Proactive Investors -
- FTSE 100 falls 37 points to 8387
- Pennon (LON:PNN) hits water sector after cutting £2.4m from dividend
- AstraZeneca (NASDAQ:AZN) sets new targets for rest of decade
Flat start for US stocks predicted
Wall Street futures are pointing to a flat start, continuing the generally restrained start to the week.
After the Dow Jones retreated from Friday's record high yesterday it is seen starting just above flat, same with the S&P 500.
After the Nasdaq set its own all-time high yesterday, today futures are pointing to the tech-heavy index opening just below flat.
Yesterday, the Dow was weighed down by JP Morgan which fell 4.5% after CEO Jamie Dimon suggested that he may relinquish his role earlier than expected, and that the banking giant wouldn’t be buying back much stock at current levels.
Overnight, cybersecurity firm Palo Alto (NASDAQ:PANW) Networks reported numbers in line with expectations, but disappointed in its outlook for the second quarter.
The stock is currently down around 6.4% in pre-market trading.
How can we increase investment in the UK?
Tomorrow, as well as the UK inflation data and results from M&S, British Land (LON:BLND), National Grid (LON:NG) and NVIDIA (NASDAQ:NVDA), there will also be an interesting Q&A session in Westminster about how to increase investment in the UK.
The House of Lords Financial Services Regulation Committee is hearing evident from the City of London Corporation's policy chairman, Chris Hayward, and director of policy and innovation, Kerstin Mathias.
This session is open to the public and is to be streamed live on Parliament TV.
Topics the committee says are likely to be covered include:
- What regulators could do to enhance the UK’s growth and competitiveness and to support investment in the UK
- How onerous regulations are in the UK when compared to other jurisdictions
- Whether regulators have the right technical capabilities to support both new and incumbent firms in the UK
- The impacts of excessive capital requirements on firm growth
- How greater investments can be mobilised through pension schemes.
This is the second evidence session of the committee’s new inquiry into the Financial Conduct Authority (FCA) and the Prudential Regulation Authority’s (PRA) secondary growth and competitiveness objective.
Superdry's backup plan
Superdry is poised to launch an emergency sale process if creditors block founder Julian Dunkerton's plans to delist the shares.
Last month, after reporting lower sales and higher losses, the Cheltenham-based company announced a restructuring plan that will see it delist from the London Stock Exchange in order to cut costs and "implement its turnaround plan away from the heightened exposure of public markets".
Sky News is reporting today that a four-week process to put the business up for sale would be launched if a restructuring plan is not approved by creditors in the coming weeks.
According to a document circulated to creditors in recent days and seen by Sky News, rejection of the restructuring plan would be followed by a four-week sale process for Superdry, with the likely outcome a pre-pack administration deal.
In other founder funding news, Talktalk Telecom founder Charles Dunstone and other shareholders are being pressed to inject £180 million into the broadband provider to help it meet its upcoming debt repayments.
According to the Telegraph, the telco’s lenders want a £330milion revolving credit facility reduced to £150 million ahead of a refinancing in November.
Dunstone and other shareholders are said to be holding talks with the bank over meeting the shortfall.
Crypto markets boosted by ETFs again
Ethereum is turning heads in the crypto markets, getting greater attention than its more talked-about larger rival.
The price of bitcoin is on the slide this morning, after climbing 7.8% at the start of the week, the strongest single-day performance in over two months to lift the BTC/USD pair above $70,000 for the first time since mid-April.
Despite inching lower, it remains above that level.
But it's Ethereum that is where the action is, clocking in nearly 20% worth of gains to soar above $3,600.
Markets are bracing for a hotly anticipated decision from the US Securities and Exchange Commission (SEC) on the approval of spot ether exchange-traded funds (ETF) this week.
Applications filed by VanEck and Ark Invest are due to be approved or rejected on Thursday and Friday respectively, according to our daily crypto report.
FTSE 100 and 250 fall but plenty of positive news about
A market round-up as we head towards midday.
The FTSE 100 is down 34 points or 0.41% at 8390, while the mid-cap FTSE 250 index is down 0.45% at 20,779.
Only one of the top 10 largest blue chips is not in red and that is AstraZeneca, after it set out its new revenue and profit margin targets for the rest of the decade.
Shares in the pharma giant are up 1.4%, putting it top of the leaderboard, ahead of Schroders (LON:SDR), Reckitt Benckiser (LON:RKT) and Flutter (LON:FLTRF).
Bottom of the list is precious metals miner Fresnillo (LON:FRES), fashion house Burberry, box-maker DS Smith and water company United Utilities , all down at least 2%.
As for the FTSE 250, sandwich and lasagne maker Greencore is top of the pile, up almost 19% after more than doubling first-half profits and upping guidance.
Self-storage investor Big Yellow is up 6% after publishing results after the close yesterday, in line with expectations but further growth in occupancy since the year end. Sector peer Safestore is lifted 2.8%.
Fallers are led by South West Water owner Pennon, down 8.3% after cutting its potential dividend payment by £2.4 million to allow for environmental fines.
Automotive component maker Dowlais fell 8.4% after cutting guidance after a mixed first half and uncertainty about the EV manufacturing sector.
Into the small caps, XP Power is up 48% after rejecting a third unsolicited approach from US energy company Advanced Energy despite the bid coming at a 68% premium on yesterday’s closing price.
XP Power called the bids "a series of highly conditional, opportunistic, indicative proposals".
Battery-focused investment trust Gore Street Energy Storage issued a trading update that analysts at Stifel says are "far better than the fund’s peers who have suspended dividends".
Shoe Zone fell 7% even though digital revenues offset a decline in brick-and-mortar sales in the first half.
Retailer Topps Tiles fell 2.4% as it continued to show cracks in revenues and profits in the first half as challenging trading conditions remained.
Problems with payments
There is "currently no effective competition" to Visa (NYSE:V) and Mastercard (NYSE:MA) in the UK payments market, leading to businesses paying more than £250 million extra annually to Mastercard and Visa due to fee increases.
A provisional report published today by the Payment Systems Regulator (PSR) suggests "the supply of scheme and processing services is not working well" and that pricing has risen "substantially" over the last five years.
The PSR launched the review into the fees paid by retailers and banks to Mastercard and Visa following concerns being raised that "a substantial proportion of prior increases in these fees to acquirers could not be explained by changes in the volume, value or mix of transactions".
Fees have risen by over 30% in real terms in five years and become more complex, as a result, the PSR suggests a number of potential remedies to improve competition, including:
- improving transparency of costs
- making it easier for businesses to switch between scheme operator
- and a requirement for the large scheme operators to justify any price increases.