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TalkTalk takeover; Cairn special dividend; Wetherspoon

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4.30pm: Gove caution derails FTSE

Cautious comments on the prospect of a Brexit deal from Cabinet Secretary Michael Gove saw the FTSE 100 close the day down 19.85 points, or 0.3%, at 6551.06

Michael Hewson, chief market analyst at CMC Markets UK, explained: “The FTSE100 has slipped back a touch, unable to gain a foothold above the 6,600 level, and subsequently slipping into negative territory on comments from Michael Gove who poured cold water on some of the optimism over the prospect of a Brexit deal by this weekend, saying that it was more likely that we may not get a deal.”

2.45pm: Furlough extended

The furlough scheme has been extended, with the Government continuing to contribute 80% towards wages.

Full story here

2pm: Budget date

The Chancellor of the Exchequer, Rishi Sunak, has announced that the government will publish the Budget on Wednesday 3 March.

Bank of England

Noon: No change to interest rate

The Bank of England’s monetary policy committee voted unanimously to leave the interest rate unchanged at 0.1%, but said it stood ready to intervene in the event of a No Deal Brexit.

Full story here

9am: Markets higher on Brexit belief

“Belief continues to build in the idea a Brexit deal can be brokered, despite slightly guarded comments from both sides of the negotiation, with sterling advancing strongly,” says AJ Bell investment director Russ Mould.

“The FTSE 100 was also higher, pushed up by domestic-facing stocks and miners. The other big story is the US stimulus package which is undermining the dollar but improving market sentiment as it looks like the Republicans and Democrats are closing on an agreement.

“Having surged through $20,000 yesterday bitcoin shows no sign of stopping – battering through the $22,000 mark on Thursday morning.

“It emerged this week that mainstream asset manager Ruffer had taken a position worth hundreds of millions of pounds in bitcoin and this may be driving the idea that the cryptocurrency is entering a new phase as more institutional investors could use bitcoin to diversify their portfolios.

The FTSE 100 was trading 8.39 points higher at 6,579.30.

7am: TalkTalk takeover

TalkTalk

Broadband company TalkTalk has agreed to a £1.1 billion takeover by its shareholder Toscafund and private-equity investor Penta.

TalkTalk shareholders will receive 97 pence in cash per share, a 16.4% premium to the share price on 7 October before the offer was first proposed.

Tosca Penta, which owns 29% of the company, said “operating in the public listed markets is not optimal” for TalkTalk and its future could be best delivered as a private firm “without the significant governance, cost, regulatory and financial reporting burdens of a company listed on the London Stock Exchange.”

Cairn’s £188m payout

Cairn Energy said the sale of all of its interests in Senegal to Woodside is expected to yield $525 million in cash, allowing it to pay a special dividend of 32 pence per share amounting to a return of about $250m or £188m to shareholders.

The dividend is expected to be paid on 25 January to those on the register on 8 January.

Wetherspoon’s Martin blasts Covid restrictions

Tim Martin, executive chairman of pubs chain Wetherspoons, will again refute much of the lockdown “evidence” at today’s AGM.

“Lockdowns, the core of the UK’s current strategy, have been shown by many studies to be ineffective, and often counterproductive,” he will tell shareholders.

“In October, the prediction of Sir Patrick Vallance, chief scientific adviser, of 4000 deaths per day, upon which the government instigated a second lockdown, proved to be wildly inaccurate.

JD Wetherspoon

“The predictions that have turned out to be true in 2020 relate to the effects of lockdowns and government actions on the economy and health.

“Over 800,000 jobs have been lost so far, approximately equivalent to the combined working populations of the cities of Manchester and Birmingham. These job losses are bound to rise sharply in the coming months, without a radical change in government policy.”

Watches of Switzerland

Luxury retailer Watches of Switzerland said revenue for the half year to 25 October fell 2.6% in constant currency terms to £414.3 million (H1 FY20: £428.7m).

However, it saw strong trading during Q2, up 21.5% in constant currency terms. The company opened a store in Glasgow during the period.

Brian Duffy, chief executive, said: “We have continued to deliver on our strategic priorities during the first half, achieving a robust performance against significant headwinds, further consolidating our position in luxury watches and demonstrating the unique, supply-driven qualities which underpin the resilience of our category and the strength of our business.”

Smart Metering ahead

Smart Metering Systems, which installs and manages smart meters and carbon reduction assets said it has continued to see a progressive recovery in the installation run-rates since the first national lockdowns, despite continued local restrictions.

SMS is currently operating at more than 80% of the pre-Covid run-rate and is positively geared for the continued increase in installation activity to deliver the mandated smart meter roll-out and the contracted order pipeline.

Alan Foy

In the light of recent trading, the board expects FY2020 underlying PBT to be marginally ahead of its expectations, with forecast year-end net cash position of c.£30m.

Alan Foy, chief executive (pictured), said: “We have demonstrated strong resilience throughout 2020 and our performance is testimony to the commitment and dedication of the entire SMS team.”

Deep Matter deal

DeepMatter, the Aim-quoted Glasgow company focusing on digitising chemistry, has signed a three-year contract with Thieme Chemistry, an international medical and science publisher, for the supply of technical data services and access to the group’s proprietary algorithms.

The contract builds on a long-standing relationship between the two businesses, providing Thieme with access to DeepMatter’s services and algorithms to ensure the quality of, and access to, their data.

Markets

The FTSE 100 is set to start on the front foot as the Santa rally picks up steam in the final trading days of the year in the hope of a Brexit deal being secured.

CFD and spreadbetting firm IG see the FTSE 100 up around 22 points, making the blue chip benchmark’s price 6,582 to 6,585 with just over an hour to go before the open.

Wall Street saw a mixed close to trading on Wednesday.

The Dow Jones Industrial Average finished down 44 points, or 0.15%, while the S&P 500 edged into positive territory. The Nasdaq Composite was stronger, slightly, as it ended the session up 0.5%.



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