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FTSE 100 Slips Over Rising Wages, Gas-Price Concerns

11/16/2021 | 11:59am EST

The FTSE 100 slipped again on Tuesday, falling 0.24%, as jobs data points toward a potential December rate hike. A rise in U.K. wages and natural gas prices are underlining the risks evident for central banks, IG Group PLC senior market analyst Joshua Mahony says. Annual wage growth of 5.8% highlights the continued inflationary pressures, with Bank of England Governor Andrew Bailey under pressure to prove he is reliable at the December meeting, Mr. Mahony says. That said, fresh October data has bought optimism for the a festive demand boom around the corner, with retail sales and industrial production figures on the rise despite supply chain concerns, Mr. Mahony says.

 
Companies News: 

HSBC Appoints Greg Hingston to Head Insurance Business

HSBC Holdings PLC said that it is appointing Greg Hingston as the global chief executive of its insurance business.

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LV= Maintains Choice of Bain Capital for Takeover Over Royal London

LV= said Tuesday that the board continues to choose Bain Capital as the bidder with the best takeover offer despite Royal London Mutual's efforts to make it reconsider the decision.

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McKay Securities Swings to 1H Pretax Profit; Declares Increased Dividend

McKay Securities PLC on Tuesday reported a swing to pretax profit for the first half of fiscal 2022 and increased its interim dividend.

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Focusrite FY 2021 Pretax Profit Jumped on Higher Revenue

Focusrite PLC on Tuesday reported a higher pretax profit for fiscal 2021 as revenue increased due to the growth of its customer base.

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Red Rock Resources Shares Fall on Dispute Over DRC JV Project

Shares in Red Rock Resources PLC fell in early trading Tuesday after it said that its partner in the VUP copper-cobalt project in the Democratic Republic of Congo has instituted legal proceedings related to the joint-venture assets.

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Diurnal Group's Alkindi Drug Approved for Use in Children, Adolescents in Switzerland

Diurnal Group PLC said Tuesday that its Alkindi drug has been approved for use by the national authorization and supervisory authority for drugs and medical products in Switzerland, Swissmedic, as a replacement therapy for adrenal insufficiency for children and adolescents.

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Trakm8 Swung to 1H Pretax Profit; Expects to Beat FY Profit Forecasts

Trakm8 Holdings PLC said Tuesday that it swung to a first-half pretax profit on increased revenue and expects to beat full-year market profit forecasts despite higher costs due to supply-chain issues.

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dotDigital FY Pretax Profit Rose on Increased Revenue

dotDigital Group PLC said Tuesday that its pretax profit for fiscal 2021 increased as it benefited from higher volumes of SMS messaging services.

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Glenveagh Properties Launches EUR100 Mln Buyback Program; Closes Sale for EUR78.5 Mln

Glenveagh Properties PLC said Tuesday that it has completed the sale of the residential and second hotel sites at Castleforbes, Dublin, for a cash consideration of 78.5 million euros ($89.2 million) to a subsidiary of Eagle Street Partners Group Ltd.

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Stanley Gibbons Names Kevin Fitzpatrick as CFO and Company Secretary

Stanley Gibbons Group PLC said Tuesday that Kevin Fitzpatrick has been appointed chief finance officer and company secretary with immediate effect, taking over the roles from Anthony Gee.

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SolGold Appoints Darryl Cuzzubbo as CEO

SolGold PLC said Tuesday that it has appointed Darryl Cuzzubbo as chief executive officer.

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Countryside Properties Names Wincanton's Tim Lawlor New CFO

Countryside Properties PLC said Tuesday that it has appointed Wincanton PLC's Tim Lawlor as its new chief financial officer from March 28.

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Biotech Growth Trust Appoints Roger Yates as Chairman Designate

Biotech Growth Trust PLC said Tuesday that it has appointed Roger Yates as chairman-designate and independent nonexecutive director effective from Dec. 1.

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musicMagpie Taps Genedrive for New CFO

musicMagpie PLC said on Tuesday that it has appointed Genedrive PLC's Matthew Fowler as its new chief financial officer, without providing the start date.

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Domino's Pizza Group Names David Surdeau as Interim CFO

Domino's Pizza Group PLC said Tuesday that it has appointed David Surdeau as interim chief financial officer with effect from Wednesday.

 
Market Talk: 

October's UK Job Report Will Be Key for BoE's Rate Hike

1041 GMT - October's U.K. labor market report, to be published on Dec. 14, is the one to watch to look for hints on when the Bank of England will hike interest rates, Berenberg's senior economist Kallum Pickering says. Data will be released two days ahead of the bank's meeting, and the BoE has stated that it would be monitoring developments in the labor market following the end of the furlough program, he says. "While some small uptick in unemployment is possible as a consequence of furlough payments ending for untenable jobs, strong employment gains, persistent wage pressure and a further rise in vacancies will likely support the case for an immediate 15 basis-points hike in the bank rate," Pickering says.

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UK Gilt Yields Rise as Unemployment Falls

1019 GMT - U.K. borrowing costs rise after official data showed unemployment in the country fell to 4.3% in the three months to September, from 4.5% in the previous three-month period. Yields on two-year and 30-year government bonds rise by around three basis points on both maturities to a high of 0.585% and 1.133% respectively, according to Tradeweb. Both levels mark their highest points since the Bank of England's last policy decision onNov. 4 and RBC Capital Markets says the data could pave the way for a rate increase in December. "Today's release, especially if combined with non-official data, removes a large degree of uncertainty around the impact of the ending of the furlough scheme," says RBC European economist Cathal Kennedy.

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Inflation to Stay High in Coming Months Then Ease in 2H 2022, Says RLAM

1007 GMT - Inflation is expected to remain at elevated levels in the next few months before starting to ease around the second half of 2022, Craig Inches, head of rates and cash at Royal London Asset Management, tells Dow Jones Newswires. "Our view is still firmly that inflation is transitory," he says. This will mean central banks will be cautious in raising interest rates, he says. RLAM expects the Bank of England to start raising the bank rate in February 2022, while the Federal Reserve will raise rates in the fourth quarter of 2022, well after the expected end of tapering around mid-2022, Inches says. The European Central Bank's first deposit rate rise won't take place before late 2023, he says.

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Lufthansa's Exposure to Asia Could Weigh on Recovery Next Year

0952 GMT - Lufthansa's exposure to Asia could delay its recovery as several important Asian countries remain closed due to the coronavirus pandemic, Berenberg says. The German airline "remains considerably more exposed to Asia than peers such as IAG (24% capacity exposure to Asia Pacific in 2019 versus 8% for IAG), threatening the pace of its recovery next year," the brokerage says. That could lead to U.K.-based IAG overtaking Lufthansa in terms of capacity next year, it says.

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Pound Rises as Strong UK Jobs Data May Support December Rate Rise

0903 GMT - The pound rises after data showed U.K. unemployment falling to 4.3% in the three months to September, alongside still-high wage growth, supporting the case for the Bank of England to raise interest rates in December, says ING. The figures suggest the end of the government's wage-subsidy, or furlough, program didn't push up joblessness. Fears of a slowdown in the jobs market were a major factor in the BOE leaving rates on hold, ING says. "Given the lack of evidence of a slowdown in today's strong jobs data, the case for a December 15 basis-point hike is now stronger." GBP/USD rises 0.4% to 1.3466, versus 1.3423 before the data. EUR/GBP falls to a two-week low of 0.8441, versus around 0.8477 beforehand.

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Imperial Brands Results Were Fine; No Mention of Buybacks Is Likely to Disappoint

0800 GMT - Imperial Brands's results for the year ended Sept. 30 were okay, with tobacco performance driving a slight revenue beat for the FTSE 100 tobacco group, RBC Capital Markets says. However, margin guidance for fiscal 2022 is below consensus expectations and might disappoint the market, the bank says. The lack of news on share buybacks, despite net debt falling toward the bottom of the target range, is also disappointing, RBC says. Net debt was reduced to 2.2 times Ebitda, nearing the lower end of the 2.0-2.5 times range, RBC says.

Contact: London NewsPlus, Dow Jones Newswires; Write to Sarka Halas at sarka.halas@wsj.com

(END) Dow Jones Newswires

11-16-21 1159ET

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