Fed hints at May rate rise, stocks fall | London closes lower
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10.30pm: US stocks fall on rate hint
US stocks rose earlier in the day on the back of a batch of strong quarterly earnings reports, but turned negative in the afternoon after Federal Reserve chair Jerome Powell hinted at aggressive rate hikes starting next month, adding: “I would say 50 basis points will be on the table for the May meeting.
“It is appropriate in my view to be moving a little more quickly” with raising interest rates.”
His comments came during a panel discussion among central bankers hosted by the International Monetary Fund.
The Dow Jones Industrial Average fell 1.1%, around 350 points, while the S&P 500 lost 1.5% and the tech-heavy Nasdaq Composite 2.1%.
7.30pm: Musk raises Twitter bid fund
Tesla boss Elon Musk is expected to provide $33.5 billion from his own resources as he prepares for a boardroom battle over control of Twitter.
He revealed in a filing that he has secured funding for his “best and final” cash offer for the social media platform.
5pm: London dips
Miners led the blue chip index lower as investors eyed key speeches from central bank officials. The FTSE 100 ended the session down 0.02% at 7627.95.
Markets were set to digest comments from the top central bank trio in Washington over the next two days, with Federal Reserve chair Jerome Powell, European Central Bank president Christine Lagarde and Bank of England governor Andrew Bailey all due to speak.
In London, BA owner IAG rose 6.17%, and budget airlines Wizz Air and easyJet ascended 4.41% and 4.89%, following well-received first-quarter results from United Airlines.
9.30am: THG reaction
Shares in THG were up 1.06p (1.12%) at 96.3p after touching 105p following CEO Matthew Moulding’s comments that the e-commerce retailer had received a number of approaches. However, it also posted a £186m loss for the year (see below).
Russ Mould, investment director at AJ Bell, said: “Having joined the stock market amid significant hype about its future growth potential and then fallen flat on its face amid criticism around corporate governance, a lack of transparency and a squeeze on margins, one might wonder why THG has attracted takeover interest.”
8.15am: FTSE 100 lower
Blue chips defied forecasters’ expectations of an early uplift in the leading shares index. The FTSE 100 was almost 14 points lower at 7,615.48 in the first minutes of trading.
7.05am: Deloitte fined
Big Four accountant Deloitte has been fined £2 million, adjusted for admissions and early disposal to £1.45m for its failings in the audit of Mitie Group for the financial year ended 31 March 2016.
Partner John Charlton was hit with a £65,000 sanction, adjusted for mitigating factors and admissions / early disposal to £40,056.25.
7am: THG loss and ‘approaches’
E-commerce retailer THG unveiled a £186 million loss before tax and adjusted EBITDA of £161m for the year to the end of December.
The loss was principally driven by adjusted items, which include the excess costs for transportation, delivery and fulfilment costs in relation to Covid-19, alongside the commissioning of new warehouses and non-recurring acquisition fees.
Chief executive Matthew Moulding said the company is planning to move to the main list on the LSE and had received a number of ‘unacceptable’ third party approaches. It confirmed that THG is not currently in receipt of any approaches.
“We continue to focus on delivering our exciting growth strategy across a number of large global sectors, and prepare to step up to the premium segment of the LSE at the appropriate time,” he said.
Today’s news turns towards macro matters with US Federal Reserve chair Jerome Powell, ECB President Christine Lagarde and Bank of England governor Andrew Bailey all scheduled to speak in Washington with inflation, geopolitics and interest rates on the agenda.
Netflix shares weighed on the tech-heavy Nasdaq after revealing it had just seen the first decline in subscriber numbers since 2011 in Q1.
Shares in the streaming giant were down more than 35% on the session after the company reported the first fall in subscribers in over a decade. Group revenues were $7.87bn, compared to $7.71bn in the fourth quarter
At the close, the Nasdaq Composite was 1.22% weaker while Dow Jones Industrial Average was up 0.71%. The S&P 500 was 0.06% softer.
London stocks closed higher as investors were buoyed by positive updates from the likes of CRH and Qinetiq. The FTSE 100 ended the session up 28 points or 0.37% at 7,629.22. Financial spread betters were pencilling in a rise of around 20 points .