Wetherspoons reports strong trading, diamond sales slide for Anglo American

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The FTSE 100 is expected to open 16 points lower on Wednesday, having closed down 0.1% on Tuesday at 7,410.04.

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Pub operator JD Wetherspoon updated the market on the 14 weeks ended 5 November on Wednesday, showing strong performance with a 9.5% increase in like-for-like sales compared to the same period last year, driven by growth in bar, food, and fruit machine sales. Total sales for the year-to-date had grown by 8.1%. Additionally, the company made financial moves to optimise its financing and expanded its property portfolio by opening one pub at Heathrow Airport while selling four pubs and surrendering six leasehold pubs, maintaining a trading estate of 816 pubs.

Mining giant Anglo American saw another big slide in diamond sales at its latest tender of De Beers, blaming continuing macroeconomic "challenges". De Beers sold just $80m of rough diamonds through Sightholder sales and auctions in its ninth sales cycle of the year, down from $200m at the previous tender and $454m in the ninth tender of 2022. "Macro-economic challenges continue to affect the diamond sector," said De Beers chief executive Al Cook, citing a slow retail recovery in China and the recently announced voluntary moratorium by major producers to curb supply to the Indian market, which is hoped to bring some stability and support to prices.

Hiscox reported a 6.8% increase in group insurance contract written premiums (ICWP) in the first nine months of the year on Wednesday, to $3.76bn, driven by strategic capital deployment in London Market and Re & ILS. Net group ICWP rose by 11%, with significant growth in Re & ILS and London Market, and Hiscox Retail ICWP increased by 4.7%. Despite challenges in the US cyber market, the company said it expected a pickup in growth in the fourth quarter.

Newspaper round-up

The economy is on course for another “decade in the doldrums” unless politicians increase public investment by £15 billion annually, starting at the autumn statement in two weeks’ time, a think tank has claimed. Growth is poised to limp along over the coming years and to remain far below its pre-2008 financial crisis trend, extending a 15-year squeeze on household living standards, according to the National Institute of Economic and Social Research. - The Times

Complaints about bank account closures have jumped in the wake of the Nigel Farage debanking scandal, new figures show. The Financial Ombudsman opened 1,613 new cases related to all bank account closures in the six months to the end of September, new figures show, equivalent to around 268 cases each month. - Telegraph

Britain’s housing market is past “peak pain” and prices look likely to bottom out by next summer, according to the estate agency Savills. The average UK house price is projected to fall by 3% in 2024, after a 4% drop this year, the upmarket estate agent and property advisory firm said in its five-year outlook. - Guardian

The message for the investment industry was an uncomfortable one yesterday. British investors were “fleeing for the exits in droves”, according to an analysis by Calastone, the funds infrastructure group. Investors withdrew a net £1.2 billion from equity funds in October, making it the worst month since the aftermath of the mini-budget debacle last year, when a net £2.4 billion was withdrawn in only a few weeks. - The Times

A warning light on the economy’s dashboard is flashing red. It is not sluggish GDP growth that is glaring most vividly, nor the modest rise in unemployment. Instead, a small band of economists fear that a slump in the money supply is the clearest sign yet of the economy facing a serious recession. To them, it signals that inflation will be crushed so completely that Britain instead risks falling into a deflationary trap. - Telegraph

US close

US stocks rose for a seventh straight day on Tuesday as both oil prices and bond yields dropped.

The Dow Jones Industrial Average finished 0.2% higher while the S&P 500 gained 0.3% and Nasdaq rose 0.9%.

The S&P 500 has now risen every day since closing at a five-month low on 27 October, gaining 6.3% over seven consecutive sessions and registering its longest winning streak since early November 2021.

Speaking on Tuesday, Minneapolis Fed president Neel Kashkari said he wasn't convinced that the central bank's rate-hiking programme was over just yet, noting the Fed's primary goal was to bring inflation fully down to its 2% target.

In a separate speech, Chicago Fed head Austan Goolsbee said a "golden path" soft landing that would see the US avoid a recession was still on the cards.