Weekly review

The FTSE 100 ended the week down 73.6 points, or 0.89%, closing at 8,164.12 on Friday.

Equity view

Scientific instruments group Judges Scientific has spent £2.25m on the purchase of Wales-based Rockwash Geodata, a specialist in rock cuttings and chippings digitalisation. The digitalisation of rock cuttings samples is used by both the mining and oil and gas sectors, and Rockwash is a market leader in its niche with an automated and patented sample preparation and data capture process, Judges said.

Marketplace tech firm Auction Technology Group has announced that private equity firm TA Associates has offloaded a 5% shareholding through a share placing with institutional investors. The company said that TA Associates had sold 6.1m shares by way of an accelerated bookbuild to institutional investors at 525p a pop on Thursday, compared with Wednesday's closing price of 565p.

Restaurant operator Tasty saw shares drop sharply on Friday after the Dim T and Wildwood owner reported a doubling of losses in 2023, but expressed its confidence in its turnaround after closing underperforming sites. Tasty, which operated from 53 restaurants during 2023, undertook a restructuring in recent months to reshape the group's estate, make redundancies and "correct the trading decline".

Quanex Building Products has announced a revised and final proposal for its acquisition of Tyman, increasing the cash component of the deal. The adjustment followed feedback from Tyman shareholders concerning fluctuations in Quanex's share price and adverse currency exchange movements since the initial offer was made on 22 April.

Safety equipment and hazard detection technologies group Halma is spending £36m on Portuguese fire detection and alarm systems maker Global Fire Equipment (GFE) to extend its presence in the European market. GFE manufactures things like control panel equipment, fire detectors, sounders and emergency lighting for commercial customers, and its products are said to be complementary to Halma's fire detection subsidiary Ampac.

Serco lifted its full-year profit guidance on Thursday following "good" progress in the first half. In an update for the first six months of the year, the outsourcer said it now expects underlying operating profit of £270m for 2024, up £10m on previous guidance. It also expects free cash flow to be better and financial leverage to be lower than prior guidance.

Private equity and infrastructure group 3i has said that its European non-food discount retail chain Action has performed well since the start of the year as it continues to open new stores. Action, which accounted for £3.72bn of the £4.06bn total gross investment return from 3i's private equity portfolio in the year to 31 March, has seen like-for-like sales grow by 9% so far this calendar year.

Care home real estate investment trust Target Healthcare REIT has offloaded four of the oldest care homes in its portfolio for £44.5m and will use the proceeds to pay down credit facilities. The company said the four assets, which represented 326 beds and around 4.6% of its total portfolio, were originally constructed in 2007-2008 and had a 12% lower gross internal floor space per resident than the portfolio's weighted average, as well as the shortest lease terms compared with other properties.

Insurance and pensions group Phoenix on Wednesday said it was looking to offload its SunLife business after deciding it was no longer core to operations. Phoenix said it had received "a number of initial expressions of interest from third parties", but warned "there could be no certainty at this stage that a disposal will occur".

Anglo American has reported another dip in rough diamond sales from De Beers as it warned of a "protracted" recovery in demand. In what is generally a quieter period for rough diamond sales, De Beers' fifth sales cycle generated $315m, down from $383m in the fourth cycle and $446m in the third. However, this was also down from $456m in the fifth cycle of 2023.

Drax said it was selling up to 90,000 small & medium-sized (SME) customer meter points from Opus Energy Group to EDF Energy Customers Limited for an undisclosed sum. The deal is an asset sale for the majority of the Opus customer meter points and follows a strategic review of the group's non-core SME energy supply business, Drax said on Wednesday.

Asset manager Liontrust swung to a small loss in the year ended 31 March after seeing net outflows of more than £6bn due to an adverse trading environment, but said it's starting to see signs of a recovery. Chief executive John Ions said the negative investor sentiment and market environment over the past 18 months – owing to high inflation, reductions in Covid savings and tax rises – was a "significant headwind for many of our strategies".

Real estate group Landsec has raised its stake in Kent's Bluewater Shopping Centre to 66.25% after a further £120m investment. The company announced on Tuesday it had completed the acquisition of an additional 17.5% shareholding from Singaporean investment firm GIC. Bluewater, located in Stone just outside the M25, is home to 300 units across 1.85m square feet of retail, leisure and hospitality space, and sees annual footfall of 28m, according to Landsec.

Over-50s holidays and financial products group Saga has said it remains on track to hit targets after an in-line start to its financial year, despite ongoing challenges in the insurance market. The company said it was taking actions to "stabilise" the broking business and is seeing early signs of expected benefits in motor. However, emerging net rate inflation in the home insurance business means its actions are expected to have "less of an impact overall".

Funding Circle said on Tuesday that it has agreed to sell its US business to Miami-based iBusiness Funding (IBF) for £33m. The sale includes all loan portfolios and would lead to a £10m gain before transaction costs. Proceeds from the deal will be reviewed in line with the company's capital allocation framework.

AstraZeneca announced contrasting results from two phase three trials involving its immunotherapy drug ‘Imfinzi’, or durvalumab, on Tuesday. The FTSE 100 pharmaceuticals giant said the ADJUVANT BR.31 trial, sponsored by the Canadian Cancer Trials Group (CCTG), investigated Imfinzi in early-stage non-small cell lung cancer (NSCLC).

Insulation and building products group SIG has delivered a profit warning after a challenging first half, as ongoing softness in the building and construction sector across Europe resulted in subdued demand. The company said it now has a "more cautious view of the timing of any potential market improvements during H2", and expects full-year underlying operating profit to be in the range of £20-30m, below the current consensus range of £36.7-43m and the £53.1m reported last year.

Prudential on Monday said it would return $2bn to investors via a share buyback to be completed by mid-2026. "Progress towards our financial objectives will increase the potential for further cash returns to shareholders. Our dividend policy remains unchanged, with the board continuing to expect the 2024 annual dividend to grow in the range of 7-9%,” said chief executive Anil Wadhwani in a statement.

Supreme said on Monday that it has bought Clearly Drinks, a UK manufacturer of specialised canned and bottled-at-source spring water and soft drinks, for £15m. Established in 1885, Clearly Drinks is a brand owner and manufacturer of soft drinks and bottled-at-source spring water in cans, glass and polyethylene terephthalate bottles. It currently services around 70 customers nationwide including major UK retailers Waitrose, Aldi, Tesco, Sainsbury's and Farm Foods.

Carlsberg confirmed on Monday that PepsiCo has agreed to waive the change of control clause in the bottling arrangements it has with Britvic, removing a potential challenge for the Danish brewer looking to buy the UK drinks company. Responding to press speculation over the weekend, Carlsberg said: "This waiver will come into effect should an acquisition of Britvic by Carlsberg, which has the recommendation of Britvic's board, proceed to completion."

Economic news

The UK economy grew faster than first thought in the first three months of the year, according to data released on Friday by the Office for National Statistics. Gross domestic product grew by 0.7% in the first quarter, up from an initial estimate of 0.6% growth. This follows 0.1% and 0.3% contractions in the third and fourth quarters of last year, respectively.

UK retail sales fell in June, an industry survey showed on Wednesday, reversing May’s short-lived uplift. According to the latest CBI Distributive Trades Survey, retail sales volumes in the year to June fell sharply, with a weighted net balance of -24. That compares to May’s balance of 8. Sales, which were reported to be well below average for the time of year, were also forecast to continue falling in July, albeit at a notably slower rate, at -9.

Manufacturers in the UK reported that output volumes remained broadly unchanged in the three months leading up to June, according to the latest industrial trends survey released by the Confederation of British Industry (CBI) on Monday. The stabilisation followed a rise in output for the first time in 18 months during the quarter to May, and looking ahead, manufacturers anticipated a modest increase in output over the next quarter. Despite a notable improvement in total order books in May, the volume of export orders experienced a significant decline.

First-time buyers have seen mortgage payments soar by nearly two thirds since the last general election, industry research showed on Monday. According to property portal Rightmove, the typical monthly payment for a first-time buyer is £1,075 per month, 61% more than 2019’s £667. The average five-year fixed 80% loan to value mortgage rate has also rocketed, from 2.24% five years ago to 5.09%. An 80% LTV is the average for first-time buyers, according to trade body UK Finance.

International events

Americans spent a bit less than anticipated last month even as price pressures slowed as anticipated. According to the Department of Commerce, in seasonally adjusted terms personal incomes rose at a month-on-month pace of 0.5% in May (consensus: 0.4%). Personal consumption expenditures however increased by just 0.2% (consensus: 0.3%) and the prior month's rise was revised down by a tenth of a percentage point to 0.1%.

The rate of inflation eased in two of the eurozone biggest economies in June, preliminary country data showed on Friday. Spain’s National Statistics Institute said annual consumer price inflation was 3.4% in June, down from May’s one-year high of 3.6%. It was, however, a little higher than expectations, with most analysts looking for 3.3%. The fall was driven primarily by slowing food and fuel prices, offsetting an increase in the cost of leisure and cultural services as Spain entered its key summer tourist season.

German unemployment rose more than expected in June, according to official data released on Friday. The number of unemployed in Europe's biggest economy rose by 19,000 in seasonally adjusted terms against expectations of a 15,000 increase.

Claims for unemployment benefits in the United States fell slightly last week, though continuing claims rose more than forecast, according to data from the Department of Labor released on Thursday. Initial jobless claims fell to 233,000 in the week ended 21 June, down from 239,000 the week before, coming in below the consensus forecast of 235,000.

Turkey’s central bank has left a key interest rate on hold, it was confirmed on Thursday, as it focuses on cooling surging inflation. The Central Bank of the Republic of Turkey's Monetary Policy Committee kept the one-week repo rate at 50%, in line with forecasts, for the third consecutive month. It also reiterated that monetary policy would remain tight "until a significant and sustained decline in the underlying trend of monthly inflation".

Economic sentiment across the Eurozone unexpectedly softened in June, a closely-watched survey showed on Thursday. According to the European Commission, the latest Economic Sentiment Indicator (ESI) was largely unchanged in June, dipping 0.2 points in both the Eurozone and wider European Union, to 95.9 and 96.4 respectively. Analysts had pencilled in a small rise for the Eurozone ESI.

Sweden’s central bank held its key interest rate at 3.75% on Thursday, as widely expected, and said that monetary policy should be adjusted "gradually". The Riksbank said that if inflation prospects remain the same, the policy rate can be cut two or three times in the second half of the year.

A closely followed gauge of consumer sentiment in Germany unexpectedly fell further into negative territory, declining for the first time in five months. The GfK's forward-looking Consumer Confidence Survey for July fell to -21.8 from a downwardly revised -21.0 the month before, missing economists' estimates for an improvement to -18.9. Consumers' willingness to save rose by 3.2 points over the month to 8.2, while the willingness to buy fell 0.7 points to -13, which the GfK said was largely due to rising prices.

Airbus warned of a hit to its bottom line and cash flow as a result of charges incurred on certain of its space activities. Total full-year earnings before interest and tax would be reduced by about €900m, due to financial charges incurred by its telecommunications, navigation and observation programmes. Those activities sat in the company's Space Systems division.

The European Union (EU) accused Microsoft of violating competition regulations on Tuesday, through the “abusive” bundling of its Teams and Office products. According to CNBC, the accusation stemmed from Microsoft's practice of tying its Teams communication tool to its Office 365 and Microsoft 365 productivity suites, which the EU claims restricts competition.

Shareholders of Turkish rapid grocery delivery giant Getir have endorsed a major restructuring plan that would see it split into two separate entities and receive a significant capital infusion from the Abu Dhabi state investment fund Mubadala, it emerged on Monday. According to Sky News, investors approved a plan to bifurcate the company at an extraordinary general meeting on Sunday.

German business sentiment deteriorated in June, according to a survey released on Monday by the Ifo Institute. The business climate index fell to 88.6 from 89.3 in May. Meanwhile, the current situation index was flat at 88.3 and the expectations index declined to 89.0 from 90.3. The manufacturing gauge deteriorated to -9.2 in June from -6.5 a month earlier, while the service sector index ticked up to 4.2 from 1.8.