Cookie Policy

We use cookies on our website and have placed these on your computer. By continuing to use our website you consent to this. For more information, including how to change your cookie settings and to disable our non-essential Google Analytics cookies, please refer to our Cookie Policy. If you do not wish to be reminded of this on each visit, please use the close button.

Newsround: FTSE weakness follows sterling strength

8 December 2017


Tags: Macro Economics

FTSE News

Hopes for progress on Brexit helped lift the pound on Thursday (7 December), hitting the relative value of the overseas earnings which dominate the FTSE 100. At close the index of leading shares was down 0.25% at 7,329.91.

Next Tuesday (12 December) UK inflation figures are out, followed on Wednesday (13 December) by similar data for the US as well ask figures showing Britons’ average earnings. This will offer an insight into how hard-pressed consumers on both sides of the Atlantic are heading into the festive period which is critical for the retail sector. The US Federal Reserve is widely expected to increase interest rates later on Wednesday. Neither the Bank of England or European Central Bank are likely to take the cue from their US counterparts when they meet next Thursday (14 December) to determine their own respective monetary policies.

Sector In Focus

The spotlight was on the bookmakers this week as on Thursday (7 December) Foxy Bingo owner GVC (GVC) confirmed speculation it wants to buy rival Ladbrokes Coral (LCL). In one of the worst kept secrets in the gambling industry, GVC outlined a proposal which values Ladbrokes at a maximum of 203.7p per share, or £3.9bn. The deal would be structured in favour of GVC shareholders where they would own 53.5% of the enlarged business and Ladbrokes’ shareholders would own 46.5%. GVC says 'the enlarged group would be an online-led globally positioned betting and gaming business that would benefit from a multi-brand, multi-channel strategy applied across some of the strongest brands in the sector.'

The proposed transaction has a payment contingent on the final form of a new regulatory framework for the UK gambling sector. Consultation on the new rules concludes in January and further consolidation may have to wait until then. William Hill (WMH) was also in focus for investors as it ended a spat with US firm Scientific Games over the latter’s acquisition of NYX. It had previously bought a stake in NYX to block the deal.

Economic Update

The pound surged on 4 December amid speculation a divorce settlement was about to be delivered but opposition from the Democratic Unionist Party (DUP) to a settlement of the Irish border issue put paid to any deal. Now the race is on to secure a compromise ahead of a crunch Euro Summit on 14 and 15 December. With all 27 EU countries participating this is a critical opportunity to secure the transition deal which can deliver the level of certainty and visibility craved by business.

ETF Watch

In the last month US markets have outperformed their counterparts across the globe, partly thanks to the US Senate passing President Trump’s tax reform plan (2 December). It is possible to gain exposure to US stocks through iShares Core S&P 500 (CSP1) for an ongoing charge of 0.07%

Company  Announcements

11 December - Investors should expect leisure group Hollywood Bowl (BOWL) to declare a special dividend when it reports full year results. The company said in October that its results would be marginally ahead of the board’s previous expectations. It is expected to reveal that full year revenue grew by nearly 9% for the 12 months to 30 September. 

13 December - In the wake of a profit warning in August, expectations are subdued ahead of half year results from Dixons Carphone (DC.). In its first quarter update, the retail behemoth bemoaned a tough UK mobile market. Investors are also concerned over the impact of weakening UK big-ticket demand on the Carphone Warehouse-to-Currys PC World brand owner, which may well report on a muted performance during the Black Friday discounting period.

Writer: Tom Sieber Tags: Macro Economics

You can start investing today through any of our account options:

Dealing Account

Access a wide range of global investments in this flexible, unrestricted account.

Find out more

Stocks and Shares ISA

Take advantage of tax free investing with our Stocks and Shares ISA today.

Find out more

Self-Invested Personal Pension (SIPP)

From great value to best-in-class, access the SIPP to suit your needs through our extensive network of providers.

Find out more

I've still got questions!

We’re on hand to help at our Customer Experience Centre on 0345 0700 720

Selftrade does not provide investment advice. This article is the authors view and is not the view or opinion of Selftrade and Selftrade accepts no liability for any loss caused as a result of the use of this information. The opinions expressed are those of the author at the time of writing and should not be interpreted as investment advice.

The value of investments can fall as well as rise and any income from them is not guaranteed and you may get back less than you invested. Past performance is not a guide to future performance. We do not provide advice or make recommendations about investments. If you have any doubts about the suitability of an investment, you should seek advice from a suitably qualified professional adviser.

Open a SIPP with Selftrade. Enjoy cashback and take control of your investments.

Earn up to £1,000 cashback on SIPP accounts opened before 30 June 2019.

Terms and conditions apply.

Find out more

If you have a Stocks and Shares ISA, make sure you get the best value for your investments. We are ranked top for price on large portfolios (Platforum, 2018).

Open an account today and we’ll cover any transfer fees up to £100.*

*T&Cs apply.

Open a Stocks & Shares ISA

Find out more