- Blue chips up 35 points
- Vodafone-Three merger hits roadblock
- Gold at record high
4.04pm: FTSE 100 to close in good spirits
The FTSE 100 index took a latter-day swing higher to bring the premier index up 35 points to 8,276 in the final stretch.
Large-cap mining stocks supported the strong end-of-day performance, particularly Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF), which rallied a bumper 10% on the back of record gold prices.
Fresnillo added nearly 7% today, while DS Smith PLC (LSE:SMDS), JD Sports Fashion PLC (LSE:JD.) and Entain PLC (LSE:ENT) were also among the biggest risers.
Supermarket stocks dragged on the index, with J Sainsbury PLC (LSE:SBRY) off 2.5%, Tesco PLC (LSE:TSCO) off 0.8% and Marks & Spencer Group plc off 0.3%.
3.50pm: Endeavour rallies over 10% as gold prices surge to record high
FTSE 100-listed miner Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) shot up over 10% on Friday after gold prices reached a record high.
At 1,826p per share, the big-cap miner is a breath away from year-to-date highs of 1,853.
It comes as the price of gold continues to climb, with an ounce of the precious element hitting an all-time high of $2,579 (£2,038)
Endeavour stock is also benefiting from this morning’s announcement that it has entered commercial production at both the Sabodala-Massawa BIOX Expansion in Senegal and the Lafigué mine in Côte d'Ivoire.
The projects, which were completed on budget and on schedule, represent key milestones in the company’s growth strategy. The commercial production threshold was passed in August, it noted.
3.15pm: easyJet joins Ryanair in calling for air traffic resignations
easyJet Group PLC has echoed calls from Ryanair Holdings PLC (LSE:RYA) for the chief executive of the UK’s air traffic controller to resign following repeated disruptions in recent years.
Chief executive John Lundgren wrote to National Air Traffic Services (Nats) this week to call for Martin Rolfe’s resignation after staff shortages hit Gatwick flights most recently.
At least 100 flights were cancelled last weekend as a result of the Nats shortages, including dozens operated by easyJet.
easyJet had been forced to cut its schedule from Gatwick in the summer of 2023 too due to air traffic staffing issues, with a fault in its system also affecting thousands of flights across the country over last year’s August bank holiday.
Lundgren argued Rolfe had been downplaying Nats’ problems in the letter, which was cited by the Financial Times, however, and accused him of giving “misleading information”.
“I am deeply concerned by the ongoing failure of the chief executive [Rolfe] to recognise the scale of the problem and to communicate honestly about it,” Lundgren said.
This follows calls from Ryanair boss Michael O’Leary for Rolfe to quit over the repeated issues, which he dubbed a “long line of cock-ups” earlier this week.
Nats chair Warren East has subsequently backed Rolfe openly, noting his team had “done everything they can to address the issues”.
2.52am: Warner leads big-cap risers
Tech stocks swung higher this morning, with the Nasdaq 100 penning a 0.2% gain to 19,442 in opening trades.
The Dow Jones Industrial Average is also looking well bid, adding 0.3% to 41,211, while the broader S&P 500 is also up around 0.3% to 5,611.
Warner Bros Discovery Inc (NASDAQ:WBD, ETR:J5A) is one of the biggest risers among the large caps, having rallied nearly 4% following the opening bell.
It follows an announcement that Charter Communications will start Charter Communications, the largest cable operator by subscribers in the US, will start providing Warner’s Max streaming service at no extra cost.
Oracle Corp (NYSE:ORCL, ETR:ORC), Uber Technologies Inc (NYSE:UBER, ETR:UT8) and Etsy Inc (NASDAQ:ETSY, ETR:3E2) are also among the biggest risers.
Adobe Inc (NASDAQ:ADBE) opened 9% lower after weak revenue guidance overshadowed a record fiscal third quarter.
Back in London, the FTSE 100 has hit an intraday high, surging 40 points higher to 8,281.
2.17pm: Go big or go small? US interest rates are no closed book
Consensus has it that the US Federal Reserve will without a shadow of a doubt lower the bank rate for the first time since July 2023 when policymakers convene next Wednesday.
Of course, nothing is set in stone, but with inflation well down, that is the logical step.
One thing that isn’t set in stone is by how much will the Fed dare cut?
While a generic, palatable, middle-of-the-road 25-basis-point cut is the likely outcome, the odds of a heftier 50-basis-point cut are not zero.
The stakes are high- cutting too much risks inflation returning; not cutting enough risks the US economy steering headfirst into a recession.
Softer-than-expected jobs data emerging from the has served to increase the odds of a bigger cut, but hawks are still abound among the Fed decision makers, meaning there is no obvious outcome.
Fawad Razaqzada, market analyst at forex trading platform StoneX, had this to say: “It is indeed a slowing jobs market that has caused the Fed to pivot.
“You would think that after the hotter inflation data that the implied probability of a 50-bps cut would have dropped to zero.
“In fact, it did fall close to zero, but it has since bounced back to around 45%, and we are back to square one.
“This implies that there is an equally split chances of a 25bp or 50bp cut next week.
As a result, we have seen dollar weaken across the board, and gold has hit a new all-time high.”
1.28pm: Wall Street, tech stocks to open in the green following bullish Thursday
US technology stocks are expected to hold onto yesterday’s percentage point of gains when Friday trading commences, with futures contracts on the Nasdaq 100 pointing to a flat opening at 19,440.
The Dow Jones Industrial Average is up 0.15% to 41,173 in the pre market, while the broader S&P 500 is up 0.2% to 5,610.
Stocks rebounded on Thursday afternoon as investors assessed new inflation and labor data, with growing anticipation of a quarter-point interest rate cut by the Federal Reserve next week.
On today’s macroeconomic calendar, yearly import prices for August are expected to show the sixth straight month of increases and export prices the fourth.
1.09pm: National Grid ESO sale: Will public ownership fix the energy system?
“How successful the new public body is in tackling grid constraints and prioritising is set to determine any benefits to consumers as a result,” writes Proactive’s Josh Lamb in an explainer of the government’s takeover of the electricity system operating (ESO) mechanism.
“Such responsibility being taken on by the government would appear to make sense for the energy firm then, leaving National Grid as the owner of large swathes of Britain’s grid but not having to bear the burden of running it on a day-to-day basis.”
Read the full report
12.42pm: Phoenix Group preview: Risk transfer bonanza
FTSE 100-listed life insurance and pensions firm Phoenix Group Holdings PLC (LSE:PHNX) reports half-year results next Monday amid no sign of the boom in bulk annuity activity easing off.
Last week, Phoenix subsidiary Standard Life pulled off another deal when it bought WH Smith’s pension scheme for £85 million.
These buyouts, in which an insurer takes on a company’s pension liabilities, have become a big money spinner on both sides of the transaction.
Paying a company to take on the risk suggests the insurer sees substantial value in the invested assets within these pension portfolios.
These deals are likely to influence Phoenix’s future earnings forecasts.
Shares were up by a percentage point this Friday.
12.17pm: Footsie recovers
The FTSE 100 index has spurred into action following an unremarkable morning session.
It is currently up 25 points 8,265, driven by a rally on mining stocks.
Fresnillo PLC (LSE:FRES) is up 5.9% and Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) 5.8% following a new record high notched up for the price of gold.
11.59am: Bitcoin struggles to reclaim $60,000
Benchmark cryptocurrency bitcoin (BTC) has been trending below the $60,000 resistance point for close to three weeks, suggesting a degree of sell-side pressure in the cryptocurrency markets.
However, the world’s largest cryptocurrency, which rallied to an all-time high earlier this year in March, has been relatively well bid in the past week.
The BTC/USD pair added 3.8% over the past seven days and is currently swapping for $58,329.
As seen with gold’s record price, bitcoin has benefitted from a weaker dollar due to the prospect of a faster-than-expected softening of interest rates from the US Federal Reserve.
This is in response to macroeconomic data suggesting the the US economy is beginning to falter, leading to greater pressure from the Fed to stimulate the economy through rate cuts.
Credit – tradingview.com
11.37am: Tesco’s market share will keep rising, reckons Citi
Citi analysts expect to see Britain’s largest supermarket Tesco PLC (LSE:TSCO) increase its market share when it reports its first-half results next month.
Analysts are forecasting a 3.8% rise in like-for-like sales, representing a steady acceleration from the 3.4% of growth seen in the first half of 2023.
According to recent Kantar data, Tesco increased its leading position in the supermarket space by 5.3% to 27.8% in the September quarter.
Tesco’s closest competitor J Sainsbury PLC (LSE:SBRY) added 5.7% to claim 15.2% of market share.
Citi raised its target price on Tesco shares to 425p from 350p and maintained a buy rating. Shares fell 0.4% to 367.5p on Friday, although Sainbury’s was bid lower with a 2.3% dip.
The broader FTSE 100 index is currently treading 21 points higher at 8,262.
11.10am: Flutter’s Brazil acquisition a ‘sensible move’
Paddy Power-owner Flutter Entertainment PLC (LSE:FLTR)’s $350 million acquisition of a controlling stake in Brazilian gaming company NSX Group ticks to boxes for brokerage Shore Capital Markets.
“We see this as a sensible move, further expanding and accelerating its growth profile, consistent with its expansion profile and medium-term leverage ratios,” said Shore Cap analysts.
They noted that the deal is likely to limit underlying earnings growth outside of the US in the year ahead, though the deal is “not a surprise” given the rapid pace of growth of Brazil’s newly regulated gaming market.
Regardless of the benefits, Shore Cap reckons the move is already priced into Flutter’s shares, so it has left a hold rating on the stock for now.
Markets appeared ambivalent to the acquisition, with Flutter shares moving 0.8% lower on Friday morning.
10.42am: AstraZeneca falls
AstraZeneca saw £4 billion wiped off its share value as top city firm Deutsche Bank cut its recommendation to ‘sell’ following the latest update on lung cancer drug datopotamab.
Currently 2.6% lower from yesterday's close, it makes Astrazeneca the worst-performing FTSE 100 constituent today.
Deutsche Bank said it had already reduced its expectations for the drug, but the recent update on biomarker data confirmed its fears and raised new ones.
Dato is not the only important pipeline prospect for AZN, Deutsche Bank said, but “it is a key building block of the HSD H2’20s revenue guide and now looks in question”.
“We think a difficult December Adcom/PDUFA coupled with downside risk into FY25 guidance and ‘25s key catalysts being H2’25 skewed means risk-reward has now become outright challenging on a 6-12 month view”.
The bank added that its forecasts are materially below mid-term consensus and company guidance, something that is not reflected in the current valuation (19 times FY25 P/E).
9.36am: Vodafone-Three merger just needs ‘some small tweaks’
Matt Britzman, senior equity analyst at Hargreaves Lansdown, has downplayed the severity of the competition watchdog’s concerns over the Vodafone-Three merger.
An investigation by the Competition and Markets Authority concluded that the merger could result in higher prices or reduced services for tens of millions of mobile customers.
The regulator found that customers might have to pay more for improvements in network quality that they do not necessarily value.
Britzman stated: “This is part and parcel with trying to get a big merger over the line.
“None of the concerns raised suggest a major overhaul of the proposal needs to take place, just some smaller tweaks round the edges should get the job done.”
Vodafone shares were up 0.3% in morning trades.
9.20am: The morning so far
The FTSE 100 remained flat at 8,238 in the first hour of Friday’s trading session.
There was little of note to move the dial on London’s blue-chip index, with the macroeconomic calendar largely barren barring an industrial production print from the eurozone later this morning.
Mining stocks led the risers after gold prices hit a record high of US$2,568 (£1,957) per ounce.
Fresnillo PLC (LSE:FRES) is up 3.3%, Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) is up 2.9% and Glencore PLC (LSE:GLEN) and Antofagasta plc around a percentage point each.
AstraZeneca PLC (LSE:AZN) is the biggest faller at 2.1%.
Gold has hit a record high as the US dollar starts to move lower on heightened expectations of an interest rate cut from the US Federal Reserve.
On the company news front, Britain’s competition watchdog has raised concerns about Vodafone Group PLC (LSE:VOD)'s planned merger with Three.
An investigation by the Competition and Markets Authority concluded that the merger could result in higher prices or reduced services for tens of millions of mobile customers.
The regulator found that customers might have to pay more for improvements in network quality that they do not necessarily value.
Additionally, the merger could negatively impact wholesale telecoms customers, including Lyca Mobile, Sky Mobile and Lebara, which depend on major networks to provide mobile services.
Paddy Power owner Flutter Entertainment has acquired a 56% stake in NSX Group, a leading Brazilian betting operator known for its Betnacional brand.
8.38am: Government buys National Grid’s ESO for £630mln
The UK government has bought National Grid's Electricity System Operator (ESO) for £630 million, marking the creation of an independent National Energy System Operator (NESO)”.
NESO’s primary role is to balance the supply and demand of electricity in real time to ensure that homes and businesses receive a reliable and continuous power supply.
The new organisation will take charge of managing the flow of electricity and gas to homes and businesses, working to integrate increasing amounts of renewable energy into the system.
John Pettigrew, chief executive of National Grid, said: “We look forward to working together with NESO to continue to drive the UK’s energy transition forward at pace; accelerating the decarbonisation of the energy system for the digital, electrified economies of the future.”
NESO chair Paul Golby called it “a pivotal moment as we head closer to the launch of the National Energy System Operator on 1 October”.
He added: “NESO will support a more integrated and coordinated strategy to meet the unprecedented challenges of climate change, ensuring security of energy supply and keeping bills as low as possible.
“NESO brings together critical roles and responsibilities under one roof, creating an environment that is essential for success.
“We will have a broad strategic oversight of both the electricity and gas systems, managing system planning, market operations, and ensuring that our energy infrastructure is secure, resilient, flexible, and future-proof.”
8.25am: FTSE 100 gains
The FTSE 100 pushed 13 points higher to 8,253 in opening trades this Friday.
Miners including Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF), Fresnillo PLC (LSE:FRES) and Glencore PLC (LSE:GLEN) led the risers after gold hit an all-time high of US$2,568 (£1,957) per ounce.
8.10am: Gold at record high
Mining stocks have pulled ahead after gold prices hit a record high of US$2,568 (£1,957) per ounce.
Fresnillo PLC (LSE:FRES) is up 2.5%, Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF) is up 2.1%, Glencore PLC (LSE:GLEN) 1.4% and Antofagasta plc 1.3%.
Gold’s record price comes as the US dollar starts to move lower on heightened expectations of an interest rate cut from the US Federal Reserve.
This follows a spate of macroeconomic data suggesting the US economy is beginning to sufficiently cool off enough to justify an easing of monetary policy.
7.47am: Flutter acquires Brazil’s Betnacional
Paddy Power owner Flutter Entertainment has acquired a 56% stake in NSX Group, a leading Brazilian betting operator known for its Betnacional brand.
The acquisition was valued at approximately $350 million.
By combining NSX with its existing Betfair Brazil business, Flutter is set to become a major player in the Brazilian sports betting and iGaming market.
Brazil, which is scheduled to regulate its online sports betting market fully in 2025, is seen as a high-growth region, particularly in the football department.
NSX entered the market in 2021 and has become the fourth-largest operator in Brazil with a market share of 12% in sports betting and 9% in the total online market.
Flutter boss Peter Jackson said: "I am excited to announce the addition of NSX, operator of Betnacional a leading Brazilian sports betting and iGaming brand, to the Flutter portfolio.
“We believe that combining the extensive local expertise of the NSX team, our existing Betfair business and the power of the Flutter Edge, will create a compelling opportunity to capitalise on the growth opportunity in Brazil which presents an exciting runway of future growth."
7.30am: CMA raises concerns over Vodafone-Three merger
Britain’s competition watchdog has raised concerns about Vodafone's planned merger with Three.
An investigation by the Competition and Markets Authority concluded that the merger could result in higher prices or reduced services for tens of millions of mobile customers.
The regulator found that customers might have to pay more for improvements in network quality that they do not necessarily value.
Additionally, the merger could negatively impact wholesale telecoms customers, including Lyca Mobile, Sky Mobile and Lebara, which depend on major networks to provide mobile services.
A reduction in the number of network operators from four to three would make it harder for these customers to secure competitive terms, said the CMA.
Stuart McIntosh, chair of the inquiry group leading the investigation, said: “We’ve taken a thorough, considered approach to investigating this merger, weighing up the investment the companies say they will make in enhancing network quality and boosting 5G connectivity against the significant costs to customers and rival virtual networks.
“We will now consider how Vodafone and Three might address our concerns about the likely impact of the merger on retail and wholesale customers while securing the potential longer-term benefits of the merger, including by guaranteeing future network investments.”
In response, Vodafone said the merger “is a once-in-a-generation opportunity to transform UK digital infrastructure with £11bn of investment”.
Vodafone boss Margherita Della Valle stated: "Our merger is a catalyst for change.
“It's time to take off the handbrake on the country's connectivity and build the world-class infrastructure the country deserves. We are offering a self-funded plan to propel economic growth and address the UK's digital divide.
"Great network connectivity is a critical enabler of so many elements of our daily life and is central to the future prospects of so many sectors.
“Businesses large and small are dependent on it and it enables new industries - like AI - to thrive. It facilitates a step change in productivity and care across the public sector, and it lies at the heart of every nation's future prosperity."
7.10am: Footsie to open flat
The FTSE 100 index is expected to open flat today after closing 47 points higher at 8,240 on Thursday.
Blue chips were knocked off their intraday highs in the latter stretch of yesterday’s trading session, but the market remained buoyant thanks to a strong showing from the likes of Fresnillo PLC (LSE:FRES), JD Sports Fashion PLC (LSE:JD.), Sage Group and Diageo PLC (LSE:DGE).
On the company news front, the Competition and Markets Authority has raised concerns over the pending merger of Vodafone and Three, suggesting that the merger “would lead to price increases for tens of millions of mobile customers”.
There are no macroeconomic announcements to move the dial today, barring industrial production figures from the EU later this morning.