ITV rebounds | Barclays | Rathbone | St James’s Place
5pm: London clings to gains
The FTSE 100 index closed up 20.55 points, or 0.3%, at 7,016.6, while the FTSE 250 enjoyed an even better day, closing 129.44 points, or 0.6%, higher.
St James’s Place, up 5.6%, was among the biggest gainers as the wealth manager returned to profit and reported funds under management climbed 11% to a record £143.77 billion (see below).
Barclays got the banking season under way with a 2% rise following a sharp profit hike, boosted by a release of credit impairment provisions. It also announced plans for a £500 million buyback.
Travel stocks rallied on plans for England to let fully vaccinated US and EU travellers skip the need to quarantine.
British Airways parent International Consolidated Airlines rose 3.8% and jet engine maker Rolls-Royce rose 3.5%. In the FTSE 250, Wizz Air soared 8% and easyJet 4.6%.
Markets turn attention to the meeting of the Federal Open Market Committee which will announce any changes to policy at 7pm BST. This will be followed by a press conference with Fed chairman Jerome Powell.
9.30am: Tidal milestone
The most powerful tidal turbine device in the world has connected to the grid in Orkney.
Orbital Marine Power’s O2 tidal turbine is anchored in the Fall of Warness where a subsea cable connects the two-megawatt offshore unit to the local onshore electricity network.
9am: London edges higher
The FTSE 100 edged back above 7,000 in the first hour of trading, up 5.4 points at 7,001.45.
7am: ITV on rise
ITV said it was emerging from the worst of the pandemic, with a strong rise in advertising revenue and a restoration of its dividend.
The first payout under the new policy would be a final dividend of 3.3p per share proposed at the full year results in respect of 2021.
Total ITV viewing was down 6% in H1 against tough comparatives and the easing of lockdown restrictions but it saw strong ratings from programmes including Unforgotten, Saturday Night TakeAway, The Masked Singer, Euro 2020 and the start of Love Island.
External revenue was up 27% at £1,548 million (30 June 2020: £1,218 million), driven by 26% growth in ITV Studios revenue and a 29% increase in total advertising revenue within which total video on demand advertising was up 55%.
Adjusted group EBITA was up 98% at £327m, driven by the strong recovery in the advertising market, resumption of productions, and tight cost control delivering £21m of savings, of which £15m are permanent.
Carolyn McCall, ITV chief executive, said: “Our H1 results demonstrate that ITV is emerging from the worst effects of the pandemic.
“We’ve continued to implement our key strategic priorities and have further strengthened the business.
“We are now a more flexible, more efficient and more digital business.
“We are optimistic about the future, despite the ongoing pandemic risk on our advertising and ITV Studios revenues. We know that the dividend is important to our shareholders and we intend to re-commence a progressive dividend policy.”
7am: Barclays profit soars
Barclays Bank posted an increase in half-year profit before tax to £3.334 billion compared to £1.523bn in the corresponding half last year.
An interim dividend of 2p per share will be paid on 2 August 2021.
The bank benefited from improving economic forecasts following the lifting of most UK Covid restrictions, which meant it was able to release £1bn in bad debt provisions that it had put aside to cover potential defaults related to the pandemic.
7am: Rathbone funds rise
Wealth manager Rathbone said funds under management and administration rose 19.8% year on year to £54.7 billion.
Paul Stockton, chief executive, said: “Following a strong set of year to date financial results we enter the second half of 2021 in a robust position.
“The acquisition of Saunderson House, announced on 23 June 2021, accelerates our financial advice strategy, and presents an exciting opportunity to explore wider UK wealth segments. The deal continues to be on track to complete during the third quarter of 2021, adding c£4.7 billion of funds under management and administration.
“We continue to focus on delivering high-quality services to our clients and developing our services. The UK wealth market is changing quickly, and Rathbones remains well positioned to take advantage of future growth opportunities.”
7am: St James’s Place
The wealth manager said gross inflows rose to £9.2 billion (2020: £7.3 billion) and group funds under management at 31 December stood at a record £143.8bn (2020: £129.3bn).
The company declared an interim dividend of 11.55 pence per share, representing 30% of prior full year dividend.
Andrew Croft, chief executive, said: “Retention has remained strong through the period, resulting in net inflows of £5.5 billion in the first half, equivalent to 8.6% of opening funds under management on an annualised basis.
“These net inflows, together with the positive impact from investment markets, has resulted in funds under management closing the half at a record.”
7am: Smart Metering Systems
The energy infrastructure company said FY 2021 underlying profitability remains in line with the board’s expectations and smart meter installation run rates are expected to continue to strengthen.
In a trading update it said it is expecting a FY 2021 dividend of 27.5 pence per share, up 10% y-o-y and in line with stated policy.
The company continues to make progress in expanding the contracted smart meter order pipeline, grid-scale battery pipeline and development of wider CaRe products and services
6am: Record US tech earnings
Google parent Alphabet, Microsoft, and Apple all reported record quarterly earnings.
Apple revenue surged 36% from a year ago to $81.4 billion, its best ever fiscal third quarter, though Apple’s shares fell back in after-hours trading on the back of a slower growth forecast. Profit almost doubled to $21.7 billion on growth in iPhone sales and its increasingly important digital services.
Alphabet shares climbed by 5% in extended trading as the Google-parent reported quarterly results that beat Wall Street estimates by a significant margin.
Net income in the fiscal second quarter came in at $18.53 billion that translates to $27.26 per share. In the same quarter last year, its net income was capped at a much lower $6.96 billion or $10.13 per share.
It generated $50.95 billion of revenue in Q2 – an increase from $31.6 billion last year.
Microsoft Corp posted its most profitable quarter, beating Wall Street expectations for revenue and earnings, as PC sales declines stemming from a global chip shortage were more than made up for by a boom in cloud services.
Shares ticked up 0.7% after Microsoft projected that growth in its Azure cloud computing business will continue apace following a quarter in which sales climbed 51%.
Overall revenue rose 21% to $46.2 billion, beating analysts’ consensus by about $2 billion
Microsoft’s market capitalisation is nearly $2.2 trillion, after climbing nearly 30% so far this year, compared with 18% for the overall S&P 500 Index.
Asia’s markets continue to trade at seven-month lows amid current turmoil in Chinese equity markets and ahead of a US Federal Reserve meeting.
Global investors have been bruised by regulatory crackdowns in China that have impacted the technology, property and education sectors.
Japan’s Nikkei 225 slid 1.71% to a six-month low. Hong Kong’s Hang Seng fell 0.24%.
Nervousness in Asian equities spread to other markets, with Wall Street retreating from record highs set earlier in the week.
The Dow Jones Industrial Average last night closed down 0.2%, the S&P 500 shed 0.5% and the Nasdaq Composite lost 1.2%.
Markets are awaiting a statement from the Fed policy meeting at 2pm EDT (6pm GMT) and will be watching for any hints on when the Fed will start reducing its purchases of government bonds and any fresh insight into its views on inflation and economic growth.