The pound has continued to climb ahead of the Bank of England’s (BoE) monthly meeting to decide interest rates tomorrow. Sterling was trading 0.7% higher against the US dollar yesterday, at $1.1541, and was 0.1% up against the euro. The FTSE has also opened higher this morning, having reached a five week high yesterday. Significant risers include Metro Bank, which is up over 11% on news it returned to profit in September. Meanwhile, the FTSE 250’s Aston Martin Lagonda is down 11% having downgraded its delivery expectations for the year this morning, pointing to further supply chain issues while posting a widening of its losses.
The UK manufacturing sector continued to shrink last month. According to S&P Global’s manufacturing purchasers’ index (PMI), a steep drop in new work received, weak export demand, and supply-chain disruption led to a scaling back of both production and employment. The index came in at 46.2 in October, down from 48.4 the month before – a 29-month low. Any reading below 50 indicates a shrink in activity. The PMI has now remained below the neutral 50 mark for three consecutive months.
Shop price inflation reached a fresh record high last month. According to the latest BRC-Nielsen IQ Shop Price Index, it reached 6.6% in October from 5.7% a month earlier. This is well above the three-month average of 5.5%, and the highest since the index began in 2005. Food inflation saw the highest rise, moving to 11.6% from 10.6% in September, again, the highest rate on record. Within that, fresh food saw the biggest prices hikes, with inflation at 13.3% against September's 12.1%, while ambient food inflation rose to 9.4% from 8.6%. Non-food inflation also hit a series high, rising to 4.1% from 3.3%. Helen Dickinson, CEO of the British Retail Consortium, said: "It has been a difficult month for consumers, who not only faced an increase in their energy bills, but also a more expensive shopping basket. Prices were pushed up by because of the significant input cost pressures faced by retailers due to rising commodity and energy prices and a tight labour market." She added that while "some" supply chain costs were now beginning to fall, it was being offset by the cost of energy.
The Financial Conduct Authority (FCA) has published final rules on a ‘pensions dashboard’ for pension providers, as it is revealed that over £26.6bn is sitting in unclaimed pension pots owned some 2.8 million people across the UK. The number of lost pensions has jumped 75% to 2.8 million over the past four years, and they are now worth 37% more in total at £26.6bn – or £9,500 on average, according to figures from the Pensions Policy Institute (PPI). The forthcoming new pensions dashboard will eventually allow savers to see all their pensions – private, public sector or state pensions - in one place online, meaning they are less likely to be forgotten by those who have changed jobs, their name, or moved house without telling their pension provider. The FCA says regulated pension providers must answer requests to find pensions, and search records for data matches. They must also be able to return pensions information to the consumer’s chosen pensions dashboard. The implementation deadline for the scheme has been moved from 30th June 2023 to 31st August 2023.
Troubled start-up Britishvolt, the company intending to build a £3.8bn battery gigafactory in Northumberland, with government support, says staff have agreed a temporary pay cut. On Monday, the Financial Times reported that it was on the on the brink of collapse and about to appoint administrators. Now, a source has told Sky News that the main problem facing the firm, a key peg in the UK’s electric vehicle future, was a government failure to deliver on a £100m grant agreed in January. The project was also supported by £1.7bn of private funding, but much of that sum would only be unlocked when the government aid was paid, forcing Britishvolt to look elsewhere for its immediate funding needs. Meanwhile, it is understood that the Department for Business, Energy and Industrial Strategy (BEIS) believes that the company has not met certain criteria for the £100m payment to be handed over. However, the firm says it has now received “promising approaches from several more international investors in the past few days,” meaning it has “now secured the necessary near-term investment that we believe enables us to bridge over the coming weeks to a more secure funding position for the future”. "To further reduce our near-term costs, our dedicated employee team has also voluntarily agreed to a temporary salary reduction for the month of November," it added. Britishvolt currently employs just under 300 staff but aims to have 3,000 workers once the plant, due to start production in 2024, is fully operational. A collapse of Britishvolt could mean more car manufacturers having to look further afield for battery supplies as the clock ticks down to the 2030 ban on the sale of new cars powered by diesel and petrol engines. Sky says. Britishvolt intends to manufacture power cells for 300,000 electric vehicle battery packs a year at its site - the former coal-fired Blyth Power Station.
Ocado shares increased in value by more than 35% yesterday after it disclosed an exclusive partnership deal to develop South Korean firm Lotte Shopping’s online grocery business. The FTSE 100 firm will work with Lotte to build a network of robotic warehouses using its smart platform technology, and provide technology for building online grocery orders from Lotte’s stores. Lotte Shopping is the second largest grocer in South Korea, operating department stores, hypermarkets, supermarkets and e-commerce, with more than 1,000 stores nationwide. It has an annual revenue of 15.6 trillion Korean won (£9.5bn). Ocado said it expects the deal to create "significant long-term value".
As expected, online furniture retailer Made.com has appointed administrators, leaving up to 700 jobs at risk, after talks to find a buyer for the group failed. Made filed a notice to appoint PricewaterhouseCoopers (PwC), yesterday. Trading of the group's shares was suspended on the London Stock Exchange - a week after Made stopped taking new customer orders pending the outcome of its rescue bid. The group said PwC would still seek to secure a sale of the firm but that there were no guarantees.
Cineworld Group announced a bankruptcy settlement with its landlords and lenders yesterday, clearing the way for the company to borrow an additional $150 million and make a $1 billion debt repayment. Landlords and creditors dropped their opposition to the billion-dollar debt repayment after Cineworld agreed to pay at least $20 million in rent accrued since 30th September. The British cinema chain filed for bankruptcy protection in Texas in September, with less than $4 million in cash on hand, and said previously it did not intend to make any post-September rent payments until the end of its bankruptcy. The world's second-largest cinema chain operator also agreed to explore a potential sale of the business and allow creditor input on its business plan, Reuters reports. Shares in the London-listed firm rocketed nearly 200% yesterday on the news, although in closing at 6.5p per share, they are still catastrophically down on their 200p + high three years ago.
Morrisons is planning to shut 132 loss-making McColl's stores, "where there is no realistic prospect of achieving a breakeven position in the medium term", putting around1,300 jobs at risk. The supermarket chain bought McColl's out of administration for £190m. All staff at risk from the closures will be offered other roles, Morrisons said.
LondonMetric Property has sold two assets for a combined £28.2m reflecting a blended net initial yield (NIY) of 4.6%. The separate transactions are made up of a fully-let retail park in Tonbridge, Kent for £22m, reflecting a NIY of 5.25%, and a warehouse in Digbeth, Birmingham, for £6.2m. Proceeds will be used in the short term to pay down some of the company's revolving credit facility, the FTSE 250 firm added.
JCB has launched its 2023 Early Careers Programme, inviting applications for more than 150 new jobs for apprentices and graduates. Last year, 2,000 people applied for places last year. JCB is looking for graduates in Design and Development, Future Technologies, Electrical and Controls, Software Development and Sales and Marketing. There will also be degree apprenticeships in Business and Engineering alongside Level 3 apprenticeships in areas such as Manufacturing Engineering, Purchasing, Mechatronics and business-wide technician opportunities. In addition, Level 2 assembly and welding apprenticeships will be offered for recruits from age 16+, while the company will be partnering with The JCB Academy to offer new T-Level qualifications. JCB has invested more than £8 million in developing the programme, which has led to more than 1,300 people joining the company via the scheme since 2008.
Four more communities have been earmarked for shared banking hubs, becoming the latest on a list of 27 areas waiting for services to begin, the BBC reports. Bury Park in Bedfordshire, Haslemere in Surrey, Prestatyn in Denbighshire, and Welling in south east London are getting the hubs, which consist of a counter service operated by Post Office staff, where customers of any bank can withdraw and deposit cash, make bill payments, and carry out regular banking transactions. They are meant to plug a gap left by high street bank closures. Consumer group Which? has said that 587 bank branches have closed this year, with another 75 scheduled to shut by the end of 2022, on top of hundreds in previous years.
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