- FTSE 100 down 10 points
- US set for green open
- Would THG founder IPO again? “Shit, no. No.”
12pm: US set for positive open
US stocks are expected to open mostly higher, building on new records set last week after a better-than-expected employment report for October and as corporate earnings also continue to surprise to the upside.
Futures for the Dow Jones Industrial Average rose 0.22% in Monday pre-market trading, while the broader S&P 500 index added 0.07% and those for the tech-heavy Nasdaq 100 shed 0.02%.
US stocks closed higher on Friday after October non-farm payrolls data showed employment gains of 531,000, beating consensus estimates for 450,000 new jobs.
Also driving positive sentiment was Pfizer which said that its coronavirus (COVID-19) drug, used with an HIV drug, cut the risk of hospitalization by 89%.
On the day, the Dow Jones increased by 204 points, or 0.56%, to 36,328 and the S&P rose 0.37% to 4,698 while the Nasdaq gained 0.2% to 15,972.
“US futures are steady after another round of all-time highs on Friday,” commented Neil Wilson, chief market analyst at markets.com.
“Earnings are better than were expected, jobs growth is picking up and the Fed’s carried off the taper without undue alarm. Pfizer’s antiviral announcement on Friday is a major positive: Dr Scott Gottlieb said the US is ‘close to the end of the pandemic phase’.
“After last week’s round of policy meetings, this week we get a lot of jawboning from the likes of Powell, Bailey and Macklem on equality and diversity. We’ll also be watching the US CPI numbers on Tuesday, and UK growth numbers for the third quarter on Thursday.”
Meanwhile, the FTSE 100 dropped 10 points to 7,293 at noon.
11am: The Hut Group founder speaks of regret for London IPO
The FTSE 100 dipped in the red in late morning, albeit by just 1 point to 7,302.
THG PLC (LSE:THG) founder and chief executive Matt Moulding has said listing in London “just sucked from start to finish” and he wished to have chosen New York for a flotation.
The retailer has halved in value since the IPO in September 2020, but Moulding said that the business is “in better shape than it’s ever been” and “it’s just operating in this environment [that] sucks.”
No statement from THG so far this morning after those extraordinary comments from Matt Moulding. Shares up 4.4% to 212.8p, maybe on take private hopes? Maybe camp THG thought it was a good interview.. https://t.co/HsmsILnZwY
— Ashley Armstrong (@AArmstrong_says) November 8, 2021
When asked if he would IPO again, in an interview with GQ at the GQ Heroes conference, he said: “Shit, no. No. I wouldn’t… There are scenarios where if you’re not an individual leading a big company, then I think the UK market can work really well. But there aren’t any examples, I don’t believe, where an individual brings a big company to a public market and it can go well, certainly as you get to a certain scale anyway.”
Last month, the firm committed to appointing a non-executive chair.
Shares were flat at 204.18p in the late morning, having risen as much as 6% earlier on Monday.
9.40am: JD Sports responds to allegations over meeting with Footasylum boss
The FTSE 100 was nearing the flatline in mid-morning, up a mere 2 points to 7,306.
JD Sports Fashion PLC (LSE:JD.) dipped 1% to 1,107p after publishing a response to media reports on a meeting between executive chairman Peter Cowgill and Barry Bown, his counterpart at Footasylum.
The Sunday Times obtained a video that was secretly filmed by an unnamed competitor of the FTSE 100 group who opposed the JD’s GBP90mln takeover of Footasylum.
It is understood that the Competition and Markets Authority (CMA) has launched an investigation into this meeting, since it happened while it was examining the deal.
According to City rules, the two sides were allowed to hold business meetings but “no business secrets, know-how, commercially sensitive information, intellectual property or any other information of a confidential or proprietary nature” can be shared while a verdict is awaited.
The athleisure retailer said that the CMA has already been fully apprised of the content of the meeting, adding that it “firmly believes” that it does not represent wrongdoing or a breach of rules.
8.35am: Darktrace claws back losses
The FTSE 100 had a lukewarm start to the trading week, up only 7 points to 7,311.
Asian markets have taken a circumspect stance as traders worry recovery won’t be plain sailing, hampered by the rise in Covid-19 cases, power shortages and a shadow over the property sector.
Despite China’s exports beating forecasts and resulting in a record trade surplus, imports missed estimates, suggesting a slowdown of domestic demand.
“Further strength in the oil price boosted the majors, miners crept into positive territory and airline-related stocks were also in demand in the face of potentially recovering international travel. Less positively, there was some pressure on banking stocks as the Bank of England‘s inaction last week on interest rates undid some of the optimism which had been building on a potential boost to earnings,” said Richard Hunter, head of markets at interactive investor.
Darktrace PLC (LSE:DARK) was the top riser, up nearly 4% to 599.5p as it clawed back last week’s losses.
This might be being helped by some positive analysts opinions, with Berenberg saying, following a visit to Darktrace’s HQ in Cambridge, the recent share price capitulation “is a result of fear not fact”.
CRH plc, Polymetal International PLC (LSE:POLY) and Fresnillo PLC (LSE:FRES) followed suit.
Fallers were topped by ITV PLC (LSE:ITV), Standard Chartered PLC (LSE:STAN) and Informa PLC (LSE:INF), retracing gains made last week.
6.55am: FTSE 100 to see quiet start
The FTSE 100 is expected to open 3 points higher at 7,307 on Monday morning.
It’s not going to be a busy week in terms of economic data releases. The key numbers will be Wednesday’s US CPI for October and consensus looks for a slight uptick given the ongoing wage pressures and supply shortages.
“Global equities higher Friday once again driven by DM and not least US stocks while EM lagged driven by Chinese stocks. US stocks have had an impressive run with S&P500 higher in 16 out of the last 18 trading days and are now 3% above the peak early September,” analysts at Danske Bank said.
“The positive tone from Friday on Wall Street has not carried over to EM where markets are lower this morning. Futures in Europe and US are also lower as we head into a new week.”
6.50am: Early Markets – Asia / Australia
Stocks in the Asia-Pacific region were mostly lower on Monday as China’s exports rose 27.1% in October compared with a year ago.
That was higher than the 24.5% growth forecast in a Reuters poll.
In Japan, the Nikkei 225 slipped 0.35% and South Korea’s Kospi dipped 0.31%.
China’s Shanghai Composite rose 0.17% while Hong Kong’s Hang Seng index declined 0.66%
Australia’s S&P/ASX200 fell 0.06% to 7,452.20 points on Monday following its best week since May mostly due to positive sentiment surrounding central banks and their outlooks over the coming months.
Gold stocks in Australia benefitted last week from the RBA, the US Federal Reserve and the Bank of England indicating they are in no hurry to increase interest rates.