• House prices rise 0.4% in July
• WPP’s new chief Cindy Rose to lead strategy review
• Bank of England expected to cut interest rates to 4%
• Nikkei hits high, dollar weakens
• Sign up for our daily business newsletter here
Deliveroo upgrades guidance, makes loss
Deliveroo reported a 9 per cent rise in gross transaction value in the first half of the year
ALAMY
The food delivery group has forecast annual core profit of between £170 million to 190 million, the upper end of its previous forecast range, boosted by an increase in orders.
Deliveroo’s gross transaction value (GTV) – the cost of all food orders and delivery fees on its platform and a key industry metric – rose 9 per cent in the first half to £3.79 billion.
However, it made a £19.2 million loss, compared to a profit of £1.3 million in the same half last year, due to higher costs associated with its £2.9 billion takeover by US rival Doordash. The deal is expected to close in the final quarter of the year.
Deliveroo made its first-ever annual profit of £2.9 million in March and analysts have forecast full-year GTV of between £7.6 billion and £7.7 billion for 2025, compared with £7.4 billion last year.
The shares, which have risen 39 per cent of the past year, edged higher this morning to 177½p. It floated at 390p a share.
WPP’s new chief to lead strategy review
Cindy Rose takes over at WPP at a difficult time for the company and the industry.
TOM STOCKILL
Britain’s biggest advertising group said its new chief executive, Cindy Rose, would lead a review of strategy and future capital allocation policy when she takes over at the start of next month as it announced first-half results.
Underlying revenue has continued to slide at WPP over the first six months of the year as the advertising group halved its dividend.
Rose’s appointment was announced just a day after a bruising profit warning last month, where revenue and margin guidance was slashed.
Revenue less pass-through costs – fees paid to external suppliers – declined 4.3 per cent, and worsened to a 5.8 per cent fall in the second quarter, as a tough macroeconomic backdrop pushed major brands to pull back on their marketing spending.
Mark Read, the outgoing chief, said it had been “a challenging first half given pressures on client spending and a slower new business environment”.
The full-year outlook for a 3-5 per cent decline in revenue and a 50-175 basis point fall in the headline operating margin, was maintained, although operating cashflow is now expected to be between £1.1 and £1.2 billion this year, down from previous guidance about £1.4 billion.
House prices rise 0.4% in July
House prices rose again last month as the buyers continued to return to the market after a slowdown in demand following the end of the stamp duty holiday, data from the mortgage lender Halifax showed.
House prices rose by 0.4 per cent in July, the biggest monthly increase since the start of this year. The average house price is now £298,237, 2.4 per cent higher than a year ago.
Amanda Bryden, head of mortgages at Halifax, said: “Challenges remain for those looking to move up or onto the property ladder. But with mortgage rates continuing to ease and wages still rising, the picture on affordability is gradually improving.”
She said the second half of the year will see a notable rise in homeowners coming to the end of fixed-rate deals. “While most borrowers coming to the end of five-year fixed-rate mortgage deals will see their monthly repayments rise. Those coming off a two-year fixed-rate are very likely to see their monthly payments come down.”
Bank of England expected to cut interest rates
The central bank’s monetary policy committee (MPC) is expected to cut interest rates by a quarter-point to 4 per cent at midday. However, the committee is once again expected to be split. Jack Barnett has more on why economists are forecasting the reduction in borrowing costs here.
The decision is likely to weigh on investors this morning, with the FTSE 100 forecast around 8 points lower when trading begins. Last night the index closed up 0.24 per cent, or 21.56 points, at a new high 9,164.30.
Asian markets rise, dollar weakens
South Korea’s Kospi rose 0.6 per cent this morning, with indices in China, Japan, and Taiwan also higher. Markets in India were lower.
AP
Asian stock markets rose and Japanese shares hit a record high this morning, lifted by tech-led gains on Wall Street, upbeat earnings, growing expectations of US rate cuts and the prospect of a meeting between President Trump and President Putin over the war in Ukraine.
Markets seemed to shake off Trump’s latest tariff moves, including an additional 25 per cent tariff on India over purchases of Russian oil. Trump’s threat of a 100 per cent tariff on chips and semiconductors was also taken in stride, as the president promised to exempt companies such as Apple that move production back to the United States.
The dollar weakened against a basket of currencies on hopes of US rate cuts and concerns about Trump’s attempts to interfere with key institutions such as the Fed and the Bureau of Labor Statistics.