FTSE 100 Live 10 June: Index lower on rates and political uncertainty, euro weakens

Political and interest rate uncertainty today meant another session in the red for leading European stock markets.

Shares in leading French companies are down sharply on Emmanuel Macron’s election gamble, with Friday’s robust US jobs report adding to stock market jitters.

The developments come ahead of this week’s US central bank meeting and key figures on UK unemployment, wage growth and GDP.

FTSE 100 Live Monday

• Stocks rattled by political uncertainty

• Brave Bison pulls Mission offer

• Photo Booth firm sees record profit

FTSE 100 falls as investors eye European political jitters and watch for clues in big week for US interest rates

Monday 10 June 2024 16:59 , Michael Hunter

London’s main stock index has closed lower, in line with a sense of caution across global markets centred on European bourses after gains for the far right in European elections.

A drop for the euro and French banks were the stand-out features of an uneasy but measured trading day.

The FTSE 100 ended down 17 points at 8,228.48. In Paris, the CAC 40 tumbled almost 100 points to 7,893.98, a loss of 1.4%.

SocGen dropped by almost 8%. Credit Agricole was down 4%.

London-listed financial stock also fell. Among them, NatWest was down 1.9%, or 6p at 311p. Prudential was down 11p at 721p.

The sense of caution also came ahead of the Federal Reserve’s next interest rate meeting due on Wednesday. The world’s most influential central bank is expected to hold rates, but investors will be on watch for clues on the timing of a cut, expected later this year.

Euro trades around its lowest level in a month as EU political jitters grip global markets

Monday 10 June 2024 16:28 , Michael Hunter

The euro is trading back around its lowest level of the day as worries over the rise of far-right parties in European elections have knocked the shares currency back down to levels last touched in mid-May.

In late trade, the shared currency is down 0.7% at $1.0744, off by almost a cent in a single session.

Its nadir for the day was $1.0733. The sell-off comes after voters backed the far right across the continent in EU-wide elections for the bloc’s parliament.

Then came a shock dissolution of the French national parliament from President Macron, in a gamble that the snap election would end the trend.

The drama sent ripples across European markets and added to a sense of caution on Wall Street. While overall falls on continental bourses were measures, French banks fell heavily.

Shares in SocGen fell 8%. BNP Paribas was down over 5%.

Southwest Airlines heads north on reports of stake building by activist investor

Monday 10 June 2024 15:16 , Michael Hunter

Shares in America’s Southwest Airlines topped the S&P 500 in morning US trade, after reports that an activist investor had built a major stake in the firm.

According to the Wall Street Journal, Elliott Investors has shares in the Dallas-based airline worth $2 billion (£1.57 billion) and is preparing to push for change to unlock value for investors.

Southwest’s stock rose almost $2 to 29.57, a rise of almost 7%.

Wall Street stocks slip as uncertainty over rates and European political outlook stokes caution

Monday 10 June 2024 14:42 , Michael Hunter

A sense of caution on Wall Street into a US interest rate call later this week took over from unease at European election results earlier in the global trading session at the start of Wall Street trade.

The S&P 500 started the day down by around 12 points to 5334.5.

That dip followed a wider loss on Friday, when strong jobs numbers added to a sense that the Federal Reserve would wait longer to cut rates. It meets on Wednesday, when it is set to hold off taking acton, and attention will focus on looking for clues over when it will.

Consensus forecasts are for one quarter-point cut in September and another later in the year. .

Looming Fed decision this week adds to sense of market caution

Monday 10 June 2024 14:26 , Michael Hunter

In the run to the start of trade on US stock markets on Monday, the gravitational pull of a looming interest rate decision from the Federal Reserve was already having an effect on sentiment.

It added to a sense of caution which followed a poor set of results for centrist parties in elections to the European Parliament.

Unease at the rise of far-right parties was compounded by President Macron’s decision to call a snap national parliamentary elections in France after his country returned more right wing representatives to the EU-wide parliament.

Investors across global markets are on watch for signs of when the Federal Reserve will start to cut interest rates. Monetary policymakers at the world’s most influential central bank meet from Wednesday and is expected to leave the cost of borrowing on hold, though attention will centre on clues over the timing of the cut widely seen as likely this year.

New York stocks set to slip in opening trade after political turbulence knocks European stocks

Monday 10 June 2024 14:01 , Michael Hunter

After an uneasy feel to trade in Europe after gains for far right parties in European parliamentary elections .

With a snap election to the French national parliament called in response by President Macron and the main Paris stock index down over 130 points, US stocks looked set for a muted start.

Futures trade pointed to a drop of around 5 points for the S&P 500. New York’s broad stock index.

The euro took the most eye-catching hit. The shared currency was down 0.5% at $1.0742.

Europe’s pan-continental share benchmark, the Stoxx 600, was down 0.6%. French banks were among the biggest fallers. SocGen fell over 8% and BNP Paribas over 5%.

Brent Crude subdued on supply outlook

Monday 10 June 2024 12:32 , Michael Hunter

The benchmark international oil price stayed under $80 a barrel this morning, with the market expecting a rise in supply after Opec signalled it would trim its production cuts.

Brent crude was at $79.90, ticking up 0.4% on the session, but staying away from May's peak above $84.

Last week’s Opec meeting sent prices lower but Brent bounced off a four-month low last Tuesday.

Commodities traders are keeping watch for more details, but the $80 a barrel mark looks like a cap, at least for now.

David Morrison at Trade Nation said: “Crude oil has had a rollercoaster week ... and it still looks vulnerable to further selling pressure.”

French stocks sharply lower, Aviva and Barclays among FTSE 100 fallers

Monday 10 June 2024 10:12 , Graeme Evans

Shares in SocGen, BNP Paribas and the construction firm Vinci were about 5% lower today after French president Emmanuel Macron called a snap election on the back of Sunday’s European poll result.

The Paris-based Cac40 index dropped more than 2% at one point and the euro traded at a one-month low against the dollar amid the political uncertainty.

The FTSE 100 showed more resilience but still fell 0.3% or 25.84 points to 8219.53 following declines of about 2% for Barclays, Lloyds and NatWest.

London’s weakness also reflected the impact of Friday’s robust US jobs report, which has left traders contemplating another delay to the first Federal Reserve rates cut.

The focus now turns to guidance from the US central bank at its meeting on Wednesday, as well as this week’s UK unemployment, earnings and GDP figures.

Other big fallers in today’s session included Aviva, which dropped 9p to 468.9p after JPMorgan removed its “overweight” recommendation with a lower target price of 550p.

Wealth manager M&G moved the other way, up 3.7p to 202p after the same firm backed shares to reach 250p. Other stronger stocks included Rolls-Royce, ahead 4.6p to 461.5p.

Ashtead shares also found positive territory, up 14p to 5572p, amid weekend speculation that it could follow the lead of CRH and Flutter Entertainment as the next FTSE 100 company to shift its primary listing to New York.

The FTSE 250 index fell by 67.65 points to 20,487.72, with Peru-based Hochschild Mining down 3% or 5.8p to 175.2p following last week’s reverse for the price of gold.

Laundry plans keep ME Group International on course for record profits

Monday 10 June 2024 09:54 , Michael Hunter

The company famed for running photobooths at stations revealed today that it had installed a record number of a different kind of self-service devices.

ME Group International, formerly Photo-ME, has turned to a new source of revenue less exposed to competition from the smart phone: Washing machines.

Its “Revolution” laundry units allow customers to cleanse large loads, including duvets and blankets, and are being installed in the firm’s signature “high footfall locations”, such as supermarket car parks and petrol forecourts.

The number of them running in the first half of 2024 was up almost fifth, with 420 installed in the period.

Based in Epsom, the FTSE 250 firm is best known for helping thousands of customers apply for ID documents from passports to driving licenses and membership cards. It also operates digital printing kiosks and food vending machines, as well as children’s rides at shopping centres.

It said it was “confident in delivering record profitability for the year, in line with market expectations”.

Nonetheless, ME Group shares slipped 8p to 163p in morning trade.

Nationwide rebels urge "no" note at AGM

Monday 10 June 2024 09:06 , Simon English

REBEL members of Nationwide trying to block its £2.9 billion takeover of Virgin Money are urging members to vote against the re-election of CEO Debbie Crosbie at this year’s AGM.

They have failed in a bid to get a vote on the deal itself and are now urging a “No” vote on all candidates and resolutions at the annual meeting, scheduled for July 17.

Online voting begins today.

Mikael Armstrong, leader of the campaign to Give Nationwide Members a Say on the purchase of Virgin Money said:

“The best and only option remaining to Nationwide members is to vote “NO” to All resolutions and “AGAINST” the re-election of every board member at the upcoming AGM.

“Starting today, Nationwide members who are aggrieved that they have been denied a say on the proposed acquisition of Virgin Money finally have an opportunity to register their disgust: simply vote NO to all resolutions and AGAINST re-elections ahead of the AGM.”

Nationwide insists the deal will create value for members and a powerful new player in savings and loans.

It says: “The Board is confident in the quality of Virgin Money’s assets and the opportunities this proposed deal would brings for our members, following appropriate investigation and review.”

The campaign said: “Nationwide continues to paint a purely positive picture of the proposed deal to members without any balance, i.e. zero acknowledgement of the costs or risks associated. This is backfiring badly, and risks the proposed deal coming across as ill-conceived and not credible.”

European benchmarks lower, Ashtead rallies on US listing report

Monday 10 June 2024 08:25 , Graeme Evans

The FTSE 100 index has fallen 0.6% or 53.39 points to 8191.98, while the Paris-based Cac40 is down 2% in response to French President Macron calling a snap election.

Banking stocks are among those under pressure, with Barclays off 3p at 214.2p and Lloyds Banking Group down a penny at 53.8p.

Aviva shares fell 10.3p to 467.6p after analysts at JPMorgan removed their “overweight” recommendation and gave the insurer a lower target price of 550p.

Wealth manager M&G moved the other way, up 1.4p to 199.7p after the same firm backed the shares to reach 250p.

Ashtead shares lifted 40p to 5598p after the Sunday Telegraph reported that the Sunbelt equipment hire firm is considering a New York listing.

Pennon Group, owner of South West Water, says chair stepping down

Monday 10 June 2024 08:02 , Michael Hunter

The owner of South West Water has announced the departure of its chair.

Pennon Group said Gill Rider will be replaced by David Sproul.

He will be paid £250,000, the same amount as his predecessor.

The FTSE 250 firm has been dealign with a wave of criticism after sticking with a £127 dividend payout plan after customers were hit with an outbreak of sickness caused by parasites in its drinking water in Devon.

Euro under pressure amid political uncertainty

Monday 10 June 2024 07:45 , Graeme Evans

The euro has fallen to its weakest level against the dollar in nearly a month, driven by renewed political uncertainty after French president Emmanuel Macron called a snap election in the wake of Sunday’s European poll result.

The single currency is 0.4% lower at $1.0755 against the dollar, with the prospect of US interest rates staying higher among other factors.

European stock markets are also set for a weaker session, with futures trading pointing to a decline of more than 1% for the Paris-based Cac40 index.

Brave Bison pulls possible offer for Mission Group

Monday 10 June 2024 07:44 , Michael Hunter

Digital media firm Brave Bison said it would not make an offer for heavily indebted agency Mission Group today, ending an approach which began in May.

Bison – which owns the Social Chain agency set up by Dragon’s Den investor Steven Bartlett – had valued Mission’s shares at around £30 million and said it would pay down debt.

But it said today that Mission “ chose not to provide access to due diligence information or key management personnel” and “rejected Brave Bison's attempts for constructive dialogue”.

It added:

“The Board of Brave Bison is disappointed by the lack of engagement from the Mission Board and does not believe that the Mission Board's strategy to deleverage the business will deliver value for Mission shareholders in excess of the Revised Proposal.”

Brave Bison is also backed by the billionaire investor Lord Michael Ashcroft.

FTSE 100 seen lower amid focus on rates outlook

Monday 10 June 2024 07:20 , Graeme Evans

The FTSE 100 index is set for another weaker session after Friday’s blowout US jobs report clouded the outlook for lower interest rates.

The addition of 272,000 non-farm payrolls in May came in well ahead of expectations near to 200,000, offset by an unexpected rise in the unemployment rate to 4%.

The next Federal Reserve decision is due on Wednesday, with comments by chair Jerome Powell scrutinised for guidance on a potential autumn cut in interest rates.

This week’s unemployment, earnings and GDP figures in the UK will also go some way to determining the rates outlook after the central banks of Europe and Canada cut last week.

Ahead of the figures, the FTSE 100 index is forecast to open 61 points lower at 8184 after losing 40 points in Friday’s session.