Hot Features
Premium
Register to chat with like-minded investors on our interactive forums.
London open: Stocks fall as France faces hung parliament
London stocks fell in early trade on Monday as investors mulled the prospect of political instability in France after the second round of the election over the weekend resulted in a hung parliament.
At 0820 BST, the FTSE 100 was down 0.3% at 8,179.74.
Axel Rudolph, senior market analyst at IG, said: “Even though the left-wing New Popular Front (NFP) unexpectedly won the second round of the French legislative elections with 182 seats and gained a relative majority, financial markets are likely to remain on edge. This is because the NFP – an uneasy alliance of green, socialist, France Unbowed and the communist party – needs a coalition partner to obtain more than the 289 out of 577 seats required in the French assembly to govern.
“The NFP will probably have to form a coalition with president’s Macron’s centrist Together party. It did far better than expected and gained 163 seats, slightly more than the far-right National Rally (NR) with 143 seats, the biggest loser in the second round of the French presidential elections.
“Despite the highest turnout for decades of around 60%, there are no real winners in the French elections as the country enters a new era of parliamentary democracy and is split into three factions. France will likely see a big change in the way it is governed with the centre of gravity shifting from the president to parliament.
“Diametrically opposing views among political parties – which aren’t known for their conciliatory stance – will make forming a coalition that can govern France difficult.
“Despite Jordan Bardella’s far-right NR party suffering a major election defeat, he and his compatriots won 50 more seats than in the 2022 French National Assembly and are already focusing on the 2026 mayoral elections and the 2027 presidential election.
“More political uncertainty lies ahead for Europe’s third largest economy.”
In UK equity markets, luxury fashion brand Burberry lost ground following a report it is expected to announce “hundreds” of job cuts in the UK as part of a cost-cutting programme following a massive drop in its share price since the start of the year.
According to The Telegraph, the company – which employs more than 9,000 people worldwide – is currently working on redundancy programmes, having already started the 45-day consultation period.
Plus500 fell as it backed its full-year expectations after a “strong” first-half performance despite “difficult” market conditions.
On the upside, drinks maker Britvic rallied after agreeing to be bought by Danish brewing giant Carlsberg for £3.3bn, having rejected two previous bids. Under the terms of the acquisition, Britvic shareholders will get £13.15 a share, including a special dividend of 25p a share.
Britvic said two weeks ago that it had rejected two proposals from Carlsberg, one at £12 and another at £12.50p a share.
Online grocery group Ocado surged after announcing plans to build a third customer fulfilment centre (CFC) in Japan as part of its ongoing partnership with Japanese peer AEON. The new Kuki-Miyashiro facility, which will go live in 2027, will operate using the Ocado Smart Platform and follows other Ocado-AEON CFCs in Midori-ku and Hachioji.
Melrose Industries was boosted by an upgrade to ‘outperform’ from ‘sector perform’ at RBC Capital Markets. It noted that the share price has fallen around 15% from April highs but said the fundamentals remain “very supportive”.
Unite Group was firmer as it said it now expects to deliver rental growth of at least 7% for the 2024/25 academic year.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Ocado Group Plc | +6.03% | +19.80 | 348.00 |
| 2 |  |
International Consolidated Airlines Group S.a. | +2.11% | +3.65 | 176.35 |
| 3 |  |
Easyjet Plc | +1.98% | +9.20 | 474.60 |
| 4 |  |
Rolls-royce Holdings Plc | +1.89% | +8.60 | 462.80 |
| 5 |  |
Flutter Entertainment Plc | +1.75% | +270.00 | 15,665.00 |
| 6 |  |
Informa Plc | +1.32% | +11.20 | 862.00 |
| 7 |  |
Melrose Industries Plc | +1.31% | +7.60 | 585.60 |
| 8 |  |
Coca-cola Hbc Ag | +1.27% | +34.00 | 2,712.00 |
| 9 |  |
3i Group Plc | +1.27% | +38.00 | 3,036.00 |
| 10 |  |
Wpp Plc | +1.16% | +8.60 | 752.40 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Bhp Group Limited | -1.38% | -32.00 | 2,290.00 |
| 2 |  |
Bp Plc | -1.30% | -6.25 | 475.95 |
| 3 |  |
Fresnillo Plc | -1.18% | -7.00 | 586.00 |
| 4 |  |
Rio Tinto Plc | -1.06% | -56.00 | 5,203.00 |
| 5 |  |
Anglo American Plc | -0.96% | -23.50 | 2,420.50 |
| 6 |  |
Glencore Plc | -0.92% | -4.45 | 478.60 |
| 7 |  |
Antofagasta Plc | -0.86% | -19.00 | 2,185.00 |
| 8 |  |
British Land Company Plc | -0.82% | -3.40 | 411.80 |
| 9 |  |
Shell Plc | -0.77% | -22.00 | 2,840.00 |
| 10 |  |
Schroders Plc | -0.63% | -2.40 | 379.20 |
US close: Stocks higher following June’s NFP report
Wall Street stocks closed higher on Friday as traders returned from the Independence Day break to some hotly anticipated labour market data.
At the close, the Dow Jones Industrial Average was up 0.17% at 39,375.87, while the S&P 500 advanced 0.54% to 5,567.19 and the Nasdaq Composite saw out the session 0.90% firmer at 18,352.76.
The Dow closed 67.87 points higher on Friday, reversing losses recorded in its truncated Wednesday session.
Investors were primarily focused on last month’s nonfarm payrolls report on Friday, with the Labor Department revealing nonfarm payrolls had risen by 206,000 in June, ahead of estimates for a reading of 190,000.
Significantly, readings on non-farm payrolls for the prior two months were revised down by a combined 111,000. The three-month moving average for total payrolls growth declined from 212,000 to 177,000 and from 178,000 to 146,000 within the private sector. In parallel, the unemployment rate ticked higher by a tenth of a percentage point to 4.1%.
Immediately following the release of the latest numbers the yield on the benchmark 10-year US Treasury note fell to 4.284%, but went on to reclaim some of its earlier losses and was later sitting at 4.296%.
Corporate earnings season will kick off next week, with the likes of Delta Air Lines and PepsiCo, as well as banking giants Citigroup, JP Morgan Chase and Wells Fargo, all set to report before the end of the week.
Monday newspaper round-up: Boeing, Tata Steel, Fortress Capital
Boeing will plead guilty to a criminal fraud charge stemming from two deadly crashes of 737 Max jetliners, after the government determined the company violated an agreement that had protected it from prosecution for more than three years, the US the government said in court filing late on Sunday. Federal prosecutors gave Boeing the choice this week of entering a guilty plea and paying a fine as part of its sentence, or facing a trial on the felony criminal charge of conspiracy to defraud the US. – Guardian
The UK will press for “job guarantees” in return for taxpayer-funded investment during talks with the Indian-owned Tata Steel about the future of its flagship Port Talbot site. The new business secretary, Jonathan Reynolds, said he believed there was a “better deal available” for the south Wales site and the steel industry as a whole, as he confirmed on Sunday that negotiations with Tata were continuing. – Guardian
Millions of passengers could be compensated for late flights if a landmark legal case against British Airways and easyJet proves successful. British Airways and easyJet are battling to throw out the case, which risks forcing airlines to pay out hundreds of millions of pounds to passengers over late flights. The two carriers have been sued in the High Court over claims they must automatically compensate travellers whose flights are severely delayed or cancelled. – Telegraph
Administrators of a failed investment business backed by celebrities and members of a south London church have labelled it a “Ponzi” scheme and say they wish to pursue the bankruptcy of its directors. Insolvency practitioners from Begbies Traynor said that bankrupting Ashley Reading, 54, and his daughter Cameron, 24, who ran Fortress Capital Partners, would allow a full investigation of their personal affairs, including bank and credit card statements. – The Times
Britain’s biggest asset manager has made the case for higher executive pay in the UK, warning that a gap between the bosses of British and American companies risks a flight of talent to the United States. Schroders, the investment group that oversees about £760 billion of assets, including stakes in some of the London stock market’s biggest companies, analysed the pay packages handed to 2,353 chief executives in Britain and America. It found that on average UK bosses were paid one fifth of the money earned by their peers across the Atlantic. Even adjusting for the size of companies, chief executives in the US were paid more than twice that of their rivals in Britain, Schroders said. – The Times
