Daily Business Live
DX auditor Grant Thornton quits | Nasdaq slumps on Meta fall
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5pm: Closing report
Shares in THG, formerly the Hut Group, rose strongly following a report that private equity firms Advent International, Leonard Green Partners and Apollo were circling the e-commerce company in which Sir Tom Hunter is a shareholder (see full story here).
Shell was among today’s other big gainers, up 3.5% to 2,029.25p as investors continued to buy into the recovery story.
Wood was a strong riser among the mid-caps, up 4.9%, while Edinburgh’s Capricorn Energy gushed 3.2% higher.
The FTSE 100 closed down 12 points or 0.17% at 7,516 on a strong US jobs report which fuelled speculation of firmer action by the Federal Reserve.
The US economy added 467,000 jobs in January, massively above the 150,000 economists were expecting, though down from the 510,000 jobs added in December. The numbers are likely to further encourage the Fed to raise interest rates.
Excitement around Amazon‘s earnings, which had fuelled an uptick in global markets, began to cool as a deep dig showed the headline numbers are flattered by the investment in Rivian, creating a one-off accounting trick that was responsible for 82.5% of Amazon’s net income.
9.30am: Market rises above the turmoil
The FTSE 100 made a good start amid all the drama Stateside and talk of more interest rate rises at home.
Resources firms and Shell led the market higher on strong energy prices, with European oil sites being hit by cyber-attacks only adding to the pressures on crude supply.
Travel food outlet operator SSP Group, owner of Upper Crusrt, gained despite saying that the Omicron Covid variant and government restrictions saw trading in the eight weeks to 30 January slump to 57% of pre-pandemic levels.
It said recent weeks “have been more encouraging” as curbs were lifted in the UK and some Continental European markets, with sales now trending positively again, driven mainly by strengthening trading in the rail sector as commuter travel returns.
The FTSE 100 was up 43.7 points at 7,572.54.
7am: Grant Thornton resigns from DX
Grant Thornton has resigned as auditor of parcel delivery firm DX over progress into a corporate governance inquiry.
DX said the Inquiry has not proceeded as expediently as initially hoped by the board.
Grant Thornton has provided the company with the reasons connected with its resignation.
In a statement, the board said it “does not consider that the reasons provided by Grant Thornton accurately reflect the current situation. As required by the Companies Act, DX will send a copy of the reasons to shareholders within 14 days of their receipt.
“The board reiterates that the Inquiry is a corporate governance investigation and, in addition, notes that it is connected to a disciplinary matter. It does not relate to the financial performance or the financial position of the Group, consistent with the trading update released on 2 February 2022.”
In October DX postponed publication of its results for the year that ended 3 July, citing a delay by Grant Thornton in completing the audit.
US markets slumped with the Nasdaq 100 posting its worst one-day fall since March 2020, as investors bailed out of stock in Meta Platforms, owner of Facebook.
While the social network founder lost $29 billion in net worth in a record one-day plunge, fellow billionaire Jeff Bezos at Amazon was set to add $20 billion to his personal valuation after Amazon’s blockbuster earnings.
Meta’s stock fell 26%, erasing more than $200 billion in the biggest ever single-day market value wipeout for a US company, reducing 12.8% holder Mark Zuckerberg’s net worth to $85 billion
Amazon shares were up 15% in extended trading on fourth-quarter net sales of $137.4bn.
Bezos’ net worth rose 57% to $177 billion in 2021 from a year earlier.
The Dow Jones Industrial Average fell 1.5%, the S&P 500 declined 2.4% and the Nasdaq Composite tumbled 3.7%.
European equities struggled on Thursday and ended lower after another rate hike by the Bank of England. Although the European Central Bank left its rate unchanged, investor focus has turned to later meetings and the prospect of an interest rate hike this year.
The Hang Seng in Hong Kong, having been closed since Monday, was up 3.2%. The stock market in Shanghai remained close on Friday as the Chinese New Year public holiday continues on the mainland.