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FTSE 100 Live: Rolls-Royce hits 18-month high, oil prices rise again, and Octopus Energy worth £3.3 billion

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 (ESI)
(ESI)

Investors have taken Germany's election deadlock in their stride after the FTSE 100 index and other European markets opened higher.

A weekend without major developments on the Evergrande debt crisis helped the mood, while oil prices have continued to rise amid global supply fears. Brent crude was trading at close to $79 a barrel, helping shares in BP and Royal Dutch Shell to rally 2%.

Rolls-Royce rose 4% — continuing a recent rebound — as the UK company unveiled a major deal to power US Air Force B-52 bombers.

The pound, meanwhile, has held firm against the US dollar despite the sight of many petrol pumps running dry as panic buying took hold.

Read More

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FTSE 100 Live Monday

  • Brent crude nears $80

  • Aldi to create 2,000 jobs

  • Rolls-Royce unveils B-52 deal

  • Markets higher after German election

FTSE ends positive — just

17:24 , Oscar Williams-Grut

The FTSE 100 has closed in the green — but only just. London’s index of leading shares ended up 12 points at 7063 — a gain of 0.17%.

Here are the main stories of the day:

Rolls-Royce shares have hit an 18-month high after the engine maker announced a 30-year deal to supply engines for the US Air Force’s B-52 fleet and sold off it Spanish business ITP Aero for £1.45 billion. Shares closed 11.3% higher.

Shares in the UK’s biggest listed cinema chains have surged amid booming ticket sales for Daniel Craig‘s final outing as 007. Screen giant Cineworld, which also owns Picturehouse and Regal in the US, rose 12% while upmarket chain Everyman was up 11.5%. Odeon, whose owner AMC is listed in the US, said No Time To Die is set to be its biggest film since summer 2019, with more than 175,000 tickets pre-sold within two weeks of release.

• Brent crude has hit a three-year high at near to $80 a barrel, heaping more inflationary pressure on the UK economy and adding to the turmoil for beleaguered motorists. The rise boosted oil producers — Shell gained 4.3% and BP rose 3.5%.

Grant Thornton has been fined £2.3 million and given a severe reprimand by the Financial Reporting Council (FRC) for its failure to spot fraud on the books of Patisserie Valerie.

Aldi has announced plans to invest £1.3 billion in the UK. The two-year spending spree will see the chain create more than 2000 jobs in the UK next year, boost warehousing space and add another 100 shops.

• Challenger energy brand Octopus has pulled level with British Gas-owner Centrica is valuation. Octopus is now worth £3.3 billion after raising £437 million from a climate fund run by former US vice president Al Gore. Shares in Centrica rose 3% today, valuing the business at £3.27 billion.

That’s all from us today. Have a good evening and we’ll see you tomorrow.

Oil prices continue to rise

07:39 , Graeme Evans

European markets are set to open higher despite yesterday's inconclusive result in Germany's general election.

The prospect of a three-way party coalition led by SPD came as little surprise, meaning investors remain focused on events in China and various global supply chain crunches.

Michael Hewson, chief market analyst CMC Markets, expects the FTSE 100 index to open 42 points higher at 7,093.

Asia markets started the week on the front foot, helped by no major developments concerning the future of debt-laden Chinese property firm Evergrande.

The price of oil continues to rise, with Brent crude up more than 1% to above 79 US dollars a barrel as traders continue to worry about supply constraints.

Oanda's Jeffrey Halley warned: “With OPEC+ struggling to meet its present production targets and US shale production returning at a snail’s pace from last year, global energy woes are set to continue as the Northern hemisphere winter approaches.”

Aldi delivers record annual sales and plans big hiring spree

07:49 , Joanna Bourke

Aldi intends to create another 2000 jobs in the UK next year, as the grocer expands following sales reaching a record high.

The company, now Britain’s fifth largest supermarket, plans to invest £1.3 billion over the next two years (2022-2023) to boost its share of the UK grocery market.

The firm gave the update as it published annual results that showed how sales increased 10.2% to £13.5 billion during the pandemic.

Aldi is planning to expand in the UK (aldi uk)
Aldi is planning to expand in the UK (aldi uk)

Read the story HERE.

Not just a supply shock

08:03 , Graeme Evans

Deutsche Bank's Jim Reid said: “All the talk at the moment is about supply shocks and it’s not inconceivable that things could get very messy on this front over the weeks and months ahead.”

He said it was wrong to focus on this just being a supply shock as authorities massively stimulated demand, in some cases to more than would have been the case without Covid.

Reid added: “If the authorities hadn’t responded as aggressively we would have plenty of supply for the demand and a lot of deflation. Remember negative oil prices in the early stages of the pandemic.”

He warned the risk of a policy error by central bankers is high: “The problem with forward guidance is that markets demand to know now what they might do over the next few months and quarters so it leaves them exposed a little in uncertain times.”

Engine deal lifts Rolls

08:24 , Graeme Evans

A significant boost for Rolls-Royce with the award of a major contract by the US Air Force provided one of the highlights of a quiet start to the week for London corporate news.

Shares rose another 4% to 138.34p to continue their recent recovery as Rolls said that the American-made F-130 engine will power the B-52 for the next 30 years.

Rolls has a long history providing the power for US military customers, having delivered thousands of engines to the US Air Force over more than 70 years.

The UK company will build and test the F130 engines at its Indianapolis, Indiana, facility following the recent completion of a $600 million investment at the manufacturing campus.

BP shares up 2%

08:44 , Graeme Evans

Shares in BP and Royal Dutch Shell have rallied 2% to leave the FTSE 100 index 55.92 points higher at 7,107.40.

The pair’s strong start to the week reflects a Brent crude price at more than $79 a barrel, having risen for five sessions in a row on the back of supply tightness.

Rolls-Royce was the biggest riser after surging 4%, while Prudential added 36p to 1,428p after setting the price for its £2 billion fundraising in Hong Kong.

Post-election deadlock

09:08 , Graeme Evans

The German election delivered a result that was much closer than opinion polls had predicted, with the SPD winning the most votes just ahead of the CDU/CSU bloc.

Coalition negotiations are expected to take weeks if not months, meaning many of the more extreme policy proposals from all parties are likely to be watered down.

UBS believes the most important development for financial markets is likely to be a greater regulatory, fiscal, and political focus on making Germany smarter, greener, and more digital.

The bank added: “We would likely see renewable developers, automotive companies tilting toward electric vehicles, semiconductors, renewable operators, and industrials as the sectors most likely to benefit.”

Grant Thornton fined £2.3 million over Patisserie Valerie audits

09:30 , Oscar Williams-Grut

Grant Thornton has been fined £2.3 million and given a severe reprimand for its failure to spot fraud on the books of Patisserie Valerie.

The Financial Reporting Council (FRC) said it had hit Grant Thornton with the fine and reprimand it for “serious breaches“ over several years in relation to its work checking Patisserie Valerie’s books. The auditor was originally in line for a £4 million fine but it was reduced after the firm admitted wrongdoing.

Grant Thornton audit director David Newstead was also fined £150,000, given a severe reprimand and banned from carrying out high-level audits for three years.

“This decision notice sets out numerous breaches of Relevant Requirements across three separate audit years, evidencing a serious lack of competence in conducting the audit work,“ said Claudia Mortimore, deputy executive counsel to the FRC.

Read more here.

Looking good: Revolution Beauty posts first half sales jump

09:59 , Joanna Bourke

Newly-floated Revolution Beauty notched up sales growth of 35% in the first half, ahead of the peak trading season that has now started.

The AIM-listed make-up brand, which floated at 160p per share in July, said revenue reached £78 million in the six months to August 31.

Revolution Beauty is AIM-listed (Revolution Beauty)
Revolution Beauty is AIM-listed (Revolution Beauty)

Read the full story HERE.

Oil giants drive FTSE higher

10:04 , Graeme Evans

Brent crude hit a three-year high at near to $80 a barrel today, heaping more inflationary pressure on the UK economy and adding to the turmoil for beleaguered motorists.

The price of Brent lifted 1.2% to $79.01 and has now risen for five sessions in a row, driven by the global economic recovery and the natural gas shortage driving demand for oil instead.

Goldman Sachs today raised its year-end forecast for Brent crude by $10 to $90 a barrel as it also looks to factor in an onoging production hit from Hurricane Ida.

The rising price outlook helped shares in BP and Royal Dutch Shell to improve by 2%, with the latter now trading at its highest level since the pandemic struck in March 2020.

Their performances underpinned a resolute performance by the FTSE 100 index, which climbed 19.36 points to 7,070.84. European markets were also higher after Germany's election delivered a result that was much closer than opinion polls had predicted.

Coalition negotiations are expected to take weeks if not months, meaning many of the more extreme policy proposals from all parties are likely to be watered down.

Evergrande's debt problems also remain in the background, although an absence of major developments over the weekend triggered some buying of Asia-focused stocks.

They included insurer Prudential, which rose 2% after revealing it expects to raise about $2.4 billion following the pricing of new shares in its Hong Kong fundraising.

The biggest rise of the session came from Rolls-Royce as it unveiled a major deal with the US Air Force to power the B-52 bomber for the next 30 years. Shares have risen more than 20% in recent days and were up another 7% or 9.5p to 142.04p, an 18-month high.

The improved global travel outlook behind the recent resurgence of Rolls is also helping British Airways owner IAG, which added 4% or 7.6p to 183.2p today.

The FTSE 250 index was 32.3 points higher at 23.641.09, with Cineworld still in recovery mode after surging 8% or 6.3p to 77.8p.

Rolls-Royce at 18-year high

11:38 , Oscar Williams-Grut

Shares in engine maker Rolls-Royce have hit an 18-month high today.

The engine maker said it had reached a deal to supply F130 engines for the US Air Force’s B-52 fleet for the next 30 years. The contract could be worth up to $2.6 billion (£1.9 billion). Parts will be manufactured at Rolls-Royce’s Indianapolis factory, which was recently upgraded at a cost of $600 million.

Shares in Rolls-Royce rose 9.5p, or 7%, to 142.04p — the highest level since March 2020.

Read more here.

Rolls-Royce accelerates further on ITP sale

12:20 , Oscar Williams-Grut

Rolls-Royce shares have climbed even further after announcing the sale of its Spanish business ITP Aero.

The company said in a statement around midday that it had reached a deal to sell ITP Aero for £1.45 billion to a consortium led by Bain Capital. Proceeds will be used to repair the company’s battered balance sheet.

Shares are now up over 10% to 145p. Read more here.

Motor Fuel Group rolls out electric charging expansion

12:57 , Simon English

THE largest independent fuel operator in the UK today unveils its flagship electric vehicle charging station in Putney, insisting it is part of the solution to the petrol and fuel crisis engulfing London and much of the rest of the country.

With petrol stations at supermarkets and elsewhere closing due to a lack of fuel and the government urging motorists not to panic buy, the Motor Fuel Group is rolling out its EV expansion plan.

The forecourt on the A3 in Putney, South West London has eight rapid electric charging bays which deliver 100 miles of range in 10 minutes.

Full story here

Motor Fuel Group rolls out electric charging expansion

12:57 , Simon English

THE largest independent fuel operator in the UK today unveils its flagship electric vehicle charging station in Putney, insisting it is part of the solution to the petrol and fuel crisis engulfing London and much of the rest of the country.

With petrol stations at supermarkets and elsewhere closing due to a lack of fuel and the government urging motorists not to panic buy, the Motor Fuel Group is rolling out its EV expansion plan.

The forecourt on the A3 in Putney, South West London has eight rapid electric charging bays which deliver 100 miles of range in 10 minutes.

Full story here

Motor Fuel Group rolls out electric charging expansion

12:57 , Simon English

THE largest independent fuel operator in the UK today unveils its flagship electric vehicle charging station in Putney, insisting it is part of the solution to the petrol and fuel crisis engulfing London and much of the rest of the country.

With petrol stations at supermarkets and elsewhere closing due to a lack of fuel and the government urging motorists not to panic buy, the Motor Fuel Group is rolling out its EV expansion plan.

The forecourt on the A3 in Putney, South West London has eight rapid electric charging bays which deliver 100 miles of range in 10 minutes.

Full story here

Aldi UK chief addresses supply chain issues

13:24 , Joanna Bourke

More from supermarket group Aldi, which earlier showed how sales leapt during the pandemic.

The firm’s UK and Ireland boss Giles Hurley has spoken about headwinds the sector is facing, and how his company is managing. He said all “of our trucks are running as they should do”, and added: “We are going to have our best Christmas range ever.”

He also said more than three-quarters of the group’s drivers are employed directly, and in August the firm increased the rates for all driving staff.

Read more HERE.

Lunchtime update

13:30 , Oscar Williams-Grut

Here are the main headlines this lunchtime:• The FTSE 100 is practically flat, down 4 points to 7046

Rolls-Royce shares have hit an 18-month high after the engine maker announced a 30-year deal to supply engines for the US Air Force’s B-52 fleet and sold off it Spanish business ITP Aero for £1.45 billion

Shares in the UK’s biggest listed cinema chains have surged amid booming ticket sales for Daniel Craig‘s final outing as 007. Screen giant Cineworld, which also owns Picturehouse and Regal in the US, was up by as much as 10%, while upmarket chain Everyman was up nearly 7%. Odeon, whose owner AMC is listed in the US, said No Time To Die is set to be its biggest film since summer 2019, with more than 175,000 tickets pre-sold within two weeks of release.

• Brent crude has hit a three-year high at near to $80 a barrel, heaping more inflationary pressure on the UK economy and adding to the turmoil for beleaguered motorists.

Grant Thornton has been fined £2.3 million and given a severe reprimand by the Financial Reporting Council (FRC) for its failure to spot fraud on the books of Patisserie Valerie.

Aldi has announced plans to invest £1.3 billion in the UK. The two-year spending spree will see the chain create more than 2000 jobs in the UK next year, boost warehousing space and add another 100 shops.

Jewellery start-up that uses lab-grown diamonds looks to open first physical store

13:30 , Joanna Bourke

London-headquartered jewellery brand Kimaï, which use lab-grown diamonds, is looking to open its first standalone shop in London.

The founders of the start-up outlined expansion plans in an interview with the Evening Standard.

Read more HERE.

Rolls helps FTSE turn positive

16:05 , Oscar Williams-Grut

The FTSE 100 has turned mildly positive for the session as the close draws near. London’s bluechip index is up 17 points at 7068. It’s been helped higher by Rolls-Royce, which is up 10% on the day. British Airways-owner IAG is the second biggest riser, up just over 5%.

Soaring oil price are also boosting the index. Shell is up 4% and BP is 3.2% better.

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