London’s FTSE 250 hit a record high, adding to Tuesday’s gains as traders looked forward to life after lockdown while the pound weakened.
The mid-cap market closed at 22,160.57, having gained 166.09 points.
“The FTSE 250 is riding an optimism fuelled wave as the UK gears up for life after lockdown,” said Danni Hewson, financial analyst at AJ Bell.
“The country’s supercharged vaccine rollout coupled with confirmation that the roadmap out of lockdown doesn’t require any last-minute detours just yet is fostering belief that the recovery is sustainable this time. There may be a few speed bumps ahead but at least we’ll take them with neatly groomed hair.”
Shopping centre owner Hammerson topped the FTSE 250 with gains of 2.4p to 37.95p followed not too far behind by Carnival Cruises and pub owner Mitchells & Butlers as investors bet on a return to the ‘old normal’.
Currency traders, however, were shaken as the UK’s medical advisory body said under-30s will be offered an alternative to the AstraZeneca vaccine due to mounting evidence linking it to rare blood clots.
“It appears that while the UK blue chip index, and its mid-cap sibling, enjoy the optimism surrounding the country’s post-Covid comeback, sterling has been saddled with concerns over the vaccine programme,” said Connor Campbell, financial analyst at Spreadex.
Sterling slid to a two-week low against the US dollar, as the Federal Reserve is expected to continue to hold off tightening fiscal policy.
The pound fell 0.51pc against the US dollar to $1.375 and was down 0.6pc against the euro at €1.157. Shares in drugmaker AstraZeneca lost 84p to £70.99 as one of the key drags on the FTSE 100.
Strong economic data helped to push the benchmark FTSE 100 up 61.77 points to 6,885.32. It came as the UK’s services sector rebounded in March while business optimism improved for the fifth month running and was the highest since December 2006.
Among companies, FTSE 100-listed Royal Dutch Shell warned of a $200m hit in adjusted earnings due to storms that blanketed Texas in February, killing more than 100 people, though it still expects to make the first profit from pumping oil since the start of the pandemic.
In the first quarter of 2021, Shell’s upstream unit, which largely handles the exploration and production of oil, captured “the upside from the current commodity price environment”, it said.
Earnings from natural gas, refining and chemicals pushed Shell to an overall profit last year, though its core business reported consistent losses as energy prices plunged due to Covid-19. The return to profit upstream is another signal the industry is recovering from the historic slump. Shares rose 14.8p to £14.40.
Meanwhile Deliveroo made gains on its first day of unrestricted trading. Shares rose 6p to 286p.
Markets Hub embed test
05:02 PM
Wrapping up
That is all from us today - thank you for following along.
Join Simon again in the morning for all the latest business updates - have a good evening!
04:49 PM
Sanne buys US Strait Capital for up to $45m
London-listed asset manager Sanne Group has bought Strait Capital, a US private equity and hedge fund administration firm for up to $45m (£33m).
An upfront consideration of $32m has been agreed, with 30pc payable in Sanne shares and an earn-out component of cash and Sanne shares, based on financial performance up to 31 March 2022, capped at $13m.
It said the buyout gives it "increased scale, capability and client coverage in North America". Strait adds 50 employees, 60 new client groups, over $20bn of assets under administration and a new office in its Texas base.
Separately, Sanne plans to raise £80m via a share placing to continue with its acquisitions.
04:16 PM
FTSE 250 closes at record high
London's mid-cap market closed at a record high of 22,160.57 today, having gained 0.76pc or 166.09 points.
“The FTSE 250 is riding an optimism fuelled wave as the UK gears up for life after lockdown,” said Danni Hewson, financial analyst at AJ Bell.
“Companies as varied as Carnival Cruises, shopping centre owner Hammerson and Upper Crust owners SSP all bounded higher today as investors embraced a new-found confidence that the new normal is out of date.
"The country’s supercharged vaccine rollout coupled with confirmation that the roadmap out of lockdown doesn’t require any last-minute detours just yet is fostering belief that the recovery is sustainable this time. There may be a few speed bumps ahead but at least we’ll take them with neatly groomed hair.”
04:13 PM
US markets waver
Wall Street
Sticking with the US, markets over there are wavering today as investors wait for the minutes of the Fed's latest policy meeting.
Here's how it stands at midday:
S&P 500 hovered near a record, up just 0.05pc.
Dow Jones moved the other way, losing a slight 0.06pc
Tech-heavy Nasdaq was flat, down just 0.01pc.
03:54 PM
Biden to challenge spending plan critics
US President Biden is set to challenge critics of his $2 trillion spending proposal in a speech on Wednesday, according to Reuters.
The news agency said he will attempt to put opponents on the defensive and "challenge critics to explain why it's acceptable that 91 of the biggest corporations paid zero in federal taxes in 2019, or lay out which parts of this package they don't think is worthy," citing an unnamed White House official previewing Mr Biden's remarks.
President Biden faces stiff opposition from Republicans, companies and some of his own party to key elements of the proposal, which needs to be approved by Congress. The speech is set to take place at the Eisenhower Executive Office Building, across from the White House.
Under his plans, the largest share of funding would come from a rise in the corporate tax rate to 28pc, from the 21pc set by former President Trump's 2017 tax bill.
He would also raise taxes on companies' overseas earnings and introduce a new minimum tax on the profits they report to investors.
UK has opportunity to lead world in reopening travel - CBI
Stansted
Britain should use its lead in vaccinations to work out how to reopen international travel and show the rest of the world how it can be done safely and effectively, according to the CBI.
My colleague Tim Wallace reports:
“There is a real opportunity for the UK to lead the world in reopening international travel. You can call it a reopening dividend, a reopening bounce, call it whatever you like. But if we are able to crack this nut safely and effectively, the UK could really lead the world here,” said John Foster at the business group.
He recommends four steps for the Government to take the lead:
“Firstly, a bit of a risk-based approach for reopening international travel. It has to be done in sync with global partners.
“Secondly, we need simple and effective border arrangements to help facilitate those reopening efforts.
“Thirdly, we need consistent comms to help provide reassurance for consumers and businesses.
“Finally, we need a way forward for the UK leadership in reopening global traffic, not just for tourism but for world-leading aerospace and maritime industries.”
This should include information on how countries will be selected for each level of the “traffic light” system, so business travellers, holidaymakers and the travel industry are not taken by surprise with very short-notice changes to the rules.
02:50 PM
Blackrock boss Larry Fink vows to overhaul culture after harassment claims
Larry Fink
BlackRock chief executive Larry Fink has vowed to overhaul the company's culture following a series of harassment claims.
In his annual letter to shareholders, he said: “I know our culture is not perfect,” Fink wrote. “In some cases, certain employees have not upheld BlackRock’s standards. I have made it clear to employees that we want to know when that happens, and those individuals don’t have a place at BlackRock.”
He also said the thing he looks forward to most post-pandemic is meeting with clients again, adding that there’s no substitute for in-person meetings.
“I miss the personal connections and unexpected ideas that come from meeting face-to-face and sharing a meal together,” Fink wrote. “It’s often through a less structured conversation than one can have on a video call that we learn most about each other and experience intangibles, like culture, that are hard to see through a screen.”
02:30 PM
Risk of blood clots is 'extremely low'
The MHRA has stressed that the risk of rare blood clots in vaccinated patients is "extremely low".
Prof. June Raine, from the MHRA, says the risk of the suspected side effect of blood clots in those taking the AZ jab is "extremely low" - "about 4 people in a million who receive the vaccine"
Breaking: Under-30s in UK to be offered alternative jab to AstraZeneca
The UK regulator has taken a different view to its European counterpart and has advised that people under the age of 30 should be offered an alternative Covid vaccine to the AstraZeneca jab because of mounting evidence linking it to rare blood clots.
Shares in AstraZeneca have remained steady following with the announcement and are currently trading 0.7pc lower.
02:09 PM
Breaking: EMA says Oxford jab should still be used for all adults
The European Medicines Agency has said the Oxford-AstraZeneca vaccine should still be used for all adults and blood clots should be listed as a "very rare" side effect of the vaccine.
Scandinavian reliability, green credentials and motorists’ near-insatiable appetite for SUVs are paying off for Volvo, as the Swedish carmaker reported its best-ever quarterly sales.
My colleague Alan Tovey reports:
Once seen as fusty, the company appears to have shaken off its old image and caught up with the times. Volvo sold 185,698 cars worldwide in the three months to March 31, up 40pc on the same period last year.
In March alone, global sales rose more than 60pc year on year to 75,315, partly helped by the rebound from Covid-19 in China, the world’s largest car market.
British consumers are also buying into the brand, with Volvo reporting a 3.28pc market share during the quarter, the highest in 30 years. A decade ago Volvos made up about 1.5pc of the UK market.
The company’s strongest ever showing in the UK was back in 1989, when it made up 3.66pc of British new car sales.
Jim Holder, editorial director at What Car?, said Volvo had become a "classless premium badge when people are getting bored of the same old German marques". "Volvo gives the same quality but in a different way,” he added.
US stocks opened mixed as investors awaited the minutes of the Federal Reserve’s latest policy meeting for clues on the central bank’s views about inflation and the bond-buying programme.
US market data - Bloomberg
01:14 PM
Britons rush back to golf courses as restrictions ease
Golf
Spending surged across Britain’s golf courses last week as pent-up putters rushed back to the fairway.
My colleague Louis Ashworth reports:
In-person spending at courses nearly quadrupled, surging 370pc compared to the previous week as outdoor sports facilities reopened.
Total spend at golfing sites, which includes remote spending, was up 190pc, with some teams hitting the links with glow-in-the-dark balls just minutes after midnight last Monday.
Data from Barclaycard payments showed overall leisure and entertainment spending jumped 136pc, with the return of sanctioned sport after months of restrictions prompting a spending splurge.
Travel and petrol spending rose 7pc over the week, with many people travelling locally for gatherings over the Easter weekend.
But the pandemic appeared to still be having a heavy impact on leisure spending, with the total value of transactions 35pc lower than the same week in 2019.
A one-off wealth tax has been proposed to help pay down nations' Covid debts - Getty Images Contributor
The International Monetary Fund (IMF) has called on governments to consider a widespread wealth tax to tackle their Covid debts.
A tax raid on the richest members of society would “increase the probability of intergenerational mobility” after younger workers suffered the most from Covid-related job losses, the fund said.
Average government debt will hit 99pc of GDP this year as a result of the pandemic, according to the IMF, which said a one-off tax could help narrow national budget deficits.
My colleague Tom Rees reports:
The lender of last resort warned that wealth taxes could be on their way if officials struggle to raise enough revenue as debt piles soar to unprecedented levels globally.
The IMF said countries could consider a “temporary Covid-19 recovery contribution, levied on high incomes or wealth” but economists poured cold water on the practicalities of the controversial idea.
HSBC has already committed to cut 40pc of its office space - Reinhard Krause /Reuters
HSBC will pay 1,200 staff to work permanently from home, according to Reuters.
The call centre employees will be issued with new contracts to reflect the change after around 70pc of the 1,800-strong workforce across the UK volunteered not to return to their offices, the news wire reported.
It comes after the bank moved to slash 40pc of its office space as a result of the pandemic, during which workplaces have emptied out under government advice to avoid the office.
Union Unite said HSBC offered call centre staff a £300 annual cheque to cover higher heating and electricity bills.
An HSBC UK spokesman said: “We are in discussions with contact centre colleagues who serve HSBC UK retail customers about ways that we can offer flexibility on work location while ensuring the way we work meets our customers’ needs. These discussions are continuing.”
11:53 AM
Market update
The FTSE 100 is trading 0.6pc higher after it was boosted by positive economic data.
Meanwhile US futures are pointing to a flat open as investors await details of the Fed's most recent meeting.
European market data - Bloomberg
11:32 AM
This boom could easily run into 2023, says Dimon
Jamie Dimon
JP Morgan boss Jamie Dimon said he’s optimistic the pandemic will end with a US economic rebound that could last at least two years.
In his annual letter to shareholders, he wrote:
“I have little doubt that with excess savings, new stimulus savings, huge deficit spending, more QE, a new potential infrastructure bill, a successful vaccine and euphoria around the end of the pandemic, the U.S. economy will likely boom. This boom could easily run into 2023.”
Dimon also pointed to US consumers, who used stimulus checks to reduce debt to the lowest level in 40 years and stashed them in savings, giving them – like corporations – an “extraordinary” amount of spending power once lockdowns end, Bloomberg reported.
10:50 AM
Tax break extended
Here's a welcome reminder from advisory firm Blick Rothenberg that HMRC has extended a tax break for home workers into the current financial year.
Nimesh Shah, boss of the firm, says that HMRC has confirmed that employed workers can now claim the working from home allowance for the new tax year, where they have worked at home for just one day because of the Coronavirus restrictions.
He adds:
The £6 per week working from home allowance is worth £62 for basic rate (20%) taxpayers; £125 for higher rate (40%) taxpayers and £140 for additional rate (45%) tax payers for the 2021/22 tax year
It comes after HMRC relaxed the rules last year due to the pandemic. The link to apply is here.
10:37 AM
Murdoch sues Flutter in row over US sports betting firm
Texas Rangers
Rupert Murdoch is trying to bulldoze his way into buying a significant stake in America’s market-leading sports bookmaker at a multimillion pound discount, according to the London-listed betting group behind Sky Bet, Paddy Power and Betfair.
My colleague Oliver Gill reports:
The media billionaire’s Fox Corporation last night filed legal action against Flutter Entertainment in row over an 18.6pc stake in sports betting website FanDuel.
Fox has the right to buy the stake in July and wants to pay a similar price to that spent by Flutter on another slice of the company last year. However the American sports betting market has continued to grow at a rapid pace since then and Flutter argues that Fox should pay a “fair market valuation” for part of FanDuel.
Analysts said that Fox was attempting to buy FanDuel for as much as a £1bn discount, and the row could pave the way for a stock market float of the business as the two sides try to judge what it is worth.
The battle stems from Flutter's merger with Stars Group last May to form one of the world’s biggest gambling groups. Fox, which had a joint venture with Stars, was entitled to buy the stake in FanDuel, then majority-owned by Flutter, in July this year.
Responding to the actions of Extinction Rebellion in Canary Wharf this morning, a Barclays spokesperson said:
Extinction Rebellion are entitled to their view on capitalism and climate change, but we would ask that in expressing that view they stop short of behaviour which involves criminal damage to our facilities and puts people’s safety at risk.
We have made a commitment to align our entire financing portfolio to the goals of the Paris Agreement, with specific targets and transparent reporting, on the way to achieving our ambition to be a net zero bank by 2050, and help accelerate the transition to a low-carbon economy.
09:52 AM
Saga soars as bosses say customers desperate to get back cruising
Shares in Saga soared by a tenth after the over-50s insurance and cruise giant hailed "significant pent-up demand" from vaccinated customers to travel again despite posting a heavy slump in profits for the past year.
The company said underlying pre-tax profits plummeted by 84.4pc to £17.1m for the year to January 31.
However, Saga said it is ready to restart its tour operations and cruise business later this year when it is given the green light by Government.
Group chief executive officer Euan Sutherland said the company expects "high levels" of customer retention in its cruise business when restrictions are lifted.
He added: "Looking ahead, while we are mindful of economic headwinds and the potential ongoing impacts of Covid-19, it is clear that there is significant pent-up demand among our customer base, the vast majority of whom have now been vaccinated and are ready to enjoy post-lockdown freedom."
09:20 AM
'Retail investors show more appetite for Deliveroo'
Shares in Deliveroo are currently trading 2.9pc higher for the day. Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown says:
Retail investors don’t appear to have lost their appetite for Deliveroo despite the severe bout of indigestion suffered by the company when institutional investors began trading last week.
And by the end of the day yesterday, shares were down by 28% from the IPO price, but this morning a surge of interest from retail investors, who could buy in for the first time saw the company gain 4% before falling back slightly.
This will be some comfort for Deliveroo customers who were encouraged to buy a slice of the company but appeared to have thrown the dice on a disastrous debut. Like a fateful round of Monopoly they were locked out of selling their shares for a week, while the company’s initial valuation fell sharply. Now they finally have a ‘get out of jail’ card, but it seems for now that many have kept it in their back pocket, waiting it out for prices to stabilise. Total market trading volumes are pretty much unchanged from yesterday.
08:59 AM
Business optimism 'highest since December 2006'
Commenting on the latest data, Tim Moore, economics director at IHS Markit, says:
UK service providers were back in expansion mode in March as confidence in the roadmap for easing lockdown restrictions provided a strong uplift to new orders. Total business activity increased at the fastest rate since August 2020 and this return to growth ended a four-month sequence of decline.
Forward bookings for consumer services and rising optimism about recovery prospects resulted in extra staff hiring across the service economy for the first time since the start of the pandemic. Business optimism improved for the fifth month running in March and was the highest since December 2006.
Around two-thirds of the survey panel forecast an increase in output during the year ahead, which reflected signs of pent up demand and a boost to growth projections from the successful UK vaccine roll-out. Of the small minority citing downbeat expectations in March, this was often linked to uncertainty about international travel restrictions.
There were further signs that strong cost pressures have spilled over from manufacturers to the service economy, especially for imported items. Higher prices paid for raw materials, alongside rising transport costs and utility bills, meant that operating expenses across the service sector.
08:44 AM
Service economy returns to growth in March
Cafe
UK services rebounded in March, with providers reporting an uptick in new orders and employment.
Renewed job creation in March represented the first overall expansion of staffing numbers across the service sector since the start of the pandemic, according to IHS Markit.
At 56.3 in March, up sharply from 49.5 in February, the services sector grew for the first time since October and at the fastest rate since August.
The survey said levels of activity were linked to a recovery in business and consumer spending, while some parts of the service economy commented on a boost from higher residential property transactions during March.
Survey respondents often commented on pent up demand and work on projects, it added.
Grant Thornton says most UK staff want to stay away from office post-pandemic
The City
Nine out of 10 Grant Thornton UK employees want to spend less than half of the working week in the office after the pandemic, according to the accountant’s chief executive David Dunckley.
The desire to stay away from the office is shared across the workforce irrespective of age, gender, ethnicity, or location, Dunckley told the Financial Times.
A survey of its roughly 4,600 UK employees found that 88pc wanted to spend most of their time working from home.
“I thought as lockdown got longer people might be more keen to get back in the office but the percentage has gone up a bit,” Mr Dunckley said.
It comes after PwC announced last week that its staff would spend between two and three days a week in the office as part of a hybrid model.
08:05 AM
Deliveroo shares climb
Deliveroo
Commenting on the rally, Neil Wilson, chief markets analyst at Markets.com, says:
Deliveroo shares edged higher at the start of unrestricted trading as investors shrugged off the stock’s dreadful start to life as a public company. There were fears the 70,000 retail customers who had participated in the float would take the opportunity to offload, but investors are holding the line for the time being.
Having tumbled 26pc on day one, the first day of unrestricted trading saw the stock climb 3pc to £2.88. I’m not sure if this is a vote of confidence or a case of averaging in, but it’s no doubt a big relief to management and the bankers involved that the retail army has not routed at the first sound of gunfire. Given the wipe-out that has already taken place, I think a lot of investors will simply think that it cannot go any lower and it’s worth holding on for a better price.
Cutting losers is harder than letting winners run. It comes as hundreds of Deliveroo riders prepare to strike over pay and conditions. The walkout underlines the regulatory risk attached to the stock and the implied impact any Uber-like ruling could have on margins.
Several activists have been detained after cracking the bank's windows.
Barclays
Barclays
Barclays
07:29 AM
Extinction Rebellion smash windows at Barclays
Barclays
Extinction Rebellion activists have smashed windows at the Canary Wharf headquarters of Barclays.
Seven activists from the group used hammers to break the windows and then pasted the message “In Case of Climate Emergency Break Glass” on the front of the bank’s building.
Extinction Rebellion said the action was part of its so called “Money Rebellion” against the capitalist system which used “nonviolent direct action, causing damage to property to prevent and draw attention to greater damage.”
“It is the latest action in protest at the bank’s continued investments in activities that are directly contributing to the climate and ecological emergency,” the group said.
It comes after the group vandalised the front of the Bank of England last week.
07:25 AM
Ryanair issues gloomy forecast
Ryanair
Ryanair warned it will struggle to make a profit this year as prolonged travel restrictions and a slow vaccine roll-out on the Continent continue to hit its recovery.
Passenger traffic for the fiscal year that started this month will likely fall at the low end of an earlier estimate of between 80 million and 120 million people, the carrier said. Profit is likely to be close to breakeven, despite recent optimism.
The company said: "Easter travel restrictions/lockdowns and a delayed traffic recovery into the peak (summer) season, due to the slow rollout in the EU of Covid-19 vaccines, means that traffic is likely to be towards the lower end of our previously guided range".
It added: "While it is not possible (at this time) to provide meaningful (2021/22) profit guidance, we do not share the recent optimism of certain analysts as we believe that the outcome for (2021/22) is currently close to break-even."
Shares rose 0.5pc in early trading.
07:14 AM
FTSE opens higher
London's blue-chip index has jumped again at the open after the International Monetary Fund upgraded its global growth forecast, with the UK expected to rebound strongly.
Meanwhile Deliveroo has climbed more than 3pc as retail investors begin trading the stock.
European market data - Bloomberg
06:55 AM
British fund CVC eyes $20bn deal for Toshiba
Toshiba is considering a buyout offer from a British private equity fund, it said Wednesday, with reports suggesting the deal could be worth about $20bn (£14.50).
Trading of Toshiba shares was halted on Tokyo's stock exchange at the open, after the Japanese firm confirmed the offer in a statement.
Toshiba said it "received an initial proposal yesterday" by CVC Capital Partners for a buyout.
"We will request detailed information and carefully discuss" the offer, the firm added.
The Nikkei newspaper said CVC was considering a 30pc premium over the Japanese industrial group's current share price, valuing the deal at nearly 2.3 trillion yen ($20.8bn) based on Tuesday's close. Read more here.
06:44 AM
Storms hit Shell - but oil business to turn a profit
Winter storms that wracked Texas will knock $200m off Royal Dutch Shell's earnings, the FTSE 100 giant said this morning - but it still expects to make the first profit from pumping oil since the start of the pandemic.
In the first quarter of 2021, Shell’s upstream unit, which largely handles the exploration and production of oil, captured “the upside from the current commodity price environment", the company said.
While earnings from natural gas, refining and chemicals helped Shell to post an overall profit last year, its core business reported consistent losses as energy prices plunged due to Covid-19. The return to profit upstream is another signal that the industry is recovering from the historic slump.
Performance at the division that refines and markets fuels, which was profitable for most of 2020, improved slightly compared to the fourth quarter, Shell said [via Bloomberg].
06:36 AM
Shell buffeted by storm
Good morning. Oil giant Shell has said that a storm that blanketed Texas in February, killing more than 100 people, cost it around $200m (£145m) in adjusted earnings.
Elsewhere, Deliveroo shares begin unconditional trading today.
Global stocks traded around all-time highs on Wednesday as investors weighed the economic rebound from the pandemic and stimulus support. The dollar halted a four-day loss.
A gauge of Asia-Pacific equities fluctuated, as did US and European futures. Chinese stocks underperformed while Japan advanced. Toshiba shares are poised to surge after the company received an initial buyout offer from CVC Capital Partners. The S&P 500 and Nasdaq 100 retreated overnight as volume on US exchanges slipped below 10 billion shares for the first time this year.
Donald Trump’s aides have drawn up secret plans to oust the chairman of the Federal Reserve and allow the president to set interest rates, according to reports.
Since 2021, Dogecoin (DOGE) has consistently been one of the largest cryptocurrencies in the market. The token has attracted tens of billions in investment and is up more than 27,000% since its launch. While the price has fallen considerably since highs, the token has held its own and performed well in 2024. Some do not see the growth stopping anytime soon. According to some analysts, DOGE could reach — and even surpass — the $100 mark. Don't Miss: Dogecoin millionaires are increasing — investor
