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Rolls-Royce set for mini nuclear deals in Sweden, Netherlands
Rolls-Royce Holdings PLC (LON:RR) is said to be nearing deals to build mini nuclear reactors in Sweden and The Netherlands.
Having been selected as the preferred supplier of such small modular reactors (SMRs) in the Czech Republic last week, Rolls-Royce is reportedly to be nearing similar deals elsewhere.
According to The Mail on Sunday, Swiss energy firm Vattenfall has shortlisted Rolls-Royce in competition with another company to deploy SMRs in the country.
An exclusive agreement has also reportedly been signed with Dutch firm ULC-Energy, leaving FTSE 100-listed Rolls-Royce just awaiting government approval in both countries... Read more
Health and beauty spending trounces wider retail
Spending on health and beauty products far outdid the wider retail sector last month, figures from Barclays PLC (LON:BARC) showed on Monday.
Some 7.3% more was spent on such beauty products during the month compared to a year earlier, reflecting the fastest growth since January 2023.
Spending across the wider retail sector ticked up by 0.1% in the meantime, as non-essential purchases climbed 0.7%.
Barclays said a quarter of shoppers signalled cutbacks on the likes of clothing to prioritise beauty spending, with many dubbing such goods as “essential” in line with groceries... Read more
Cosmetics firm Warpaint London PLC (LON:W7L) was among the FTSE AIM 100's biggest risers on Monday, having climbed by 5.5%.
Dow Jones set to build on record as Wall Street seen higher
Wall Street looked on course for a positive start to the week on Monday following a record closing high for the Dow Jones on Friday.
Futures had the Dow Jones adding 8 points on the opening bell after the index notched up a new record closing value of 42,063 ahead of the weekend.
The S&P 500 and Nasdaq were seen higher too, with respective gains of 6 and 39 points expected.
Last week’s 50-basis point cut to base interest from the Federal Reserve had fuelled gains on Wall Street, prompting the S&P 500 to also hit a record.
Attention turns on Monday to US purchasing managers index data from S&P Global, which is due to be released later in the day.
“Once again, it is the services sector which remains the bright spot, although the strength of this sector also brings major concerns of another inflationary surge,” Scope Markets analyst Joshua Mahony commented.
“Thus, between additional manufacturing-led weakness, or another surge in services inflation, there looks to be plenty of cause for caution when the PMI surveys are released later today.”
This follows August’s reading of 54.6, which saw service sector growth weighed down by a second consecutive decline in manufacturing activity.
Gold holds above $2,600 after fresh record
Gold remained elevated above the US$2,600 per ounce mark come Monday afternoon, having hit yet another record earlier in the day.
By the afternoon, gold sat at US$2,622 and in line with levels seen over the weekend following a rise to a new high of US$2,631 earlier on.
This followed a boost in the wake of the Federal Reserve’s move to cut US interest rates by 0.5% last week, while growing tensions in the Middle East have also buoyed demand as Israel and Lebanon-based Hezbollah continued to exchange blows over the weekend.
FTSE 100-listed Endeavour Mining PLC (LON:EDV) sat among the index’s biggest risers on Monday following the precious metal’s latest gain, having climbed by 1.3%.
UK private sector still ‘healthy’ despite slowing growth - analysts
Analysts have moved to reassure that a slowdown in UK private sector growth reflects a return to normalised trends rather than a more worrying downturn in the economy.
“While the slight slowdown was across both services and manufacturing, each sector continues to expand at a healthy rate,” EY ITEM Club analysts said following figures from S&P Global earlier in the day.
These had shown the UK purchasing managers index (PMI) fell to 52.9 this month, against 53.8 in August, in part driven by uncertainty ahead of October’s Autumn Budget... Read more
“On balance, the EY ITEM Club expects growth to slow to levels closer to trend growth rates for the remainder of 2024,” analysts added.
Ballinger Group analyst Kyle Chapman noted the figures supported expectations that the UK was on course for a “soft landing” as the Bank of England looks to wind down interest rates.
“Growth is cooling but remains robust, and inflationary pressures are evidently easing,” he said.
“There are plenty of softer price indicators in the report for the Bank of England to take comfort from, with employment growth slowing and growth in end prices falling to a more than three-year low.”
Currys soars as Berenberg sees improvement ahead
Currys PLC (LON:CURY) topped the FTSE 250’s risers on Monday after Berenberg analysts pointed to an improving outlook for the electronics retailer and hiked its share price target.
Shares in Currys sit around 45% below pre-pandemic levels despite the firm’s better financial position and stronger outlook, analysts said in a note.
Pointing to an 8.2x price-to-earnings ratio, Berenberg added Currys was trading on a roughly 40% discount to peers, with “no credit” being given “for earnings upside” ahead.
Currys’ share price target was lifted from 92p to 125p as a result, implying a prospective 60% upside on Friday’s close.
A turnaround plan since 2019 has seen debt reduced by £700 million, analysts highlighted, with further improvements set to see cash flow to equity hit £100 million by 2027.
“This financial discipline, a clear strategy and right-sized cost base, will continue to support normalised capex levels to drive growth,” Berenberg said.
A ‘buy’ rating was reiterated, with shares in Curry jumping 6.3% to 83.35p.
Pound at to two-year high versus Euro
PMI readings on Monday morning showing the UK economy was outperforming the Eurozone dealt a boost to the pound sterling, lifting it to a two-year high against the Euro.
Come late morning, the pound was climbed to €1.1967 and its highest level compared to the Euro since August 2022.
Though S&P Global data showed UK private sector growth had slowed between August and September, the 52.9-point reading indicated ongoing economic improvement.
Separate figures covering the Eurozone showed PMI fell to 48.9 in the meantime, indicating business activity had entered contraction territory.
Germany, France drag Eurozone into contraction territory
Business activity across the Eurozone has fallen into contraction territory in September for the first time in seven months on the back of German and French economic struggles.
According to the HCOB Flash Eurozone purchasing managers index (PMI), Eurozone private sector growth dipped below 50.0 points this month to 48.9.
This fall below the mark indicates shrinking activity, with the reading reflecting the lowest level in eight months.
Europe’s manufacturing sector weighed on the figure as PMI fell to 44.8, against 45.8 previously, while services dipped from 52.9 to 50.5.
This follows a slump in German economic activity, while an Olympics-related boost to France’s private sector seen in August appeared to wear off.