Proactive Investors -
- FTSE 100 off lows, down 8 points at 7,687
- BT (LON:BT) names Telia's Allison Kirby as new chief executive
- Government confirms raft of new oil and gas licences to be granted
Mobico rises on reports of Eurostar rival
Mobico Group PLC, the bus and rail operator, is one of a group of companies looking at launching a cross-Channel train service to rival Eurostar, according to reports.
Shares jumped 5.5% to 95.80p.
The Financial Times said other parties involved in the discussions include the Spanish Cosmen industrialist family, which is an investor in Mobico (LON:MCG), formerly known as National Express , according to two people with knowledge of the plans.
The new rail service, to be named Evolyn, would start running between London and Paris through the Channel Tunnel as early as 2025, they said, although final details have yet to be finalised and could change.
The initiative would represent the first challenge to Eurostar’s monopoly of passenger rail traffic linking London to major cities in Europe including Brussels and Amsterdam as well as Paris.
Analysts at Liberum said: "We would expect any such project to have a lead time of several years."
They pointed out the Channel Tunnel has extremely stringent safety requirements for trains while customised trains would need to be ordered which implies a lead time of at least two years.
"Government co-operation would also be required to facilitate increased customs and border post capacity at all stations used by the potential new services," the broker added.
Eurozone inflation falls and sees return to growth
The FTSE 100 is trading little changed now after figures showed Eurozone inflation fell in line with market expectations and that the single currency area returned to growth during the second quarter of 2023.
Inflation fell in line with expectations to 5.3% in July, according to Eurostat, the EU’s statistical office, down from 5.5% in June.
Euro area #inflation at 5.3% in July 2023, down from 5.5% in June. Components: food, alcohol & tobacco +10.8%, services +5.6%, other goods +5.0%, energy -6.1% - flash estimate https://t.co/ZRulqYvik4 pic.twitter.com/sUJi2lTwUX— EU_Eurostat (@EU_Eurostat) July 31, 2023
But core inflation, which excludes energy and food prices to give a clearer sign of underlying price pressures, was unchanged at 5.5%, a touch above expectations.
Seasonally adjusted gross domestic product increased by 0.3% in the eurozone in the second quarter, compared to the first quarter, ahead of the consensus of 0.2%.
Euro area #GDP +0.3% in Q2 2023, +0.6% compared with Q2 2022: preliminary flash estimate from #Eurostat https://t.co/n5WsMENWRs pic.twitter.com/jAzDwpeQqC— EU_Eurostat (@EU_Eurostat) July 31, 2023
ING Economics said the better-than-expected figure was boosted by very strong Irish activity.
"Without Ireland, growth would have been halved," it said, adding that "looking through the most volatile components, we argue that the economy has remained broadly stagnant."
Lending picks up in June despite rising rates - Bank of England
UK lenders approved many more mortgages than expected in June and net unsecured lending to consumers leapt by the most in over five years, figures from the Bank of England showed today.
Banks and building societies approved 54,662 mortgages in June, the most since October 2022, and higher than from 51,100 in May, while approvals for remortgaging rose to 39,100 from 34,100 during the same period.
UK Mortgage Approvals Jun: 54.7K (exp 49.0K; prevR 51.1K)- Net Lending Sec. On Dwellings Jun: £0.1B (exp £0.2B; prev -£0.1B)
- Net Consumer Credit Jun: £1.7B (exp £1.3B; prev £1.1B)
- Consumer Credit (Y/Y) Jun: 7.6% (prevR 7.6%)
— LiveSquawk (@LiveSquawk) July 31, 2023
Net mortgage borrowing by individuals was £100 million in June, swinging from net repayments of £100mln in May and record high net repayments of £1.1bn in April.
The effective interest rate on newly drawn mortgages, meaning the actual interest rate paid, increased by a further 7 basis points to 4.63% in June.
“June's marginal uptick on May shows that people have recalibrated to the new rate environment and are getting on with their lives,” Simon Jones, CEO of investing comparison platform, InvestingReviews.co.uk commented.
The BoE also reported a £1.66bn monthly increase in net consumer lending, the largest such increase since April 2018.
Jones said this “shows the growing reliance on credit as people's finances are stretched to breaking point.”
Dr Martens on the front foot
A good start for iconic bootmaker Dr Martens PLC (LON:DOCS) which has risen after reports an activist fund manager has been building a stake in the firm.
Sky News reported that Sparta Capital has quietly accumulated stock the FTSE 250-listed outfit and has been engaging with its board in an attempt to improve its financial and operating performance.
Sparta, which was launched in 2021 by Franck Tuil, a longstanding executive at the prominent investor Elliott Management, is now understood to be a top ten shareholder in the footwear brand.
Dr Martens has seen its valuation slump amid supply chain bottlenecks and a slowdown in US sales leaving shares 40% lower in the last 12 months.
However, it is a brighter picture today and shares are 5.1% to the good at 153.60p.
Meanwhile, the FTSE 100 is steadily eating away atearlier losses, now down 7 points at 7,688.
Energy producers higher as PM signals hundreds of new licences
Shares in North Sea energy producers are in the green in early trading in London, after PM, Rishi Sunak confirmed that hundreds of new oil and gas licences will be granted in the UK.
Number 10 said hundreds of new oil and gas licences will be granted off the coast of Scotland to "boost British energy independence" and "reduce reliance on hostile states".
Ministers expect the current 33rd round to award over 100 licences, starting in the autumn. The round was launched in October and in January it was confirmed that 115 bids had been received.
Centrica (LON:CNA) is up 1.7%, Ithaca Energy is 3.5% higher and Harbour Energy (LON:HBR) 2.2% to the good.