The FTSE 100 made a bright start on Thursday, looking to break a four-day losing run, supported by well received earnings.
The advance in London follows weak trading on Wall Street, where pre-US election and interest rate nerves hit stocks.
The FTSE 100 index traded up 55.66 points, 0.7%, at 8,314.30. The FTSE 250 was up 25.76 points, or 0.1%, at 20,855.69, and the AIM All-Share added 1.40 points, 0.2%, at 730.53.
The Cboe UK 100 was up 0.7% at 832.62, the Cboe UK 250 rose 0.2% to 18,428.68, and the Cboe Small Companies was flat at 16,768.08.
The CAC 40 in Paris and Frankfurt’s DAX 40 each added 0.5%.
In New York on Wednesday, the Dow Jones Industrial Average lost 1.0%, the S&P 500 fell 0.9% and the Nasdaq Composite shed 1.6%.
In Tokyo on Thursday, the Nikkei 225 rose 0.1%, but in China, the Shanghai Composite ended 0.7% lower. In Hong Kong, the Hang Seng Index was down 1.3%. Sydney’s S&P/ASX 200 lost 0.1%.
The dollar surrendered some ground early Thursday. The pound was quoted at $1.2960 early Thursday, up from $1.2938 late Wednesday afternoon. The euro stood at $1.0788, up from $1.0780. Against the yen, the dollar was trading at JP¥152.24, fading from JP¥152.83.
‘The dollar’s rise has been fuelled by hard selling in US Treasuries, particularly at the long end, with the 10-year yield climbing from 3.6% in mid-September to over 4.2% now. This uptick in the yield curve signals market optimism about ’US exceptionalism’, especially when compared to the ECB’s back-to-back rate cuts, BoE’s dovish twist, and the aggressive easing from the BoC. Moreover, growing election uncertainties, heightened fiscal deficit concerns, and lower expectations for Fed cuts have made rising Treasury yields the least resistance path. This interest rate support naturally benefits USD bulls,’ Pepperstone analyst Dilin Wu commented.
‘Despite a slight pullback today, the market is poised to take advantage of any dollar weakness, fueled by the belief that Trump’s election would further strengthen its uptrend. With Trump and Harris polling in six or seven battleground states within the margin of error, the ’Trump trade’ hasn’t been fully reflected in the DXY.’
In London, Barclays added 3.2% as it raised its annual outlook and reported a rise in third-quarter earnings.
Total income rose 4.6% to £6.54 billion from £6.26 billion a year prior. Pretax profit surged 18% to £2.32 billion from £1.89 billion. It reported a total income growth in Barclays UK, the Barclays UK Corporate Bank and in the firm’s investment bank.
On the investment bank, it said: ‘Global Markets income increased 3%, with [fixed income, currencies, and commodities] and equities both up 3% respectively. Investment banking income increased 13%, as higher fee income in advisory and debt and equity capital markets was partially offset by lower income in the international corporate bank.’
Total income fell in Barclays Private Bank & Wealth Management and the US Consumer Bank, however.
Looking ahead, it now expects 2024 net interest income, excluding the investment bank and head office, above £11.0 billion. It had previously expected the figure to land at £11.0 billion. Barclays UK net interest income was raised to £6.5 billion from £6.3 billion.
Consumer goods firm Unilever backed its yearly outlook and hailed a ‘fourth consecutive quarter of positive, improved volume growth’. Shares rose 3.4%.
Revenue edged up ever-so-slightly to €15.25 billion in the third-quarter, from €15.24 billion a year prior. Underlying sales perked up 4.5%, the Dove soap and Magnum ice cream owner said. Volumes rose 3.6% and price growth was 0.9%.
‘We have delivered a fourth consecutive quarter of positive, improved volume growth, with each of our business groups driving higher volumes year-on-year,’ Chief Executive Officer Hein Schumacher said.
‘We are taking decisive actions, where we see operational or market challenges to ensure we are well positioned for consistent and improved performance. As part of the group’s overall transformation, we are implementing a comprehensive productivity programme and the separation of Ice Cream, both of which are progressing as planned.’
Unilever still expects full-year underlying sales growth within its 3% to 5% ‘multi-year range’.
boohoo said it is in the process of reviewing the ‘content and validity’ of a request by shareholder Frasers Group for a general meeting. boohoo shares traded 2.3% higher.
Sports Direct owner Frasers said boohoo ‘urgently needs to address the management of its business’. Frasers owns 27% of the online fashion retailer. Frasers is requisitioning a general meeting of boohoo with an aim to add Mike Ashley, the FTSE 100 listing’s own founder and major shareholder, to the boohoo board as chief executive. Frasers also wants to add Mike Lennon, an ‘experienced restructuring professional’ to the boohoo board.
boohoo earlier this month launched a strategic review amid a downturn in sales. It had also agreed a new £222 million debt facility with a consortium of its existing relationship banking group, which Frasers hit out at on Thursday.
‘Frasers’ view is that the terms of the debt refinancing are wholly unsatisfactory. Frasers considers the refinancing to be a step backward for the company and an appalling outcome for shareholder,’ Frasers said. ‘Had boohoo engaged constructively with Frasers on the refinancing, alternative solutions could have been fully explored which may have resulted in a more favourable outcome for all stakeholders.’
boohoo added: ‘The boohoo board is in the process of reviewing the content and validity of the requisitions with its advisers. A further announcement will be made in due course.’
The Frasers announcement comes after the retailer’s proposal to acquire handbags maker Mulberry was rebuffed.
Frasers shares were down 1.8%.
Also on the decline, Travis Perkins fell 5.6% after it cut guidance. The builders’ merchant now expects annual adjusted operating profit of £135 million, its outlook lowered from around £150 million.
‘Overall, the group’s key end markets are stabilising with some very early signs of recovery. Management expects to see positive growth in these underlying markets over the next twelve months, but that this growth will be slow and non-linear at the outset, with the benefit to financial performance starting to be realised in the second half of 2025,’ Travis Perkins explained.
In the third quarter of 2024, revenue fell 5.7% on-year.
Gold rose to $2,735.04 an ounce early Thursday, up from $2,718.02 at the time of the London equities close on Wednesday. Brent oil was quoted at $75.45 a barrel, up from $75.06.
Copyright 2024 Alliance News Ltd. All Rights Reserved.
