Market report

Persimmon dips | Calnex on track | Balfour Beatty upgrades


4.45pm: London lower

The FTSE 100 closed 20.31 points lower at 7,515.75.

9.30am: Entain hit by fine

Entain was top of the FTSE 100 fallers after news that the Ladbrokes and Coral owner had been given a hefty fine for its failures in social responsibility and anti-money laundering, according to a UK regulator.

Shares fell 3.48% to 1,358p after the UK Gambling Commission said the betting and gaming group will pay £17mln, for failures at its online business and land-based businesses.

“Our investigation revealed serious failures that have resulted in the largest enforcement outcome to date,” said Andrew Rhodes, chief executive of the Gambling Commission.

Shares in Balfour Beatty leapt more than 8% in early trade after the construction services and infrastructure giant boosted profits in the first half (see below).  

The FTSE 100 opened higher but fell back as investors digested stronger than expected UK CPI figures. The index was trading 17 points lower at 7,519.18.

7am: Persimmon profits dip

Housebuilder Persimmon reported a fall in interim profits, but against “a strong comparator” and said price rises were offsetting higher costs.

Pre-tax profit for the six months to 30 June fell to £439.7m from £480m on total revenue down to £1.68bn from £1.84bn.

Completions fell to 6,652 from 7,406 last year when demand for larger homes surged during the Covid pandemic.

It said demand is strong with the group’s average private sales rate in the period around 1% ahead year on year and a robust forward order book of £2.32bn. It re-iterated guidance of 14,500-15,000 completions for the full year.

7am: Calnex on track

Telecoms testing company Calnex said it has made solid progress against its strategy in the first few months of the new financial year and is confident that the group’s performance in FY23 will be in line with market expectations. 

In a statement ahead of today’s AGM, the Linlithgow-based company continues to experience high demand for its range of test and measurement solutions as it benefits from supportive market trends with the transition to 5G and growth in cloud computing and the order book remains strong.

It said the integration of iTrinegy, acquired in April, is progressing as planned.

Calnex has recently renewed its multi-year contract with long-established partner Spirent Communications. This is the third renewal since the relationship was established in 2013, demonstrating the continued mutual commitment to growing the relationship for the success of both parties.

Despite wider global issues, the company said its positive trading performance and the supportive trends within the telecoms sector provide the board with confidence in its ability to deliver on its growth strategy this year and beyond.

7am: Balfour Beatty

Construction firm Balfour Beatty upgraded full year guidance after interim profits more than doubled and new orders rose 10%.

Pre-tax profit rose to £83m from £35m a year earlier and it now expects annual earnings to be ahead of previous expectations. Profit from operations more than doubled to £82m from £40m.

The company declared an interim dividend of 3.5p a share, up 17%.

Full year profit from investment disposals was now expected to be in the range of £55m – £65m, while annual average net cash was forecast to be £740m – £780m, which includes Balfour’s share buyback and further working capital outflows in the second half of the year.

Balfour Beatty said it continued to see inflationary pressures across its construction and infrastructure markets in labour and materials.

“Whilst the group is not immune to these pressures, Balfour Beatty is currently mitigating these risks through contractual protection and early buyout using the Group’s scale and supply chain management and does not expect a material impact on the full year results,” the company said.

7am: Inflation soars

Business leaders called for investment to energy to ease global price shocks and cap business rates as inflation hit 10.1% in the year to July.

Full story here

Global markets

A busy day of economics news follows the UK inflation reading, alongside producer and retail prices, followed by eurozone GDP and employment figures at 1000 BST, and US retail sales at 1330 BST. In the evening, the US Federal Reserve will release the minutes from its latest monetary policy meeting at 1900 BST.

The pound was quoted at $1.2118, up from $1.2099 late Tuesday.

In Tokyo, the Nikkei 225 was 1.1% higher in late trade, while the S&P/ASX 200 in Sydney was up 0.3% shortly before the closing bell. In China, the Shanghai Composite was 0.1% higher in afternoon dealings. The Hang Seng in Hong Kong was up 0.8%.

In New York, the Dow Jones Industrial Average added 0.7% and the S&P 500 added 0.2%, though the Nasdaq Composite lost 0.2%.

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