FTSE 100 live: UK unemployment drops, Vodafone, Land Securities and Imperial Brands report
UK unemployment has come in lower than expected, completing the pandemic jobs miracle enabled by the furlough scheme.
The UK’s jobless rate came in at 4.3% in September, down from 4.5% a month earlier and below expectations of 4.4%. The numbers suggest the end of the furlough scheme that month did not derail the UK’s jobs recovery.
UK Chancellor Rishi Sunak says: “Today’s numbers are testament to the extraordinary success of the furlough scheme and welcome evidence that our Plan for Jobs has worked.
“Our Plan for Jobs is at the heart of our vision for a stronger economy for the British people, with schemes like Kickstart and Sector Based Work Academies continuing to create opportunities for people up and down the country.”
Also today, Vodafone and tobacco company Imperial Brands have half-year results and Land Securities has full-year numbers.
Read More
FTSE 100 software giant Sage eyes deals as its gears up for growth
FTSE 100 Live: Inflation surges to 4.2%, Bank under pressure to raise rates
FTSE 100: Smoking shares down, booze shares up as market treads water
Key Points
UK job vacancies hit record high as unemployment sinks
FTSE flat in afternoon trade
Vodafone upgrades forecasts after strong six months
Land Securities returns to profit
Imperial Brands leaves investors feeling flat
Lord Cruddas says break up of CMC a “no-brainer"
09:25 , Simon English
PROFITS have plummeted at CMC Markets as a Covid share trading boom came to a shuddering halt, leaving founder and Tory peer Peter Cruddas keen to break up the business that made his fortune.
Lord Cruddas wants to split the business into a spread betting arm and a more traditional stock broking business, the later presently attracting higher ratings from City investors.
07:28 , Simon English
PROFITS have plunged at CMC Markets, the spread betting house majority owned by Lord Cruddas, the former Tory party co-treasurer.
CMC rode a boom during lockdown as new investors tried their luck with shares. That wave looks to have crashed.
In the half-year revenues almost halved to £128 million. Profit sank from £141 million last time to £36 million. That forced CMC to hack the dividend from 9.2p to just 3.5p, a blow to the founder and CEO who owns more than 60% of the stock.
Inflation soars to highest in a decade
07:15 , Simon English
INFLATION soared in the last month, putting further strain on family finances and making an increase in interest rates before Christmas look like a racing certainty.
The City has been concerned for months that the Bank of England is too lax about inflation. The Threadneedle Street rate setters insist inflation will peter out early next year.
Today’s figures show inflation has jumped from 3.1% to 4.2% worrying politicians and some economists.
Blue Prism shares surge on counter bid
Tuesday 16 November 2021 15:20 , Oscar Williams-Grut
Shares in automation software firm Blue Prism have surged after the company said it had received a surprise bid countering its agreed takeover offer.
Blue Prism said it received a 1200p a share offer from SS&C Technologies Holdings last week. The bid trumps an already agreed offer from private equity firm Vista at 1125p.
Blue Prism has pulled a shareholder vote on that deal while it evaluates the SS&C offer.
“Whilst the directors of Blue Prism continue to believe that the Vista Offer is in the best interests of Blue Prism shareholders and are not withdrawing their recommendation of it at this stage, in light of the SS&C Proposal, the Board consider it to be in Blue Prism shareholders’ interests to adjourn the Court Meeting and General Meeting in order to explore further the approach from SS&C,” the company said.
Shareholders had been due to vote on Friday.
Blue Prism’s stock has spiked 101p, or 9%, to 1225p.
LV= takeover row escalates
Tuesday 16 November 2021 14:36 , Oscar Williams-Grut
The battle over the future of mutual insurer LV= exploded into a war of words today, as its CEO accused his opposite number at Royal London of throwing “a grenade” into deal talks.
Royal London CEO Barry O’Dwyer this morning broke cover to publicly urge LV back to the negotiating table. He told BBC Radio 4’s Today programme there was a “significant risk” that Bain Capital’s £530 million take-over of LV could collapse amid what he described as “near universal dismay” at the deal.
“My message to LV is let’s talk,” O’Dwyer said. “There must be a better way.”
The intervention came shortly before LV released a statement defending the Bain bid and pushing back against Royal London’s claim that its bid offered a better deal for members. LV said this was “grossly misleading”.
CEO Mark Hartigan accused O’Dwyer of trying to torpedo the Bain deal. He told the Standard: “We wait a year, we’re in the middle of a very important vote, at the last minute they lob a grenade.”
ARM deal faces security probe
Tuesday 16 November 2021 14:14 , Oscar Williams-Grut
The UK government has called in ARM Holding’s $40 billion sale to US chip maker Nvidia on security and competition grounds.
Digital secretary Nadine Dorries on Tuesday ordered a ‘Phase 2’ investigation into the deal, citing “competition and national security grounds.”
Dorries said: “ARM has a unique place in the global technology supply chain and we must make sure the implications of this transaction are fully considered. The CMA will now report to me on competition and national security grounds and provide advice on the next steps.”
Cambridge-headquartered ARM designs microchips, which it then licenses to manufacturers. Its chip designs are used in everything from smartphones to fridges. It claims to be in use in 200 billion devices.
FTSE little changed in lunchtime trade
Tuesday 16 November 2021 12:35 , Oscar Williams-Grut
The FTSE 100 is up a meagre 10 points this lunchtime at 7362.
Vodafone is top of the index, up 5%, after strong half-year numbers.
Land Securities is up 4.4% after bouncing back to profit of £275 million in half year, from £835 million loss last year. Bullish statements on the outlook for the London property market have helped rival British Land rise 3.1% too.
Diageo is just behind with a gain of 1.9% after raising profit guidance and setting a new aim to capture 6% of the world’s entire alcohol market value.
Darktrace continue its decline, down 2.3%.
Imperial Brands fizzles
Tuesday 16 November 2021 11:13 , Simon English
Investors are still waiting for Imperial Brands to catch fire, and there is a sense that patience is wearing thin.
The tobacco giant behind Rizla, Winston, Drum and other brands is edging towards “next generation” smoking vapes. Too slowly, say some.
Profit for the year was up 15% to £3.15 billion, but that seems largely due to the sale of the cigar division. The divi is edged up by 1% to 139p, but the market wasn’t overly impressed.
Dan Lane at Freetrade said: “Get ready to hear all about the ‘strengthening’ and ‘acceleration’ phases from Imperial over the next few years. Behind the buzzwords, that means cost-cutting followed by finally making room for heated tobacco products. But, for all the gung-ho attitudes to the future this morning, Imperial is still pumping cash into the ways of the past.”
The shares fell 25p to 1573p.
Revolution Bars targets ‘favourable’ high street rents for new bars
Tuesday 16 November 2021 10:34 , Naomi Ackerman
Younger drinkers returning to partying habits since “Freedom Day” have helped Revolution Bars‘ sales top pre-Covid levels - and the chain now plans to capitalise on cheap rents up for grabs on UK high streets.
Revolution, which runs 67 bars nationwide and employs 3000 staff, has had a difficult pandemic. Revenues fell from £110 million to just over £39 million in the year to July 3.
But the listed chain said weekends have been “busier than ever” since then, pushing sales 14% above 2020 levels.
Boss Rob Pitcher said the chain now plans to use some of £34 million in equity recently raised to open eight new sites and refurbish over half its estate over the next two years.
Read the full story here
Land Securities returns to profit
Tuesday 16 November 2021 10:10 , Joanna Bourke
A “recovery” in the central London office market has helped Land Securities return to profit, with the property giant cheering business demand for space even as many people work from home.
Mark Allan, chief executive of the firm, which has been investing in central London offices and mixed use sites in cities, said: “The economic recovery following the pandemic has generally been at the stronger and more sustained end of our expectations range.”
He said “decision makers” are now prepared to commit to lettings. Allan added that firms are attracted to high quality and sustainable space, although he pointed out some companies are still uncertain about how many staff will be in the office at one time.
Read more HERE.
FTSE flat despite strong earnings
Tuesday 16 November 2021 09:00 , Oscar Williams-Grut
The FTSE 100 is flat in early trade despite strong earnings and upgrades boosting stocks.
The FTSE is down 2 points at 7350 after almost an hour of trade.
Vodafone is top of the index, up 5%, after strong half-year numbers. Diageo is just behind with a gain of 2.7% after raising profit guidance and setting a new aim to capture 6% of the world’s entire alcohol market value. Land Securities is up 2% after bouncing back to profit of £275 million in half year, from £835 million loss last year.
Netflix secures more UK filming space, with deal to double presence at Shepperton Studios
Tuesday 16 November 2021 08:31 , Joanna Bourke
Netflix has secured more room to film productions in the South East, agreeing to double the size of its production hub at the famous Shepperton Studios.
Today Pinewood Group said it has agreed a “long-term contract” with the California-headquartered streaming giant to double the size of its existing production hub at Shepperton Studios.
Read the full story HERE.
String of retailers plan new Covent Garden store openings
Tuesday 16 November 2021 08:10 , Joanna Bourke
A host of retailers and food brands have agreed lettings to open new stores in Covent Garden, in a boost for the West End which was hammered by the pandemic.
FTSE 250 landlord Capital & Counties, which has a £1.7 billion property portfolio in central London, said fashion firm Uniqlo taking over a 21,600 square feet site is among the deals done.
Nine other brands have or will launch stores on Capco’s estate. They are watch company TAG Heuer, jewellery business e&e, WatchHouse Coffee, fashion retailer Empresa, beauty brand Lisa Eldridge, Bullards Spirits, fragrance specialist Guerlain and beauty group OTO.
LA-based clothing company Rails will open its debut London site on Floral Street.
Read more HERE.
Vodafone ups guidance as it hails ‘sustained growth'
Tuesday 16 November 2021 08:00 , Oscar Williams-Grut
Vodafone has increased its guidance after a strong half-year performance.
Revenue rose 5% to €22.5 billion and adjusted earnings were up 6.5% to €7.5 billion. Headline operating profit fell 22% to €2.6 billion due to one-off gains from a deal last year. When that was excluded operating profit rose.
Vodafone CEO Nick Read said he was seeing “very broad based” strength across the business and said today’s numbers showed he was building a “sustained growth engine” in a sector where growth has “historically been flat to negative.”
Vodafone said full-year adjusted earnings were now set to be at the top end of forecasts at €15.2 billion to €15.4 billion. The forecast for free cash flow was upgraded by €100 million to €5.3 billion.
The telecoms giant maintained its interim dividend at 4.5 cents per share.
Job vacancies at record high
Tuesday 16 November 2021 07:49 , Oscar Williams-Grut
UK job vacancies have hit a record high of 1.17 million.
Jack Kennedy, UK economist at the global job site Indeed, said: “This data speaks volumes about the strength of the jobs market. For months the drumbeat of job creation has been getting steadily louder, and it barely skipped a beat as the furlough scheme was ending.”
That seems to leave the path clear for the Bank of England to raise interest rates, a move it delayed last week to the anger of some in the City.
Read more on this morning’s jobs data.
Economists react to strong jobs numbers
Tuesday 16 November 2021 07:47 , Oscar Williams-Grut
The UK’s official unemployment rate has come in at 4.3%, lower than forecast.
Matthew Percival, CBI Director of People & Skills, said: “The UK’s jobs outlook remained strong over the summer with employment figures rising and unemployment falling. However, ongoing supply chain issues, labour shortages and record high vacancies have put a brake on growth.
“The Supply Chain Advisory Group is a positive development, demonstrating the Government’s willingness to work in partnership with business to tackle current challenges. Companies will continue to face these issues well into the New Year, so it’s important this spirit of collaboration is maintained to safeguard the UK’s economic recovery.”
Thomas Pugh, economist at RSM UK, said: “The labour market appears to have escaped the end of the furlough scheme relatively unharmed. If the official data for October tells a similar story, which we think it will, then a major obstacle preventing the Monetary Policy Committee (MPC) from raising interest rates in December will have been removed.
“The 160,000 rise in payrolls for October, also released today, suggests that the winding down of the furlough scheme didn’t lead to a surge in unemployment last month. Indeed, the claimant count rate fell from 5.2% in September to 5.1% in October. What’s more, total vacancies continued to rise to another record of 1,172,000. And there was evidence that the issue is becoming more widespread throughout the economy with 15 of the 18 industry sectors showing record highs. Both single month vacancies and Adzuna’s online job advert estimates reached record levels of vacancy numbers in October, suggesting that the end of the furlough scheme hasn’t helped to ease labour shortages.
“This isn’t official data so the MPC will want more evidence to be sure that the labour market is recovering. But the official data for September indicates that the labour market recovery was robust. Indeed, the fall in the unemployment rate from 4.5% in August to 4.3% in September was driven by a 247,000 rise in employment.”
