FTSE 100 Live: Energy price cap jumps 80%, key Federal Reserve speech due

A 80% jump in Ofgem’s energy price cap today lifted the typical annual household bill to £3,549 from 1 October.

The cap impacts around 24 million households and will remain in place until 31 December, when it is likely to be revised higher amid surging wholesale costs.

In the fight against inflation, US Federal Reserve Jerome Powell is due to give a potentially market-moving address later at the Jackson Hole economic policy symposium in Wyoming.

Read more on the Ofgem price cap

FTSE 100 Live Friday

  • Markets focused on Federal Reserve speech

  • German consumer confidence hits record low

  • Royal Mail shares rise on stake speculation

British Honey Company warns of revenue dip

11:58 , Simon Hunt

Honey and spirits maker The British Honey Company today warned of fall in revenues as “substantial” cost of living increases hits customer purchasing power.

It said that end-of-year results were now likely to “fall below” previous market expectations and that the business now expected to deliver revenues of “approximately £6 million”.

The Buckinghamshire firm told investors it was “experiencing more challenging conditions in the second half of the year, exacerbated by substantial domestic cost of living increases and international geo-political instability as the war in Ukraine continues, inflating raw materials costs and adding to supply-chain issues.”

Shares in BHC were suspended from the alternative trading platform Aquis last month after it said it needed additional time to complete the audit of its full year results.

The business is now expected to be accepted back as it seeks to deliver last year’s financial results next month.

read more here

News of £5.1bn takeover sees Micro Focus shares skyrocket 90%

11:28 , Simon Hunt

Shares in British tech company Micro Focus almost doubled this morning after it agreed a £5.1 billion takeover from Canada’s OpenText.

They were up most than 90% at 512.40p — just under the 532p offer price — in early trading following news of the deal announced late last night.

The Newbury industrial software provider becomes the latest large British company to go under the hammer as the weak pound is attracting suitors.

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Blow for Musk as US judge scorns demand for Twitter user data

11:00 , Simon Hunt

Elon Musk has suffered a setback in his legal battle with Twitter after his demands that the firm hand over user data was dismissed by a judge as “absurdly broad”.

“No one in their right mind has ever tried to undertake such an effort,” Chancellor Kathaleen McCormick said in a Delaware court.

Musk walked away from his Twitter takeover offer after accusing the company of understating the number of fake accounts on its platform. Twitter has denied this.

Musk’s argument got a boost this week after the US securities regulator wrote to Twitter’s CEO, Parag Agrawal, requesting details on its methodology for estimating the number of fake accounts.

Royal Mail shares higher, FTSE 100 holds firm

10:25 , Graeme Evans

Royal Mail shares have risen 2.5%, up 6.4p to 272.5p, on the first day of industrial action involving 115,000 workers.

The increase has been driven by speculation around the 22% stake held by Czech billionaire Daniel Kretinsky’s Vesa Equity Investment.

Shares also rose 4.5p yesterday as Royal Mail said it had been told by business secretary Kwasi Kwarteng that he ‘reasonably suspects’ that Vesa plans to increase its stake, If this happens it would trigger an investigation through the recent National Security Investment Act.

Royal Mail shares have been trading at two-year lows after the company’s recent warning that the fortnight of strike action planned by the Communication Workers Union would leave its UK delivery business “materially loss making” in 2022/23.

The first day of action is taking place today, with other walkouts due on Wednesday and 8 and 9 September. The company has offered an unconditional 2% pay increase backdated to 1 April, with a further 3.5% increase subject to a series of business changes.

Much of the company’s stock market value is tied up in the profitable European parcel delivery operation GLS, which is likely to be the focus of Kretinsky’s interest.

Royal Mail shares were among the factors helping the FTSE 250 index to improve 88.46 points to 19,346.33 today.

London’s top flight gained 19.13 points to 7498.87, with investors seeing value in GSK and its former consumer healthcare division Haleon after their recent Zantac-driven losses. Shares rose 15.6p to 1406p and 5.6p to 269.2p respectively.

Copper’s latest price rise meant mining stocks were higher, led by Chile’s Antofagasta following a rise of 22.5p to 1189.5p. The metal has surged by about 15% from its low in mid-July, helping Anglo American up by another 42p to 2961.5p today.

Miners boost FTSE 100, Micro Focus jumps 92%

08:43 , Graeme Evans

Copper’s latest price rise meant mining stocks were at the forefront of an improved session for London’s FTSE 100 index today.

The metal has surged by about 15% from its low in mid-July, aiding the valuation of Chile’s mining giant Antofagasta. Its shares rose 23.5p to 1,190.5p, while Rio Tinto and Anglo American were also higher by 2% today.

The FTSE 100 index lifted 0.6% or 42.92 points to 7522.66, with GSK and former consumer healthcare division Haleon also on the risers board. Fallers included London Stock Exchange, which dropped 98p to 8312p.

The FTSE 250 stood 105.96 points higher at 19,363.83 as investors got their first chance to react to the planned takeover of former blue-chip stock Micro Focus International.

Shares in the enterprise software provider jumped 92% after its board recommended an offer from US-based information management business OpenText at 532p a share or £1.8 billion. The stock, which was above 720p prior to the pandemic, jumped 247p to 514.8p.

German consumer sentiment at record low

08:01 , Graeme Evans

Germany’s latest consumer sentiment reading has fallen to a new record low as Europe’s energy crisis takes its toll.

GfK’s figure of minus 36.5 was much worse than expected and compared with minus 30.9 the previous month.

The gauge relating to buying appetite fell 1.2 points to minus 15.7, the lowest since October 2008 as households focus on dealing with surging energy bills.

Powell speech in focus, FTSE 100 higher

07:45 , Graeme Evans

A potentially market-moving address by Federal Reserve chairman Jerome Powell will today provide guidance on how the central bank intends to get inflation back under control.

Powell’s comments, which will be made to the Jackson Hole economic policy symposium in Wyoming at about 3pm UK time, are likely to dash any hopes that the Fed is ready to slacken its stance on tackling price pressures.

The hawkish message will point to interest rates staying higher for longer and suggest that a “neutral” level is far from the 2.5% seen by some on Wall Street in recent weeks.

Michael Hewson, chief market analyst at CMC Markets, said the Fed will want to be sure that inflation is falling at a sustainable enough pace before it signals any sort of dovish shift or pivot, especially if inflation turns out to be stickier than expected.

He added: “If inflation finds a base at a level which is still well above their 2% target it’s extremely unlikely the Fed will lean into any sort of guidance that suggests a rate cut is coming.”

Ahead of Powell’s address, CMC expects the FTSE 100 index to 23 points higher at 7,502 after a broadly flat session yesterday.

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