|Day's range||6,060.16 - 6,218.79|
|52-week range||4,898.80 - 7,727.50|
The FTSE 100 is set for its biggest shake-up in more than four years after the impact of coronavirus wiped out revenues for companies in travel and aviation but boosted others in emergency services and technology. EasyJet and Carnival, the cruise ship operator, are expected to fall into the FTSE 250, according to share prices on Friday that have more than halved since the onset of the pandemic. Dropping out of the FTSE 100 is significant for companies given the access to tracker or exchange traded funds that only follow the index of the UK’s top companies.
The Zacks Analyst Blog Highlights: Bayer Aktiengesellschaft, InflaRx, Legrand, Innate Pharma and DiaSorin
Wall Street turned higher late in Friday’s session after Donald Trump’s latest salvo aimed at China did not deliver the harsh sanctions traders had feared. The S&P 500 closed up 0.5 per cent and the Dow Jones Industrial Average ended little changed, recovering from a fall of more than 1 per cent, after the US president said in a scheduled address that his administration would revoke special trade privileges for Hong Kong. Analysts had been predicting a much more aggressive US response to Beijing’s approval of a national security law for Hong Kong.
The bumper run in the US stock market is beginning to turn its doubters into believers, adding fresh thrust to a rally that has wrongfooted veteran investors, lured in retail traders, and defied the dire economic outlook caused by the global pandemic. The rally has built a legion of sceptics who worry the market is being driven entirely by Federal Reserve stimulus and that bullish investors are too confident a vaccine will emerge to rekindle corporate profits. “There’s an element of fear of missing out — FOMO — as investors start to look at the momentum,” said Emily Roland, co-chief investment strategist for John Hancock Investment Management in Boston.
(Bloomberg) -- British Gas’s more than three-decade connection to the U.K.’s blue-chip stock index looks set to come to an end after shares of parent Centrica Plc plunged by more than half this year.Analysts expect Centrica to be demoted from the FTSE 100 benchmark in a quarterly re-shuffle next week. That would represent a moment of historical significance for a stock that under different names has been ever-present in the gauge since 1986, the year that the Conservative government of Margaret Thatcher privatized British Gas through an initial public offering.The shares’ 56% slide this year has reduced the company’s market value to a level where it no longer passes the test to retain its position in the FTSE 100.“Centrica’s ejection would cap a multi-year share-price slide that dates back to a peak of almost 400 pence in 2013,” Russ Mould, investment director at brokerage AJ Bell, said in emailed commentary. The stock closed on Thursday at 39.05 pence, valuing the business at 2.3 billion pounds ($2.8 billion).According to guidelines from index provider FTSE Russell, a stock will be removed from the FTSE 100 if its market capitalization ranks 111 or below among eligible shares at the time of the re-balancing. At its current valuation, Centrica is the 140th biggest company on the FTSE All Share index. The next quarterly review will be based on June 2 closing prices and announced on June 3.The first half of 2020 has been torrid for Centrica, which suspended its dividend and paused a planned sale of North Sea oil and gas assets last month after the Covid-19 pandemic sapped energy demand and triggered a slump in crude prices. Chief Executive Officer Iain Conn stepped down in March after five years leading the group.But the share price fall dates back a lot further than that. On top of a longer-term slide in oil prices, the company has faced competition from smaller challengers like Octopus Energy and Bulb, while also being hit by a price cap by the U.K. Office of Gas and Electricity Markets. The shares are now 90% below a record high set in 2013.Tell SidBritish Gas Plc joined the FTSE 100 on Dec. 9, 1986 after a share sale that was promoted in a government television campaign urging Britons to spread word of the investment opportunity by telling “Sid,” a name that was meant to represent the general public.In 1997, the company, whose history stretches back more than 200 years, was split into separate firms, BG Plc and Centrica Plc. BG later became BG Group Plc and was bought by Royal Dutch Shell Plc in a deal announced in 2015.British Gas, under Centrica, has seen its share of the domestic market steadily decline over the past 15 years, according to Ofgem data, also losing ground to rivals like Electricite de France SA and SSE Plc.That said, a potential turnaround isn’t being ruled out by some analysts.“Following years of structural challenges faced by Centrica in the U.K. retail market, failed attempts to deliver growth in its consumer business and falling profits from its commodity-exposed units, we believe the worst is behind the company,” Citigroup analyst Jenny Ping wrote in a May 21 note.The company has sufficient liquidity to navigate volatile demand due to the pandemic, and a future simplification of the group could boost the shares, Ping wrote.A spokesman for Centrica declined to comment on the upcoming index review when reached by phone.Other stocks that might be demoted from the FTSE 100 in next week’s review include Princes and P&O cruise operator Carnival Plc, budget airline EasyJet Plc and plane-parts maker Meggitt Plc, reflecting the impact of the Covid-19 crisis on global travel demand, according to Helal Miah, an analyst at investment broker The Share Centre, who spoke by phone.That would potentially leave them vulnerable to selling by funds whose aim is to mirror the performance of the FTSE 100 -- known as tracker funds.Stocks that could be added to the benchmark gauge include cybersecurity firm Avast Plc, betting company GVC Holdings Plc and home emergency and repair services provider HomeServe Plc, Miah said.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Europe stocks rally on hopes that the European Union will unveil large stimulus package to reduce the economic fallout from the coronavirus pandemic.
The number of UK organisations reporting on their gender pay gap has halved during the past year, adding to concerns that the coronavirus pandemic could set back equality in the workplace. The average pay gap increased from 11.9 per cent to 12.9 per cent in the year to April, according to Financial Times analysis of government figures — but only half of the 10,000 eligible UK employers submitted data to the government in the period. The UK government removed the requirement for companies to report their pay gaps this year at the onset of the coronavirus crisis in March in an attempt to help companies that were struggling to cope.
Rolls-Royce has lost its investment-grade rating — held for the past 20 years — after Standard & Poor’s on Thursday downgraded the company to junk status because of “prolonged weak profitability” and expectations of materially lower cash flow from its engine service contracts. The downgrade is a severe blow to the aero-engine company, which only last week announced plans to cut 9,000 jobs, mainly from its civil aerospace division. It could also hit profitability of future long-term service contracts, as the perceived risk for customers of striking multiyear deals would increase.
The sun’s out, school holidays aren’t far off, and Dominic Cummings has made it clear that those rules weren’t meant to be interpreted too strictly anyway. From the size of the rally in travel and leisure stocks, though, you’d be forgiven for thinking the pub gardens were already full of punters quaffing Pimm’s and pints. The pan-European Stoxx travel and leisure index had risen more than 10 per cent for the week to date by midday on Thursday.
Euro Zone stocks were supported as the European Commission (EC) prepares to unveil a plan to help the EU economy recover.
US stocks staged a late rally on Wednesday as hopes of a faster economic recovery overcame concerns over the relationship between the US and China. Wall Street’s S&P 500 finished the day 1.5 per cent higher, closing above 3,000 for the first time in 12 weeks. Other global equity benchmarks also rose, with London’s FTSE 100 gaining 1.3 per cent and the benchmark Euro Stoxx 600 closing 0.2 per cent higher.
Upheaval in the retail sector, accelerated by coronavirus, has wiped more than £1bn off the value of British Land’s portfolio. The FTSE 100 property company owns about £11bn worth of property, including key sites in Broadgate, east London, and Paddington in west London. Just over a third of that — £3.9bn — is made up of retail parks, stores and shopping centres, which have shed more than a quarter of their value over the year.
Yes, a weakening renminbi is worrying, particularly when the US dollar is broadly lower, but fiscal and monetary stimulus is a nice comfort blanket. Japan is rolling out a ¥117tn ($1.1tn) package of easing, equal to 6 per cent of gross domestic product a month, after announcing the previous round of stimulus. The European Commission fired up appetite for regional shares and sovereign bonds with plans to seek approval to borrow as much as €750bn in debt in order to fund the eurozone’s recovery from Covid-19.
(Bloomberg) -- U.K. stocks rose after Prime Minister Boris Johnson outlined plans for the re-opening of outdoor markets, car showrooms and shops in England next month, providing relief for retailers that have been forced to shut down in an effort to control the spread of the coronavirus.The benchmark FTSE 100 Index rose as much as 2.3% on Tuesday -- outpacing other major European gauges -- with airlines and travel stocks among the biggest gainers on optimism about travel restrictions easing in some European countries, and retailers rising after the government’s announcement. U.K. stock markets were closed for a public holiday Monday, while Europe’s benchmark Stoxx 600 rose 1.5% that day amid a bailout for Deutsche Lufthansa AG.Consumer stocks rose after Johnson said Monday evening that England’s outdoor markets and car showrooms will be able to reopen from June 1, as soon as they are able to meet the coronavirus guidelines to protect shoppers and workers, while all other non-essential retail outlets will be expected to be able to reopen from June 15 if the government can control the spread of the virus. U.K. car dealership stocks including Pendragon Plc and Vertu Motors Plc jumped.“Lockdown has caused considerable damage to the U.K. consumer economy,” Shore Capital analysts including Clive Black wrote in a note Tuesday, calling the re-opening plans a relief for non-discretionary retailers. “We expect calendar year 2021 to be one of stabilization at this stage.” British midcap stocks also rallied, with the FTSE 250 Index gaining as much as 2.9% to the highest since April 30.Next Plc shares rose as much as 6.6% on Tuesday, while Primark owner Associated British Foods Plc gained as much as 6.2%. Both stocks are down 31% so far this year. Pub operator JD Wetherspoon Plc -- which last week outlined plans to reopen its 875 pubs with special precautions when it has the official go-ahead -- surged as much as 10%, while Marston’s extended its rally following Friday’s announcement on a brewing joint venture with Carlsberg A/S. PayPoint Plc, which provides in-store bill payment services for customers, rose as much as 9.5%. For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Hopes of a quick economic recovery gave a lift to global stocks on Tuesday, taking them to their highest levels since the coronavirus pandemic first took hold in early March. In the US the S&P 500 moved above the 3,000 point level for the first time in nearly three months, though the index pared gains late in the session on renewed concerns about new US tariffs against China. Investors were switching into riskier assets, with travel and leisure stocks leading the gains in response to moves by Germany and Spain to lift their travel restrictions.
Hong Kong stocks tumbled on Friday after the Chinese government said it planned to impose national security legislation on the city, in the latest sign of how simmering geopolitical tensions have become a significant concern for investors. The city’s Hang Seng index fell 5.6 per cent due to rising fears that the show of legal force could reignite mass pro-democracy protests in the Asian financial hub and worsen tensions between Washington and Beijing. China’s CSI 300 of Shanghai- and Shenzhen-listed stocks fell by 2.3 per cent.
Global stocks and crude oil slowed advances made this week as fears over renewed tensions between Washington and Beijing outweighed hopes of more stimulus packages to support the world’s largest economies. Investors sought out havens such as gold and US Treasuries after China moved to assert its authority over Hong Kong with plans to impose a national security law on the territory. The Communist party’s decision earned a sharp rebuke from Washington, where Mike Pompeo, US secretary of state, called the plans a “death knell” for autonomy in the financial hub.
The decision drew a warning from President Donald Trump that Washington would react "very strongly" against the attempt to gain more control over the former British colony. The U.S. Senate published a bill with bipartisan support that would sanction Chinese officials who implement the law.
It’s a bit early to be thinking about the next FTSE index review (scheduled for June 3 and framed on the previous day’s prices) but as it’s something other than results let’s do so anyway. It has control of its whole value chain, in contrast to asset-lite hotel companies that, in some cases, have a more complex job of trying to help multiple hotel owners to optimise their positions.
Global stock markets pushed higher on Wednesday as investors took heart from the prospect of central banks offering further measures to stimulate economic growth and protect incomes. The optimism was underpinned by continued demand for sovereign debt issued by some of the world’s biggest economies, enabling governments to fund their record spending commitments. Minutes from the US Federal Reserve indicated the central bank was ready to support the economy over the medium term if there were additional outbreaks of the virus.