing app developers from freely steering consumers to alternative offers.
The European Commission, the executive arm of the EU, said today that it is investigating the Silicon Valley giant's new contractual requirements for third-party app developers and app stores.
Thierry Breton, the EU internal market commissioner, said: “Apple’s new slogan should be ‘act different’. Today we take further steps to ensure Apple complies with the DMA rules.”
If companies are found guilty under the rules they can face a penalty of up to 10% of global annual revenue, potentially rising to 20% if the offence is repeated.
8.33am: FTSE cuts losses but European stocks in green
The Footsie has continued to cut its losses, now down by just single figures, though other major European indices are all higher.
While the London index is down 0.1%, Germany's DAX and France's CAC 40 are up 0.2%, while Spain's IBEX 35 is up 0.3% and Italy's FTSE MIB up 0.4%.
In London, behind Prudential on the leaderboard is a group of retailers, led by Burberry, often a proxy for China, as are miners, which are all in the red, so that's confusing.
Further down there are a lot of consumer facing names, JD Sports, Primark owner AB Foods, Coca-Cola HBC, Frasers and cigarette makers British American Tobacco and Imperial Brands.
"There may be increasing signs of a pause for reflection," says Richard Hunter, head of markets at Interactive Investor, which he puts down to investors considering the disproportionate effect of technology shares on market performance this year, in particular Nvidia, which last week briefly became the US market’s largest company by value after a 155% rise this year alone.
Data at the end of last week showed that around 60% of the S&P 500’s total return this year has come from just five stocks – Nvidia, Microsoft, Meta Platforms, Alphabet and Amazon.
"Drilling deeper, there could also be an element of smaller cap stocks now being in bargain territory having been left behind in the mega cap tech surge, although it remains to be seen whether a rotation out of tech into more traditional value stocks will follow," says Hunter.
Looking around global markets, Hunter notes that with Japan is a focus of investor attention, where the weakness of the yen remains a concern to the central bank there, "with further intervention a possibility, while at the same time the potential of strengthening inflation raises the possibility of a further interest rate hike".
"Even so, the Nikkei index has fared well so far this year, with a rise of 16% driven by a resurgence of interest in the country in tandem with a rotation out of Chinese stocks, as well as the weakness of the yen which has provided something of a boost to its exporters," he says.
8.10am: FTSE opens sharply lower
The FTSE 100 has lurched lower at the open, with miners and commodities giants weighing down the index.
In early trading, the blue-chip benchmark dropped over 50 points but has already cut that back to a 37-point decline to 8235.
The six largest stocks in the index are all in the red, while the biggest fallers include miners Anglo American PLC (LSE:AAL), Antofagasta PLC (LSE:ANTO), Rio Tinto Ltd (LSE:RIO, ASX:RIO, OTC:RTNTF) and Fresnillo PLC (LSE:FRES).
Bond-sensitive stocks are also lower, including insurer Phoenix Group (LSE:PHNX) and water companies.
However, top riser is Prudential PLC (LSE:PRU), up 4.6% after it announced a $2 billion share-repurchase programme, beginning with a $700 million tranche.
Outside the blue-chips, SIG is down 16% after its profit warning.
8.01am: SIG profit warning
SIG PLC (LSE:SHI), the insulation manufacturer, has issued what looks like a profit warning, with market conditions said to have "remained challenging".
Like-for-like sales are down 7% on last year, which is behind expectations, and it expects this year to see operating profit in the range of £20-30 million, the midpoint of which is well below consensus expectations of £40 million.
It cites softness in its French, German and UK interiors businesses, which together represent over half total revenue based on last year.
7.35am: Frasers buys Coggles from THG, agrees logistics partnership
Mike Ashley's Frasers Group PLC (LSE:FRAS) has struck a multi-year partnership with online shopping group THG PLC (LSE:THG) including purchasing the Coggles.com clothing website from the online shopping group.
Frasers said the partnership "will mutually enhance retail operations at both groups", with the Frasers Plus loyalty scheme integrated into THG's Ingenuity platform.
Frasers said it will benefit from THG's courier management services to "drive the efficiency and performance of Frasers' Australian fulfilment and logistics operations, supporting the group's international expansion".
In a separate pre-AGM trading statement, THG reported the second quarter of the year has seen "further progress" in line with previous revenue guidance, with a third consecutive quarter of year-on-year revenue growth.
However, growth for its beauty division and Ingenuity platform was offset by a decline in online nutrition sales, as well as FX headwinds in Asia.
Full-year guidance is unchanged.
7.24am: Any weakness in Big Tech 'means end of the party'
The tone for today is being set by a "moody trading session" across Europe and the US on Friday, says market analysts Ipek Ozkardeskaya of Swissquote Bank.
"One of the most significant moves of last two trading days of the US was a 10% selloff in Nvidia sales for … no reason other than the fact that it was the end of the month, the end of the quarter and the end of H1," she says.
Investors preferred taking profits while they repositioned for the second half of the year rather than buying more Nvidia shares at peak levels, and at "a very high valuation with little certainty regarding how to value a stock that’s price-to-projected sales hit the highest of the S&P 500."
"But still, Nvidia is expected to deliver around $28 billion in the Q2, more than double the same time last year, while Microsoft is expected to announce 15% sales and Apple just 3%.
"It’s just that, no one really knows at this point, if Nvidia deserves a higher price tag."
"And the problem with that is, because the US Big Tech stocks led by Nvidia were responsible for most of this year’s rally in major US indices – because the S&P500’s equal weight index remained far behind the normal weighted index since at least a month, any weakness in the US tech rally could mean the end of the party for the major US indices."
7.15am: Stumbling start for FTSE 100 expected
The FTSE 100 is anticipated to open lower on Monday, ahead of the last week in June, which is due to start slowly but build to a busier finish.
On spread-betting platforms, London's blue-chip index has been called down 10 points, having finished last week on a low note, losing close to 35 points to close at 8,237.72, but gaining almost 91 points or rising 1.1% over the whole week.
Wall Street finished last week with a mixed day, as profit taking hit Nvidia, while this morning Asian stock markets are also mixed.
The week ahead is a quiet one from a macroeconomic data perspective until the UK gross domestic product (GDP) update on Friday, which could be seized upon by political parties ahead of the general election the following week.
US GDP is also due on Thursday, a day ahead of the release of the core PCE price index, the Federal Reserve's preferred inflation gauge at the end of the week.
Analysts at Danske Bank said to watch the German Ifo business sentiment index and a string of ECB speeches throughout the day, with European politics the centre of attention this week ahead of the first round of the French parliamentary elections.
In company news things pick up from midweek, with Thursday, as often the case, the busiest day.