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FTSE 100 Down, Sterling Could Rise if Labor Market Remains Strong

09/14/2021 | 04:41am EDT

Sterling Could Rise if Labor Market Remains Strong

Sterling and some U.K. stocks which are sensitive to interest rates could rise if the unemployment rate continues to decline after the furlough scheme ends, says Emma Mogford, fund manager at Premier Miton Monthly Income Fund. If the unemployment rate continues to fall after a government-backed employee retention scheme ends on Sept. 30, "that should provide a boost to sterling and interest rate sensitive stocks," she says. Official data from the Office for National Statistics showed employee numbers were back at pre-Covid levels in August. Higher consumer prices and a robust labor market could potentially prompt the Bank of England to tighten monetary policy earlier than anticipated. Sterling is last up 0.2% at $1.3860.

 
Companies News: 

Thinksmart FY 2021 Pretax Profit Rose

Thinksmart Ltd. on Tuesday reported a rise in pretax profit for fiscal 2021 and said the company is well placed for the future.

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Tern PLC Swung to 1H Pretax Loss

Tern PLC reported on Tuesday a swing to a pretax loss for the first half of 2021 on higher costs, but said that it is optimistic about the second half.

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Cambria Automobiles Says Go-Private Takeover Is Now Unconditional

Cambria Automobiles PLC said Tuesday that the go-private management offer for the car retailer is now unconditional, after having met the required acceptance threshold.

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Bytes Technology Says 1H Performance Was Strong, CFO to Retire

Bytes Technology Group PLC said Tuesday that its performance continued to be strong during the first half of fiscal 2021, and that Chief Financial Officer Keith Richardson intends to retire.

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Argo Blockchain Launches IPO of ADSs on Nasdaq

Argo Blockchain PLC said Tuesday that it has launched an initial public offering of its American depositary shares on the Nasdaq Global Market.

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Tertiary Minerals Appoints Former Arkle Resources CEO as Managing Director

Tertiary Minerals PLC said Tuesday that it has appointed Patrick Cullen as managing director with immediate effect.

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Kistos First-Half Revenue Rose

Kistos PLC said on Tuesday that revenue rose for the first half, and that it was undertaking a work program to enhance production at the Q10-A gas field and appraise the Q11-b gas discovery at the Vlieland light oil discovery in the Netherlands.

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Good Energy Swung to 1H Profit

Good Energy Group PLC on Tuesday reported a profit for the first half of the year, and said full-year expectations remain unchanged.

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Tandem Group 1H Profit, Revenue Climbed

Tandem Group PLC said Tuesday that its profit and revenue rose in the first half of 2021.

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Springfield Properties FY 2021 Pretax Profit Rose

Springfield Properties PLC said Tuesday that fiscal 2021 pretax profit and revenue rose, and that it enters the fiscal 2022 with good visibility over full year revenue as it delivers against a significant order book.

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Accesso Technology Says 2021 Revenue Will Rise to Pre-Pandemic Levels

Accesso Technology Group PLC said Tuesday that it expects 2021 revenue to be at least at pre-pandemic levels and improved profitability.

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Colefax Group's Tender Offer: Shares Valued at GBP6.7 Mln Purchased

Colefax Group PLC said Tuesday that it purchased shares valued at 6.7 million pounds ($9.3 million) via its tender offer.

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Sanne Group 1H Profit Fell as Revenue Recovered

Sanne Group PLC said Tuesday that profit ticked down and revenue rose in the first half of the year, as client activity recovered after the Covid-19 hit.

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Peel Hunt to Pursue AIM-Market Listing

Peel Hunt Ltd. said Tuesday that it intends to seek admission of its ordinary shares to be admitted to trading on the London Stock Exchange's AIM market.

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EKF Diagnostics Raises 2021 Expectations on Strong 1H Trading

EKF Diagnostics Holdings PLC said Tuesday that its profit and revenue rose in the first half of 2021 and that it expects full-year results ahead of its previous expectations.

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Made Tech Group Plans to Float in London on Sept 30

Made Tech Group PLC said Tuesday that it expects to float on the AIM of London later this month.

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TP Group 1H Pretax Loss Widened

TP Group PLC said on Tuesday that its pretax loss widened for the first half after booking higher costs.

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Bonhill Group Confirms Narrower 1H Pretax Loss, Lower Revenue

Bonhill Group PLC said Tuesday that its pretax loss narrowed in the first half, although revenue fell amid a lack of live events as previously announced.

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Fiske Swung to FY 2021 Pretax Profit, Shares Rise

Shares in Fiske PLC rose on Tuesday after the company said it swung to a pretax profit for fiscal 2021 as revenue rose, and that it had a good start to fiscal 2022.

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Staffline Shares Fall After Cautious Outlook Despite Narrowed 1H Loss -- Update

Staffline Group PLC shares fell on Tuesday despite a narrowed first-half pretax loss, after it said it remains mindful of pandemic-driven economic uncertainty and potential labor shortages.

 
Market Talk: 

UK Labor Market Recovery Continues, Slack Remains

1013 GMT - The U.K. labor market continued with its strong recovery in the three months to July, Citi's Benjamin Navarro says. The number of people employed was 183,000 higher in the three months to July than in the previous three months and labor demand reached a record high in the three months to August, with total vacancies exceeding 1 million on a three-month basis for the first time on record. Despite the continued improvement, unemployment remained a little higher than Citi expected, at 4.6%. Total hours worked also remained around 4% below pre-pandemic levels. "We think elevated levels of labor market mismatch continue to point to challenges ahead," Navarro says.

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Ocado Share Price Faces Gloomy 2021 After Disrupted 3Q

1007 GMT - Online grocer Ocado's share price looks set to continue struggling after a third quarter marked by higher costs and a fire disrupting its operations, CMC Markets says. Ocado is among the 10 worst performing FTSE 100 stocks this year so far, the investment platform says. Third-quarter retail revenue declined 10.6%, falling back from pandemic highs and hit by the fire at the Erith fulfillment center, while higher wages will add another GBP5 million to Ocado's cost base, CMC Markets says. "Any further progress in terms of share price gains could well be hard won," CMC Markets says. Shares trade down 3.1% at 1,828.50 pence.

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Ocado's Robot Fire Damaged More Than Sales

0958 GMT - Online grocer Ocado's latest warehouse accident involving robots has cost it millions at a time when it is also facing considerable extra costs from human labor, particularly delivery drivers, Russ Mould at AJ Bell says. The company's business model depends on signing up more grocery sellers to use its logistic platform, and suffering two fires caused by robots is damaging to more than just one quarter's sales because prospective clients might think twice before signing up with the company given the considerable disruption a small accident can cause, Mould says. "The share price has taken a real beating this year because it has been slow to sign up new grocery partners for its systems, and the second robot fire has hurt its credibility," Mould says.

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Bunzl's Latest Acquisitions Expected to Be EPS Accretive

0931 GMT - Distribution-and-outsourcing group Bunzl acquired two businesses with combined revenue of GBP77 million, and given the targets' Ebitda profile, they should be low-mid single digit accretive to EPS, analysts at Jefferies say. One of the businesses, McCue, is fast-growth and high-margin and subsequently attracted a higher multiple than usual, but it should create value creation in three years, and the deal opens an appealing new market, the U.S. bank says. The company's spend to date is GBP390 million, compared with GBP134 million at the interims, and this implies the company spent GBP256 million on both of these deals, with the bulk probably going to McCue, the bank says. Jefferies rates the stock buy with a 3,000-pence target price.

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UK 10Y Gilt Yield Hits Near 12-Week High After Labor Data

0856 GMT - Investors sell 10-year benchmark U.K. government debt after official data showed company payrolls have returned to pre-pandemic levels as the recovery from the Covid-19 crisis continues. The unemployment rate fell slightly to 4.6% in the three months to July from 4.7% the previous month. "The falling unemployment rate is another sign that the U.K. economy is experiencing a healthy recovery," says Emma Mogford, fund manager at Premier Miton Monthly Income Fund, adding that the Bank of England will be closely watching how the labor market reacts to the end of the furlough scheme in Sept. 30. The 10-year gilt yield climbs to its highest in nearly 12 weeks at 0.782% after the announcement, according to Tradeweb.

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UK Labor Market Showed Strength in Summer; Challenges Ahead in 4Q

0802 GMT - Job creation remained strong over summer in the U.K., Pantheon Macroeconomics says. The number of people employed was 183,000 higher in the three months to July than in the previous three months, according to the Labour Force Survey. "The strength of the employment indicators of Markit's purchasing managers index survey and the KPMG/REC Report on Jobs in August suggest that employment growth will remain brisk throughout the third quarter," Pantheon Macroeconomics' chief U.K. economist Samuel Tombs says. Further growth in employment will likely push down the unemployment rate even further toward its pre-Covid low of 3.8%, he says. However, the winding up of the furlough program will probably lead to an increase in unemployment and underemployment in 4Q, Tombs says.

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UK 2026 Gilt Auction Expected to Go Well

(MORE TO FOLLOW) Dow Jones Newswires

09-14-21 0641ET

Stocks mentioned in the article
ChangeLast1st jan.
ACCESSO TECHNOLOGY GROUP PLC 0.00% 875 Delayed Quote.84.21%
AJ BELL PLC 0.30% 404.8 Delayed Quote.-7.08%
AJ NETWORKS CO., LTD. -2.14% 5500 End-of-day quote.19.18%
ARGO BLOCKCHAIN PLC 2.34% 131 Delayed Quote.300.00%
ARKLE RESOURCES PLC -5.56% 0.85 Delayed Quote.-27.66%
BONHILL GROUP PLC 0.00% 11 Delayed Quote.0.00%
BUNZL PLC 0.12% 2517 Delayed Quote.3.03%
BYTES TECHNOLOGY GROUP PLC -2.86% 509 Delayed Quote.51.94%
CAMBRIA AUTOMOBILES PLC 0.00% 82.5 Delayed Quote.41.03%
CMC MARKETS PLC 0.00% 276 Delayed Quote.-29.41%
COLEFAX GROUP PLC 0.00% 645 Delayed Quote.50.00%
DJ INDUSTRIAL 0.43% 35609.34 Delayed Quote.15.20%
EKF DIAGNOSTICS HOLDINGS PLC -1.69% 81.6 Delayed Quote.13.73%
FTSE 100 0.08% 7223.1 Delayed Quote.11.72%
GOOD ENERGY GROUP PLC 1.75% 290 Delayed Quote.62.92%
KISTOS PLC 1.63% 375 Delayed Quote.129.36%
LONDON BRENT OIL -0.37% 85.52 Delayed Quote.62.71%
NASDAQ COMP. -0.05% 15121.67834 Real-time Quote.16.55%
PREMIER MITON GROUP PLC 0.00% 178.5 Delayed Quote.21.02%
SANNE GROUP PLC 0.22% 905 Delayed Quote.46.92%
SPRINGFIELD PROPERTIES PLC 0.00% 144.5 Delayed Quote.7.04%
STAFFLINE GROUP PLC -1.38% 71.4 Delayed Quote.61.08%
TERN PLC 2.56% 20 Delayed Quote.187.77%
TERTIARY MINERALS PLC 1.92% 0.265 Delayed Quote.6.00%
TP GROUP PLC -0.55% 4.525 Delayed Quote.-33.06%
WTI -0.40% 83.272 Delayed Quote.71.11%
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