Market report

War rattles investors | Fink backs ‘moderate’ politics


The Israel-Gaza war and a slide in corporate performance continued to drag the stock market lower. The FTSE 100 fell by a further 88.47 points, or 1.2%, to close at 7,499.53.

Losses were felt across sectors with Mobico, formerly National Express down another 3.25p to hit a new low of 56.5p following a recent profit warning. It was announced that rival operator Arriva has been bought in a deal valuing the company at €1.6 billion.

EasyJet shares fell 10.25p, or 2.7% to 364.5p after a downgrade by Barclays analysts who were sceptical that the carrier would be able to reduce its winter losses.

Admiral, which was the best FTSE 100 performer, and Direct Line, made impressive gains after Sabre Insurance upgraded its full-year guidance. The former rose 58p to 2489p and the latter added 8.5p to close at 165¾p. Sabre closed 2p higher at 152p.


Fink sees moderation in UK politics

Sir-Keir-Starmer-in-Edinburgh-Feb-23

Larry Fink, the chairman and chief executive of BlackRock, the world’s largest fund manager, has dropped hints that he the City would welcome a Labour government.

He said Sir Keir Starmer had shown “real strength” to bring the party back to the centre ground and hopes Labour’s transformation is an indication that the age of populism symbolised by Donald Trump is coming to an end.

Following a visit to the UK, Mr Fink told the Wall Street Journal: “I’m very pleased to see how the Labour party in the UK went from an extremist party with a Marxist leader to Keir Starmer who has shown real strength as a moderate Labour party.

“That actually has given me hope that the pendulum went so far. 

“If you think about the UK — the UK was the one that started the high level populism through Brexit and then the populism here led to Donald Trump being president.

“We will see what happens if Keir Starmer gets elected – but I believe that’s a measurement of hope.”

A spokesman for BlackRock later played down Mr Fink’s direct endorsement of Labour, saying: “Larry was offering his observations on the transformation of the Labour Party and his view that political parties moving back toward the centre was a measurement of hope. He was not offering an endorsement of any political party.”


Tesla

Tesla

Tesla CEO Elon Musk said he was cautious about going “full tilt” on plans for a Mexico factory after the company missed Wall Street expectations on third-quarter gross margin, profit and revenue.

Mr Musk said “If the macroeconomic conditions are stormy, even the best ship is still going to have tough times”.

Shares in the company fell more than 4% in after-hours trading on Wall Street last night. They had closed down 4.8%.

Tesla has managed to maintain demand with a series of price cuts, though the price of the popular Model Y SUV was “almost unchanged”.

However, price cuts this year have battered its gross margin, particularly in China where it faces stiff competition from local manufacturers.

Revenue in the third quarter rose 9% to $23.35 billion, compared with analysts’ estimates of $24.1 billion. That marked the slowest pace of growth in more than three years.

Its average revenue per unit declined by nearly 11% from a year earlier.


Deliveroo

Deliveroo

Deliveroo expects food price inflation to continue falling and said that it is increasing revenue from fewer orders.

The delivery app said its gross transaction value was up 5% year-on-year to £1.7bn in the third quarter despite a moderation in the growth of food prices. However, the number of orders slid by 1% to 69.7m.

Founder and chief executive of Deliveroo Will Shu said: “I’m encouraged by the improving growth trends in key international markets.”


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