Market report

Gatwick warns of ‘UK lag’ | McColl’s | Braveheart | Babcock


5pm: FTSE 100 enjoys best week since November

The FTSE 100 closed 25.48 points, or 0.4% higher at 7,218.71, just below the day’s new one-year high of 7,224.46, helped by yet another record surge on Wall Street.

London’s blue chip index has enjoyed its longest weekly winning streak since November, although investors remain concerned that the Bank of England could pull back asset purchases earlier than expected.

Babcock jumped 6.4% to the top of the FTSE 250 index after it agreed to sell its consultancy unit Frazer-Nash for £293 million.

2.15pm: Hotel in administration

One of Scotland’s best-known Victorian hotels has been put into administration after a collapse in trade caused by the Covid-19 pandemic.

Full story here

1pm: Rangers case duo sue for millions

Rangers’ former administrators Duff & Phelps are chasing a massive £120 million pay-out from the Scottish Crown Office for reputational damage, according to a report.

The New York-based firm says it lost significant earnings after two of its staff were wrongly arrested as part of the Scottish prosecution service’s “malicious” investigation into the 2012 takeover of the Ibrox club.

Full story here

9am: Babcock a highlight as market rises

Babcock shares rose 5.7% to 324.25p after the FTSE 250 engineering group agreed to sell its consultancy unit Frazer-Nash to KBR for £293million. 

It marks the end of a 14-year partnership between Babcock and Surrey-based Frazer-Nash Consultancy which sprung out of classic carmaker Frazer-Nash.

The FTSE 100 rose 21.6 points to 7,213.82 and is heading for the fourth consecutive week of gains which would be the longest winning streak for the bluechip index since November last year. The FTSE 250 was up by 0.13%.

Vectura‘s board is likely to face further criticism after it backed a takeover offer from the maker of Marlboro cigarettes.

The decision sparked outrage among the UK’s medical chiefs and physicians who were shocked that the inhaler maker, which helps people with respiratory problems, could succumb to US tobacco giant, Philip Morris International.

7am: Gatwick boss warns of UK lag

Gatwick airport

Gatwick Airport chief executive Stewart Wingate said the UK is in danger of “squandering the advantage that the vaccination programme has afforded us for international travel”.

In a statement with half-year figures showing a huge loss, he said: ” Our Government needs to act now and remove unnecessary and costly PCR testing requirements for passengers, particularly for those double vaccinated.

“UK travel recovery should not be allowed to lag behind the US and Europe. Passengers need the travel rules simplified so they can choose to travel more freely and enjoy much needed breaks and reunions with family and friends which are currently much more attainable for those in Europe and the US.” 

Gatwick Airport carried just 569,000 passengers in the first six months ended 30 June 2021 due to the impact of COVID-19 and the associated international travel bans.

While the airport remained open throughout this period all revenue streams were impacted and the collapse in passenger demand along with Government restrictions led to a £244.6m loss for the six-month period and an EBITDA loss of £50.2m.

7am: McColl’s capital raising


McColl’s Retail Group has completed a capital raising by placing 150m shares at the offer price of 20p, raising gross proceeds of approximately £30 million and net proceeds of £27.3m at a discount of 31.03% to the closing price of 29p on 11 August.

Each of the directors subscribed to the offer.

The funds will be used to increase the number, and accelerate the pace of rollout of Morrisons Daily stores, from 56 to 350 by the end of the financial year ending November 2022 (an increase of 50 stores against the group’s previous target of 300 stores by the end of December 2023).

The company will also iImprove the grocery infrastructure in the Morrisons Daily sites, further invest in the store estate, including the potential to extend the rollout of Morrisons Daily beyond 350 stores; and reduce the Group’s financial leverage.

7am: Braveheart raises £2.5m in placing

Braveheart Investment Group has announced a placing of 13,888,889 new ordinary shares at a price of 18p per share to raise gross proceeds of £2.5 million before expenses.

The company intends to use the new funds to accelerate the development of Paraytec’s Covid testing instrument by taking direct control of the final design and engineering packages.

In parallel, partners will continue to be sought by Paraytec for licensing and development and/or potential sale. The board believes this strategy should enable Paraytec to deliver a finished product to market directly if it fails to find a satisfactory deal with a third party.

The placing price represents a discount of approximately 20.88% to the closing mid-market share price of an existing ordinary share on 12 August.

The placing shares will represent approximately 26.59% of the enlarged issued share capital of the company.

Trevor Brown, chief executive of the company, and Free Association Books, a company connected to him, has subscribed for 8,000,000 placing shares. Vivian Hallam, executive director, has subscribed for 833,333 placing shares

Global markets

Oil prices fell for a second day after the International Energy Agency warned that demand growth for crude and its products had slowed sharply as surging COVID-19 cases worldwide forced governments to revive movement restrictions.

“Growth for the second half of 2021 has been downgraded more sharply, as new COVID-19 restrictions imposed in several major oil consuming countries, particularly in Asia, look set to reduce mobility and oil use,” the IEA said.

However, OPEC was more upbeat in its outlook and forecasts a rebound in oil demand globally this year and further growth in 2022, notwithstanding the rising concern about the surge in COVID-19 infections.

Brent crude was down 49 cents, or 0.7%, at $70.82 a barrel by 0507 GMT, after dropping 13 cents in the previous session.

US crude was off by 53 cents, or 0.8%, at $68.56 a barrel, having fallen 0.2% on Thursday. The benchmarks are still heading for a slight gain this week – Reuters.

The FTSE 100 was tipped to open 12 points to the good at 7,205 after a positive session on Wall Street.

The Dow Jones Industrial Average added 15 points and the S&P 500 rose 13.

Asia has been more mixed with with Japan’s Nikkei 225 up by points while Hong Kong’s Hang Seng was 189 points lower.

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