Daily Business Live
FTSE 100 surges; Virgin Money; ITV; Boohoo; Omega; OSB
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9.30pm: Dow hits new high
The Dow Jones Industrial Average ended at a record high on Wednesday, while a tech sell-off left the Nasdaq lower.
The Dow Jones Industrial Average rose 96.99 points, or 0.28% and the S&P 500 gained 2.97 points, or 0.07%. The Nasdaq Composite dropped 51.08 points, or 0.37%.
5pm: FTSE 100 enjoys best day since February
Stocks rallied after the head of the US Treasury said she had not meant to either predict or recommend interest rate hikes.
There was a commodity price boost for miners and positive Eurozone data providing impetus for investors.
The index’s top performing shares were dominated by Anglo American, BHP, Rio Tinto, Glencore and Evraz, as copper prices hit another 10-year high earlier in the day.
It saw the top companies in London rebound from an unusual midday crash that analysts said had no obvious cause on Tuesday.
The blue chip index closed at 7,039.3, a rise of 1.7% or 116 points, making it the best day of trading since the middle of February.
10am: GDP revised upwards
Scotland’s GDP is now estimated to have grown by 2.3% during 2020 Quarter 4, revised up from the first estimate of 2.0% published in March, according to statistics announced by the chief statistician.
For 2020 as a whole, annual GDP is estimated to have fallen by 9.6% in real terms compared to 2019, unrevised from the first estimate.
9am: FTSE 100 recovers
Blue chips recovered from yesterday’s slump with the FTSE 100 gaining more ground, up 67.59 points or 0.98% at 6990.76.
But London shares followed Wall Streets’s fall in tech and delivery stocks. Just Eat Takeaway, down 145p or 1.99% to 7125p and Ocado Group 1.82% or 36.5p lower at 1967.5p, were the two biggest losers in the leading index.
7am: Virgin Money enjoys strong first half
Virgin Money returned to statutory profit, with underlying profit for the half year more than doubling to £245m (H1 2020: £120m) given a significantly lower impairment charge.
The net interest margin declined 6 basis points YoY to 1.56% but with improved momentum as Q2 increased to 1.60%.
David Duffy, chief executive, said: “Virgin Money had a strong first half. We doubled underlying profit compared to last year and returned to statutory profit.
“We’ve made significant strategic progress to transform Virgin Money into a leading digital bank and our rebranding is largely complete.
“We are cautiously optimistic about the improving outlook as the impact of the vaccination programme in the UK delivers positive revisions to economic expectations.
“We’re continuing to manage through what is still an uncertain economic backdrop, but the bank is well placed, with a strong balance sheet, and through ongoing strategic delivery we have a clear path to long-term, improved sustainable returns.”
7am: ITV recovers
ITV said it was cautiously optimistic about the year ahead as advertising revenue recovered from the Covid-19 crisis.
Total external revenue rose 2% to £709m in the first quarter. ITV Studios revenue rose 9% to £372m as media and entertainment income fell 3% to £484m.
Advertising revenue fell 6% in three months to the end of March but rose 68% in April and is expected to be up 85% in May and 85-90% in June.
The FTSE 250 broadcaster said its expectations were based on the relaxing of Covid-19 restrictions and a strong schedule including Love Island and the delayed Euro football tournament.
ITV’s total viewing rose 1%, boosted by Saturday Night Takeaway and the Six Nations rugby tournament.
Chief executive Carolyn McCall said: “We have made a good start to 2021 with total revenue and total viewing both up, despite the continuing impact of the pandemic. We finished the quarter strongly with the substantial majority of our shows back in production and a recovery in the advertising market.
“We are encouraged by the UK roadmap out of lockdown and remain cautiously optimistic about the year ahead.”
Ms McCall said she was heartened by the outlook for advertising, which she predicted would be up by about 26% in the first half from a year earlier. She said she was confident about achieving a £30m cost-cut target for 2021.
7am: Boohoo jumps
Online fashion retailer Boohoo has posted a 37% jump in full-year core earnings following a surge in demand for digital shopping during the Covid-19 pandemic.
Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) came in at £173.6m in the year to 28 February, ahead of analysts’ average forecasts.
Revenue rose 41% to £1.75 billion and revenue growth for 2021-22 was forecast at around 25%.
7am: Omega test boost
Omega, the Scotland-based medical diagnostics company, notes that the Mologic COVID-19 lateral flow antigen test has been independently verified in a 665-person study in Germany by FIND a global not-for-profit foundation.
The test was shown to demonstrate best-in-class performance with 100% specificity and 96.4% sensitivity compared with laboratory PCR testing.
Colin King, CEO, said: “This is great news for the Mologic test, which we are now producing under our VISITECT brand. It is significant that the test has been shown to have high diagnostic accuracy on self-collected swab specimens.
“Rapid diagnostic tests play a crucial role in breaking the spread of infection in the community and we are delighted to be a leading manufacturer of these home-grown tests.”
7am: OSB Group ‘strong’
OSB Group, the specialist lending and retail savings group formerly known as One Savings Group, reported Ssrong financial and operational performance throughout the first quarter.
Andy Golding, CEO, said: “I am delighted with the financial and operational performance that OSB Group has achieved so far this year. The underlying net loan book grew to £19.6bn at the end of March 2021, supported by £1.1bn of organic originations, achieved at attractive margins and on tighter post-COVID criteria.
“We entered the second quarter with a robust pipeline of new business and applications in our core Buy-to-Let and Residential sub-segments remain strong. We continue to control volumes in our more cyclical product lines.”
7am: Scotgold loan
Scotgold Resources, the company behind the gold mine near Loch Lomond, said some of its directors and an unrelated third party have provided it with a short-term loan of £2 million.
The lenders include non-executive chairman Nathaniel le Roux, three non-executive directors and an unrelated third party holding a 3.35% stake in the company.
On 27 April, Scotgold said directors of the company were proposing short-term debt financing after recent delays to the production ramp-up at its Cononish mine had a negative impact on the company’s cash position.
7am: Direct Line claims fall
Direct Line said premiums fell and motor claims were subdued in a first quarter affected by the Covid-19 lockdown.
Motor premiums were affected by low sales of new cars and fewer drivers entering the market, causing deflation. This also led to lower claims than normal.
The FTSE 250 insurer said the reduction in motor premiums was less severe than the wider market and that motor premiums appeared to stabilise in April.
Gross written premiums declined 4.7% to £752.3m in the three months to the end of March, led by a 10.6% drop in motor business to £367.3m. This more than offset a 1.8% increase in home premiums to £140.3m and a 16.1% rise in commercial premiums to £154m.
Rescue and other personal lines premiums fell 16.3% to £90.7m, mainly because of reduced travel partnership premiums with overseas travel limited. Green Flag was affected by reduced shopping levels during lockdown, leading to a 1.5% reduction in premiums to £19.4m.
1am: Castle View expecting loss
Leisure management company Castle View Corporate Holdings said it is anticipating an eight-figure loss in the year to 31 March, “but is hopeful that the end of lockdown and the removal of restrictions on public access to sports facilities will herald a rapid return to a pre-pandemic trading climate”.
The Bridge of Allan-based company – formerly Castle View Ventures – has interests in sports centre management, weight management, and food production. Its main operating division is based in Leicestershire and it has an Cambuslang-based UIN Foods.
It said it is optimistic about the easing of lockdown restrictions boosting its balance sheet as it forecast a major loss in its most recent financial year.
London was expected to open higher despite Japan’s Nikkei 225 falling 0.83% while Hong Kong’s Hang Seng dropped 0.32%.
On currency markets, the pound was up 0.1% at $1.39, although US services data due later today could provide a catalyst for movement.
The Dow Jones closed 0.06% higher but the Nasdaq Composite suffered heavy losses, ending the session 1.88% lower on the back of a sell-off in tech stocks. Facebook, Amazon, Apple, Netflix and Google-parent Alphabet all traded lower.
The S&P 500 closed out the session 0.67% weaker.
Analysts said the market may pick up towards the end of the week when employment figures are published.