The FTSE 100 is steady in afternoon trade, as investors digest Jeremy Hunt’s Spring Budget. The Chancellor has just begun his speech, with a cut to National Insurance expected to be the headline measure.
Shares in airlines, energy companies and homebuilders are the biggest risers on the stock market. SSE is ip 36p at 1694p, Taylor Wimpey is up 3p at 142p. IAG, the owner of British Airways, is up 7p at 149p.
On the corporate side, Legal and General, Ibstock and Capita are among the companies reporting results, while Southend Airport owner Esken is to leave the London Stock Exchange as the Essex hub changes hands.
FTSE 100 Live Budget Day
National Insurance: 2p or not 2p no longer the question as Hunt cuts the rate paid by all workers
13:37 , Simon Hunt
In a widely trailed move, the Chancellor confirms the 2p cut to National Insurance.
He’s taken the main rate down to 8% from 10%, saving the average UK worker around £450 a year.
The move is expected to boost the labour supply in the economy, by making it pay to work more hours.
He made the same move in his last set-piece fiscal overhaul, when the Autumn Statement also included a headline-grabbing 2p NI cut.
It will apply from April 6.
Windfall tax on energy companies extended to 2029, raising £1.5 billion
13:35 , Simon Hunt
Chancellor says that high energy prices after Russia’s invasion of Ukraine are lasting longer, extending high profits in the industry.
So he is keeping the windfall tax on the sector in palce until 2029, raising £1.5 billion.
There will also be legislation to abolish it if “market prices fall to the historic norm for a sustained period”
Shares in the sector shrugged off the news. BP stayed over 6p higher on the day at 477.3p. Shell is up 31p at 2483p
Household Support Fund extension welcome, says Martin Lewis
13:34 , Simon Hunt
The Jeremy Hunt Household Support Fund extension is welcome, says Martin Lewis.
Household Support Fund extension by 6mths also welcome (probably will need extending again after). This is money for local councils to help the most desperate and the cost of living crisis means sadly there’s high demand. Would’ve been awful to cut it off right now. #Budget2024…
— Martin Lewis (@MartinSLewis) March 6, 2024
ISA chance missed?
13:32 , Simon Hunt
Kevin Brown, savings specialist at Scottish Friendly, says: “One missed opportunity was to broaden the scope of family ISA saving and investing across the generations.
“Our research has shown that 7 in 10 (68% of parents) want grandparents to be allowed to open a JISA for their grandchildren, however the current rules stipulate that it has to be the parent or the guardian that does this first.
“There needs to be a change to JISA rules to allow other family members, such as grandparents, to open them too. This would provide a boost to children’s savings.”
Not enough properties available for long-term rentals
13:27 , Simon Hunt
Hunt moves to reduced the number of properties available as short-term holiday lets
The Furnished Holiday Lettings tax regime “is creating a distortion meaning that there are not enough properties available for long term rental by local people” said Hunt.
“To make the tax system work better for local communities, I am going to abolish the Furnished Holiday Lettings regime.”
Stamp duty relief abolished… for multiple homes
“I have also been looking at the stamp duty relief for people who purchase more than one dwelling in a single transaction, known as Multiple Dwellings Relief,” said Hunt.
Intended to support investment in the private rented sector, Hunt said an external evaluation found “it was being regularly abused”.It’s now been abolished, too.
Government to up vape and tobacco taxes
13:24 , Simon Hunt
Jeremy Hunt will up the tax on vapes, “to discourage non-smokers to take-up vaping”.
But tobacco duty will be incresased at the same time, “to maintain a financial incentive” for smokers to turn to vapes instead.
The measure continues the Government’s fight against the rise of vaping, after a ban on disposable vapes was announced earlier this year.
More govt spending needed, say economists
13:24 , Simon Hunt
Olly Bartrum, the senior economist at the Institute for Government, says the 1% increase in real terms departmental spending is better than expected but still “problematic”.
Public services remain under huge strain, he warns.
Small businesses get boost from VAT tinkering
13:21 , Simon Hunt
The compulsory threshold for VAT registration will be increased by £5,000 to £90,000.
Tax experts said the change would be a boost to small businesses close to the threshold, who faced little incentive to grow as they hit the ‘cliff-edge’.
Robert Marchant, VAT specialist and Head of Tax at Crowe UK, said: “The VAT cliff edge has been eroded (a little). The compulsory VAT registration threshold has been raised by £5k to £90k with effect from 1 April 2024.
“The Tax Policy Associates had previously calculated that 26,000 small businesses were deliberately restricting growth to remain beneath the registration threshold. This modest increase will therefore help some organisations to grow but it remains to be seen whether the change will go far enough.”
Fuel duty freeze a ‘step in the right direction’
13:18 , Simon Hunt
Hunt’s move to freeze tax on fuel is getting some qualified backing from the car industry
Lisa Watson, director of sales at Close Brothers Motor Finance, called it “a step in the right direction” adding:
“It will come as some relief to motorists concerned about the soaring cost of driving from A to B.
“Whilst only likely to have a small positive impact, it’s a step in the right direction, particularly for the 53% of drivers who cite fuel prices as the biggest challenge in the next 12 months.”
Public sector spending growth target held at 1%
13:17 , Simon Hunt
The Chancellor said the Government will keep its 1% target for public sector spending growth, rather than cutting it to 0.75%.
Hunt said: “I am keeping the plan for public sector spending growth at 1% in real terms, but we are going to spend it better.”
There were reports that Hunt may have considered cutting the rate to 0.75%.
The Government will also launch a “public sector productivity plan”, he said.
FTSE stocks edge up
13:15 , Simon Hunt
Shares in airlines, energy companies and homebuilders are the biggest risers on the stock market. SSE is ip 36p at 1694p, Taylor Wimpey is up 3p at 142p. IAG, the owner of British Airways, is up 7p at 149p.
British ISA welcomed
13:11 , Simon Hunt
Matt Mckenn at personal finance site finder.com said: “The big question about the British ISA was whether it would eat into the existing £20,000 annual allowance or be added as an extra on top. The fact that the Chancellor has given an additional £5,000 to accommodate this is a sensible move and I respect the ambition of a British ISA.
“In my opinion, it is reasonable for the British government to try and stimulate growth in its domestic market and this ensures UK investors won’t have to curb their current foreign investment plans.”
Creative industries given additional tax relief
13:08 , Simon Hunt
The Chancellor said he will up tax credits for visual effects firms in an aim to boost Britain’s creative industries.
He said: “We have become Europe’s largest film and TV production centre with Idris Elba, Keira Knightley and Orlando Bloom all filming their latest productions here. Studio space in the UK has doubled in the last three years. At the current rate of expansion, we will be second only to Hollywood globally by the end of 2025.”
The Government will also remove the 80% cap for visual effects costs in the Audio-Visual Expenditure Credit.
Tax reliefs for touring and orchestral productions will also be extended.
Hunt listens to City on ISA reforms
13:05 , Simon Hunt
He said: “following calls from over 200 representatives of the city and our high growth sectors I will reform the ISA system to encourage more people to invest in UK assets. After a consultation on its implementation, I will introduce a brand new British ISA which will allow an additional £5,000 annual investment for investments in UK equity with all the tax advantages of other ISAs.
“This will be on top of the existing ISA allowances and ensure that British savers can benefit from the growth of the most promising UK businesses as well as supporting them with the capital to help them expand.”
Hunt will push ahead with NatWest sale as British Isa confirmed
13:04 , Simon Hunt
The Chancellor will push ahead with plans to sell off the government’s remaining 34% stake in NatWest this summer. There will also be a new British ISA, which will have an additional £5,000 tax free investment allowance on top of present allowances.
On pension fund reform, he said: “I start with pension fund reform. I want our brilliant technology entrepreneurs not just to start here but to stay here, including when the time comes for a stock market listing. So we will build on the Edinburgh and Mansion House reforms to unlock more pension fund capital.
“We will give new powers to The Pensions Regulator and Financial Conduct Authority to ensure better value from Defined Contribution schemes by judging performance on overall returns not cost. We will make sure there are vehicles to make it easier for pension funds to invest in UK growth opportunities, so I am today publishing the names of the winners of the LIFTS competition
Building new homes for young people
13:00 , Simon Hunt
Hunt promises to transform Barking Riverside and Canary Wharf with £242 million of investment, alongside investments in Blackpool, Sheffield and Liverpool.
“Together [this] will build nearly 8,000 houses as well as transforming Canary Wharf into a new hub for life science companies,” said Hunt
“We are launching a new £20m Community Led Housing scheme supporting local communities to deliver the developments they want and need,” he added.
Fuel Duty freeze ‘a step in the right direction’
12:57 , Simon Hunt
The latest freeze in fuel duty was hailed as ‘a step in the right direction’ as the price of petrol has risen in recent months amid concerns about the Middle East and global shipping.
Lisa Watson, director of sales at Close Brothers Motor Finance, said: “Extending the ‘temporary’ fuel duty cut by 12 months will come as some relief to motorists concerned about the soaring cost of driving from A to B.
“Whilst only likely to have a small positive impact, it’s a step in the right direction, particularly for the 53% of drivers who cite fuel prices as the biggest challenge in the next 12 months.
“We’ve seen continuous hikes at the pumps over the last few months and this has added further pressure to drivers who already feel they’re faced with increased costs from all lanes, making car ownership difficult to afford for 62% of drivers. What is essential now is that this cut reaches drivers’ fuel tanks and wallets.”
Hunt extents tax cuts for business investment
12:56 , Simon Hunt
Business investment up to reach 10.6% of GDP this year, Hunt says.
He points to investment from Nissan , Google and Microsoft in the UK.
He extends “full expensing” tax breaks on investment spending to expenditure on leasing.
Debt will fall
12:53 , Simon Hunt
OBR says debt as a percentage of GDP will fall in every year to just 94.3% by 2028-29. Underlying debt, which excludes Bank of England debt, will be 91.7% in 2024-25 according to the OBR, then 92.8%, 93.2%, 93.2% before falling to 92.9% in 2028-29.
Chancellor accused of ‘taking credit’ for BoE work on inflation
12:52 , Simon Hunt
Professor Stephen Millard, deputy director of think tank NIESR, criticised the Chancellor for ‘trying to claim credit’ for the fall in inflation.
Millard said: “The Chancellor is trying to claim the credit for bringing inflation down. This is the job of the Bank of England’s MPC and they should get the credit for this. Political interference in monetary policy is not something that we should welcome.”
Economy to grow
12:50 , Simon Hunt
The OBR expects the economy to grow by 0.8% this year and 1.9% next year – 0.5% higher than their Autumn Forecast. After that growth rises to 2%, 1.8%, and 1.7% in 2028.
Fuel Duty frozen yet again
12:47 , Simon Hunt
Fuel Duty will be frozen yet again, Jeremy Hunt has said.
The temporary cut to duty, introduced in 2022, will also stay in place. Fuel duty has been frozen every year since 2011.
Hunt said: “If I did nothing, fuel duty would increase by 13% this month”
In announcing the freeze, the Chancellor also took a swipe at Sadiq Khan, who he said has “tried to punish” motorists with measures like ULEZ expansion.
Alcohol duty freeze extended
12:46 , Simon Hunt
Jeremy Hunt gave the pubs industry a boost as he extended the freeze on alcohol duty.
Hunt said: “I have decided to extend the alcohol duty freeze until February 2025.
“This benefits 38,000 pubs all across the UK – and on top of the £13,000 saving a typical pub will get from the 75% business rates discount I announced in the Autumn. We value our hospitality industry and we are backing the great British pub.”
Budgeting Advance Loans repayment period extended
12:42 , Simon Hunt
The Chancellor will increase the repayment period for Budgeting Advance Loans, which are offered to those on Universal Credit to help them pay emergency costs.
Hunt said nearly one million people rely on those loans.
He said: “To help make such loans affordable, I have today decided to increase the repayment period from 12 months to 24 months,” he said.
Inflation to fall below 2%
12:41 , Simon Hunt
Chancellor Hunt says according to OBR forecasts inflation will be below the 2% Bank of England target within months, which should allow cuts in interest rates and cheaper mortgages.
Inflation was 11% when he and Rishi Sunak took office.
Hunt says Govt given the average household £3,400 in cost of living support over the last two years.
‘Permanent cuts in taxation’ promised
12:39 , Simon Hunt
Chancellor says he will help families “not just with temporary cost of living support, but “permanent cuts in taxation.”
Hunt promises ‘lower taxes’ as he opens Budget
12:37 , Simon Hunt
At the start of his speech, Jeremy Hunt hailed the Conservative Party’s economic record, and hinted that tax cuts are set to be announced.
He said: “Growth has been larger than every large European economy, unemployment has haled and there are 800 more jobs for every single day we have been in office.
“Of course interest rates remain high as we bring down inflation,. But because of the progress we have made, we can help families not just with temporary cost-of-living support but with permanent cuts in taxation.
“We do this because lower taxes means higher growth.”
Budget about to start
12:32 , Simon Hunt
PMQs has finished and Chancellor Jeremy Hunt is about to begin his budget speech. Stay tuned for live coverage and market reaction.
Market snapshot: UK stocks and the pound higher ahead of Budget
12:04 , Michael Hunter
With around half an hour to go before the Chancellor Jeremy Hunt stands up in the House of Commons to deliver the Budget, here is a look at the state of play on the UK’s main financial markets.
The top-tier FTSE 100 share index is up 28 points at 7674.58.
The mid-cap FTSE 250 stock benchmark is up 151 points at 19422.83.
The pound is 0.2% stronger on the day against the dollar at $1.2726
And sterling is flat against the euro at €1.1699.
The yield on 2-year UK government debt is at 4.627%; 5-year debt yields are at 3.976% and the benchmark 10-year bond yield is 4.143%.
Could Hunt pull an income tax ‘rabbit from the hat’?
11:54 , Daniel O’Boyle
Neil Wilson of Finalto says that a cut to income tax is unlikely, but could be a surprise ‘rabbit’ from Jeremy Hunt’s hat.
More likely, however, would be an update to tax thresholds to ease the ‘stealth tax rise’ from fiscal drag
Wilson said: “Budget Day – what to expect from Wonky Wednesday? For policy wonks at the Treasury, it’s their big day out. Pre-election personal tax giveaways have been well leaked – eg NI cut by 2p again. There could be a more eye-catching income tax cut. A cut to income tax would be a bit of a rabbit – whether enough to swerve election wipeout remains to be seen. The risk is that, somewhat against character, Hunt announces a bunch of tax cuts that upset the markets. We have seen before that bond vigilantes are hunting in their packs again.
“I don’t think this is really going to happen and Hunt will lean again on fiscal drag to do the lifting, a particular bugbear when inflation and wage growth ought to have seen the levels change a lot since 2020. The tax rate will beat the post-war high of 37.2% of GDP in 26/27 or 28/29 depending on what Hunt does today – it will be breached no matter what, largely because of fiscal drag.”
Will we see an ‘austerity budget’?
11:48 , Daniel O’Boyle
Kathleen Brooks, research director at XTB, says the Chancellor is in a difficult position because of a lack of fiscal headroom.
Brooks says: “There is a chance that Jeremy Hunt could sacrifice the non-ringfenced public sector, for example defense, in order to build a war chest for future tax cuts if the Tories do win the next election. Public spending is only expected to rise by 1% from 2025, this could be reduced to 0.75%. This would leave Hunt open to accusations that this is an ‘austerity budget’, however, he may accept this in order to focus on the potential for affordable tax cuts down the line.
“As we have mentioned, there are plenty of evidence that voters prefer increases to public spending rather than tax cuts, but that does not appear to be Rishi Sunak’s game plan for this election.”
Market snapshot: Shares edge up ahead of Budget
11:33 , Daniel O’Boyle
Take a look at our latest market snapshot with shares a little higher ahead of the Budget.
‘Hunt should focus on long-term, not giveaways’
11:29 , Daniel O’Boyle
NIESR economist Paula Bejarano Carbo says Jeremy Hunt should ‘focus on the long-term’, rather than ‘giveaways’:
She said “Today’s Spring Budget is taking place against a backdrop of low economic growth, as seen most notably by GDP per head being lower in the last quarter of 2023 than just before the pandemic (2019 Q4).
“While increasing real wages have improved conditions for many households in recent months, long-term economic prospects will remain weak without growth-enhancing fiscal policies, such as a commitment to increasing public investment. We therefore hope today’s Budget focuses on the long-term, rather than pre-election giveaways.”
Boosting the City should be ‘key priority’
11:23 , Daniel O’Boyle
Aster Crawshaw senior partner at international law firm Addleshaw Goddard says: ”Maintaining London as a leading global financial centre should be a key priority for any Government. The Chancellor has spent time listening to the City, and there are a range of measures which I would hope to see in the Budget.”
“Phasing out the Bank Levy would provide a much needed boost to financial services and improve the overall competitiveness of the UK economy. The Chancellor could also give a boost to UK capital markets, providing support to companies that may seek to list in the UK, incentivising investment in UK equities and removing stamp duty on trading. Also, he could encourage a more risk based approach to financial services regulation – too many UK based businesses are choosing to make primary listings in other countries citing the UK’s regulatory environment as ‘holding them back’.”
Eurozone retail sales ‘in line with declining trend’
10:52 , Daniel O’Boyle
Eurozone retail sales grew by 0.1% in January, in a sign that the currency union’s stagnation is continuing into 2024.
ING senior Eurozone economist Bert Colijn said: “The first hard data point for the eurozone economy in the first quarter did not provide reason for much optimism. Retail sales may have increased slightly after a sharp drop in December retail volumes but they are still well below the November level.
“This means that the January data point is still in line with the broad declining trend seen since late 2021.”
Unlike the UK, the Eurozone narrowly avoided a technical recession to end 2023, but there is little real difference between its economic performance and the UK’s, with both hovering close to the zero growth mark.
Battle for future of Southend airport draws to a close as Esken reaches deal with lender Carlyle
10:48 , Simon Hunt
A protracted battle over the future of Southend airport today drew to a close after owner Esken bowed to pressure from its biggest lender Carlyle and agreed to wind down the business in a move likely to leave shareholders empty-handed.
London’s sixth airport had been in the hands of Esken, formerly known as Stobart Group, after it acquired the site for £21 million in 2008. But Southend was hit hard by the coronavirus pandemic, with the airport being forced to close to passengers for months on end after a number of high-profile airlines withdrew operations.
Esken saw its stock tumble as it became saddled with hundreds of millions of pounds of debt amid a struggle to keep afloat. The company was dealt another blow in January after its main lender, US private equity group Carlyle, accused the company of having breached the terms of a £194 million loan and demanded urgent repayment.
Esken initially tried to shake off Carlyle’s accusation and dispute its legal basis, with CEO David Shearer telling the Standard the lender was “seeking to get their hands on the airport on the cheap,” adding that the legal threat could upend the airport’s operations.
But the firm today said it had reached a deal under which Carlyle would become the majority shareholder of the airport after admitting it did not have the necessary funds to fight the company in court.
Government finances ‘hemmed in on three fronts’
10:39 , Daniel O’Boyle
Ahead of the Budget, Panmure Gordon economist Simon French gives his take on the state of the UK Government’s finances
Taxpayer’s NatWest stake cut down again
09:51 , Daniel O’Boyle
The Treasury has sold another 1% of NatWest, as markets hope that today’s Budget will provide more detail on the upcoming retail sale of shares in the bank.
The Government bailed out the Bank after the Global Financial Crisis, and has been selling down its stake ever since. It faced increased pressure to cut down its holding amid the controversy last year around the closure of Nigel Farage’s account with NatWest-owned Coutts.
The taxpayer’s stake in the bank is down to 31.85%, from 32.88%.
At the Autumn Statement last year, Jeremy Hunt revealed that the general public will be able to play a part in the sale of NatWest shares for the first time when a retail offering is launched this year.
NatWest shares are up 1.5% to 253.5p today.
Construction sector moves toward growth as PMI survey comes in ahead of forecasts
09:37 , Michael Hunter
A closely watched barometer of the UK’s struggling building sector has come in a little better than expected this morning
The purchasing managers’ index for construction rose to 49.7. it was expected to read 49.0 and came in at 48.8 last time. The forward-looking survey predicts growth with a reading above 50, taking the hard-pressed sector to the brink of expansion today.
Construction has been hit by rising interest rates, making projects more expensive to finance and choking off demand in the house market.
The improvement will come as relief, with the Bank of England expected to cut borrowing costs later this year, further improvement could lie ahead.
Vimto owner gears up for record Ramadan; shares get a boost
09:06 , Simon Hunt
Vimto owner Nichols is gearing up for its busiest trading weekend of the year as it prepares to sell as many as 25 million bottles of the iconic fruity drink during the season of Ramadan.
Vimto has become the go-to drink for Muslims observing Ramadan, with the Middle East accounting for around a third of its global exports as the firm celebrated its 100th Ramadan season in 2023.
CEO Andrew Milne said a targeted marketing drive, which included creating a new TikTok Arabia account, had helped boost sales by another 10% in the region during the year.
Nichols shares jumped as much as 7% today after it posted a 75% leap in pre-tax profits to £24 million, with revenues rising 3.5% to £171 million.
Milne said the firm’s cost inflation had come down to the mid-single digits following double-digit rises last year.
But he warned: “In the last couple of months consumers have been tightening their belts a bit. Interest rates are having a bit more of an effect.”
888 to pay $50 million to fold US operation
08:33 , Daniel O’Boyle
William Hill owner 888 is set to close down or sell its struggling US sites and apps, paying $50 million for the rights to do so, after failing to find the same stateside success as rivals like Flutter and Entain.
The gambling giant launched in the US in 2021, a bit later than rivals, as states legalised online sports betting and online casino games. It signed a licensing deal with the owners of Sports Illustrated, using the iconic magazine’s name for its sportsbook.
But the business failed to gain any ground against rivals like Flutter-owned FanDuel and Entain-owned BetMGM. It launched in only four states and made only £20 million in revenue in 2022, good for a 0.2% market share. It never looked close to turning a profit, making a £12 million loss in 2022.
Now, it has launched a strategic review of the US operation, which could end in the sale or closing of the operation. 888 also offers some business-to-business services in the US, which will remain open.
FTSE 250 rises as consumer stocks cheer up; Premier Foods rallies on pension announcement
08:24 , Michael Hunter
London’s mid-cap share index, commonly seen as providing more insight into the domestic UK economy, is making gains as investors wait for today’s Budget.
The FTSE 250 is 34 points higher at 19,305.45, a gain of 0.2%.
Consumer stocks are in the lead as the lead, with real estate and energy stocks providing support.
Premier Foods made the biggest single gain, up 15p to 154p, a rise of 10%, after it announced it could end payments to cut its pension scheme deficit earlier than expected.
It will boost cashflow at the maker of Bisto gravy and Mr Kipling Cakes by £33 million for 2025.
FTSE 100 holds steady in Budget day opening trade
08:06 , Michael Hunter
London’s main stock market index is off to a sluggish start, with investors waiting for a sense of direction from the Budget.
It is widely expected to be the last set of tax-and-spending measures before a general election expected later this year.
Before the lunchtime rush of detail in the government’s financial plans, the FTSE 100 ticked down by a modest three points to 7,642.69
Chancellor Jeremy Hunt will outline his plans at around 12.30 p.m.
L&G in show of faith in London
07:38 , Simon English
L&G, the biggest investor in the City with more than £1 trillion in assets, shows faith in under pressure London markets with pledge to up its divi by 5% a year.
New CEO António Simões, CEO, said: “Everything I have seen since joining the business in January has confirmed what attracted me to Legal & General. We have an authentic sense of purpose and stand out for our market-leading businesses, performance track record and strong balance sheet, delivered by talented colleagues.”
While other big investors wobble about the long term future of the City, L&G, around since 1836, saw profits for the year slump from £783 million to £457 million.
The CEO said: “ We remain confident in our ability to deliver resilient, organic growth, supported by our strong competitive positioning in attractive and growing markets. Our confidence in our dividend paying capacity is underpinned by the Group’s strong earnings and strong balance sheet, which has Solvency II regulatory capital of £16.6bn: a surplus of £9.2bn in excess of a capital requirement of £7.4bn.”
The divi is up 5% to 20.34p a share.
New Capita boss promises “rapid reduction” in costs
07:29 , Daniel O’Boyle
Outsourcing giant Capita, among the biggest beneficiaries of Government contracts, is to start a “rapid reduction” of costs to save £100 million, after swinging to a £107 million loss last year.
The business – one of the UK’s largest employers with a 43,000-strong workforce – lost £106.6 million as revenue dipped to £2.8 billion in a year in which the business was hit by a major cyber-attack.
CEO Adolfo Hernandez, who took over at the start of the year, said: “We need to deliver a rapid reduction in our cost base and are on track to deliver the net £60m annualised cost savings, from Q1 2024 as announced in November. Today we are announcing further material efficiency improvements of £100m to improve our competitive position.”
Capita announced 900 job cuts late last year.
Housing market slowdown takes a chunk out of brick sales at Ibstock
07:27 , Michael Hunter
Ibstock, one of the UK’s biggest brick makers, cast fresh light on the impact of the slowdown in the UK housing market on building products suppliers today.
Brick volumes at the company fell by about 30%, cutting revenue in its Clay Division by just over a fifth to £292 million.
Overall group revenue fell by 21% to £406 million for 2023. Profit before tax slumped by 71% to £30 million, including the impact of a one-off charge of £30 million.
The firm took action to cut costs “and align capacity to near term demand expectations”. Annual savings came in at £20 million a year.
Southend owner Esken to be delisted after deal with Carlyle
07:20 , Simon Hunt
The owner of Southend airport is to be delisted after reaching an agreement with lender Carlyle.
Esken, which was set to be taken to court by Carlyle over the repayment of a loan, has instead reached a deal in which Carlyle will become a 82.5% shareholder of the airport.
Any return for shareholders at the end of the process is likely to be negligible.
Esken said: “While there could have been the opportunity to pursue other sources of finance given more time, Esken did not have access to the financial resources to sustain it through what would have involved a protracted court battle.”
FTSE 100 on course for opening gains
07:00 , Michael Hunter
London’s main stock market index is expected to make opening gains, with attention in the City set to shift to Westminster for the Budget.
It is likely be the last set of tax and spending measures before a general election expected this year. Chancellor Jeremy Hunt is expected to find room to cut National Insurance by 2p.
Such a move would save a full-time worker on a salary of £35,000 around £450 a year.
But it would also use up much of the government’s so-called “fiscal headroom”, the space in which it can make decisions on increased spending or lower tax rates.
Nonetheless, City experts are also expecting a package of tax cuts for motorists.
Beforehand, there are earnings due from Legal & General.
The FTSE 100 will rise by around 6 points according to futures trading, with its European peers expected to make. gains in Paris and Frankfurt.
Overnight in New York, tech stocks led a brisk retreat from the record highs last week on major indices. Apple fell almost 3%, with the near €2 billion fine from the EU casting a shadow over the stock. The Nasdaq Composite fell 1.7% and the S&P 500 lost 1%.
In Asia, stocks were mixed, with Hong Kong’s Hang Seng higher, Tokyo’s Nikkei 225 flat and India’s Sensex lower.
Recap: Yesterday’s top stories
06:37 , Simon Hunt
Good morning from the Standard City desk.
Yesterday’s agreed £1 billion takeover bid for Spirent Communications marks another dismal day for the City.
For how much longer can the top brass of the London Stock Exchange, led by CEO David Schwimmer, and the Treasury led by Jeremy Hunt look on while the stream of companies quitting London become a torrent?
Spirent, which older readers will remember as Bowthorpe, has been quoted in London for almost 70 years, and is a serious global player in a vital fast-growth sector, 5G communications, with a headquarters in Crawley.
To make things even worse, Mark Dixon, the boss of another huge UK success story, shared workplace provider Regus’s owner IWG, appears to be putting the finishing touches to a move to a listing in New York.
At this rate it is only a matter of time before one of the UK’s great FTSE 100 household names will up sticks in search of more exciting valuations overseas. That would mark a shattering blow to the prestige of the City, London and the UK as a whole. It cannot be allowed to happen.
Here’s a summary of our other top stories from yesterday:
