FTSE 100 close: London subdued on quiet earnings day as YouGov mulls US listing
London’s FTSE 100 started the week in subdued fashion, as a quiet earnings day was overshadowed by reports that YouGov is mulling a US listing.
The capital’s premier blue chip index closed the day on 7,495.24 points, down 0.88 per cent, while the FTSE 250 index, which is more aligned with the domestic economy, was also down 0.3 per cent.
Monday was flat with no major economic data or results scheduled, while markets anticipate a much busier week with UK unemployment figures on Tuesday and inflation on Wednesday.
Cost of living pressures facing households are set to ease, as experts predict inflation will fall below wage growth for the first time since last April.
Official figures out on Tuesday are tipped to show that wage growth hit 7.4 per cent in the three months to June on an annual basis, up from 7.3 per cent last month.
The biggest risers on the FTSE 100 at the open were Airtel Africa, up almost three per cent and B&M, which rose about 2.8 per cent. Meanwhile Ocado was the biggest faller at 4.37 per cent, followed by Ladbrokes owner Entain, down a shade under four per cent.
Fintech trading firm Plus500 has unveiled a fresh $120m payout for investors this morning despite reporting a slump in profits compared to last year amid “quieter market conditions”.
The London-listed firm said it would put $60m shareholders in shareholders’ pockets via a dividend payout as well as clawing back $60m worth of shares from investors in a buyback programme.
At the close, the FTSE 250 company’s shares were up two per cent.
Watches of Switzerland, which is 250-listed, reported its shares soaring at more than 6.2 per cent, while W.A.G Payment Solutions was down.
While London remained flat overall, there was the prospect of London’s embattled equity markets being at risk of another high-profile departure after YouGov’s boss said he was considering switching their listing to New York.
“I think the markets are better at supporting companies like ours there,” the data firm’s chief Stephan Shakespeare said in an interview with the FT.
This week there will also be a glut of results from major insurers, including Aviva, L&G and Admiral.
According to Hargreaves Lansdown sentiment is likely to be dampened by heavy losses on Asian equity indices overnight, as the Nikkei 225 having dropped 1.3 per cent, while the Hang Seng Index tumbled 2 per cent.
Meanwhile, Chinese property giant Country Garden’s debt problems deepened after its onshore bonds were suspended, sending its shares plunging 16 per cent to record low on Monday in a fresh blow to policymakers trying shore up confidence in a stuttering economy.
“A crisis in the Chinese real estate sector is a story the market has heard before and not one which has typically come with a happy ending for stocks,” says AJ Bell investment director Russ Mould.
“News China property giant Country Garden had missed bond payments as it racked up big losses was always likely to prompt selling in Asian markets and that’s fed through to the European open.
“This latest calamity is reflective of a recovery which has not lived up to expectations since the world’s second largest economy ditched zero-Covid measures at the end of last year. The usual catalogue of names with Chinese ties were under the pump including Burberry, Standard Chartered and Prudential. The one silver lining for the West may be a deflationary impact from China’s woes which helps in the battle against inflation.
“The higher than anticipated rate of US producer price inflation reported on Friday – often a good indicator of the trajectory of consumer prices – is helping to sour sentiment and raises the stakes ahead of UK CPI figures on Wednesday this week.
“A significant fall to 6.8% is expected, anything short of that could prompt another surge in gilt yields – drawing groans from anyone set to remortgage or take out a new mortgage any time soon.
“Market research and data analytics firm YouGov is the latest UK-listed firm to consider a listing in the US – presumably in search of the higher valuations typically afforded to shares across the Atlantic. YouGov has arguably entered a new phase of its development following the recent acquisition of Germany’s GfK consumer panel business.”