- FTSE 100 flat at to 8179
- UK GDP rises 0.7% in Q1, more than expected
- JD Sports trips lower over Nike sales warning
3.56pm: FTSE 100 to close flat
The FTSE 100 is on track to close out the week down 0.6% in the last full week before the election.
Today, the blue-chip index held flat, despite a boost by GDP coming in stronger-than-expected for the first quarter.
UK gross domestic product (GDP) rose 0.7% in the first three months of the year, figures from the Office for National Statistics showed, stronger than the 0.6% first estimate and up from a 0.3% decline at the end of last year.
Meanwhile, the sports clothing retailer JD Sports led the fallers after dropping more than 4% off the back of a weak earnings report by Nike.
As newer brands such as Roger Federer’s On and France’s Hoka look to steal market share, Nike said it expects a mid-single-digit percentage drop in the current financial year.
However, analyst Jonathan Pritchard at Peel Hunt said there are a number of things to consider from JD’s perspective.
"Although Nike is clearly not in form right now, [JD] maintains strong relationships with brands that are currently successful (On Running, New Balance, HOKA), and the allocation of space ebbs and flows.”
Outside of the FTSE 100, workers experienced a stressful morning on payday when several leading banks experienced outages, with customers unable to send payments or access online banking.
The issue appears to be fixed now, with Barclays, HSBC, Virgin Money and Nationwide all having been affected.
3.42pm: Currencies and commodities today
As the FTSE 100 moves towards the close, here's a look at how commodities and currencies have performed today:
- Bitcoin/USD: -1% at $60,953
- GDP/USD: -0.15% at $1.262
- GDP/EUR: flat at €1.1801
- EURO/USD: flat at $1.069
- Brent Crude: flat at $86.34
- WTI Crude: -0.65% at $81.21
- Gold: flat at $2,325
- Silver: +0.85% at $29.27
3.22pm: Bank payment problems fixed
Pay.uk, the body which oversees Britain's retail payments, has revealed the technical issue which prevented bank users from being able to send payments and receive their monthly salaries has been fixed.
A spokesperson said: "We are aware that a small number of faster payments were delayed or not processed earlier today.
"Working with our infrastructure provider, this technical issue has been fixed. We are now seeing payments return to normal."
Barclays issued a tweet, telling users payments were back up and running after around a day of disruption.
is now resolved! With that being said, any payments that you have tried to make should now go through for you so please keep an eye out on your account for these to be reflected. If you do need any further help then we are here 24/7 for you. - Devid ????♂️ 2/2
— Barclays UK Help (@BarclaysUKHelp) June 28, 2024
3.02pm: Man Utd owners face big bill
Manchester United owners the Glazer family are facing a potential bill running into hundreds of millions of dollars after a court judgement affecting all NFL team owners.
A California jury ruled that the National Football League (NFL) violated antitrust laws, ordering it to pay $4.7 billion in damages to customers who purchased its Sunday Ticket package for live games via satellite television.
This decision, stemming from a federal class-action lawsuit in Los Angeles, could significantly impact the distribution of sports rights.
The Glazers, who recently sold a 25% stake in the premier league club to Ineos billionaire and Labour Party supporter Jim Ratcliffe, own 100% of Florida-based franchise the Tampa Bay Buccaneers, one of the 32 American Football teams affected by the ruling.
2.36pm: Wall Street starts flat
US markets have opened mostly flat after key inflation data came in line with estimates, raising hopes for an earlier rate cut this year.
Only the S&P 500 registered a significant rise at the start of trading, with the index jumping by close to 0.2%.
The personal consumption expenditures index (PCE), an important gauge of inflation in the eyes of the Federal Reserve, slowed from 2.7% to 2.6% in May, taking it to the lowest level since February 2021.
Core PCE, which outstrips volatile food and energy prices, also dropped to 2.6% from 2.8%, the lowest point seen since March 2021.
"If we’re right, the Fed should be confident enough by its meeting in September that core PCE inflation is heading sustainably back to 2% that it can start to ease," said Ian Shepherdson at Pantheon Macroeconomics.
1.57pm: Cazoo app and website to return
Cazoo, the secondhand car site which fell into administration in May, is closing in on restoring its app and website after the brand was bought by a rival.
Motors, the fellow secondhand care selling platform, said it purchased the brand and is planning on re-launching a new app and website for it.
Cazoo's collapse came after a drastic round of restructuring which resulted in hundreds of job losses.
Some 700 workers had their roles cut since May, as the company, which at one point commanded a £5 billion valuation, struggled financially.
Barry Judge, the chief executive of Motors, said: “Despite its challenges as a business, Cazoo has undoubtedly become a household name with car buyers.”
1.39pm: Wall Street to open higher after presidential debate
Wall Street is on track to open higher today as the market reacts to Trump and Biden's first presidential debate.
"Last night’s Presidential debate was a disaster for the incumbent Joe Biden," said David Morrison at Trade Nation
"All the chatter in Democratic circles is focused on how to go about replacing him, while most other accounts acknowledge that Donald Trump acquitted himself quite well."
Back in the UK, Biden is now odds-on to stand down before the election, with betting firm Willliam Hill pricing his departure before the vote at 10/11.
“It is odds-on for Biden to stand down at 10/11, in order to give his party a last hope to save their chances of keeping Trump out of the Oval Office," a William Hill spokesperson said.
Meanwhile, in company news, Nike is on track to shed close to 15% of its value after it warned that its 2025 full-year revenues would be lower than expected amid a downturn in demand.
As newer brands such as Roger Federer’s On and France’s Hoka look to steal market share, Nike said it expects a mid-single-digit percentage drop in the current financial year.
1.20pm: More on banking outages
Some of the outages plaguing HSBC users have been resolved, however, payment issues are still affecting the lender - an issue felt across multiple banking groups.
A spokesperson for HSBC said: "There is a separate issue impacting payments across several banks. Customers sending payments online, by app or on the phone may see a slow response or see a failure notice.
"We advise them to please check with the recipient or view their recent transactions in the mobile app via the notifications icon before attempting to the send the payment again."
Nationwide similarly said: "We are aware of a third-party payments issue impacting some providers, including Nationwide.
"This has unfortunately delayed a small number of payments, which we expect will be processed and paid later today."
1.00pm: Barclays and Virgin Money also hit by issues
More customers of leading high street banks have been suffering issues with sending payments and accessing online banking.
Both Barclays and Virgin Money customers have been unable to process payments.
Virgin Money said it resolved the pay situation but was still facing issues with accessing online banking.
The issue is now resolved and new payments are flowing normally. We’re working through the backlog of payments delayed as quickly as possible and apologise for the inconvenience. Thanks for your patience while we work through it.
— Virgin Money (@VirginMoney) June 28, 2024
Update - we’re also aware of some intermittent issues with accessing online banking and our app, which we’re working to resolve as quickly as possible. Thanks for your patience while we restore the service. https://t.co/mAVnTRWh3b
— Virgin Money (@VirginMoney) June 28, 2024
Hello there,
Thank you for your message, I hope you're doing ok this morning.
So sorry to hear you've been caught up in the issue with regards to the payments being made and received. This is an issue with the faster payment system and it's happening across all banks. 1/3
— Barclays UK Help (@BarclaysUKHelp) June 28, 2024
12.37pm: JD Sports still holding lower after Nike's results
JD Sports shares are continuing to hold lower today as it received a negative read-across from Nike's results yesterday.
Shares are down close to 5%, the largest drop out of FTSE 100 constituents today.
Meanwhile, in the US, Nike is down around 15%.
Analysts at GlobalData believe certain brands are hindering its performance.
"As well as it being increasingly impacted by macroeconomic challenges, its performance is also being significantly marred by Converse, which declined 18.1% during the quarter, as its footwear proposition remains out of touch with modern designs and silhouettes, driving consumers to turn to other trending brands such as Adidas," said Alice Price at the data and analytics company.
"Nike is preparing to batten down the hatches in FY2024/25, now predicting sales in H1 to be down high-single digits before improving marginally in the second half of the year, with the business forecasting full year revenue to be down mid-single digits."
12.10pm: K-pop agents charged with insider trading over BTS break
Employees linked to HYBE, the agency behind K-pop group behind BTS, have been charged with insider trading after they sold shares in the company before the hit group announced they would be taking a break.
Earlier this month, BTS said it would be taking a temporary hiatus, which resulted in HYBE shares sinking by as much as 25%, causing £1.1 billion to be wiped from the company's valuation.
Prosecutors in South Korea claimed the employees were aware of BTS's planned announcement and therefore sold shares to avoid losses of between US$24,000 to US$108,000.
Fans speculated the reason for the break was due to South Korea's mandatory military service, with all able-bodied men required to enlist for 18 months before the age of 28.
Six of the members are currently serving their mandatory service and are not expected to reunite until this time next year.
11.44am: Nationwide also suffers outage
And it's not just HSBC users having trouble.
Nationwide customers are reporting that they haven't recieved salaries or pension payments, with the building society having said it is looking into the issue.
Hi Lucie, we are aware there is a delay with some customers receiving their salary or pension payments today. These payments are being processed, and will be paid into your account today. Sorry for any inconvenience this is causing. If (cont) https://t.co/IpyTkoyhoK
— Nationwide (@AskNationwide) June 28, 2024
Like the troubles at HSBC, it is not confirmed whether the outage is an internal issue or a result of a cyberattack.
11.24am: HSBC users locked out of online banking on payday
HSBC users were left unable to access their bank accounts on payday this morning after the lender suffered an outage on its mobile banking app.
Some 7,000 reports of outages were made on Downdetector, leading to HSBC issuing a statement, apologising for the issue, promising to have it back up and running soon.
We’re really sorry that some customers are having issues accessing personal online and mobile banking. Our IT teams are working hard to get these services back to normal. You can still authorise online card purchases via SMS.
— HSBC UK (@HSBC_UK) June 28, 2024
However, customers weren't happy with the speed of the response.
"The fact it took an hour of issues to write such a general tweet is ridiculous,” said one Twitter/X user. Another questioned why the consumer-facing operating systems were so poorly built.
HSBC suffered a similar issue back on Black Friday last year, when users again were unable to access banking services, with purchases unable to be authorised through the app.
Staff at the group continue to search for a fix and it is unconfirmed whether the outage is a result of a cyberattack.
11.03am: Port Talbot to close before Unite can strike
Tata Steel has brought forward the closure date of Port Talbot to the day before workers were set to strike.
Port Talbot’s steelworks will shut on July 7 instead of in September, with the new end date being the day before Unite members were set to walk out.
While the first blast furnace at the site was scheduled to shut later this month, it is the second furnace’s closure which has been sped up, and is expected to result in 2,800 immediate job losses.
Labour had urged Tata to avoid closing the site early, asking it to wait till after the election, promising fresh rounds of negotiations should the party be put into power.
10.42am: Tough day for AIM
While the FTSE 100 attempts to finish the week in the green, in the world of small caps its not looking as rosy.
For AIM-listed MusicMagpie, the CD and tech recycler, shares dropped more than 18% to a new low as it posted lower interim revenues and warned business generally was tough.
Steve Oliver, chief executive, said that the market for second-use technology had become more competitive and the market has “undoubtedly been challenging”.
Meanwhile, Tasty PLC (AIM:TAST), the owner of restaurant chains Dim T and Wildwoods, saw its shares fall more than 6% after its losses widened and it was forced to undergo a restructuring plan.
Post-tax losses swung from £6.4 million in 2022 to £14.5 million in 2023, prompting the AIM-listed hospitality group to launch a restructuring process.
Under the plans, Tasty will close 19 loss-making stores, renegotiate seven existing leases and make redundancies.
In a final blow to the small-cap market, bar operator Nightcap confirmed it would be cancelling its listing on the exchange due to poor valuation and the fact it is more effective raising funds as a private company.
Gareth Edwards, chair at Nightcap said: "The Board believes that Nightcap's current public market valuation does not reflect the underlying potential of our business or our achievements to date and that this is unlikely to change in the short-to-medium term."
10.17am: Ooh la la
French stocks are again bottom of the pile around European markets.
While the FTSE 100 is up 0.4% and Germaby's DAX 0.5%, the CAC 40 in Paris is down 0.44%.
Italy's FTSE MIB and Spain's IBEX 35 are up 0.36% and 0.25%, while the Euro Stoxx 600 has risen 0.19%.
Traders "continue to fear the worst" ahead of a French election that has already sparked a relative rise in French borrowing costs, says Joshua Mahony at Scope Markets.
The first round of voting begins on Sunday, with the latest opinion poll from this morning showing the far-right National Rally winning 37% of the popular vote.
This was published in the Les Echos newspaper, with a rise in the vote share for NR and Emmanuel Macron's party in third place behind the left-wing coalition.
"With Sunday’s election expected to whittle down the field down to just two parties, Macron’s roll of the dice could backfire spectacularly given the fact that the polls put his party in at third place," says Mahony.
"Should we see next Sunday’s election provide a run-off between the Far-Right and Far-Left, traders will have plenty to mull over in the coming week."
This morning there was a round of eurozone inflation data, with lower-than-expected French CPI at 2.1% and Italian CPI at 0.8%, offset off by a lofty 3.4% Spanish figure.
"This disparity highlights the difficult job faced by the ECB who need to set policy that is appropriate for both ends of the spectrum," says Mahony.
10am: Property transitions
Residential property transactions in May increased for the fifth consecutive month, figures from HMRC show.
The provisional seasonally adjusted estimate of the number of UK residential transactions in May was 2% up on April and 17% higher year on year at 91,290.
Numbers of UK non-residential transactions were 10,130, 1% up on the month and 6% on last year.
9.32am: More comments on the GDP figures
"It’s the tiniest sliver of improvement but when it comes to UK GDP growth, every little really does help," says Danni Hewson, AJ Bell's head of financial analysis.
"Figures had already confirmed that the country had plodded out of recession at the start of 2024, now the ONS has confirmed that plod had a little more pace.
"It matters, especially as the nation weighs up what it wants from the next government. Growth has been front and centre of party manifestos, even if they differ on the details of how that growth can be achieved."
On the other hand, Neil Wilson at Finalto says while GDP was revised up, "it makes little difference if you cannot afford groceries, pay the rent, get a mortgage etc etc.
"Voters go to the polls next week and the only question is over the size of Labour’s majority. This will matter to markets though – it will only really become clear once they start changing things. I don’t think anyone really appreciates how radical they could be."
8.10am: GDP good news for next PM, may give BoE pause for thought
Let's hear what economists are saying about UK first-quarter GDP, which was revised up to 0.7% quarter-on-quarter from the previous estimate of 0.6%.
Peter Arnold, UK chief economist at EY, says revisions to the expenditure components saw support from consumption and the net trade increase, though this was partly offset by more downbeat assessments of business investment and government consumption.
A 0.4% rise in consumer spending was supported by continued strong growth in real household disposable income, which increased 0.7% for the second consecutive quarter, he notes, which meant that the household saving ratio rose to 11.1% from an already-high 10.2% at the end of 2023.
"Looking ahead, the EY ITEM Club expects GDP to grow at a decent pace in Q2", he Arnold says, but "probably a bit softer".
Further ahead, he says: "Provided rising consumer confidence results in households gradually moving away from the cautious sentiment exhibited over the last year, the EY ITEM Club thinks there is a prospect of a decent consumer-led recovery."
Paul Dales at Capital Economics says the upward revision to GDP growth points to good news who whoever is Prime Minister this time next week.
He adds: "It now looks as though real household disposable income will grow by more than our forecast of 2.0% this year and we are expecting a solid 3.5% gain next year too. This underpins our forecast that consumer spending will be the main driver of a rise in GDP of at least 1.0% this year and about 1.5% next year."
"Should the saving rate fall back from its unusually high level, the economic recovery could be even stronger. This is certainly good news for whoever will be the Prime Minister this time next week, although it could also contribute to the Bank of England cutting interest rates a bit slower than otherwise."
Rob Wood at Pantheon Macroeconomics points out that growth now exceeds the 0.6% assumption in the May forecasts from the Bank of England's monetary policy committee.
"The MPC said in the minutes of their June Policy meeting that they would cut interest rates even with strong growth in H1 2024 because they expect the economy to slow to a more manageable 0.2% quarter-to-quarter pace in the second half of the year.
"Even so, growth even further above potential in H1 2024 may give the MPC some pause for thought, and supports our call that rate-setters will wait until September before cutting Bank Rate for the first time."
8.47am: Morning so far
The FTSE 100 has lifted by close to 32 points after UK GDP grew quicker than expected in the first quarter of the year.
Providing some positive news for Sunak ahead of the election, it was revealed today the country’s economy grew at its fastest pace since 2021, according to ONS’s revised figures.
In company news, fashion retailer JD Sports has fallen at the open as it suffered a negative read across from a poor update from Nike last night.
Nike shares dropped by close to 13% in premarket trading after it warned that its 2025 revenues would be lower than expected amid a downturn in demand and a rise in competition from newer brands.
Meanwhile, Keywords Studios said investment firm EQT Group has tabled an increased 2,450p per share offer, valuing it at £2 billion, which the board is minded to recommend.
In the small caps, bar operator Nightcap confirmed it would be cancelling its AIM listing due to poor liquidity and weak valuations.
8.20am: JD Sports hit by Nike warning
FTSE 100-listed sportswear retailer JD Sports Fashion PLC's (LSE:JD.) shares are down 6% Nike earnings overnight.
The US trainer giants pointed to a negative revision for its new year outlook as it also reported lower than expected sales for its fiscal fourth quarter.
“While we are encouraged by our progress, our fourth quarter results highlighted challenges that have led us to update our fiscal 2025 outlook,” Nike CEO Matthew Friend commented.
The company did not provide details of its revised outlook in its earnings statement released shortly after Thursday's closing bell, though it said demand for its footwear was weak as consumers are tempted by newer brands.
Rival Adidas has also been winning fans with its 'terrace fashion' trainers.
8.09am: FTSE 100 off to a stonking start
The FTSE 100 has kicked off in fine style, rising 54 points to 8,234 in opening trades, up 0.66%.
All of the top 40 blue-chips are flashing green, apart from SSE, and that's down only 0.01%.
Top of the list are Intertek and 3i Group, both up 1.8%, NatWest up 1.6%, Rolls-Royce up 1.3% and Shell up 1.2%.
JD Sports is the only notable faller, down 6%.
7.55am: Takeover updates for Tyman (LSE:TYMN) and Keywords
Lock maker Tyman (LSE:TYMN) has agreed a tweak to its takeover by US peer Quanex Building Products Corp.
In April the London listed company shook hands on a 400p deal, valuing it at £788 million.
Today, it said shareholders will also receive a special interim dividend of 15p, though it is conditional upon takeover being approved.
If the takeover scheme is not sanctioned, no special dividend will be paid.
Elsewhere, Keywords Studios PLC said investment firm EQT Group has tabled an increased 2,450p per share offer, valuing it at £2 billion, which the board is minded to recommend.
This updated offer follows a revised possible cash offer of 2,430p per share from EQT earlier in the week.
To finalise transaction documentation, the "put up or shut up" date (deadline for making a formal bid) has been extended to 5pm on July 3.
7.33am: More ONS numbers
There's more from the ONS than just GDP today, in what it calls National Accounts day.
Contributing to the top-line GDP number, there was an increase of 0.4% in real household expenditure in the first quarter, revised up from the first estimate increase of 0.2%. This follows declines in the previous two quarters.
Largest contributions to the growth were from recreation and culture; housing; and food and non-alcoholic drinks.
Business investment is estimated to have increased by 0.5% in the quarter, revised down from 0.9%, building on the 1.4% increase at the end of last year. Year on year, business investment fell 1.0%.
Balance of payments data from the statistical body shows the underlying UK current account deficit narrowed to £23.8 billion, around 3.5 % of GDP, in the quarter, down from £26.3 billion or 3.9% of GDP the preceding period.
The UK current account deficit, when trade in precious metals is included, narrowed to £21.0 billion, or 3.1% of GDP, though a smaller deficit of £17.7 billion was expected.
7.16am: FTSE 100 seen higher as GDP reading improves
The FTSE 100 is being tipped to end the week on a higher note, boosted by stronger-than-expected UK economic growth figures.
Spread-betters have called the London benchmark up 27 points, after the index fell almost 46 to 8,179.68 by the close.
UK gross domestic product (GDP) rose 0.7% in the first three months of the year, figures from the Office for National Statistics showed, stronger than the 0.6% first estimate and up from a 0.3% decline at the end of last year.
On a year-on-year basis GDP was up 0.3%, also beating the consensus forecast of 0.2%.
In output terms, services grew by 0.8% on the quarter with widespread growth across the sector, ONS said, while the production sector grew by 0.6% and the construction sector fell by 0.6%.
Back to markets, and Wall Street stock indices grew modestly overnight, with the S&P 500 inching up 0.1% to a new all-time high.
This followed a US GDP reading, which showed growth was 1.3% in Q1, down from the 1.4% expected.
Asian stocks are mostly higher this morning.