Proactive Investors -
- FTSE 100 rallied from opening low of 7,405.45
- Wall Street seen starting in the green
- First Citizens Bank buys most of SVB assets
Energy villans
Energy providers British Gas, Scottish Power and OVO energy are revealed to have been the worst perpetrators of installing prepayment meters in 2022, government figures revealed.
Prepayment meters, a pay-as-you-go service for utility bills, were banned from being installed after it was found British Gas had been breaking into vulnerable households to install the devices.
Throughout 2022, more than 94,000 prepayment meters were installed under warrant, the government data highlighted.
British Gas contributed to 25,000 of these installations, followed closely by Iberdrola-owned Scottish Power which installed 24,300 – the worst offender considering its smaller customer base.
A look at some of today’s movers in London
Risers
Equals - up 11% to 90 Payments company rallied after swinging to a full-year post-tax profit. The AIM-listed company focused on the small and medium-sized marketplace reported profits of £3.6mln to the year-end 31 December 2022 compared to a loss of £2.3mln for 12 months prior.
AIQ - up 42% to 7.8p Shares shot up on Monday as the company announced a new contract for a virtual datacentre. The contract, worth US$458,600, was a boon for the micro-cap firm which will project manage and subcontract the technical delivery. The project is expected to be delivered over the span of seven months, with payments being made in tranches.
Fallers
Scotgold - down 67% to 12p Scotgold’s stock crumbled as the miner said gold grades had been lower than expected and it issued a ‘going concern’ warning alongside plans to raise US$500,000. Going concern is an accounting term that refers to a business’s ability to meet its future financial obligations.
Gulf Keystone - down 16% to 144p Shares fell around 16% in Monday’s early deals as it reported to investors that the main export route out of the Kurdistan region of northern Iraq, the Iraq-Turkey pipeline, has been shut-in.
Wall Street seen higher
Wall Street is expected to open higher as pressure on US regional banks abates, with news that failed Silicon Valley Bank (SVB) is to be acquired by North Carolina-based lender First Citizens Bank helping to improve sentiment in the markets.
Futures for the S&P 500 index rose more than 0.5% in Monday pre-market trading, while those for the Dow Jones Industrial Average (DJIA) gained just under 0.5%, and contracts for the Nasdaq-100 added 0.3%.
Regulators confirmed early Monday that First Citizens will acquire the deposits and loans of SVB just more than two weeks after the bank's demise sparked a crisis of confidence in global financial markets.
Under the deal with the Federal Deposit Insurance Corporation (FDIC), First Citizens will assume assets of $110 billion, deposits of $56 billion and loans of $72 billion as per a loss-sharing agreement that will provide downside protection against possible credit losses.
After a turbulent week of trading, the S&P 500 closed up 0.6% at 3,971 points on Friday, while the DJIA added 0.4% to 32,238 and the Nasdaq Composite gained 0.3 % to 11,824.
“Futures are indicating the week will start on a marginally positive note for Wall Street, with major indices currently eyeing some gains at the opening bell,” commented James Hughes, chief market analyst at Scope Markets.
“General sentiment appears to be improving with the news that draws on regional banks are abating somewhat and also with an update on the sale process of SVB. The turmoil that gripped European banks heading into the weekend is also abating – at least for now – but it would be of little surprise if traders were to cling onto a cautious mindset for some time yet.
With economic data thin on the ground over the next few days, investors will be looking to the revised estimate for US fourth-quarter GDP, due for release on Thursday, which should confirm growth of 2.7% in the final quarter of 2022, TickMill Group market analyst Patrick Munnelly noted.
“The main event outside of banking news flow this week will be the Fed’s preferred inflation gauge, the PCE (personal consumption expenditures) deflator due for release on Friday,” Munnelly said.
“Once again investors will be parsing the data for signals that the recent disinflationary signs were driven by the unusual weather witnessed at the beginning of the year or will the number confirm that further work from the Fed will be required to tackle persistent inflation pressures.”
“Markets are expecting the headline PCE deflator to fall to 5.2% in February from 5.4% in January, while the core figure excluding energy and food prices is expected to show an uptick of 0.5% leaving the annualised number at 4.8%,” he added. “If confirmed this will leave officials with the conundrum of battling inflation while at the same time walking the fine line of maintaining market stability amidst the landscape of banking sector fragility.”
An hour and a half ahead of the US open, the FTSE 100 is up 66 points.