9.28am: Market awaiting US confirmation on Iran deal<\/p>\n
The FTSE’s gains have dissipated a little, now up just over 10 points, while the FTSE 250 is in the red.\u00a0<\/p>\n
Miners are dragging a little on the blue-chip index, with Rio Tinto, Glencore, Anglo American and Antofagsata all down 0.6-1%.\u00a0<\/p>\n
“It may seem like a quiet start to the day, but in reality, there is a huge amount going on underneath the surface,” says Kathleen Brooks, research director at XTB.<\/p>\n
The oil price is remaining steadfast at around $80 per barrel, despite Iran saying that it had reached an agreement with Oman about the route for shipping lanes in the Strait of Hormuz, and Tehran saying that the US has agreed to return to the Memorandum of Understanding pledges.<\/p>\n
“Caution in the oil price today is a sign that the market needs confirmation from the White House that this is all true, and the prospects of a deal to reopen the Strait of Hormuz is not a false dawn,” says Brooks.<\/p>\n
“President Trump will also need to state his approval for the market to believe it. For now, Brent is likely to remain in a tight range below $80 per barrel. However, confirmation from the US could send Brent back towards $75.”<\/p>\n
With the FTSE 100 near all-time highs and the FTSE 250 also reaching a new peak, Brooks says “this is a reminder that the recent global stock market rally is not only about tech”.<\/p>\n
As the comes after stronger PMI data for last month, “suggests that the UK economy is gaining momentum as we move through Q3” and could see UK stocks benefit from upward momentum for earnings.<\/p>\n
Brooks notes that SpaceX is higher by more than 1% in overnight trading and “could attempt a recovery later today”, with the stocxk “worth watching closely” today as it was the worst performer on the Nasdaq 100 yesterday and faces a big hurdle today with stock lock-uyps coming to an end.<\/p>\n
“It is also a highly volatile stock, so if it recovers it could be a sign of stronger overall sentiment for the index.”<\/p>\n
Brooks says the market could be a bit “directionless” as we lead up to some major event risk, including Friday\u2019s US jobs report.\u00a0<\/p>\n
“Payrolls are always important, but they are taking on extra significance since the Fed has dropped forward guidance.”<\/p>\n
\t\t\t\t\t9.04am: ADM (NYSE:ADM, XETRA:ADM)<\/a>iral ADM (NYSE:ADM, XETRA:ADM)<\/a>ired but not by all<\/p>\n Admiral boss Milena Mondini de Focatiis said the group had increased motor insurance rates ahead of the wider market following a \u201csofter period in the cycle\u201d, as it priced for sustainable long-term growth.<\/p>\n Analysts at Citi recently noted how the group has been\u00a0drip-feeding\u00a0small inflation-adjusted premium increases\u00a0to gradually strengthen margins and earnings, with conditions in UK motor insurance likened to the “boiling frog” description once used by Admiral co-founder Henry Engelhardt two decades ago.<\/p>\n Peel Hunt analyst Andreas van Embden, who has a ‘sell’ rating on the shares,\u00a0says the dividend was better than expected and the solvency ratio in line with forecasts, but the\u00a0decline in PBT was worse than the consensus forecast.<\/p>\n The decline was largely driven by an 18% drop in the UK motor business, with results flat versus the second half of last year but including significantly higher reserve releases, that\u00a0van Embden\u00a0suspects was from reserve releases being brought forward.<\/p>\n “The outlook for UK motor claims inflation is 5-7% and ADM states rates are broadly flat and that significant rate increases will be needed to turn the market.<\/p>\n “ADM is increasing rates in the high single-digits ahead of the market and in line with inflation in order to try and stabilise margins and does not expect to grow this year.<\/p>\n “We believe this risks losing some competitiveness in the second half of the year. With 29% downside to the current share price, we reiterate our Sell recommendation.”<\/p>\n 8.47am: OSB falls as profit and guidance drop<\/p>\n OSB Group is the biggest faller on the FTSE 250 this morning, down 13.4% after the owner of Charter Savings Bank and\u00a0Kent Reliance reported interim results showing a fall in profit before tax to below forecasts.<\/p>\n While the net loan book grew 1.3%, helped by 10% growth in originations in line with management guidance, analyst Abid Hussain at Panmure Liberum notes that the net interest margin\u00a0fell to 223bps from 230bps “as more costly spreads on new retail funding outweighed new business written at sustainable margins”.<\/p>\n Impairments rose to \u00a316 million from \u00a32 million, which was worse than the market expected, but Hussain says “looks more like a normalisation off an unusually low base rather than borrower stress, since arrears balances decreased”.<\/p>\n Together with higher admin expenses, this was the cause of the 3% fall in\u00a0PBT to \u00a3187 million, a 2% miss against consensus.<\/p>\n Guidance for the net interest margin has been cut too, on the view that high retail funding costs will not ease and that competition in the retail savings market stays strong.<\/p>\n 8.31am: WPP soars, PZ Cussons (LSE:PZC)<\/a> falls<\/p>\n On the FTSE 250, shares in\u00a0WPP have soared 25% this morning<\/a> as the advertising group\u00a0reported a smaller decline in revenues for the second quarter as improving media performance offered early evidence of progress under new CEO Cindy Rose’s turnaround plan.<\/p>\n Revenue less pass-through costs fell 4.7% on a like-for-like basis to \u00a34.75 billion in the first half, compared with the \u201cmid to high single digit\u201d decline forecast in April.<\/p>\n The decline moderated to 2.8% in the second quarter from 6.7% in the first, helped by an improved trend at WPP Media and easier comparisons.<\/p>\n Rose said: “While legacy account losses continue to weigh, Q2 saw a further sequential improvement in LFL growth, highlighting the momentum we are building across the company”.<\/p>\n PZ Cussons (LSE:PZC)<\/a> has dropped 4% despite\u00a0beating its recently upgraded profit forecast<\/a> and resumed dividend growth after stronger sales and a sharp reduction in debt.<\/p>\n The Carex and Imperial Leather owner reported adjusted operating profit of \u00a359.5 million for the year to 31 May, up 24.5% on last year and above the \u00a353-57 million guidance range given in June.<\/p>\n 8.15am: Metlen and Admiral help FTSE open higher<\/p>\n The FTSE 100 has inched higher in early deals, up 18 points to\u00a010,907.<\/p>\n Top of the leaderboard is Metlen\u00a0Energy & Metals, up 10% as the Greek\u00a0energy and metallurgy group celebrated a year in the index with a positive set of results.\u00a0<\/p>\n Next is\u00a0Admiral, up 4.1% to a new all-time high despite a fall in profits and a near-40% dividend cut.<\/p>\n Persimmon is up 3.8% on the back of its results too,<\/p>\n Other risers include defence names BAE Systems and Babcock, along with retailers and housebuilders.\u00a0<\/p>\n At the other end,\u00a0Tritax Big Box REIT is down 4.5% after issuing\u00a0new shares to raise \u00a3350 million to fund its data centre development pipeline. \u00a0<\/p>\n \u00a0<\/p>\n 8am: Admiral profits falls as conditions get ‘more challenging’<\/p>\n Admiral Group has reported an 18% fall in first-half profit<\/a> and cut its interim dividend by 39% as conditions in the UK motor insurance market became more challenging.<\/p>\n CEO\u00a0Milena Mondini de Focatiis said: “Against more challenging market conditions, we are pricing for long-term sustainable growth with our UK motor business having increased rates earlier than the market, following a softer period in the cycle.”<\/p>\n She added that the recent acquisition of Flock, a provider of digital insurance for commercial vehicle fleets, has been completed and integration is “progressing well”.<\/p>\n 7.43am: Persimmon keeps dividend flat<\/p>\n Persimmon held its dividend flat as it reported double-digit growth in first-half profits and completions but flagged signs of softer demand in the second half<\/a> and additional inflationary pressure for next year.<\/p>\n The FTSE 100 housebuilder has posted interim results showing underlying operating profit rose 10% to \u00a3189.1 million, although the margin narrowed by 30 basis points to 12.8%.<\/p>\n Almost 5,190 home sales were completed in the six months to 30 June, up 13% from a year earlier, while the average selling price edged 1% higher to \u00a3285,752.<\/p>\n Persimmon’s recent trading suggested some cooling in the open market, with net private sales rate excluding bulk deals falling to 0.59 from 0.61 in the five weeks since June and weaker enquiries seen during July.<\/p>\n 7.28am: FTSE 250 high<\/p>\n It should not have gone unmentioned, but the UK’s mid-cap index hit a record high yesterday.<\/p>\n The FTSE 250 climbed 155.75 points or\u00a00.6% to close at\u00a024,459.3, having gained over 400 points this week.\u00a0<\/p>\n Unlike the FTSE 100, which has been notching new highs all over the place this year, the 250 was slowly ascending back to the previous high from 2021.\u00a0\u00a0\u00a0<\/p>\n FTSE 100 Live: Stocks called higher, is\u00a0Iran another false dawn?\u00a0<\/p>\n London’s blue-chip shares index is set to open modestly higher on Thursday as investors focus on another busy day of corporate reporting and mull whether news of an Iran deal is another\u00a0false dawn.<\/p>\n The FTSE 100 has been called 22 points higher on the futures market, after adding nine points to close at 10,888.3 yesterday.<\/p>\n Wall Street trading was mixed overnight as this week\u2019s equity rally began to lose momentum. The Dow Jones rose 0.5% to another record closing high, but the S&P 500 slipped 0.2% and the Nasdaq fell 0.8%, ending a four-day winning streak.<\/p>\n Investors remain cautiously optimistic that negotiations with Iran could lead to the partial reopening of the Strait of Hormuz.<\/p>\n Tehran said it had agreed a proposed shipping route with Oman, although the arrangement would be temporary and would not represent a full reopening of the waterway.<\/p>\n Jim Reid at Deutsche Bank said markets had experienced \u201cplenty of false dawns\u201d during the conflict, with attention now shifting towards the details of any agreement.<\/p>\n President Donald Trump struck a more guarded tone, saying he would \u201csee what happens\u201d in the talks.<\/p>\n Brent crude is roughly flat at around $79.50 a barrel this morning, while European and UK natural gas prices have dropped more than 13% over the past week.<\/p>\n Asian markets are weaker this morning, amid renewed caution towards technology stocks. South Korea\u2019s Kospi is down 4.6%, while Japan\u2019s Nikkei has fallen 0.9% and Hong Kong\u2019s Hang Seng lost 1.7%.<\/p>\n Today\u2019s economic calendar includes the UK construction PMI, German factory orders, eurozone retail sales and US jobless claims.<\/p>\n The UK corporate diary includes Persimmon, WPP, Harbour Energy, Admiral, TP ICAP, Serco, Hikma Pharmaceuticals, Metlen Energy, Quilter and OSB Group, while ConocoPhillips (NYSE:COP, XETRA:YCP)<\/a>, Howmet Aerospace, Datadog and Constellation Energy lead the US pre-market slate, followed by Cloudflare, Petrobras (NYSE:PBR)<\/a> and Monster Beverage after the close.<\/p>\n Overnight, AppLovin and SanDisk plunged almost 16% and 8% in afterhours trading after reporting earnings, while\u00a0eBay climbed 2% after its numbers.<\/p>\n","protected":false},"excerpt":{"rendered":"9.28am: Market awaiting US confirmation on Iran deal The FTSE’s gains have dissipated a little, now up just…\n","protected":false},"author":2,"featured_media":729173,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[84,59,56,54,55],"class_list":["post-729172","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-business","tag-gb","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/729172","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=729172"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/729172\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/729173"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=729172"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=729172"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=729172"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}