FTSE 100 holds on to gains | Deliveroo cuts loss, orders rise
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5pm: London edges higher
The FTSE 100 ended the session up 0.83% at 7,220.14, and is at its highest level since 20 February 2020.
Admiral Group ticked 3.91% higher, with shareholders set to cash in as the company paid an increased interim dividend and extra payouts after the sale of its Penguin Portals business (see below).
Prudential gained 2.62% after it said first-half new business profits rose 25% and adjusted operating profit from continuing operations was 19% higher, but struck a cautious note over the short-term outlook due to Covid uncertainty.
Long-term savings group Phoenix fell 2.2% as the company said it was on track to hit the upper end of its annual cash generation target range, but swung to a pre-tax interim loss.
10am: New Virgin Atlantic flights
Virgin Atlantic will be offering its first international flights from Edinburgh when it launches a direct link to Barbados and Orlando.
9.30am Markets in more positive mood
The FTSE 100 built on Tuesday’s gains to trade around a one-month high suggesting investors have moved on from the latest set of jitters over Covid variants for now,” say AJ Bell financial analyst Danni Hewson.
“Progress on a huge US stimulus package helped stocks close in positive territory on Wall Street, providing a positive cue for European equities – while the carving up of the UK market by overseas buyers continues apace as Avast agrees to a merger with NortonLifeLock.
“The other key threat stalking the markets is inflation and US inflation figures out this afternoon could be the latest test for the current sunnier sentiment.”
Deliveroo: “After a disastrous start to life as a public company led some wags to denote takeaways platform Deliveroo ‘Flopperoo’, the company appears to be flipping things around and clawing back a little credibility.
“News it had hired a prized Amazon executive in a top technology role and German rival Delivery Hero’s decision to take a sizeable stake in the business have helped lift the share price and kick-start its rehabilitation and there is at least nothing in Deliveroo’s first half results to undermine that process.
“Both the value and volume of orders came in ahead of what was expected in the first half and its coffers look pretty full – boosted by the IPO cash.”
See Deliveroo figures below
Admiral: “Admiral comes out of its latest set of results looking like the Rolls Royce of motor insurers. Compared with its peers the growth in profit and customer numbers the company is chalking up is highly impressive.
“Admiral has won over customers by offering flexibility, boosting its digital capability and paying out customer rebates in a timely fashion, helping to put it ahead of the pack in a highly competitive market.
“These qualities have been rewarded with a double-digit increase in customer numbers at a time when other UK motor insurers are struggling to eke out any growth here at all.
“Shareholders are being richly rewarded with record dividend payments and Admiral’s strong financial position gives it lots of options while it works out what route it wants to take next.
“The road ahead could be a little bumpier for Admiral as the artificially lower levels of traffic and collisions driven by Covid restrictions.”
See Admiral figures below
9am: Biscuit factory to close
McVities owner Pladis has rejected appeals to save the factory in Tollcross, Glasgow and will go ahead with closing it as planned.
8am: London opens higher
The FTSE 100 opened 28.66 points higher at 7,189.70 (see markets below).
7am: Phoenix rising
Phoenix, the UK’s largest long-term savings and retirement business, will invest in the Standard Life brand after doubling its cash generation and edging up its half-year dividend.
Group operating profit came in at £527m for the half year to the end of June (H1 2020: £361m).
7am: Deliveroo orders rise
Meals courier Deliveroo said it had seen no material impact from the reopening of restaurants in the second quarter.
The firm, which connects customers to more than 115,000 restaurants and grocers across the UK and 11 other countries, said its gross transaction value doubled (up 102%) to £3.386 billion.
It posted a reduced adjusted EBITDA loss of £27 million compared to £30.3 million in H1 2020, as higher gross profit was largely offset by increased investments to support future growth
The Statutory loss before tax improved to £104.8 million in H1 2021 compared to £128.4 million in H1 2020.
It said 85% of riders globally saying they are satisfied or very satisfied working with Deliveroo; rider attraction and retention rates remain high despite rising job vacancies across economies.
7am: Admiral raises dividend
Admiral Group has declared an interim dividend of 115p a share, made up of a normal dividend of 87.9p and special dividend of 27.1p, up 63% year on year.
It also declared a special dividend of 46p as part of the phased return of proceeds from the Penguin Portals comparison businesses.
A start was expected for the FTSE 100 following a strong performance for most of the US markets overnight, with the Dow Jones Industrial Average closing 0.46% higher, while the S&P 500 climbed 0.1% to another record level. The Nasdaq Composite slipped 0.49%.
Traders on Wall Street were lifted by the passage of a $1 trillion infrastructure bill by the US Senate yesterday, which will now head for a similar vote in the House of Representatives.
The positive sentiment continued in Asia this morning with Japan’s Nikkei 225 rising 0.5% while Hong Kong’s Hang Seng was 0.14% higher.