Friday update

DB Live: Odds-on for indy; St Mirren update; Centrica sale

4.45pm: London closes lower

London stocks finished in negative territory despite business activity growing at its fastest pace in five years in July.

The FTSE 100 ended the session down 87.62 points or 1.41% at 6,123.82, and the FTSE 250 was 1.28% weaker.

2pm: Independence backed

All Under One Banner Scottish independence

Scotland is now odds-on to vote for independence despite Boris Johnson’s visit north to talk up the benefits of the United Kingdom, according to bookmaker BoyleSports.

It has cut the odds on securing a vote for independence into 4/5 from 11/10.

The odds also suggest it is 1/6 from 2/5 that a poll won’t go ahead before the end of 2022.

1.45pm: St Mirren update

St Mirren chief executive Tony Fitzpatrick has released an update following further tests on seven staff suspected of contracting the coronavirus.

Full story here

8.15am: London sharply lower

Mixed quarterly earnings updates and souring US-China relations dulled optimism about a post-pandemic economic recovery and sent stocks sharply lower, despite better retail figures.

Education publisher Pearson fell 2.7% to the bottom of the FTSE 100 even after saying it had seen a rebound in demand since June.

The blue-chip FTSE 100 was trading more than 100 points or 1.64% lower at 6,109.43 and on course for its biggest weekly decline since early mid-June.

7.15am: Retail sales higher than forecast

Retail sales across the UK grew more strongly than expected in June when non-essential stores in England were allowed to reopen to the public in the middle of the month.

Full story here

7am: Centrica sale

British and Scottish Gas owner Centrica is selling its North American energy supply, services and trading business, Direct Energy, to NRG Energy for $3.625 billion (£2.85bn) in cash on a debt free, cash free basis.

The company said the deal increases the long term strength of its balance sheet with proceeds to help reduce net debt significantly and to make a material contribution to the group’s defined benefit pension schemes.

Alongside the significant restructure announced in June 2020, it “creates a simpler and leaner energy services and solutions company, focused on delivering for its customers and enabling the transition to a lower carbon future,” it said.

Centrica will focus on its core home UK and Ireland markets.

Stuart Lamont, investment manager at Brewin Dolphin Aberdeen, said: “After a torrid 2019, it’s been a tough start to the year for Centrica – revenues and profits have dropped against a challenging economic and commodity backdrop.

“However, there are some positive steps in here for the longer term: the sale of Direct Energy, its North American energy business, is a significant move that will go some way towards simplifying Centrica and offsetting debt. The resumption of the sales process for Spirit Energy, its exploration and production arm, will likely do the same in time.

“With resilient cash flow and reduced debt, there are tentative signs of recovery in Centrica after a challenging few years – but there is also still plenty to do and it remains a work in progress.”

Hotel Chocolat

Hotel Chocolat

Hotel Chocolat said digital sales rose over 200% in the quarter to the end of June and sales of subscriptions or recurring purchases, such as refills for in-home hot chocolate makers, grew 47%.

French Connection

The fashion chain reported digital sales up 24% over the last 15 weeks.

The company said that following the re-opening of stores on 15 June in-store sales have been low “although conversion of those customers actually in the stores has been better than in the prior year”.

Naked Wines

With pubs and restaurants closed, online alcohol sales have boomed and Naked Wines reported a 77% increase in sales in the quarter to the end of June.

In a trading update the company described itself as a “long-term winner” from the shift of consumer demand from buying wine in physical stores to digital channels.

The company also said that John Walden, Naked Wines chairman, is to leave.

Nucleus assets rise

Wrap platform Nucleus Financial said that despite the Covid-19 outbreak assets under administration (AUA) in the three months to 30 June grew 13.1% to £15.8bn on the previous quarter and 3.2% year on year.

Full story here

6am: Twitter rise and fall

Twitter drew millions more users in the last quarter because of the pandemic and the Black Lives Matter protests, but the social media plunged to a loss as advertisers reined in spending.

Full story here 

Today’s agenda

New face covering rules come into effect in England

Today’s top Daily Business headlines

Johnson backs union vow with £1.9bn Scots top-up

Frost admits UK faces prospect of no-deal Brexit

SPL restart blow as St Mirren hit by Covid-19 outbreak

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