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Delays hit Persimmon | Wood sees better H2 | Mattioli Woods


10.30pm: Musk pulls $44bn Twitter bid

Billionaire Tesla owner Elon Musk has withdrawn his $44bn (£36.2bn) bid to buy Twitter, alleging multiple breaches of the merger agreement.

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5pm: Equities close higher

Investors took the Prime Minister’s resignation in their stride, perhaps with some sense of inevitability and hope that there will be some immediate action from the new Chancellor to tackle rising business costs.

The FTSE 100 closed 81.31 points higher at 7,189.08. Sterling was up 0.58% at $1.1989.

Commodities companies were among the day’s big winners after reports of further Chinese stimulus measures to support the world’s second largest economy.

Antofagasta soared 8.51% higher, Anglo American added 7.09%, Glencore was up 6.72% and Rio Tinto rose 4.21%. 

Oil companies also moved higher as crude recovers. Brent was up 3.86% at $104.58 a barrel after having fallen below $100 this week. BP was 4.99% better while Shell was up 3%.

9.30am: Johnson quits as Tory leader

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8.30am: House prices defy downturn

UK house prices rose in June at their fastest monthly pace since early 2007, despite the cost-of-living crisis.

Prices rose 1.8% from May, when they increased 1.2%, according to a survey released by Halifax. The average house price hit a record high of £294,845. The annual growth rate is the highest since late 2004.

Russell Galley, managing director at Halifax, said the UK market had continued to defy any expectations of a slowdown.

8.15am: London rises

The FTSE 100 built on yesterday’s rise by gaining 46 points to trade at 7,153.86.

The pound strengthened by about around 0.25% to $1.1961.

7.30am: abrdn equity teams merge

Fund manager abrdn is combining its UK and European equity teams. The move will see Ben Ritchie, previously head of European equities lead the 20-strong team. Andrew Millington, previously head of UK equities will take on a new role as head of research & investment process, equities. There will be a number of departures.

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7am: Persimmon held back by external factors

Dean Finch, CEO of housebuilder Persimmon, said delays in the planning system, disruption in material supply chains and challenges in securing labour have impacted completions in the first half to the end of June.

The group delivered 6,652 new homes in the period, down on the 7406 built in the same half last year.

Total revenues for the period were also lower at £1.69bn (2021: £1.84bn) including housing revenues of £1.63bn (2021: £1.75bn).

“We anticipate, however, profit at the half year to be modestly above our expectations reflecting strong demand and positive pricing conditions. Our forward sales position is robust,” said Mr Finch in a trading update.

He said the planning system “remains slow, impacted by a Covid-related backlog and increasing complexity.

“For example, across the industry there are c. 120,000 plots in England currently stalled within the system due to Natural England’s nutrient neutrality guidance. In the absence of firm guidance from government this uncertainty will continue. Persimmon currently has around 1,500 plots affected by this issue which were due for delivery to local communities over the next five years.”

The group’s average selling price increased by 4% year on year in the first half to c. £245,600 (2021: £236,199).

7am: Wood Group forecasts stronger performance

Energy services company Wood Group said it expects a stronger performance in the second half across all business units, supported by the higher order book.

The sale of the Built Environment Consulting division is expected to improve the net debt position in the second half.

Higher activity in specialist engineering is offsetting the impact of exiting work in Russia and a weaker performance in Applied Intelligence.

In a half year trading update for the the period to 31 May the Aberdeen-based company reported orders up 18% YoY and 5% YTD to c.$8.1 billion.

Group operating profit (before exceptionals) will be around $95 million, compared to $86 million in HY21, with the increase reflecting a lower amortisation charge.

New chief executive Ken Gilmartin, pictured, said: “It is encouraging to see the improving operational momentum in our business, especially the growth in our Projects order book, supported by a backdrop of strong market demand for our engineering solutions.

“While our debt remains high, the sale of the Built Environment consulting business will restore the financial flexibility necessary to deliver our strategy, and we are making good progress towards completion in the second half.

“While we are mindful of the current global macro uncertainty, we have an exciting future in front of us across the global energy market, addressing both security and sustainability.

“We have the people and skills to capture the opportunities ahead and deliver sustainable free cash flow. I look forward to saying more on our plans at our half year results, and in detail at a capital markets day in late Q4.”

7am: Mattioli Woods revenues grow

Mattioli Woods, the specialist wealth and asset management business which acquired Glasgow-based Maven Capital Partners, said revenues for the year to end of May are up over 70% on the prior year.

It said this reflects the impact of recent acquisitions and strong organic revenue growth of 10%. Profit is in line with management’s expectations.

Chief executive Ian Mattioli said: “Acquisitions completed during the year, together with those completed in the prior year continue to trade ahead of our initial expectations, including the group’s two largest acquisitions to date of Maven Capital Partners and Ludlow Wealth Management.

“Maven generated a number of significant performance fees as a result of successful fund, VCT and investor partner exits, highlighting the quality of its investment proposition and further supporting the acquisition rationale.

“Maven continues to realise cross-selling revenue synergies within the Group, with further new investment opportunities in development.

“The Ludlow team continues to engage with our discretionary portfolio management and other investment services, with opportunities to realise additional synergies being progressed across the Group.”

Global markets

The FTSE 100 was expected to build on yesterday’s gains, adding just over 82 points to finish at 7,107.77, despite recessionary fears and a fall in oil prices.

Shell and BP are likely to be a drag after a 5% fall in crude prices overnight, with Brent at $101 this morning – close to a two-month low.

“The primary reason for the current selling pressure on oil prices is that traders are concerned about the possible threat of recession taking place and having a negative influence on the prices,” said market analyst Naeem Aslam at AvaTrade.

The pound has taken a hit following the Cabinet fall-out, though is up slightly this morning against the dollar at $1.1957, but close to two-year lows. 

US stocks rallied to finish slightly higher after the minutes from the latest meeting of the Federal Reserve’s policy committee showed officials in a hawkish mood.

Minutes from the Federal Open Market Committee revealed “almost all participants agreed” to a 0.75 percentage point interest rate hike after they were rattled by the further sharp rise in underlying price pressures in April and May.

With a third up day in a row, the S&P 500 and Nasdaq both closed almost 0.4% higher, while the Dow Jones edged up 0.23%.

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