FTSE 100 Live: ‘Housing market under pressure, but far from crash’, shares fall again

Key market data as FTSE 100 recovers

Take a look at the key market data as the FTSE 100 rallies, but remains in the red.

A correction or a crash?

A further decline in housing prices appears certain, but – following the release of Halifax’s latest house price index – experts are divided on whether this will be a smooth decline or a sharp crash.

Adam Smith, founder of broker Alfa Mortgages, said: “As the Halifax observes, the immense strain being put on people’s finances will almost certainly send prices lower during the months ahead. Inflation is proving extremely stubborn and the base rate is now expected to peak far higher than we thought a couple of months ago.

“However, the housing market could still experience a correction rather than a crash during the next 12 months due to the lack of supply and strength of the jobs market. Curiously, June and July to date have seen positive demand, especially from first-time buyers who are enthusiastically diving in and seizing attractive deals as asking prices edge down.”

James Briggs, head of personal finance intermediary sales at Together, said: “House prices fell by 0.1% in June, backing wider reports of the UK’s falling position among global property house price growth this year. While the market is under pressure and there will undoubtedly be regional corrections, we are far from a crash.”

On the other hand, John Choong, market and equity analyst at InvestingReviews.co.uk, said: “With the average fixed mortgage rate now firmly above 6%, the housing market should brace for an onslaught. This is especially the case in the South of England, which is under the most pressure.

“Household incomes are getting squeezed by the month due to Andrew Bailey’s complacency and incompetence.

“If inflation continues to remain sticky for the foreseeable future, the rapid tightening of monetary policy could trigger a recession, leading to higher unemployment and a bloodbath in the housing market.”

CMMC dealt blow as finance chief leaves for rival

CMC Markets suffered a fresh blow today when long-standing finance chief Euan Marshall quit to join trading rival IntegraFin.

Founder and CEO Lord (Peter) Cruddas has been under fire lately for his loyal support of ousted Prime Minister Boris Johnson, whom he feels was unfairly “stitched up”.

He wrote in The Telegraph last month: “What I am surprised by is the brazen nature with which they have dispensed with the man who had the only mandate to lead this Parliament. I am shocked by their shamelessness and utter disregard for British democracy.”

Read more here

Just two London postcodes remain with average room rents below £750 per month

The average cost of renting a room has risen above £750 per month in all but two London postcodes, data has revealed.

Figures shared exclusively with the Standard’s Homes & Property by houseshare portal SpareRoom showed that the price of being a tenant has risen disproportionately in many of the capital’s traditionally more affordable neighbourhoods.

While there were six postcode districts with average rents below £750pcm in the first three months of this year — plus another three areas under £752pcm — just two met either criteria in the second quarter.

Read more here

Mortgage rates creep further up

Mortgage rates rose again after holding steady yesterday, but at a slower pace than in recent weeks.

The average interest rate on a two-year fixed-rate deal is now 6.54%, up from 6.52% yesterday. For a five-year fix, the average interest rate rose from 6.02% to 6.04%.

The number of mortgage products on the market grew to 4,621.

However, more price rises could be on the way after gilt yields soared yesterday.

Market snapshot as shares keep falling

Take a look at today’s market snapshot as shares opened lower, with the FTSE 100 now approaching the lowest intraday figure of the year.

Bookie-owned betting service pulls up sale process before finishing post

Bookie-owned Sports Information Services, which broadcasts horse races and data to betting shops, is no longer up for sale.

According to reports at the time, the owners of SIS – including Ladbrokes and William Hill as well as private equity groups – were looking to sell the business for £200 million.

However, one of its shareholders, Catalyst Media, today revealed that it would no longer be looking to sell the business. Catalyst is an investment group that now only has a single investment, its 20.5% stake in SIS.

Catalyst said after SIS agreed new contracts with some of mainland Europe’s top bookies, including Sweden’s Kindred and Betsson, its board decided a sale was no longer the best option.

“The SIS board has decided that shareholder value can best be maximised for the time being by continuing to implement the existing strategic development plan for the business which will target growth in all SIS’s product areas over the coming years,” Catalyst said.

FTSE 100 falls further but banks and miners limit overall decline

London’s FTSE 100 stayed under overall pressure in Friday opening trade, as it failed to find its feet after one of the biggest tumbles of 2023 took it to some of its lowest levels of the year by Thursday’s close.

There were some signs of a more confident mood, with banks, miners and some consumer rising and the overall losses driven by more defensive sectors which were more resilient during the wave of selling.

Overall, the main UK stock index lost a further 37 points to 7,243.65, a drop of 0.5%. Utility and pharmaceutical stocks were the biggest fallers. United Utilities fell 14p to 933p. Severn Trent was down 35p to 2416p. GSM, the drugmaker, fell 14p to 1324p.

Some financial and consumer stocks did start to bounce back from the previous day’s strong sell-off. Asian-focused, London listed bank Standard Chartered rose 2.4p to 670p. Barclays was up 1p at 147p. Ocado, the online grocer and e-commerce tech stock, was up 13p at 566p. Cruise line carnival was 7p stronger at 1309p.

Mining stocks, which led the selling earlier in the week on worries about a slowdown in China’s economy, bounced higher. Anglo American added 10p to 2179p. Rio Tinto gained 35p to 4928p.

CMC loses finance chief

CMC MARKETS suffered a fresh blow today when long-standing finance chief Euan Marshall quit to join trading rival IntegraFin.

Founder and CEO Lord Peter Cruddas has been under fire lately for his loyal support of ousted Prime Minister Boris Johnson, whom he feels was unfairly “stitched up”.

He wrote in The Telegraph last month: “What I am surprised by is the brazen nature with which they have dispensed with the man who had the only mandate to lead this Parliament. I am shocked by their shamelessness and utter disregard for British democracy.”

Today Marshall, paid £371 million last year, said he was leaving.

He said: “I have thoroughly enjoyed working with the extremely talented people at CMC over the last 11 years, and particularly my last 4 years as CFO. The Company has changed significantly during my time here, and through the recent investments in diversifying the business, there are strong foundations in place for the enduring success of the business.”

With Cruddas somewhat distracted by politics, some in the City may fear CMC lacks high level leadership, though Marshall will remain in place for a while as a replacement is sought.

Cruddas, a huge Tory party donor, said: “”Euan has been a highly valued member of the CMC team, holding various positions since becoming a part of the group in 2011. Over the past 4 years, he has served as the CFO, playing a crucial role in the Company’s transformative journey. On behalf of the Board and colleagues throughout CMC, I would like to express our gratitude to Euan for his dedication and valuable contributions during his tenure. As he moves forward in his career, we extend our best wishes for his future endeavours.”

Like other trading houses, CMC enjoyed a Covid-lockdown boom. The shares are down 43% in the last year as revenues fell.

Today the shares rose 9p to 158p, which leaves the business valued at £442 million.

JD buys out remainder of Iberian arm for €500m as it eyes more global expansion

JD Sports continues on its path to global domination, as it today agreed to buy out the remainder of its Spanish, Dutch and Portuguese arm Iberian Sporting Retail Group for €500 million (£427 million).

JD already owned just over half of ISRG, but hopes to have more control over the business as it plans to open 500 international shops over the next five years.

CEO Régis Schultz said: “At our Capital Markets Event earlier in the year, we emphasised the benefit of having strong complementary concepts to support our ‘JD first’ global growth strategy. ISRG is a highly successful business and one of the leading players in sports retail in Iberia. By bringing the two businesses closer together, there is significant potential for accelerating growth.

“We sincerely thank the minority shareholders, Balaiko and Sonae, for their important contributions to the business during our time as partners.”

Analysts at Peel Hunt noted that the acquisition came just days after a licensing deal in the Middle East, signalling JD’s aggression about global expansion.

They said: “Taking over the ‘other half’ of ISRG gives JD greater control of the growth in appealing European markets. There was progress last week with franchises starting in the Middle East, so JD is not dragging its feet as it grows across the world.

“We continue to believe that the global growth story here is materially undervalued.”