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Inflation falls to 2.5% in surprise dip as fuel costs rise

In a surprise move, the UK's inflation took a downward turn last month as lower hotel prices helped balance out an increase in fuel costs, newly released official statistics indicate. The Consumer Prices Index inflation rate dropped to 2.5% in December, down from November's 2.6%, per the Office for National Statistics (ONS). Forecasts had largely expected the inflation rate to hold steady at 2.6% for the last month. Despite the unexpected decrease, December's inflation remains over the Bank of England's target of 2%, leading to concerns among economists and policymakers during a time of standstill economic growth. Chancellor of the Exchequer Rachel Reeves expressed her dedication to bettering people's living standards, stating: "There is still work to be done to help families across the country with the cost of living," and "I will fight every day to deliver that growth and improve living standards in every part of the UK." Offering insight into the political reaction, former Bank of England policymaker Michael Saunders noted that the drop in December's inflation figures would likely have been met with a "sigh of relief" at Downing Street. The release of the latest figures occurs amidst considerable volatility within UK's financial markets; the past week alone has seen a stark fall in the pound's value, alongside a surge to decade-high levels in borrowing costs. According to the ONS, a 1.9% decline in hotel prices coupled with moderate rises in restaurant and cafe prices exerted the greatest dampening effect on overall inflation, while airfare costs also saw a notably reduced rate of escalation during the month. Services inflation, a key indicator monitored by the Bank of England, fell to 4.4% in December from 5% in November. However, petrol and diesel prices saw an increase in December compared to November. Grant Fitzner, Chief Economist at the ONS, commented: "Inflation eased very slightly as hotel prices dipped this month, but rose a year ago." He added: "The cost of tobacco was another downward driver, as prices increased by less than this time last year."

Pound sterling suffers fresh 14-month low as traders pare bets on Fed rate cuts

Sterling experienced another setback on Monday, dropping to its lowest level in 14 months against the US dollar due to a worldwide sell-off caused by worries that the US Federal Reserve might limit interest rate cuts to just one this year. The pound weakened by as much as 0.7% against the dollar, hitting $1.211, which marked it as the G-10's poorest performer in comparison to the dollar, as reported by City AM. "Sterling continues to trade on a soft footing and its losses could extend this week," commented Chris Turner, an FX analyst at ING, who also indicated that the pound might plummet to $1.20. The downturn arises following a difficult week for UK financial assets, with sterling tumbling over three per cent and government bond yields soaring to multi-decade highs. Market participants have positioned their bets against the UK due to anxiety that the government’s Budget could exacerbate inflation, decelerate growth, and result in the Bank of England easing off on interest rate reductions sooner than anticipated. Moreover, government bond yields accelerated on Monday as well, with the 10-year gilt's yield climbing by four basis points to 4.87 per cent, and the 30-year gilt's yield increasing by 12 basis points to 5.53 per cent. This UK-specific distress occurs amid broader market trepidations, as investors reconsider expectations about how aggressively the Fed can cut interest rates in 2025. A robust employment report last week signalled that the world's largest economy remains in a robust expansion mode while the looming spectre of Donald Trump’s tariffs has stoked concerns over potential inflationary impacts "The US labour market is too hot to allow for any Fed easing soon," Barclays analysts have noted. Just one rate cut from the Federal Reserve is what markets are currently anticipating this year. The stronger dollar results from higher rates in the US, which attract investors seeking a higher return on US assets compared to those in other regions. This Monday saw the dollar index, which measures the greenback against major currencies, hit its highest mark since November 2022. With expectations of higher interest rates in the US, bond yields around the world are also pushed up, as the US federal funds rate serves as a lending benchmark in the global economy. In recent weeks, government bond yields in all advanced economies have seen increases, although UK gilts have underperformed slightly in comparison to their peers.

JP Morgan boss warns trade tariffs could lead to US recession and stagflation

Jamie Dimon, chairman and chief executive of JP Morgan, has cautioned that the stringent trade restrictions imposed by President Donald Trump could steer the US economy towards recession and stagflation. Dimon's comments came ahead of the multinational investment bank's financial results, which reported a revenue of $180.6bn and a net income of $58.5bn in 2024, as reported by City AM. He lauded the bank for playing "a forceful and essential role in advancing economic growth." In the banking giant's annual report, Dimon stated: "The recent tariffs will likely increase inflation and are causing many to consider a greater probability of a recession." He added: "And even with the recent decline in market values, prices remain relatively high. These significant and somewhat unprecedented forces cause us to remain very cautious." Expanding on the risk of recession, Dimon said: "Whether or not the menu of tariffs causes a recession remains in question, but it will slow down growth." He further elaborated: "There are many uncertainties surrounding the new tariff policy: the potential retaliatory actions, including on services, by other countries, the effect on confidence, the impact on investments and capital flows, the effect on corporate profits and the possible effect on the U.S. dollar." He characterised JP Morgan Chase as "a company that historically has worked across borders and boundaries." The chief executive of the bank emphasised that the "long-term health of America, domestically, and the future of the free and democratic world" are intrinsic to the well-being of the investment bank. In a notable development, despite Trump reportedly using JPMorgan head Dimon as an informal consultant post-election as he prepared for a second term—considering him a "sounding board" for economic strategies—there appears to be a divide emerging over tariffs. Dimon remained impartial during the US presidential campaign, but there has been talk about his potential inclusion in the cabinet of either Trump or his then-rival Kamala Harris come 2024. Adding to the discourse, billionaire investor Bill Ackman has also made headlines with a stern warning on Sunday regarding Trump's trade policy, suggesting it could lead to an "economic nuclear winter."

UK government bonds hit 25-year low as inflation fears persist

On Tuesday, government bonds faced a major sell-off as persistent inflation fears continued to mount. Subsequently, yields on government debt across the globe saw significant increases, implying reduced investor interest in sovereign debt due to an inverse relationship with bond prices, as reported by City AM. "It’s all about yields at the moment with some big or landmark moves again yesterday in a period where there continue to be doubts about whether the Fed can cut rates in 2025," commented Jim Reid, Deutsche Bank's head of research. The US witnessed a noteworthy auction for 10-year Treasuries on Tuesday, which drew its highest yield since 2007, alongside upticks in yields on shorter-term debts. On the European front, the 10-year German bund yield escalated to 2.48 per cent, potentially marking its sixth consecutive weekly surge from around 2.0 per cent noted in early December. In the UK, the 30-year Gilt yield surged to levels not seen since 1998, and the benchmark 10-year Gilt yield also rose to 4.68 per cent, last recorded at this height in October 2023. Heightened bond yields have come as a response to recent economic releases hinting that inflationary pressures might be more entrenched than previously anticipated by investors. One such indicator is a survey from the Institute for Supply Management, suggesting that input costs within the US services sector are accelerating at their quickest rate in over two years. Mohit Kumar, an analyst at Jefferies, noted in his analysis that the increase in prices paid was widespread and not influenced by any one-off factors. "The rise in prices paid was broad based and the details did not show any one off factors which could have influenced the data," he wrote. Meanwhile, separate data from the US labour market indicated a six-month high in job openings for November, suggesting strength in the world's largest economy. This led investors to scale back their expectations for the number of interest rate cuts by the US Federal Reserve this year. The forthcoming nonfarm jobs report on Friday is anticipated to provide additional insights into the US economic trajectory. Despite the current sell-off in government debt, Kumar believes it is unlikely to persist, especially if the US labour market shows signs of weakening, potentially leading to swifter interest rate reductions. "We are still in the camp that the current sell-off should not have many legs and see rates as close to their local peaks at current levels," he commented. However, Kathleen Brooks, research director at XTB, highlighted that investors should keep a watchful eye on public finance data.

Trufin set for first ever full year profit as Balatro poker craze boosts finance company

Financial services company Trufin is poised to report an adjusted profit before tax that is "significantly ahead of market expectations" buoyed by the success of its video gaming division's release of the indie sensation Balatro. The firm is on track to announce its first-ever full-year profit, achieving this milestone a year sooner than anticipated, as reported by City AM. While Trufin is predominantly recognised for its financial services, its subsidiary Playstack has carved out a niche in mobile game publishing. This year, Playstack launched Balatro, an independent title that quickly became a hit, clinching the titles of ‘Best Independent Game’ and ‘Best Mobile Game’ at the 2024 Game Awards, contributing to an "exceptional year-end performance" for Trufin. The poker rogue-like game generated over $1 million in revenue within its initial week on iOS and Android platforms, and reports suggest it amassed upwards of $4 million within two months post-launch. Playstack's operating profit is expected to have surged by over 20-fold, with revenues increasing by more than 440 percent. "The success of Balatro should not be underestimated and it has been a joy to watch it build throughout the year," commented Trufin CEO James van den Bergh. He added, "These achievements would not have been possible without our extremely disciplined and careful approach to building a robust and scalable games publisher." Thanks to Balatro's impressive performance, Trufin anticipates its adjusted operating profit for 2024 to exceed £7 million, a significant turnaround from the £3.5 million loss recorded in 2023. Meanwhile, Trufin, the specialist finance provider which debuted on the London Stock Exchange in 2018, has predicted its profit before tax to surpass £500,000—a striking shift from the £6.6 million loss seen the previous year. Revenue is also anticipated to have climbed significantly to around £54 million, almost tripling from £18.1 million reported in 2021. However, Trufin faced a substantial hiccup in July as shares tumbled over one-third following an early termination of an agreement with Lloyds by its subsidiary Satago Financial Solutions, leading to a marked drop in revenue projections—from £3.8 million to an estimated £2.4 million in 2024 for Satago. Despite this setback, the group's share price has rallied robustly, increasing 83 per cent over the past year. Oxygen Finance Group, another arm of the Trufin business, is set to report a 21 per cent increase in revenue and a sizeable 65 per cent surge in operating profits to £2.1 million.

FTSE 100 climbs and UK gilts rebound as lower inflation boosts rate cut expectations

Gilts experienced a rebound on Wednesday, and the FTSE 100 started the day on a positive note after the release of inflation figures that were lower than anticipated. The Office for National Statistics (ONS) reported a headline rate of 2.5 percent in December, a slight decrease from the previous month's 2.6 percent. Services inflation, which is considered a more accurate indicator of domestic price pressures, fell to 4.4 percent from November's 5.0 percent, coming in under the 4.8 percent forecasted by analysts in the City, as reported by City AM. Michael Brown, a senior research strategist at Pepperstone, commented that the data would provide "significant relief" to both Rachel Reeves and Andrew Bailey amidst concerns in the UK gilt market. Investors have recently been anxious about the potential for enduring inflation in the UK, which has driven gilt yields to their highest levels in years as expectations for interest rate reductions diminished. Nevertheless, yields eased across various maturities on Wednesday as market participants began to anticipate at least two cuts to interest rates within the year. "The Bank of England will likely feel emboldened to continue its easing cycle in February," noted Sanjay Raja, Deutsche Bank’s chief UK economist. In early trading, the yield on the two-year gilt sensitive to rate changes dropped by eight basis points, while the 10-year yield saw a six basis point decline. Equities also opened with gains, with housebuilders leading the way, buoyed by the prospect of further interest rate cuts. The FTSE 100 witnessed a notable increase of 0.74 percent in early trading, buoyed by gains seen in homebuilding firms such as Persimmon, Taylor Wimpey, Barratt, and Berkeley, placing them amongst the top risers in the index. Meanwhile, reflecting optimism about the UK's domestic economic health, the midcap FTSE 250 jumped 1.5 percent, reaching 20,056.85. Sterling initially dipped but later made some headway against the dollar, though it remained essentially flat at $1.221. "The market isn’t too sure where to take the pound it seems," commented Kyle Chapman, an FX markets analyst at Ballinger Group. A stark slide to its lowest position compared to the dollar in over a year marked the previous week for the pound, spurred on by concerns for the economic prospects of the UK. Traditional logic holds that the anticipation of lower interest rates would devalue the pound due to smaller yields on investments, however, Kathleen Brooks, research director at XTB, pointed out that "these are not normal times for UK assets".

Wise forecasts robust growth with 21% increase in active customers and £1.4bn income

Shares in global fintech company Wise saw a six per cent increase in early trading today, following the release of preliminary figures for its current financial year on Thursday. The firm is set to provide further updates during its capital markets day. The presentation will also include updates on the current financial year, with full results due to be posted on June 5, as reported by City AM. Wise, which specialises in facilitating easy international money transfers for consumers, anticipates a 21 per cent growth in active customers to 15 million and a 16 per cent increase in underlying income. Based on these projections, the fintech firm expects to generate an income of £1.4bn in the current year. However, it predicts a one per cent drop in its profit margin. The money transfer company forecasts an underlying income growth of 15 to 20 per cent in the 2026 financial year, with pre-tax profit margins aligning with top estimates. Wise has also revealed plans to dilute its Employee Benefit Trust share purchase programme to prevent shareholder dilution from historical stock-based compensation (SBC) grants, which equate to around 25 million shares. The fintech firm reiterated its listing change following the Financial Conduct Authority's reforms to the UK listing regime in 2024. Wise's listing was moved to the Equity Shares Category in July 2024. Wise made its debut on the London Stock Exchange on July 7, 2021, and over its 14-year history, it has transferred over £0.5tn across borders. In its January quarterly trading update, the company disclosed that cross-border volumes had surged by 24 per cent to £37.8bn. The firm's accounts also saw increased adoption, driving a 39 per cent rise in card and other revenue.

JP Morgan highlights UK policy strain as gilt yields soar, impacting government borrowing costs

JP Morgan has issued a warning that UK policy credibility is "coming under pressure" in the wake of ongoing disturbances in the gilt market and concerns over sluggish growth. Gilt yields, which mirror the cost of government borrowing, have seen a significant rise in recent weeks, as reported by City AM. The yields on both 10-year and 30-year gilts have ascended for six straight days, resulting in the yield on the 10-year bond reaching a post-2008 peak, while the 30-year yield hit a post-1998 high. These movements in gilt yields are largely in tandem with US Treasury yields, as market participants have reached the consensus that global interest rates must escalate to curb inflation. However, JP Morgan analysts have pointed out that the market shifts in the UK have been "exacerbated" by worries over an "expansionary fiscal policy" that could stoke inflation further. This comes after Chancellor Rachel Reeves' first Budget, which saw an increase in spending plans by approximately £70bn annually for the next five years. "For now, the move has been orderly and there is no real case for the BoE to intervene on financial stability grounds as it did after the 2022 mini-Budget," wrote the JP Morgan analysts. They also noted that the mix of rising borrowing costs and notably weaker recent growth will likely elevate the deficit trajectory and constrain flexibility within the government's fiscal rules. There are indications that the Treasury is gearing up for "ruthless" public spending cuts to ensure adherence to these fiscal regulations. The Prime Minister's spokesperson confirmed that "nothing (was) off the table when it comes to delivering value for money for taxpayers". Analysts from JP Morgan noted that while faster interest rate cuts could relieve some pressure on the government, most surveys indicate a significant rise in inflation expectations.

FTSE 100 crumbles again as Trump's 'Liberation Day' tariff assault continues

The FTSE 100 had a gloomy start on Friday, still feeling the effects of Trump's 'Liberation Day' comments as it opened in negative territory. In early trading, the United Kingdom’s leading index was down by approximately 1.2%, with its mid-cap counterpart, the FTSE 250, also seeing a decline of nearly 1%, as reported by City AM. Banks were among those feeling the brunt during market opening, extending a downside pattern from Thursday's session. Natwest shares dropped over five per cent, while Barclays took a hit exceeding four per cent. Following its position as Thursday's biggest loser on the FTSE, Standard Chartered’s shares continued to wane, experiencing another fall of over four per cent. Conversely, British American Tobacco and SSE emerged as top performers in early dealings, each securing gains in the region of two per cent. Likewise, the retail giant behind Primark, Associated British Foods, saw its shares ascend over two per cent. AJ Bell’s investment director Russ Mould commented: "With markets having suffered their worst week in five years, investors were hiding under their duvet on Friday hoping the pain would go away." He went on: "Unfortunately, the relentless selling continued, with markets falling across Asia and Europe and futures prices suggesting the US will follow suit upon commencement of trade later today." Mould further remarked that "countless sectors" are poised for impact from tariffs, yet the plethora of "moving parts" presents a challenge to "know where to begin to comprehend the situation." "Investors looking to buy on the dip were spoiled for choice given the sharp declines seen on the market this week. It's now a question of when investors feel brave enough to go shopping. Today's extended sell-off implies investors are still too nervous to take the plunge," he added. On Thursday, the FTSE 100 experienced a sizeable drop, shedding 133 points and closing at 8,474.74 – a 1.6% decrease from the previous day's total. In a bold move, Trump imposed a baseline 10% import levy on all countries trading with the US during his Wednesday address, with increased rates for those classified as "worst offenders." A 10% import tariff was levied on the UK while the European Union suffered a steeper 20% hike. Commentators have noted with surprise that 'Markets appear to have been unprepared' for such trade measures. Stocks across Europe also faced a downtrend, with Germany's DAX falling 0.8%, France's CAC 40 dipping by 0.9%, and Amsterdam’s AEX index experiencing a 0.5% decline. The announcement of tariffs contributed to Wall Street recording some of its most substantial losses since 2020. On the Nasdaq Exchange, big tech firms including Apple and Nvidia saw sharp drops, declining nine and eight percent respectively. The S&P 500 was not immune to the downturn, with a near five percent fall, while the Dow Jones Industrial Average saw a four percent dive. Hargreaves Lansdown's head of equity research Derren Nathan commented: "Despite months of sabre-rattling by Donald Trump, markets appear to have been unprepared for the depth and breadth of tariffs announced by the White House." As a result of the tumult across the pond in the US and the White House's significant measure, "The FTSE 100 is set to open down a touch further, after US stocks suffered their worst day in five years."

Barclays shares bounce back after bruising spell as FTSE 100 recovers from chaotic week

Barclays' shares made a recovery on Tuesday morning, following a difficult week marred by the impact of President Trump's aggressive tariff measures. The FTSE 100 bank had struggled in the aftermath of the trade dispute, as reported by City AM. The lender experienced a substantial decline of nearly ten per cent after China retaliated with its own set of tariffs against the US. Barclays was one of the major banks, alongside HSBC and Standard Chartered, leading declines amongst top fallers in the blue-chip index as markets floundered. According to Russ Mould, investment director at AJ Bell, "In Barclays' case, its investment bank is heavily geared into how the financial markets performed." He added, "Tumbling, or volatile, markets are likely to deter merger and acquisition activity and also new market floats, both areas where there are fat fees to be made." Despite the previous turbulence, Barclays witnessed a near three per cent uptick as the FTSE 100 stabilised on Tuesday, while HSBC and Standard Chartered continued to wrestle with losses. John Cronin, founder of SeaPoint insights, highlighted that, "Barclays has seen more significant selling pressure than UK domestic-focused peer banks in recent days." Meanwhile, Lloyds and Natwest, which focus predominantly on domestic markets, have managed to sidestep steep losses. Lloyds saw a rise of over two per cent and Natwest edged up by one per cent during early trading. "This is a function of its reliance on cyclical Investment Banking revenues as well as its significant exposure to the US consumer by virtue of its US cards business." Mould commented that while Barclays and its counterparts are considered "geared plays on economies and financial markets on the way down, they are likely to be seen as geared plays on them if they recover. "After its fall, Barclays trades on just 0.7 times historic book value and it is the cheapest of the Big Five FTSE 100 banks on this measure," he continued.

Brooks Macdonald set to transition from AIM to LSE main market in strategic growth move

Asset management firm Brooks Macdonald is planning to leave AIM for the London Stock Exchange’s main market in a bid to boost its profile and stimulate growth. In a recent trading update, the company stated that the move would enhance its "corporate profile," and provide an "opportunity to own its ordinary shares to a broader group of investors". The transition, which doesn't require shareholder approval, is slated for March. Despite net inflows being slightly weaker than analysts' predictions, Brooks Macdonald reported that the past quarter had seen the strongest gross inflows in the last 18 months, as reported by City AM. Gross inflows for the three months ending 31 December totalled £579m, while gross outflows were £730m. Net outflows amounted to £151m, with investment performance contributing an additional £200m. Funds under management concluded the period at £17.9bn. City AM disclosed today that Brooks Macdonald has made several senior staff redundancies in recent months, including its global head of distribution, global head of marketing, and head of public relations. "It seemed to me that they were keeping it below the 10 per cent threshold, and doing it over a staggered period of time, so they didn’t have to enter into a consultation," commented one former employee. Brooks Macdonald has today signalled that its recent string of acquisitions, including the purchase of financial planning firm Lucas Fettes and independent financial advisor LIFT, are advancing positively. Additionally, the company's sale of its international business is reportedly progressing as planned. "We continue to believe that these transactions will help accelerate the execution of the group’s strategy and leave it better placed to take advantage of the structural growth areas in the UK Wealth space," commented Investec analysts Rahim Karim and Jens Ehrenberg. Despite assets under management falling short of expectations, Investec analysts have maintained their earnings per share forecast for Brooks Macdonald, citing lower anticipated costs.

Bank of England contacts lenders over Trump's tariffs as Reeves says 'banking system is resilient'

The Bank of England has been surveying lenders about their clients' financial stability in the wake of the turmoil caused by President Trump's aggressive tariff policies that have disrupted financial markets. The central bank requested details concerning market liquidity and any issues their clients might be experiencing with funding, as reported by the Financial Times, as reported by City AM. The Prudential Regulation Authority, tasked with overseeing banks, building societies, credit unions, insurers, and key investment firms, is actively engaged with lenders to address client concerns. Sources familiar with the discussions informed the FT that topics included market liquidity and worries over hedge fund clients potentially failing to meet equity requirements on margin accounts. In a recent session at the House of Commons, Chancellor Rachel Reeves declared that she had spoken with the Bank of England's governor, who "confirmed that markets are functioning effectively and that our banking system is resilient." She also mentioned her forthcoming meeting with U.S. Treasury Secretary Scott Bessent to discuss possible relief from President Trump's imposed tariffs. Over the weekend, global bank leaders took part in a conversation orchestrated by the Bank Policy Institute, an event reported by Sky News, where US bank executives shared their perspectives on the Trump administration's trade policy with their international colleagues. Among the attendees were prominent banking executives, including Brian Moynihan from Bank of America, CS Venkatakrishnan from Barclays, Georges Elhedery from HSBC, and Jamie Dimon from JP Morgan. Dimon expressed concerns about the impact of tariffs on the long-term economic alliance of the United States in a letter on Monday, stating: "I am hoping that after negotiations, the long-term effect will have some positive benefits for the United States." In response to the situation, a spokesperson for the Bank of England mentioned: "It is standard practice for us to implement close monitoring of market liquidity conditions at times of greater volatility." On Wednesday, the Bank of England's Financial Policy Committee is scheduled to release the minutes of its latest meeting, providing insight into its perspective on the financial market.

Rathbones outflows slow as Investec merger moves forward

Rathbones has successfully stemmed the tide of outflows that ensued following its merger with Investec’s wealth division. In a trading update released today, the wealth management firm revealed that investors withdrew £200m from its platform in the last quarter of the year, a decrease from £600m in the previous quarter, as reported by City AM. Despite witnessing "particularly strong discretionary inflows", the asset manager noted that a temporary surge in withdrawals around the Autumn Budget resulted in net negative outflows. The company's discretionary and managed propositions saw an increase in inflows to £400m, up from £100m between July and September 2024. However, as the transition into Rathbones continued, cash kept flowing out from the Investec Wealth & Investment business (IW&I), with outflows rising from £300m in the previous quarter to £400m. In 2023, Investec announced that its wealth and management division would merge with Rathbones in an £839m deal. "The integration of IW&I continues to proceed well, and we have made substantial progress in the integration process, in line with our expectations," the firm stated today. "The client consent process is well-progressed with very encouraging responses, and we continue to anticipate completing the client migration onto a single operating platform during the first half of 2025." Over the past year, investors have withdrawn over £1bn from IW&I, offsetting the £415m that flowed into Rathbones’ investment management arm and £606m into its asset management arm. At the close of the year, the firm reported funds under management standing at £109.2bn, an increase from £108.8bn at the end of September and £105.3bn at the end of 2023. However, this was slightly below the anticipated £110bn closing funds under management projected by analysts. The company's share price has struggled to make significant gains in recent months, trading down four per cent from a year ago. "Rathbones’ shares have weakened like others in the sector in recent months, reflecting the generally weak sentiment towards asset-gathering stocks given the uncertainty that has prevailed," commented analysts at Peel Hunt. The firm outlined its priorities for 2025, stating: "Our priorities for 2025 include completing the migration of IW&I clients whilst adding marketing and distribution capability to support organic growth opportunities, both directly and in tandem with third-party IFAs."

City analysts downgrade luxury stocks as impact of Trump tariffs filter through

Deutsche Bank, the city broker, has lowered the target share price for a range of luxury firms as Trump's tariffs begin to influence analyst predictions. The broker assigned a 'Hold' rating to Richemont, LVMH, Moncler and Kering, reducing the share price for each company, as reported by City AM. "The direct impact of the tariffs is not a huge headwind in our view... However, weaker global stock markets and the broader economic uncertainty will weigh on confidence and we see this further postponing a recovery in luxury demand," analysts commented. Hermes was the sole firm to receive an upgrade, with Deutsche Bank shifting its recommendation from a 'Hold' to a 'Buy' and raising the target share price from €2,220 to €2,550 (£1,911 to £2,195). Mamta Valechha, Consumer discretionary analyst at Quilter Cheviot, stated that Hermes would benefit from its "strong pricing power and higher-end positioning" despite the inevitable single-digit price increases. "However, how the US (and global) luxury consumer responds to potentially reduced global economic growth remains unknown," Valechha added. There was a significant sell-off in luxury markets after Trump announced tariffs on April 2. Burberry, Kering, and LVMH have dropped 16.6 per cent, 16.2 per cent 12.5 per cent, respectively, since April 2. Traditionally safe bets Hermes and Ferrari have dropped 8.5 per cent and nine per cent, respectively. Analysts were initially banking on a resurgence in the luxury sector following a dip caused by the cost-of-living crisis in Europe and economic downturn in China during 2023. "It is no longer clear that the third quarter of 2024 was the nadir for luxury demand," stated analysts from Deutsche Bank. "The luxury recovery in the fourth quarter now looks likely to be the anomaly and not the trend."

Morson Group grows specialist engineering arm with deal for Orange Solutions

Recruitment giant Morson Group has expanded its engineering services business by buying a Greater Manchester company. Specialist recruiter Morson was founded in Salford in 1959 and has grown into a £1.3bn turnover business with more than 1,500 global employees. Now it has acquired Trafford Park-based Orange Solutions, a niche safety and control systems engineering firm. Morson says Orange will sit alongside its existing engineering-focused businesses including Morson Projects, Waldeck and Ematics, which work across sectors including aerospace, marine, defence, and energy. Orange Solutions has worked on projects in the UK and overseas in industries including oil & gas, marine,offshore renewables, petrochemicals, pharmaceutical, transport infrastructure, and heavy industry. The company has a long-standing relationship with Ematics and Morson Projects, and its new parent group says: “The strategic investment by Morson will enable Orange Solutions to maximise its potential for growth, supported by the Group’s existing engineering businesses and wider portfolio, while benefitting Morson’s clients with niche expertise in a specialist and safety critical field.” Orange Solutions’s founder and managing director, Tony Hynes, will remain in post, alongside the company’s experienced team of engineers. Paul Ward, associate director of Morson’s Power and Control Division, has worked on projects with Mr Hynes for three decades and worked on a number of projects with Orange Solutions. Mr Ward said: “The knowledge, skills and experience offered by Orange Solutions are in high demand, thanks to increasing use of automation across a wide range of industries, along with the need to control extremely complex systems and manage safety.” Morson Group CEO, Ged Mason, said: “The synergy between Orange Solutions’ track record and client base, and our Ematics business will enable us to offer clients even more expertise from within the Morson Group, with additional capacity and capabilities to resource projects effectively.” Tony Hynes added: “Orange Solutions has grown by providing the knowledge and experience needed to deliver complex projects on time. With so much potential in our sectors, the time was right for us to seek a strategic partner that can support our continued growth. The synergy and existing relationship with Morson, which is based locally to our existing HQ, made them an ideal fit. “As part of the Morson Group, we will continue to build on our reputation, while enabling our clients to tap into the 1,200 engineers employed across Morson’s engineering division.” Morson was advised by Beyond Corporate and RSM UK Corporate Finance LLP.

The latest acquisitions and equity investments in Wales

Here we feature the latest equity funding raising and business acquisition deals in Wales. Game industry veterans Susan and Lee Cummings have secured a significant six-figure investment from Angels Invest Wales, PlayCap and the Games Angels for their new game development studio, 10six Games. The investment boost comes ahead of the upcoming first game release by 10six Games. The company has also announced the appointment of industry guru Nick Button-Brown as a company director. Led by lead investor Huw Bishop, the pre-seed round has been funded by a syndicate of 12 angel investors including members of PlayCap (a global angel network of women from the games industry who specialise in early-stage investments in studios, companies, and tech in games) and The Games Angels (a global angel network of Games Industry veterans). The Development Bank of Wales has provided match-funding from the Wales Angel Co-Investment Fund that is run by Angels Invest Wales. Susan and Lee Cummings previously set-up Tiny Rebel Games, the award-winning game production studio behind Doctor Who: Legacy and Infinity for mobile devices and computers. Susan also co-founded 2K Games, developing Bioshock, Borderlands, X-Com, 2K Sports, and Civilization. She is a visiting professor at the University of South Wales along with husband Lee who worked at Sony before moving to Rockstar Games’ Grand Theft Auto team where he was a producer on GTA: San Andreas and GTA 4, and where he was a key member of the redesign team on Bully. More recently, he has led the creative design for various award-winning games including Doctor Who, Star Trek, War of the Worlds, and Wallace & Gromit (under licence). Mr Button-Brown has worked across the tech and games industry for more than 20 years, including helping grow and scale Improbable, and helping take Sensible Object to a trade sale to Niantic. He is currently chair at Outright Games, Chair at Coherence and on the board at Adinmo. He founded The Games Angels in 2021, a community of games industry veterans investing and supporting start-ups. Nick is also on the board at UKIE (one of the UK’s games industry representative bodies) and OKRE (a charity promoting links between research and entertainment) as well as driving Funding Quest, a programme improving the investability of UK Games companies. Ms Cummings said: “Representation in video games is more important than ever, and technological limitations have long constrained the scale of customization developers could offer. With our proprietary technology and our upcoming game “You v Zoombies, we’re breaking those barriers—creating fully personalized, ever-evolving experiences for every player. This level of customisation was previously unattainable, but thanks to advancements in generative AI, we’re making it a reality right here in Wales.” Mr Cummings said:“Our technology enables autonomous AI-driven design decisions, from custom starting spells and upgrades to gameplay sequencing and story development. It’s an incredibly exciting breakthrough. “We’re also grateful for the support of gaming industry expert Nick Button-Brown and our funding partners, who share our vision for the future of personalized gaming.” Lead investor Mr Bishop said: “It was a pleasure to bring together a group of angels to support 10six Games, a new game development studio led by seasoned founders and gaming rockstars, Susan and Lee Cummings. They have a uniquely exciting vision for the next generation of player character and story customisation in games. Their track record is second to none and I look forward to supporting them in the future”. Tom Preene of Angels Invest Wales said: “This is a team surrounded by some of the top experts in the global games industry. They are working at the cutting edge of technology and are known for their innovation and creativity. Gaming is a growth industry, and it is exciting to think what it could mean for Wales as more developers start to recognise South Wales as a gaming hub.” The investment by the syndicate of angels was match funded by the Wales Angel Co-Investment Fund. With equity and loans from £25,000 to £250,000, the £8 million fund is available to syndicates of investors seeking to co-invest in Wales based SMEs. Syndicates are managed by Lead Investors who have been pre-approved by Angels Invest Wales. Cellar Drinks Powys-based Cellar Drinks has acquired Hurns Beer Company. The deal, the value of which hasn’t been disclosed, marks a significant milestone in Cellar Drinks’ ambitious growth plans. Hurns Beer Company will continue to operate from its existing depots in Swansea and Caerphilly and under its own name. The acquisition also brings opportunities for new and existing Hurns customers with an expanded product range, including new brewery partnerships, an extensive wine portfolio, premium spirits and soft drinks. Rhys Anstee, managing director of Crickhowell-based Cellar Drinks said: “I am thrilled to take on the stewardship of Hurns Beer Company and cannot wait to build upon its incredible legacy. Hurns has a rich history, and we are committed to honouring its past while also driving it forward into a new era. Our customers can look forward to unrivalled service levels as well as an expanded and diverse product offering, ensuring that we continue to be their trusted drinks supplier for years to come.” Connie Parry, from the Hurns family, said: “As a family, we are delighted to hand the keys over to Rhys. We have known each other for many years, and he is the ideal custodian to lead the business into its next chapter. The entire team is excited about the future and looks forward to working together to continue growing the business.” Chyrelle Anstee, director at Cellar Drinks Co, added:“Our new Hurns customers can look forward to a new online ordering facility, lots of engagement from key suppliers, and a new bi-monthly brochure that will allow them to focus on profitability in these uncertain times. We’re committed to offering innovative solutions that make doing business easier and more profitable for all of our customers.” The Hurns was originally established as the Hurns Mineral Water Company by Arthur A Hurn in the late 1800s. Burbank A Cardiff fintech start-up has raised £5m to support global expansion plans. It comes after Burbank earlier this month successfully demonstrated the world’s first certified online card-present transaction. Known as card-present over internet (CPoI) its tech platform redefines two-factor authentication so allowing shoppers online to simply tap their card to their mobile device and securely enter their PIN to complete a transaction, just like they do in-store. Until now, online payments were card-not-present (CNP) transactions, which have high and increasing levels of fraud. Currently, online merchants face over $40bn annually in fraud and charge backs, which is when a cardholder disputes a transaction and the merchant is obligated to provide a refund. The £5m seed funding round was led by Mouro Capital with participation from Anthemis (supported by Foxe Capital), Portfolio Ventures and others. These funds will accelerate the global roll out of Burbank’s platform. Justin Pike, the Newbridge-born founder and chief executive of Burbank, said, “We are extremely excited to bring this evolution in payments to the world. The payments experience should be the same for everyone, regardless of channel. “In-store we pay by tap and PIN, which is globally trusted and familiar, and now, for the first time ever, we’re enabling the same process in online channels. Simple, secure, and scalable. The way it should be.” Manuel Silva Martinez, general partner at Mouro Capital, said: “I’m thrilled to support Justin and his team of payments experts. Burbank offers a simple, seamless integration through a single while-label SDK (software development kit), which securely integrates into existing technology stacks, and supports multiple schemes on iOS and Android. It’s what the market needs.” Ruth Foxe Blader, general partner at Foxe Capital, added, “CPoI is the first protocol that legally shifts liability away from the merchant. It’s a massively scalable approach, with global demand.” Burbank’s advanced platform offers unparalleled convenience and robust security, empowering consumer-facing businesses to innovate in customer experience and unlock new revenue opportunities.” Burbank owns the intellectual property to its technology and said it will soon receive two global patents. Its revenue model will see it taking a percentage of the savings made for merchants on the cost of processing. Hugh James deal Cardiff headquartered legal firm Hugh James have advised the shareholders of Kent-based Highway Care Limited on its sale to Ramudden Global, a leading provider of infrastructure safety solutions. Kent-based Highway Care, a leading provider of innovative road safety solutions, offering a broad range of products, including permanent and temporary road barriers, mobile traffic products, automation systems, and security solutions. The acquisition by Ramudden Global ensures continued investment in the company’s product development, allowing it to expand its reach and enhance its service offering in the road safety sector. Huw James corporate and commercial partner Andrew Hoad led the deal, supported by solicitor Daniel Burke. Mr Hoad said: “It has been a great pleasure working with John and the Highway Care team throughout this sale. We congratulate Ramudden Global on their successful acquisition and look forward to seeing Highway Care continue to flourish under its new ownership.” Curtis Bowden & Thomas Acquisitive professional services firm Xeinadin has acquired south Wales accountancy firm Curtis Bowden & Thomas. The value of the deal for the firm, which has offices in Tonypandy and Bridgend, has not been disclosed. Established in 2003, Curtis Bowden & Thomas provides a range of general accounting and taxation services to local businesses. The 22-strong team will continue to operate from their offices with the support and resources of being part of Xeinadin’s network. The firm will continue to trade as Curtis Bowden & Thomas. Robert Lloyd, Stephen Smith, and Stephen Davies partners with Curtis Bowden & Thomas, said: “We’re excited to join Xeinadin and continue delivering the high-quality service our clients expect. South Wales faces distinctive challenges, from economic regeneration to skills shortages, and we’re confident that being part of Xeinadin will improve our ability to support local businesses. With access to a wider network of expertise and resources, we’ll be better equipped to help our clients navigate these challenges and drive sustainable growth.” Last year Xeinadin acquired Carmarthen-based accountancy firm Clay Shaw Butler and Bridgend-based Clay Shaw Thomas. Derry Crowley, chief executive at Xeinadin, said: “Curtis Bowden & Thomas has built a strong reputation in South Wales by providing businesses with the support they need to thrive, despite the unique economic challenges of the region. With a deep understanding of the local business environment, their expertise aligns well with Xeinadin’s commitment to supporting growth in Wales and we’re excited to welcome them to the team.”

Gambit Corporate Finance toast best ever year with deals worth £500m in 2024

Gambit Corporate Finance orchestrated transactions with a value of more than £500m in 2024 in what was its best ever year. The mid-market corporate finance advisory firm, established in 1992, said that while the UK mergers and acquisitions (M&A) market experienced some turbulence last year, due to continued macroeconomic headwinds and concerns over the likelihood of significant changes to the UK tax system, its impressive growth has continued. It acted on 16 deals last year. Notable transactions included acting as lead advisor for Bridgend-based Nodor International in it becoming majority-owned by Inflexion Private Equity. Nodor is the world’s leading darts brands, with its products including Winmau dartboards and Red Dragon darts. The deal, which will accelerate the company’s global growth plans, was one of the biggest ever private equity transactions in Wales. While the value of the deal was not disclosed, it is understood to have been well north of £100m. It also advised a shareholder of Cross Hands-based leading food and beverage business Castell Howell on the disposal of a material stake in the business Clinica Baviera SA, the Spanish-quoted business and one fo the largest ophthalmology chains in Europe, also turned to Gambit on its entry into the UK market with the acquisition of Optimax. Optimax operates 19 clinics across UK major cities and specialises in eye surgery and ophthalmic services. Gambit also acted for Newport headquartered timber group Premier Forest on four acquisitions, while also advising Carmathenshire-based Shufflebottom on its acquisition by Embrace Steel Group, whic is one of the UK’s largest independent providers of steel-framed buildings for industrial and commercial sectors. Gambit said average enterprise value/Ebitda multiples were strong with solid fundamentals, with it ensuring premium valuations. It said this trend is expected to continue through 2025. Whilst there was a decline in international buyers in the UK M&A mid-market early last year, Gambit said it is experiencing increased international interest, particularly Northern European and US buyers. Gambit is the exclusive UK shareholder in Corporate Finance International (CFI), a group of global corporate finance advisory firms with 28 offices in 18 countries and some 300 fee earners. CFI enables Gambit and its clients to identify and directly access buyers, sellers and investors on a global basis. In 2024, CFI completed in excess of 100 transactions and more than 30% of these were cross border. CFI was ranked by Thomson Reuters as number 18 in Europe and in the top 30 globally for transactions up to €200 million in value. Frank Holmes, Gambit partner, said “We are very proud that Gambit achieved its best ever year in its 32 -year history, despite some turbulence in UK M&A markets. We have invested heavily in the growth of the firm and we have a team of unprecedented quality and size. This, coupled with our unmatched global reach via Corporate Finance International means that we are expecting the momentum generated in 2024 to continue." Jason Evans, partner and head of debt advisory at Gambit, said: “The abundance of capital held by private equity funds, venture capital investors, debt funds and acquisitive companies, coupled with a lowering cost of capital and more stable macroeconomic landscape is fuelling a recovery in M&A volumes and debt capital markets.

Mastercard class action funder to sue Merricks after £10bn case settled for £200m

The litigation financier in the colossal class action lawsuit against Mastercard is preparing to take legal action against its own class representative after he settled a £10bn case for a mere £200m. The case, which centred around alleged overcharging of interchange fees on Mastercard debit and credit cards, concluded last month following a nine-year legal battle that reached the Supreme Court, as reported by City AM. This was the first case under the UK’s 2015 Consumer Rights Act, which permits collective proceedings in competition matters. It also followed the European Commission ruling that found Mastercard's interchange fees violated EU laws. Lawyer Walter Merricks led this class action, with Innsworth Capital providing funding up to £60.1m, plus an additional £15m to cover defendant costs if unsuccessful. The claim sought compensation of approximately £10bn, but it was disclosed in December that it settled for £200m. Documents unveiled on Thursday showed that half of the settlement sum, £100m, would be equally distributed to all who submitted a claim, estimated to be around 44 million people, equating to £2.27 each. The remaining £100m "will be used to pay the litigation funder." The funder indicated they would contest the settlement and claimed that Merricks would be violating his obligations under the litigation funding agreements. In his witness statement, Merricks expressed that "despite this stance taken by Innsworth, I remained of the view that the interests of the class were best served by agreeing the £200m settlement, so I indicated to Mastercard that I was minded to accept the offer." He also noted in his statement that due to this decision, Innsworth Capital is intending to initiate arbitration proceedings against him, which includes a claim for damages. He detailed how, upon informing Mastercard of the impending claim by Innsworth, Mastercard decided to make £10m available "in order to deal with the threatened arbitration against me." Seema Kennedy, executive director at Fair Civil Justice, remarked on the advancements: "this claim shows why reform is so badly needed, and we will continue to call on the Government to introduce measures to improve transparency and accountability of the funding sector."

HSBC to shut UK investment banking arm as part of major global restructuring

HSBC is preparing to scale back sections of its investment banking operations across the UK, Europe and North America as part of a comprehensive global restructuring strategy under new CEO Georges Elhedery. This development follows the bank's announcement last year of plans to achieve $3bn (£2.4bn) in cost savings and restructure into four new divisions, divided between East and West, as reported by City AM. "We will retain more focused M&A and equity capital markets capabilities in Asia and the Middle East, and we will look to wind-down those activities in Europe, the UK and the Americas," an HSBC spokesperson informed City AM. The company aims to transition to a "Our intention is to move to a more competitive, scalable, financing-led model," according to a memo sent to staff and seen by Reuters. In the internal communication, management acknowledged that the changes would be disruptive for those involved in dealmaking and corporate capital raising in the affected regions. "As part of our ongoing efforts to simplify HSBC and increase leadership in our areas of strength, we are finalising a review of our Investment Banking business," the spokesperson further added. The news has led to a 0.7 per cent drop in HSBC’s share price. Elhedery’s streamlining plan for HSBC has already resulted in numerous senior bankers being laid off, with predictions that over 40 per cent of HSBC’s top 175 managers will be let go. HSBC has witnessed a series of departures from its senior executive team, including Annabel Spring, the head of global private banking and wealth; Celine Herweijer, the group sustainability officer; Stephen Moss, the Middle East chief; and European leaders Colin Bell and Nuno Matos. The bank's new CEO, Elhedery, who took over from Noel Quinn four months ago, has swiftly initiated significant changes at the banking behemoth with an aim to curb expenses and streamline operations.

Newcastle law firm Sintons toasts strong year as revenues rise 11%

Newcastle law firm Sintons is toasting another year of strong financial growth after seeing turnover rise more than 11%. All staff members received a turnover-based bonus for the third year running following the results for the year ended March 2024, which have now been published to show an 11.5% increase in turnover, from £16.2m to £18.1m. Operating profit increased marginally from £6.36m to £6.59m, while staffing levels increased from 145 to 163 by year end, a figure that has since risen. The firm said it aims to expand its team further during 2025, with plans to continue its successful apprenticeship programme. Recruitment is also already under way for more legal specialists to join its team. A report within the accounts highlights the seven-figure refurbishment of its city centre office, which has just been completed. It said: “In another financial year when the firm achieved a double-digit increase in turnover and a further 22 colleagues joined the business, Sintons continues to grow as the members invest further in ensuring that the firm has the best people, the best premises and the best systems to meet, and exceed, the expectations of our clients. “The extensive redevelopment of the firm’s head office in Newcastle started during the year, with a project time of approximately nine months and a budgeted spend of approximately £1.8m. This is a bold reimagining of the way in which we work and the facilities we can provide to clients. “The redevelopment being carried out provides the firm with an outstanding working environment for our people, a client dedicated suite and a colleague hub. This investment not only emphasises our commitment to the North East community, which the firm is proud to call home, but our confidence in the future direction of the firm. “Our colleagues are the firm’s greatest asset and we thank them for their continued commitment and dedication to the firm. We were delighted to be in a position to pay, for the third year running, the maximum bonus to all our colleagues under our firmwide bonus scheme.” Following publication of the accounts, managing partner Chris Welch said: “We’re grateful to have recorded another successful financial year, thanks to our outstanding people and the support of our clients. All areas of the business have performed exceptionally well, from our business-focused teams which support companies with all their legal requirements, through to our personal and family law experts and our colleagues who are helping those who have suffered traumatic and life-changing injuries. “Having the best people as part of our team is vital to our success. We welcomed a wealth of new colleagues to the business in the last financial year and we’ve added a further 40 colleagues in 2024, strengthening the excellent legal support we provide to businesses and to individuals. “We’re also investing in the next generation of legal talent, and alongside our graduate recruitment programme we play a major role in the North East Solicitor Apprenticeship Programme, designed to provide different routes for people to qualify as lawyers.”

London and Home Counties hardest hit by huge capital gains tax burden

London-based investors and those from the Home Counties are poised to be the most affected by the upcoming rise in capital gains tax in April, prompting advice from a top accountancy firm to shift assets into more tax-efficient schemes. UHY Hacker Young, accountants, have provided data exclusively to City AM that taxpayers in the capital are expected to shoulder an additional £430m in capital gains tax (CGT) this year, comprising 30% of the total increased revenue, as reported by City AM. Neighbouring counties such as Buckinghamshire, Surrey, and Hampshire are also set to contribute substantially, with an additional £306m forecasted. In her initial Budget delivered towards the end of last year, Chancellor Rachel Reeves chose to increase both the lower and higher rates of CGT. Basic-rate taxpayers, earning up to £50,270 annually, are now subject to a CGT rate of 18%, a jump from the previous 10%. Higher-earners will experience an increase from 20% to 24% in their CGT when the changes take effect in April. Phil Kinzett-Evans, a partner at UHY Hacker Young, heavily criticised the tax increases, suggesting they could hinder economic growth and reduce market liquidity. "One of the problems with increasing capital gains tax is that it discourages investors from investing in UK growth companies that are listed on the stock market – exactly the kind of investment we need to see more of in the UK," he stated. "It [also] forces investors to consider holding on to assets rather than liquidating them, locking up money that would otherwise fuel the economy at a time when economic activity is stalling." The study, conducted through a series of Freedom of Information requests, revealed that residents of Kensington and Chelsea will be hit hardest by the increases, facing an additional £108m in CGT this year. This figure is more than double the expected receipts from the next highest council, which UHY Hacker Young predicts will be Westminster with an extra £53m in capital gains tax contributions.

Bank of England to cut rates five times in 2025, says Morgan Stanley

Morgan Stanley has forecast that the Bank of England will implement five interest rate cuts in 2025 to bolster a faltering economy. On Monday, the US investment bank revised its growth forecasts downward, attributing this to the prolonged effects of the Bank's monetary tightening and repercussions from the Budget, as reported by City AM. It now anticipates the UK economy to expand by just 0.9 per cent in 2025, a decrease from the previous projection of 1.3 per cent and significantly below the consensus among City economists. "While the peak impact of the Bank of England’s policy tightening is likely behind us, its drag on the economy still persists," Morgan Stanley analysts wrote. They also observed that the measures announced in the Budget have negatively affected business sentiment. The analysts highlighted a "limited hiring appetite" even before the increase in employment costs, with demand becoming "lacklustre to non-existent" post-Budget. Recent purchasing managers’ index (PMI) data indicates that companies have been shedding jobs at the quickest rate since the financial crisis, barring the pandemic period. "The mood music has deteriorated meaningfully since the summer," the analysts commented, suggesting that the Bank would focus more on the weakening economic activity than on persistent inflation signs. According to Morgan Stanley's predictions, the Bank Rate would end the year at 3.50 per cent, a reduction from the current 4.75 per cent. Goldman Sachs, another Wall Street heavyweight, also expects the Bank to aggressively cut rates, forecasting six reductions by mid-2026. These forecasts are considerably more dovish than market predictions, which suggest three or four rate cuts by mid-next year. Policymakers are set to convene again on 6 February, with a third rate cut expected to be endorsed.

HMRC sees UK firms overpaying billions in corporation tax as complex system hits businesses

UK businesses overpaid a staggering £14.2bn in corporation tax last year, a report by a prominent accountancy firm has revealed, highlighting the ongoing challenges posed by the nation's intricate financial system. Chancellor Rachel Reeves has assured entrepreneurs and investors of her support for British business, despite economic pressures from President Trump's tariffs and tax increases announced at the Autumn Budget, as reported by City AM. However, a complex tax regime is causing deep-seated issues, with many firms overpaying HMRC, as per findings by UHY Hacker Young. The accountancy firm's research, derived from a Freedom of Information request, indicates that UK companies overcompensated the government by £14.2bn in corporation tax in the year ending April, affecting approximately 400,000 businesses. The study notes that the overpayment for the fiscal year 2024 to 2025 was 21 per cent higher than the previous tax year. Corporation tax, which deducts a portion from company profits, operates on a tiered system, with the principal rate set at 25 per cent for businesses earning profits above £250,000. UHY Hacker Young's accountants argue that HMRC's approach often results in firms paying excessive corporation tax due to potential penalties if profits fall short of projections. This situation can lead to "significant cash flow problems," the researchers warn, as it falls upon companies to reclaim any overpaid funds. "Overpaying corporation tax is a double hit for struggling businesses," remarked Brian Carey, a partner at UHY Hacker Young. "Not only do they suffer from lower-than-expected profits, but they also see vital cash locked up with HMRC." This statement comes on the heels of a separate report by Thomson Reuters which highlighted that businesses now contribute to over a quarter of all UK tax receipts. The surge in corporation tax receipts has been a significant factor, with the government now collecting over £200bn through this tax. Concurrently, concerns are being raised about HMRC potentially underestimating the extent of tax evasion.

Emma Suchland steps up as PwC's new Northern leader, succeeding Armoghan Mohammed

Emma Suchland has been appointed as PwC’s new regional market leader for the North, ready to succeed Armoghan Mohammed, the outgoing regional chair who is set to retire. Having joined the ‘Big Four’ accounting firm in 2016 and thereafter serving as the UK private business leader from January 2022, Suchland is ascending within the company ranks, as reported by City AM. With her career commencing in the late 1990s as a tax trainee at Robson Rhodes, she brings a wealth of experience from previous tenures at BDO as a tax partner and EY, where she was an associate director for transaction tax. Based in Manchester, Suchland is poised to drive growth in her new position. Regarding her promotion, Suchland expressed enthusiasm about leading the Northern division, stating: "I’m truly excited to lead our Northern business and continue building on the outstanding work that Armoghan has accomplished." She also outlined her goals: "My focus will be on leveraging the exceptional talent and diverse expertise within our Northern team to support our clients’ growth and navigate the evolving market landscape." Commitment to strengthening ties with local businesses and fostering community collaboration were also among her stated priorities: "I’m committed to working closely with local businesses and convening across our communities to foster collaboration, to deliver meaningful results and promote long-term sustainable growth." Mohammed, whose tenure at PwC began in 2002 when he joined as a senior manager, had held the regional chair position since October 2020. Carl Sizer, PwC’s chief markets officer, expressed his enthusiasm about the new appointment: "We are thrilled to have Emma step into the role of Regional Market Leader for the North. Emma’s brings extensive experience and a proven track record in driving strategic growth and fostering strong client relationships."

North East firms tackle almost two million overdue invoices in 'incredibly challenging' year

A challenging year for North East businesses saw them struggle with almost two million overdue invoices on their books last year, latest figures show. The region’s companies saw a 3.4% rise in unpaid bills year-on-year, with the total number of overdue invoices creeping up to 1,872,510 in 2024, the research from R3, the UK’s insolvency and restructuring trade body, revealed. R3 analysed data provided by Creditsafe to reveal the figures, which showed that October proved to be the toughest month, with a total of 171,028 recorded during the month. The number of North East companies feeling the strain of overdue invoices also rose to 150,126 in 2024 – an increase of 1.8% from 2023 when 147,473 firms recorded overdue invoices on their books. Kelly Jordan, chair of R3 in the North East, said: “2024 was an incredibly challenging year for North East businesses. “While a decline in inflation levels provided some relief by slowing the pace of rising costs, this was overshadowed by a host of other challenges. “Ongoing supply chain disruptions made it harder for businesses to operate smoothly. “High energy costs continued to squeeze profit margins, and political uncertainty surrounding the election left many unsure about the future. “These difficulties were further compounded by new pressures introduced in the October budget, making it even harder for businesses to regain their footing. “The combination of these ongoing pressures has left many businesses in the North East unable to meet payment deadlines and struggling to stay afloat.” In 2024, the North East saw the sixth largest increase in the number of firms with overdue invoices on their books, when compared to the other UK’s nations and regions, with Scotland seeing the largest rise, followed by Greater London and the North West. Ms Jordan, who is a partner at Muckle LLP, added: “Over the past couple of years, many businesses struggled to pay their bills on time, and as conditions have not improved enough, these debts have snowballed. “This has placed immense pressure on North East businesses, with more and more now unable to meet their payment deadlines amidst ongoing financial challenges.

Five taxes Rachel Reeves could raise to plug the funding gap after her Budget

"Public services now need to live within their means," Rachel Reeves declared to a group of business leaders during the CBI’s annual summit in November, reaffirming her position: "because I’m really clear, I’m not coming back with more borrowing or more taxes." The Chancellor's remarks at that time were aimed at providing reassurance to the private sector following the backlash from her first Budget release in October. This maiden financial plan saw more than £40bn of charges imposed on businesses and the wealthy—a move that came as a shock despite Reeves' extensive efforts to court executives before the election, as reported by City AM. Nevertheless, Reeves seemed to strike a different note weeks later when she refrained from reiterating those same declarations in the House of Commons later in November, instead stating that the government will "never have to repeat a Budget like that because we won’t ever have to clear up the mess of the previous government ever again." Even Keir Starmer, when confronted by Conservative leader Kemi Badenoch, subtly shifted away from Reeves's stance, commenting that he was "not going to write the next five years of Budgets here at this despatch box". Now facing the prospect of tightened fiscal constraints, both Reeves and Starmer are grappling with financial realities. There's a growing consensus among analysts that escalating gilt yields might obliterate the £9.9bn budget cushion that Reeves had earmarked following her Budget announcement. The Treasury has affirmed that the "non-negotiable" and self-imposed fiscal rule to match government spending with tax receipts will remain in force. Should there be a breach, the Chancellor would have no choice but to source funds from alternative avenues, potentially indicating future tax increases. With a strained relationship with many in the business community and restricted by a commitment not to raise taxes on "working people", the government's routes for generating revenue are somewhat narrow. Prime Minister Keir Starmer, alongside Chancellor Rachel Reeves, has caused unease amongst some business leaders following a spate of tax raises announced at the recent Budget. The promise made towards "working people" effectively eliminates any adjustment to approximately 46 percent of the government’s total tax income, which includes income tax, national insurance contributions for employees, and Value Added Tax (VAT). An additional vow not to elevate corporation tax beyond its existing rate of 25 percent maintains another eight percent of tax revenues at their current figures. Taken together, Chancellor Reeves is precluded from altering 54 percent of the taxation base. However, Capital Economics analyst Ashley Webb outlines five potential tactics that Reeves could employ:. Reeves has not dismissed the possibility of increasing levies such as capital gains tax, alcohol and tobacco duties, air passenger duties or vehicle excise duty. Despite the government's pre-election dismissal of a "mansion tax", Webb suggests that another option could be to raise stamp duty and council tax on high-value and second homes. However, these measures could have significant political repercussions. Prior to the Budget, rumours of a potential increase in the capital gains tax rate beyond 30 per cent sparked outrage among investors, who argued it would undermine the incentive to invest in the UK. Further charges on second homes could also lead to accusations of Reeves targeting the affluent and aspirational. As Webb notes, adjustments to these taxes would only yield marginal additional revenue, as they collectively account for just 11 per cent of total tax receipts. Another approach could involve modifying existing tax relief policies, such as ISAs and pensions. This could include reducing the amount of tax relief on pension contributions for high earners or abolishing the lifetime ISA. However, this could raise concerns about the UK exacerbating its own investment stagnation. Encouraging investment into British companies has been a central objective of the City reform agenda, and discouraging investment from pension funds is likely to cause unease. Webb suggests another approach the government might consider is prolonging the freeze on personal income tax thresholds beyond 2027/28 to 2029/30. Reeves could look to widen the net of existing taxes, as evidenced by her recent policy to impose VAT on private school fees from the start of this year. Expanding VAT to currently exempt products and services is a strategy that comes with historic caveats, Webb points out. "The ‘pasty tax’ debacle in 2012, when the then Chancellor George Osborne raised VAT on ‘hot takeaway food’ before quickly reversing it, suggests this could be difficult to do," he notes. Webb also proposes that "Another option could be expanding the base on which national insurance tax is charged, for example by including investment income in addition to earned income." To create new revenue streams, Webb identifies a significant opportunity for the Chancellor to save funds by halting interest payments on the £710bn of central bank reserves held at the Bank of England by commercial banks. Although Reeves has indicated no intention to pursue this course, should interest payments linked to the Bank Rate cease on all reserves, Webb cites Capital Economics’ estimation of up to £34bn a year in potential savings for the government. However, any potential boost could be curtailed by the expectation of a rate loosening cycle this year. If the base rate is cut to 3.5 per cent next year and the Bank of England continues to reduce the amount of reserves by selling its gilt holdings as part of a programme of quantitative tightening, perhaps to around £500-550bn by the end of 2026, the potential tax-take may be reduced to around £20bn a year, Webb says. "Moreover, to maintain its ability to use Bank Rate as a monetary policy tool, the Bank of England would probably introduce tiered reserve remuneration rather than paying no interest at all, which would further reduce the potential tax revenue," he adds. "Even so, this would still be a chunky source of revenue for the government. As this would effectively be a tax on banks, though, at the margin it may weigh on the supply of credit." Critics of the government say it has already broken a manifesto pledge after hiking national insurance contributions for employers, despite saying it would not change the levy in its manifesto. However, breaking its pledge not to change income tax, VAT or national insurance contributions from employees would present entirely new challenges politically for the government. Even so, small tweaks to these charges could raise big sums. A one percentage point rise in each would raise £9bn, £7.3bn and £4.7bn respectively by 2026/27, according to Capital Economics’s calculations.

Close Brothers stock soars past target price while HSBC, Barclays and Standard Chartered tumble

Shares in FTSE 250 lender Close Brothers experienced a surge on Thursday morning, contrasting with the downward trend of banking rivals HSBC, Barclays and Standard Chartered. The lender saw gains peak at ten per cent during early trading before settling around five percent, as it began to recover from recent losses, as reported by City AM. In contrast, Standard Chartered led the FTSE 100's losses, dropping nearly 10 per cent, while Barclays and HSBC fell by close to seven per cent and over six per cent respectively. Close Brothers' stock has been under pressure over the past six months due to its involvement in the car mis-selling scandal. This week, the saga moved to the Supreme Court, where Close Brothers is attempting to overturn an October ruling by the Court of Appeal. The ruling deemed it unlawful for banks to pay commission to a car dealer without the customer's informed consent. Following the verdict, Close Brothers' shares plunged almost 25 per cent and have remained unstable since. The Supreme Court's judgement could take several months, but the Financial Conduct Authority has stated it will confirm an industry-wide redress scheme within six weeks if the banks receive an unfavourable verdict. As the Supreme Court hearing commenced on Tuesday, the stock experienced fluctuations throughout the day. Peel Hunt rated the stock a 'hold' in a note issued on April 1, setting a target price of 277.20p. However, following Thursday's gains, Close Brothers surpassed the analyst's target, reaching highs of 310p. Analysts have revised their forecast for Close Brothers' full-year earnings per share, reducing it by 15% to 50.6p. Their guidance on the lender's full-year net interest margin – a key banking indicator of the difference between the rates at which a bank borrows and lends – has also been cut to 7%, with an anticipation that it will drop further to 6.7% in the second half. RBC Capital Markets adjusted their target price for Close Brothers down to 340p from 360p according to a note issued last week, yet they maintained an 'Outperform' rating. This suggests that they anticipate the company's shares to "materially outperform sector average over 12 months."

Natwest share price rockets to 10-year high as investors eye bumper 2025 growth

The share price of Natwest has soared to its highest point since February 2015 in early trading today, as investors show confidence in the bank's growth prospects for 2025. The UK lender's stock has surged by 95 per cent over the past year, marking it as one of the FTSE 100's top performers, with no signs of momentum waning, as reported by City AM. Last month, RBC analyst Benjamin Toms noted the bank's "attractive net interest income (NII) momentum" heading into 2025. NII is the differential between the interest banks earn on loans and other assets and what they pay out on deposits, with higher rates typically bolstering this income by allowing banks to charge more for lending. "The domestic banks have large structural hedges, and based on current rate expectations, we think the hedge roll benefit will more than offset the impact of rate cuts," Bank of America analysts stated. They also suggested that "Additional upside may come from higher loan growth, particularly in commercial, given the government’s growth agenda." "Natwest should be best-placed to take advantage of any UK growth" among UK banks, they continued, forecasting an annual four per cent increase in the bank's loan book. The analysts underscored Natwest's leverage to UK economic expansion, especially in the corporate and commercial sectors, due to its status as Britain's largest commercial bank. Furthermore, last summer saw Natwest expand its market presence by acquiring Sainsbury’s Bank and the residential mortgage portfolio from Metro Bank.

Saga anticipates higher profits and strong travel growth, plans to refinance £325m debt

Saga, the over-50s financial services and travel provider, has announced that it anticipates reporting an underlying profit before tax higher than previous forecasts. In a recent trading update, the company predicted that the underlying profit before tax for the last six months of 2024 would be slightly higher than the previous year, as reported by City AM. Saga's travel division is expected to report an underlying profit before tax "in the high single-digit millions", compared to the £1.5m reported in the prior year, indicating revenue growth of 15 per cent and passenger growth of nine per cent. Over the past six months, Ocean Cruise achieved a load factor of 91 per cent, three per cent ahead of the previous year, while River Cruise reported a load factor of 89 per cent, with combined ticket prices and onboard revenue per passenger amounting to £327, a total increase of 15 per cent from last year. "We continued to generate strong demand for both our cruise and travel businesses," stated Saga CEO Mike Hazell. Last month, Saga announced a 20-year partnership with Belgian insurance giant Ageas for motor and home insurance, which will see Saga’s price-comparison website, pricing, claims and customer service activities taken over by the insurer. However, earlier this week, City broker Peel Hunt downgraded Saga’s stock rating, noting that the firm faced "a refinancing hurdle" this year. The funds from the partnership with Ageas will be utilised by the firm to refinance £325m of outstanding debt by spring this year. Following the deal, Peel Hunt reduced its price target for the stock to 120p. Since the beginning of 2025, Saga’s shares have declined by over nine per cent. Looking forward, Saga reported that both Ocean Cruise and River Cruise's booked load factors are surpassing last year's figures. The company's River Cruise division is scheduled to launch a new ship, the Spirit of the Moselle, in July 2025, which will boost capacity. Currently, the booked revenue for travel stands at £126m, marking a 10 per cent increase compared to the same period last year, with 39,000 passengers booked in, an 11 per cent rise from the previous year.

London Stock Exchange's IPO market is 'nothing more than a dribble'

With only four IPOs initiated on the London Stock Exchange this year compared to 15 takeover bids, there's a rising concern among analysts that London’s equity markets are losing robust companies at an alarming rate. Commenting on this trend, AJ Bell investment analyst Dan Coatsworth expressed concerns about the market's performance, as reported by City AM. "It's now been nine months since the UK general election and the pace of IPOs is nothing more than a dribble," he remarked. While three out of the four firms initiating public offerings joined the LSE's junior market AIM, Achilles Investment Company was the sole new entrant on the main market with its £54m valuation. The spectre of rising taxes coupled with the turmoil instigated by US President Donald Trump's tariffs is contributing to "considerable uncertainty" for businesses. This uncertain climate has caused many firms to hesitate in moving forward with IPOs due to fears of volatile market conditions, as pointed out by Coatsworth. In a related discourse yesterday, Peel Hunt head of research Charles Hall emphasized the "urgent" need to bolster London’s equity markets to raise their appeal for forthcoming IPOs. Nevertheless, some signs of a turnaround are starting to show, with announcements in March from both authentication technology company Quantum Base and accounting firm MHA that they plan to go public later in the year. On another front, this year's most significant takeover overtures have featured KKR's £1.6bn bid for Assura, the £1.2bn deal proposed by Greencore for Bakkavor, and Dowlais' £1.1bn proposition from American Axle & Manufacturing. Most of these acquisitions have been made at a significant premium to the company's market capitalisation, indicating that UK equity markets may still be undervalued. "The second quarter has already got off to a strong start with Qualcomm expressing interest in potentially buying Alphawave IP," observed Coatsworth. Despite a lacklustre performance from IPOs so far this year, Coatsworth noted that speculation about new entrants is ramping up. Potential candidates for a London float in the coming months include Waterstones, gold mining firm NMMC, and banking group Shawbrook, which was delisted in 2017. Coatsworth also mentioned rumours that CK Hutchison might list its European, Hong Kong and South-East Asian telecoms operations in London. In addition to the 15 ongoing takeover situations, Coatsworth pointed out that there are still many potential targets for bidders on the market. These include B&M, whose share price has halved over the past year and is currently trading at 7.6 times its forward earnings. "It's either a bargain at that price or the market doesn't believe the earnings forecasts," commented Coatsworth. Halfords is another retailer that many expect to become a target due to its low valuation and the need for radical changes to its business model. Lastly, Jet2's share price is currently at its lowest level since 2023, presenting a potential opportunity for rival airlines to attempt a takeover.

Bank of England's Carolyn Wilkins highlights market discipline amid UK bond turmoil

The recent upheaval in the UK's bond market is a clear indication that the "dragons of market discipline are alive and well," according to a statement made today by Carolyn Wilkins, an external member of the Bank of England's financial policy committee (FPC). Speaking at Fitch Ratings, she acknowledged the recent instability in the gilt market, as reported by City AM. "Recently we’ve seen orderly movements in global yields as one would expect given news that markets consider relevant to the global outlook." She further noted, "There have been spikes in yields in a number of individual countries in recent years, including the UK, that indicate the dragons of market discipline are alive and well," The UK government bonds experienced a significant sell-off, largely driven by the anticipation that US interest rates would remain high for a longer period due to persistent inflation. The yield on the 10-year gilt reached 4.93 per cent, its highest level since the financial crisis. Gilt yields are closely linked to movements in the US Treasury market. Although yields have almost entirely recovered following soft economic data, the FPC remains concerned about the high levels of public debt, both in the UK and globally. "The FPC that I sit on is of the view that global sovereign debt risks are material," Wilkins stated, adding that global public debt is likely to approach 100 per cent of GDP by the end of the decade. Concerns are intensifying among market participants about the sustainability of public debt externally, which could affect the internal cost of debt servicing for the UK government, as well as for households and businesses, an expert emphasized. In recent times, a slew of commentators have sounded the alarm on the rising debt in advanced economies. Significantly, the Congressional Budget Office in the United States highlighted an alarming trend on Friday, stating that US government debt is likely to exceed its post-World War II record, a projection that's yet to account for the impact of the tax cuts introduced by Donald Trump. "The fiscal situation is daunting, the debt trajectory is unsustainable," remarked Phillip Swagel, director of the CBO, after the office published its report.

How many times will the Bank of England cut interest rates in 2025?

The speed at which the Bank of England reduces interest rates in 2025 will be a significant point of interest for financial markets, mirroring its importance in 2024. The Bank has only cut interest rates twice this year, leaving the Bank Rate at 4.75 per cent as we enter the new year. Following the latest data release in December, financial markets anticipate a similarly slow pace of easing in 2025. Official figures released the week before Christmas revealed that inflation increased to 2.6 per cent in November, meeting expectations but confirming that inflation remains stubborn, as reported by City AM. Wage growth exceeded market predictions, indicating that price pressures will continue for some time. Unsurprisingly, the Bank chose to maintain rates in December. There was little alteration in the Bank's guidance, with policymakers pledging a 'gradual' rate of interest cuts due to numerous uncertainties surrounding the economic outlook. However, the voting split did surprise markets, with three out of the nine members of the Monetary Policy Committee (MPC) advocating for another cut, primarily due to the UK's recent sluggish performance. GDP figures indicated a contraction of 0.1 per cent in October, marking the second consecutive month of shrinkage. The Bank of England predicts the economy will stagnate in the final quarter of 2024. Indeed, since the summer, growth has been minimal at best and the Budget hasn't provided much relief for businesses. The Monetary Policy Committee (MPC) noted that the increase in National Insurance Contributions is "weighing heavily on sentiment". As we move into the new year, many economists suggest that policymakers will be more influenced by the prospect of slow growth than persistent inflationary pressures. "Although the UK economy is facing significant wage pressures, economic activity is significantly less dynamic than in the US," said Guillaume Derrien, senior eurozone economist at BNP Paribas. He added: "Between an ECB whose rate cuts will, admittedly, be gradual but steady, and a US Federal Reserve that is now more hawkish, the Bank of England will be in an intermediate position in 2025, with four rate cuts expected in 2025...at a rate of one cut per quarter," Ruth Gregory, deputy chief UK economist at Capital Economics, concurred. "We haven’t changed our view that the Bank will continue to cut rates by 25bps a quarter," she stated. The rise in inflation in November was predicted long ago – it was mainly due to base effects – while the MPC pointed out that monthly pay figures can be "volatile". Persistent inflation could still pose a problem for the Bank, but at this point, sluggish growth appears to be the primary concern. Stagnation has already shown up in the official statistics. The Monetary Policy Committee (MPC) is facing uncertainty regarding the influence of Donald Trump, particularly on interest rates and how his tariffs might affect the global economy. The specifics of the tariffs remain vague. "Indicators of trade policy uncertainty had increased materially, but that the magnitude and the direction of the impact of any such policies on UK inflation was at present unclear. These effects might not be apparent for some time," commented the Bank during its last meeting. They indicated that President Trump is poised to significantly affect international trade policy yet refrained from estimating the potential outcomes.

Barclays shares explode higher as FTSE 100 rebounds after Trump roll back

Shares in FTSE 100 heavyweight Barclays soared in early trading following Trump's rollback of his 'Liberation Day' tariffs. The bank's stock surged over 20 per cent as markets opened, before settling to a 15 per cent gain, topping the blue-chip index's risers. This surge helped offset the lender's losses following Trump's tariff onslaught, reducing its one-month loss to three per cent. Barclays shares had taken a hit as geopolitical tensions escalated over the past week, with shares in the lender dropping nearly ten per cent after China launched its first round of retaliatory tariffs against the US on Tuesday, as reported by City AM. Russ Mould, investment director at AJ Bell, commented: "In Barclays' case, its investment bank is heavily geared into how the financial markets performed." He added that "Tumbling, or volatile, markets are likely to deter merger and acquisition activity and also new market floats, both areas where there are fat fees to be made." The firm's investment bank has become a crucial part of business operations and has been a significant driver of profits. It exceeded £11.85bn in total income for 2024, surpassing analyst estimates of £11.7bn. Barclays' recovery coincided with the FTSE 100 surging over five per cent. Lenders have borne some of the most substantial losses amidst the escalating global trade war. Last week, the FTSE 100's 'Big Five' led the decline in the index. Both HSBC and Standard Chartered have experienced setbacks due to their Asian operations, which were hit hard by the heavy tariffs imposed by Trump. Before the opening of US markets on Tuesday, Bloomberg's estimates highlighted that major bank stocks had shed more than $700bn (£544bn) in market value within a single week.

FTSE 100 stages tentative recovery as pound climbs from one-year lows

The FTSE 100, UK's blue-chip index, opened 1.5 per cent higher this morning, clawing back some of the losses sustained over the previous three trading days in the wake of US President Donald Trump's extensive tariffs. Yesterday saw the FTSE 100 plunge by more than four per cent as global stock markets grappled with the potential impact of a worldwide trade war, as reported by City AM. However, early trading this morning witnessed a cautious recovery in the market. The domestically-oriented FTSE 250 leapt 1.6 per cent in early deals, while the Stoxx Europe index 600 climbed 1.4 per cent. Commodities-focused stocks on the FTSE 100 led the market upwards, buoyed by increasing commodity prices. BP saw a 2.6 per cent rise, while mining companies Antofagasta and Glencore both increased by three per cent. US-centric tech stocks listed on the FTSE 100, such as Scottish Mortgage Investment Trust and Polar Capital Technology Trump, also demonstrated strong performance this morning. In the meantime, the pound rose by 0.46 per cent after hitting a one-year low yesterday of around $1.27. US stocks have also continued their recovery from the sharp downturn experienced in recent days, with Dow Jones futures up 1.7 per cent and S&P futures rising 1.3 per cent. Matt Britzman, senior equity analyst at Hargreaves Lansdown, cautioned: "This should hardly be seen as the end of the trouble, especially with President Trump showing no signs of easing his stance on perceived trade imbalances." Despite Trump's threats to escalate tariffs on China beyond 100 per cent, Asian markets have remained unfazed. Japan's Nikkei surged by six per cent this morning, while the Chinese Hang Seng and Shanghai Stock Exchange indexes experienced increases of 1.2 and 1.4 per cent respectively. Gold, which had been negatively impacted by uncertainty surrounding Trump's tariffs, rose by one per cent this morning to exceed $3,000 again, although it is still down by 3.7 per cent over the past week.

Bank of England to slash rates much faster than markets expect, Goldman Sachs says

Goldman Sachs has posited that markets are significantly underestimating the likelihood of the Bank of England accelerating interest rate cuts. Traders currently foresee only two reductions this year, with an additional cut expected in 2026, which would bring the benchmark Bank Rate down to 4.0 percent from its present 4.75 percent, as reported by City AM. Despite concerns over persistent inflationary pressures within the UK economy and predictions of a headline rate surge to above three percent by spring, recent figures indicate private sector pay growth soared to 6.0 percent in the three months leading up to November, surpassing forecasts. The US investment bank acknowledged the "uncomfortably high" price pressures but noted "several indications" that the medium-term inflation outlook is easing. Citing factors such as a significant downturn in growth, a likely deceleration in household real disposable income, and the potential impact of escalating trade tensions, analysts including Sven Jari Stehn anticipate a modest 0.9 percent economic expansion for the UK in 2025, lagging behind the consensus estimate of 1.3 percent. Analysts also highlighted "notable signs of underlying cooling" in the labour market from various business surveys and recent unemployment data, suggesting this could help moderate wage increases. "We are sceptical that Bank Rate can stay above four per cent persistently – as priced by financial markets – without materially weakening the economy and thus inflation," they said. Goldman Sachs predicts a drop in interest rates to 3.25 per cent by mid-2026. "While it is possible that the BoE will slow the pace of cuts if underlying inflation fails to make progress, we believe that a step-up to a sequential pace of cuts in response to weaker demand is actually more likely," they argued. Investors are anticipating another rate cut from the Bank in February due to growing concerns about the economic outlook.

Gold prices dip despite safe haven status amid Trump's new tariffs and global market turmoil

Despite its status as a safe haven amidst global trade uncertainties, gold prices have seen a decline for the third consecutive session. Over the past week, gold has dropped nearly three per cent in US dollar terms, following a steady rise since the onset of 2024, as reported by City AM. This drop coincides with a worldwide slump in stock prices in the wake of US President Donald Trump's comprehensive tariffs, which economists fear could plunge the world into recession. On the day of Trump's tariff announcement, the precious metal performed robustly, momentarily reaching a new all-time high of $3,225 after the president disclosed tax figures by country, before settling back to $3,125. However, it has since pulled back, even briefly dipping below the coveted $3,000 mark this morning. The depreciation in gold prices has occurred despite a fall in the value of the US dollar against other major currencies: when measured in euros, gold has declined almost six per cent since Thursday morning. While tariffs may play a significant role, analysts at Tatton Investment Management suggest that the end of the financial year last week may have distorted gold markets due to portfolio rebalancing. Given gold's strong performance in recent months, it would have become over-represented in many stockpicker portfolios, leading to a temporary sell-off to adjust proportions, according to the investment firm's analysts. As the broader market took a hit, many investors were likely compelled to liquidate their positions in gold, resulting in downward pressure on its price. "Margin calls from brokers is likely to have exacerbated some of the market movements," offered Susannah Streeter, head of money and markets at Hargreaves Lansdown. She went on to say: "Investors using more risky margin accounts can borrow money to invest, but falls in asset prices are prompting demands they deposit more money, as the value of assets used as collateral falls." Moreover, Streeter observed that increased unease among investors has led many to cash in on profits accrued over the past year and pivot to cash holdings. Alternatively, Michael Brown, a senior research strategist at Pepperstone, attributed the decline in gold's value to the unwinding of tariff risk premium following an exemption of bullion imports from tariffs.

UK long-term borrowing costs hit highest level since 1998

The cost of long-term government debt soared to its highest level since 1998 on Tuesday, as investors became increasingly anxious about the UK’s economic future. The yield on the 30-year gilt, which reflects the price of government borrowing, reached 5.28 per cent on Tuesday following a gilt auction conducted by the Debt Management Office (DMO), as reported by City AM. The DMO sold £2.25bn of long-term government debt at a yield of 5.2 per cent, making Rachel Reeves the first Chancellor since Gordon Brown to oversee a bond auction with an average yield of over five per cent. The auction attracted the lowest level of demand since December 2023, indicating that investors are less willing to purchase longer-term UK government debt. Yields and prices move inversely. With demand for gilts lower, prices fall which pushes up the yield. The sell-off in UK government debt is not unique among global peers. Government borrowing costs have increased around the world in recent months, reflecting fears about elevated debt levels and the potential inflationary impact of Donald Trump’s trade policies. However, the sell-off in the UK has been accentuated by concerns about the scale of government debt issuance and the domestic economic outlook. The Chancellor plans to borrow £297bn through financial markets this fiscal year, the second highest level on record Markets also anticipate fewer interest rate cuts in 2025 due to fears about the potential persistence of inflation. This has put further upward pressure on gilt yields. According to analysts, rising gilt yields may erode the Chancellor's financial flexibility when the Office for Budget Responsibility (OBR) releases its updated economic predictions in March. Reeves had allocated only £9.9 billion to satisfy her main fiscal requirement that daily spending be covered by tax revenues.

West Midlands Lloyds and Halifax branches to close

A host of Lloyds and Halifax branches across Birmingham and the West Midlands have been tabled for closure over the coming months. The group is among 136 which the banking group has confirmed will be shut down. The first to close will be Lloyds and Halifax branches in High Street, Bromsgrove, at the end of May. They will be followed by Halifax, in Erdington's High Street in September, and Lloyds in Vicar Street, Kidderminster, just a few weeks later. Lloyds branches in Foleshill Road, Coventry, and High Street, Shipston-on-Stour, will both close in the first half of November and finally Halifax in Bearwood Road, Smethwick, will cease trading in March next year. Email newsletters BusinessLive is your home for business news from across the West Midlands including Birmingham, the Black Country, Solihull, Coventry and Staffordshire. Click through here to sign up for our email newsletter and also view the broad range of other bulletins we offer including weekly sector-specific updates. We will also send out 'Breaking News' emails for any stories which must be seen right away. LinkedIn For all the latest stories, views and polls, follow our BusinessLive West Midlands LinkedIn page here. Across the wider region there are branches in Staffordshire, Shropshire and the East Midlands also earmarked for closure. In total, 61 Lloyds, 61 Halifax and 14 Bank of Scotland branches will shut their doors for good between May and March 2026. The closures come weeks after Lloyds Banking Group said it would allow customers of Lloyds, Halifax and Bank of Scotland to use stores across any of its brands for in-person banking. The group has blamed the move on customers shifting away from banking in person to using mobile services but stressed it would offer affected workers roles elsewhere in the company. A statement said: "Over 20 million customers are using our apps for on-demand access to their money and customers have more choice and flexibility than ever for their day-to-day banking. "Alongside our apps, customers can also use telephone banking, visit a community banker or use any Halifax, Lloyds or Bank of Scotland branch, giving access to many more branches. "Customers can also do their everyday banking at over 11,000 branches of the Post Office or in a banking hub." The announcement means that more than 1,700 bank branches have shut or announced their intention to close since February 2022 when a voluntary agreement saw the major banking groups commit to assessing the impact of every closure. This has included both Lloyds and Halifax branches in Birmingham city centre and elsewhere across the region. It works out at an average of around 50 closures announced per month, with around 289 branches expected to shut this year.

UK dividends dip as mining sector cuts payouts, despite overall growth in 2024

In 2024, UK dividends experienced a 0.4 per cent decrease on an underlying basis after mining companies cut payouts by 40 per cent compared to the previous year. Despite headline dividends in 2024 increasing by 2.3 per cent to £92.1bn, this was largely due to a surge in one-off payments amounting to £5.6bn. Underlying or regular dividends dropped to £86.5bn, primarily due to a £4.5bn reduction in payouts by mining stocks, which had been the largest paying sector over the preceding three years, as reported by City AM. Excluding miners, underlying growth in UK dividends for 2024 stood at four per cent, while headline growth was 8.4 per cent, as per data from Computershare’s Dividend Monitor report. Housebuilders also contributed to the decline in the total dividend, with FTSE 100 giant Persimmon and FTSE 250 member Bellway both reducing payouts throughout the year. Overall, 17 out of 21 sectors saw increased or maintained payouts in 2024, with banks, insurers and food retailers being the strongest contributors to growth. Conversely, the final quarter of 2024 witnessed a 0.1 per cent rise in underlying dividends while headline figures fell by 0.5 per cent. Looking ahead to 2025, Computershare estimated that median dividend growth should continue at a rate of between four to 4.5 per cent. However, it highlighted that significant cuts have already been announced by several major firms, such as the soon-to-be-merged Vodafone/Three, which are likely to bring down the headline figures. As a result, it is predicted that underlying dividend rates will see a modest increase of just one per cent to £88.2bn, while headline rates are anticipated to rise by a mere 0.7 per cent to £92.7bn. David Smith, portfolio manager at Henderson High Income Trust, commented on the potential impact of the UK Budget: "The impact of the UK Budget is likely to curtail dividend growth for some domestic businesses given corporate margins are coming under pressure from the increase in National Insurance and minimum wage." He also pointed out the international aspect of the UK market, stating, "However, one must remember that 75 per cent of the UK market’s revenues are derived overseas where the global economy is improving."

FTSE 100 hits new all-time high as markets bet on interest rate cut

The FTSE 100 has reached a new record high this morning, surpassing its previous peaks from last spring. The value of London's top 100 listed companies has increased by 2.7 per cent over the past week, spurred on by economic data suggesting that the Bank of England may implement more aggressive interest rate cuts than anticipated. The FTSE 100's prior all-time high was achieved earlier this year on 15 May, with an intra-day peak of 8,474.71. Today, it hit a new intra-day high of 8,480.36, growing 0.9 per cent in the morning before slightly retreating, as reported by City AM. This news follows Tuesday's better-than-expected inflation data and further indications of the UK economy's struggle to perform. Services inflation, a key measure of persistent inflation, dropped to 4.4 per cent, its lowest since March 2022. Meanwhile, UK GDP for December fell short of expectations, with the economy only expanding by 1.1 per cent, while retail sales dipped by 0.3 per cent throughout the month. These data points provide the Bank of England with justification for quicker interest rate cuts than markets had predicted, with financial markets suggesting only 0.5 per cent of cuts throughout 2025. The index has also been aided by the pound's depreciation against the dollar since September, which boosts the revenue of companies conducting business overseas. Sterling has dropped to just $1.218, compared to $1.342 in September. "Three quarters of companies in the FTSE 100 generate their earnings overseas, and the relative value of those foreign earnings is boosted when the pound weakens," explained Dan Coatsworth, an investment analyst at AJ Bell. "The natural resources sector was also lifted by merger and takeover chatter, encouraging investors to bid up shares in the likes of Glencore and Anglo American." Contributing significantly to the FTSE 100's growth over the past year, HSBC, Shell, Rolls-Royce, Barclays, and Unilever accounted for two-thirds of the index’s expansion.

First North West deal for European investor Crossbay as it acquires Greater Manchester warehouses

A £1.26bn European logistics investor has made its first North West acquisition. Crossbay, the pan-European urban logistics platform of private equity real estate manager MARK, bought an industrial investment on Irlam Business Park near Manchester for more than £11m from Buccleuch Property. The two warehouses, totalling 83,923 sq ft, sit between Junction 11 of the M60 and Junction 20 of the M6 in Irlam. They are let to two tenants with an average unexpired lease term of more than 11 years. In December, MARK announced its Crossbay II fund had secured €660m (£556m) in total fund commitments, representing a 20% increase in fund size compared to its predecessor. Including debt financing, Crossbay II has a total investment capacity of over €1.5bn (£1.26bn). Crossbay plans to grow in the UK, and its Irlam deal follows two recent industrial acquisitions in Yorkshire Knight Frank advised Crossbay on the acquisition, while Zaman Roberts advised Buccleuch Property. Craig Barton from Knight Frank said: “These two modern units let to quality tenants, within the prime industrial location of Irlam, west of Manchester provide high specification accommodation with superb motorway access. With continued robust occupational dynamics across the NW, we anticipate strong underlying performance. “This was an important acquisition for Crossbay and a sign of their belief in the strength of the North West logistics market. They are keen to expand further and we would be interested to hear of any further opportunities.” Adam Roberts from Zaman Roberts said: "Having advised Buccleuch Property on the purchase in 2016, our client successfully executed their business plan and we are now pleased to have completed the sale to Crossbay.”

Investors pile into gold as Trump's tariff turmoil continues

The price of gold has soared to another record peak, fuelled by concern over President Donald Trump's tariff strategy and a weakening dollar, leading investors towards the traditional sanctuary of precious metals. Gold's value ascended 1.5% to surpass $3,200 (£2,451) per troy ounce on Friday – an unprecedented level – as Asian markets stumbled due to the ongoing repercussions of President Trump's deferred tariff measures, as reported by City AM. Despite its status as a refuge for capital during turbulent times, the precious metal had initially been swept up in a severe sell-off amid tariff-driven market chaos. Gold spot prices experienced a remarkable increase of over 30% since the beginning of 2024 but witnessed a downturn from $3,166/oz to $2,973/oz from April 2 to April 6. Market experts believe that investors were compelled to sell their gold assets to cover margin calls from creditors. Pepperstone analyst Michael Brown pointed to the removal of the "risk premium" associated with gold after its exclusion from the postponed tariffs Trump labeled ‘Liberation Day’ as the cause of the brief dip. Nevertheless, from April 6 onward, gold has bounced back robustly, registering its most significant bi-day surge since 2020 and reaching a new all-time high. Market strategists have attributed this latest rally to the faltering US dollar – which renders the metal more accessible to buyers using other currencies – and predictions that central banks might accelerate interest rate cuts more than previously presumed to prevent an economic deceleration. This week has seen the dollar descend to its lowest level against major global currencies in a decade. Dominic Schinder of UBS Global Wealth informed Bloomberg TV that further rate cuts from the Federal Reserve would provide another "leg up" for gold, as the yield on holding cash – a common refuge amid prevalent bearish sentiment – is lower. This rally boosted London-listed gold miners, leading the FTSE 100 higher on Friday morning. Fresnillo saw an increase of approximately 5.9 per cent, while Endeavour experienced a surge of over 4.5 per cent in early trades. Brokers at Peel Hunt upgraded precious-metal-miner Fresnillo from 'hold' to 'add' in a note, suggesting that sustained high gold and silver prices would generate more cash flow at the commodities giant. "[The first quarter] saw gold and silver prices well ahead of expectations on rising market uncertainty," they noted. "The extreme US tariff announcements simply added to this uncertainty.

Nikhil Rathi secures another five-year term as FCA chief amidst UK regulatory overhaul

Nikhil Rathi has been reappointed as the chief executive of the Financial Conduct Authority (FCA) for a further five years, tasked with the government's new mandate to cut back on unnecessary and repetitive regulation, as confirmed by the Chancellor. Rathi, who previously served as a Treasury official and the CEO of the London Stock Exchange, will continue his leadership at the FCA, the UK's principal financial regulator, as reported by City AM. Should he complete this term, Rathi's tenure at the helm of the FCA will reach a full decade. The Chancellor has chosen to maintain stability in the role, highlighting that Rathi's contributions have been "crucial" to the government's ambitious regulatory reform efforts aimed at streamlining the UK's regulatory framework to eliminate perceived impediments to economic expansion. On Christmas Eve, Rachel Reeves and Keir Starmer issued a directive to the heads of the UK's ten leading regulatory bodies, urging them to "tear down the regulatory barriers" they believe are constraining economic progress. This initiative to orientate the UK's regulatory bodies towards promoting growth has led to the departure or removal of several regulatory leaders, including those at the Competition and Markets Authority and the Solicitors Regulation Authority. The campaign has also triggered a significant reshuffle within the financial regulatory landscape, exemplified last month by the merger of the Payments Systems Regulator with the FCA, which aims to minimise redundant regulatory obstacles for businesses. Rathi will oversee the seamless integration of the merger. Upon hearing of his reappointment, he commented: "I am honoured to be reappointed by the Chancellor. The FCA does vital work to enable a fair and thriving financial services sector for the good of consumers and the economy." In the previous month, both the FCA and the Bank of England's Prudential Regulation Authority abandoned their initiatives to regulate firms' diversity, equity and inclusion (DEI) performance. Reflecting on these actions and other measures to reduce regulatory burden, Rathi stated: "I am proud of the reforms we have delivered to support growth, bolster operational effectiveness, set higher standards and to keep our markets clean and open." Reeves expressed her approval, saying: "Nikhil Rathi has been crucial in this government's efforts to reform regulation so it supports growth and boosts investment – I am delighted he will be continuing his leadership of the FCA."

Triodos Bank appoints former HSBC boss as UK chief executive

Ethical bank Triodos has appointed a new chief executive in the UK. Mark Clayton joined the Bristol-headquartered company last year as its chief operating officer and is expected to take up the post in early summer. He will succeed Dr Bevis Watts, who announced last October that he would step down after nearly a decade at the helm. Mr Clayton, who was previously chief operating officer at Unity Trust Bank, had a 23-year career at HSBC, where he held various senior roles and led large teams within the retail banking division. Gary Page, chair of Triodos Bank UK, recently re-appointed as chair for a final term of three years, said: “It was crucial for us to find a new CEO with the right values and passion for ethical and sustainable banking, as well as a strong understanding of our customers and a rapidly changing banking landscape. "Mark has made a really positive impact since joining Triodos and we are confident he is the right person to lead the bank forward and deliver the impact we want to have. My thanks go to Bevis for his contribution over many years and for his commitment to assist in the smooth transition over the coming months. We wish him well for the future.” Mr Clayton said he was driven by a "strong desire to protect the world" and was "hugely honoured" to be given the top job at Triodos. "I am excited for the opportunities ahead at Triodos Bank UK," he said. "We have an excellent leadership team in place working to deliver on our mission of making money work for positive change in society." Triodos Bank UK, a certified B Corporation, has more 300 staff based in Bristol headquarters, as well as offices in London and Edinburgh. With a balance sheet of approximately £2bn, the bank is well known for financing UK pioneers in sustainability.

Pensions industry hopes Bell appointment could 'revive' auto-enrolment debate

Industry leaders are hopeful that the appointment of Torsten Bell as pensions minister could reignite discussions about increasing the contribution rate for auto-enrolment pensions. Bell assumed the pensions brief on Wednesday following a mini-reshuffle triggered by Tulip Siddiq’s resignation as City minister, as reported by City AM. Emma Reynolds, his predecessor, has taken over Siddiq’s former role. Bell previously served as chief executive of the Resolution Foundation, a left-leaning think tank that has advocated for higher auto-enrolment contributions to fund domestic investment and enhance financial security for retirees. Auto-enrolment pensions were launched in 2012 to counteract the decline in workplace savings. The policy is widely regarded as successful. According to government data, UK employees saved £114.6bn towards their pensions in the decade following its introduction in 2012, a real terms increase of £32.9bn. At present, the minimum contribution for these pensions is divided, with employers contributing at least three per cent and the employee the remaining five per cent. However, in Ending Stagnation, a book co-authored by Bell during his tenure at the Resolution Foundation, he argued for an increase in contributions. "The next phase in its development should be a levelling up of the minimum contributions by both employers and employees to six percentage points (from three and five per cent respectively), representing a 50 per cent increase in total," he wrote. "A capped amount of these savings should be made available for everyday contingencies – tackling precarity for individuals as we underpin higher investment for the economy as a whole." stated an advocate for increased auto-enrolment rates in the pensions industry. This view supports that such changes will secure more adequate savings for future pensioners. "In the next five years, the majority of defined contribution pension savers will enter retirement with less income than they expect or need, and this will worsen to a peak in the early 2040s," warned Andy Briggs, chief executive of Phoenix Group, in his remarks to City AM. Briggs highlighted that increasing auto-enrolment contributions is critical, branding it the "single biggest lever" the government could utilise to rectify the impending pension shortfall. Despite pledges that pension adequacy would be reviewed during the second phase of its pension review, the Financial Times reported that Chancellor Rachel Reeves had postponed said review indefinitely. The cause for the postponement, as noted by media sources, was concern over imposing additional burdens on businesses following the Budget's pressures. Briggs optimistically noted that alterations could be executed "as economic conditions allow" and recommended a develop "roadmap" to guide businesses and households preparatively. Moreover, Lisa Picardo, Chief Business Officer UK at PensionBee, expressed hope that Bell's appointment might "revive necessary discussions" regarding auto-enrolment contributions. Zoe Alexander, director of policy & advocacy at the Pensions and Lifetime Savings Association, expressed her optimism about the appointment, stating it could lead to "progress on both phases of the Pensions Review". The initial phase of the pensions review has been centred around consolidating the UK’s fragmented pensions industry and encouraging schemes to invest in the domestic economy. The deadline for firms to respond to phase 1 was on Thursday. A Government spokesperson said: "Creating wealth and driving growth is at the heart of our Plan for Change. We are determined to ensure that tomorrow’s pensioners are supported, which is why the Government announced the landmark two-stage Pensions Review days after coming into office and why the Pension Schemes Bill was in the King’s Speech." They added: "Automatic Enrolment has turned millions of people into pension savers with around 9-in-10 eligible employees saving for their retirement."

Banks face turmoil as HSBC and Barclays shares plummet amid escalating global trade war

The 'Big Five' banks on the FTSE 100 were engulfed in losses on Wednesday as tensions escalated in the global trade war. China retaliated by hiking its tariff on US goods to 84 per cent, a response to President Donald Trump's 50 per cent levy that came into effect today, pushing China's total import tax to a staggering 104 per cent, as reported by City AM. HSBC shares took a hit of over four per cent due to Beijing's countermove. Barclays and Standard Chartered also felt the heat, with their shares dipping nearly five per cent. Stocks had already been under pressure in early trading as Trump showed no intention of retreating from his tariff strategy. Domestically-focused lenders Lloyds and Natwest saw their shares fall nearly three and four per cent respectively. Russ Mould, investment director at AJ Bell, commented: "Yesterday's fragile recovery in stocks has been shattered by renewed selling as reciprocal tariffs on what the Trump administration regards as the 'worst offenders' comes into effect." "Investors had initially taken some positives from a willingness in the White House to negotiate with Japan and Israel but an escalation with China triggered another sell-off on financial markets." Bloomberg calculations on Tuesday revealed that more than $700bn (£546bn) of global bank stocks' market value has evaporated since Trump's 'Liberation Day.' HSBC, with its Asia-centric operations driving losses, has alone seen almost $30bn (£23bn) wiped off its value. Britain's prime lending institutions are scheduled to unveil their half-year financial reports towards the end of July, a period that may bring unwelcome news to investors as they absorb the repercussions. Shore Capital's equity analyst Gary Greenwood commented on the anticipated content of the reports, indicating they are expected to mirror "volatility in capital markets". He elaborated: "IPO's that were going to happen, impact in market related activity, impact in wealth management areas – that's where you'll feel it first." Greenwood also predicted lenders' future guidance would likely suffer due to tariffs. He explained further, saying: "On an accounting basis, banks might start to add a bit to their provisions." "More uncertainty could make them more cautious about lending and risk appetite could change to not push as hard in terms of growth." Such developments pose additional challenges for Chancellor Rachel Reeves, who has been actively advocating for banking leaders to help bolster growth within the UK.

US jobs surge impacts global markets: Pound tumbles and UK gilt yields spike

The sterling tumbled in relation to the US dollar, while yields on gilts faced renewed strain as fresh data underscored the enduring robustness of the US economy. The most recent figures from the US labour market document an uptick in employment with 256,000 positions added in December, a pace that exceeded November's and surpassed the forecasts of analysts, as reported by City AM. Contrary to projections by specialists who anticipated a static rate, unemployment edged down to 4.1 percent, defying expectations of holding steady at 4.2 percent. "The report pointed to the labour market having remained solid as 2024 drew to a close," commented Michael Brown, senior research strategist at Pepperstone. The persistent vigour of America's economic performance is likely to persuade policymakers at the US Federal Reserve that prudence is warranted in reducing interest rates. Post-release of these statistics, the pound declined by 0.8 percent against the dollar to $1.22, marking its lowest since November 2023. Market projections regarding the trajectory of rate cuts have moderated, mirroring the ongoing strength of the economic landscape as well as the potential inflationary push from Donald Trump’s trade tariffs. Now, traders are not forecasting a rate cut by the Fed until October, having previously predicted a reduction as soon as June earlier in the week. Fluctuations in US interest rates hold repercussions across the globe and recent times have seen sovereign debt markets especially affected, with mounting anticipation among investors for heightened global interest rates. Neil Birrell, Chief Investment Officer at Premier Miton Investors, has suggested that the latest figures will do little to alleviate the pressure on government bonds. "The jump in bond yields looks set to continue," he stated. The UK is particularly vulnerable to these market fluctuations due to the significant proportion of UK government debt held by international investors. Following the release of these figures, the cost of UK government debt increased across all maturity profiles, adding to an already challenging week.

IG Group boosts share buyback programme to £200m following Freetrade acquisition

IG Group, the FTSE 250 firm, has announced plans to spend an additional £50m on share buybacks following its acquisition of trading app Freetrade. The company's six-month results up to 30 November revealed an extension of its previous share buyback programme from £150m to £200m, as reported by City AM. IG Group CEO Breon Corcoran stated: "It is pleasing to show how we can both invest in accretive growth and return capital at attractive equivalent rates of return on our buyback, all whilst safeguarding our robust balance sheet." The results showed a revenue increase of 11 per cent to £522.5m over the six months, with adjusted profit before tax rising 30 per cent from £205.7m to £266.8m. Despite IG Group's strong growth, analysts had mixed reactions to the results. Jefferies had predicted trading revenue would total £453m, but it only grew to £451.7m, although the analysts had forecast an adjusted profit before tax of only £242m. RBC, on the other hand, predicted a 12 per cent growth in revenue and a 40 per cent growth in earnings per share, compared to actual growth of 43 per cent. Corcoran added: "First half performance reflected more supportive market conditions, but we have work to do to grow active customers which will be necessary to deliver sustainably stronger growth," Last week, IG Group acquired stock trading app Freetrade for £160m, with the firm set to move to IG Group in mid-2025. The direct-to-consumer trading platform, which burst onto the scene in 2018, provides investors with commission-free options for shares, ETFs, and gilts. The announcement of its sale received mixed responses from investors, some of whom were vexed by a sale price that didn't match up to recent fundraising valuations. "CEO Breon Corcoran has re-energised the investment case for IG Group setting out the opportunity and identifying areas of improvement," remarked RBC analyst Ben Bathurst. On the positive side, IG Group's stock has seen a notable surge, climbing 25 per cent over the past half-year.

Firms set to hike prices to battle Rachel Reeves' tax raid, Bank of England survey suggests

Inflationary pressures are expected to continue throughout the year as companies plan to increase prices in response to the tax-raiding Budget of Rachel Reeves, according to a survey from the Bank of England. The Bank's most recent decision maker panel, which polls finance chiefs nationwide, revealed that firms' inflation expectations rose in December, as reported by City AM. Anticipated price growth for the upcoming year increased to four per cent, up from 3.8 per cent the previous month, marking the highest level since April of the previous year. The survey also indicated that actual price growth in the year to December rose to four per cent, an increase from 3.7 per cent the month prior. Concerns about inflation have been mounting, spurred by reports that companies will raise prices in reaction to government tax increases. Chancellor Rachel Reeves raised the rate of employers' national insurance in October's Budget, a key part of a broader £40bn tax hike. However, the Bank of England's survey revealed that over half (54 per cent) of firms anticipate raising prices due to the Chancellor's tax raid, a figure unchanged from November. Economists fear this could reinforce inflationary dynamics, which have yet to be definitively curbed. The latest data showed that inflation rose to 2.6 per cent in November. While the Bank of England's most recent forecasts suggest inflation will peak at 2.75 per cent in mid-2025, many analysts worry that price pressures could be worse than anticipated. Financial markets have recently reduced bets on interest rate cuts due to concerns that price pressures might persist. Markets are currently predicting just two rate cuts this year. The Bank of England's survey presented mixed news regarding wage pressures facing firms. Realised annual wage growth fell to 5.3 per cent in December, the lowest since the Bank began asking this question in May 2022.

ECB and Fed rate decisions to underscore economic divergence between Europe and the US

Markets are gearing up for a busy week as they anticipate central bank announcements, with interest rate decisions due from both the US Federal Reserve and the European Central Bank (ECB). The upcoming decisions are set to underscore the divergent economic perspectives between the two regions, with the ECB likely to slash borrowing costs for the fifth consecutive time, while the Fed is expected to maintain rates, as reported by City AM. In December, the Federal Open Market Committee (FOMC) trimmed rates by 25 basis points and indicated that only two rate cuts would occur in 2025. However, investor expectations for further rate reductions in the US have moderated in recent weeks, despite ongoing progress on inflation. This shift in sentiment is attributed to concerns about the inflationary effects of Donald Trump's economic policies and the persistent robustness of the US economy. "We expect the strength of the economy and uncertainty over immigration and trade policy to prompt the Fed to pause its easing cycle," commented Bradley Saunders, North America economist at Capital Economics. Data released the day after the Fed's meeting is projected to reveal that the US economy expanded at an annualised rate of 2.7 percent in the fourth quarter. Considering these factors, most traders are now predicting just one rate cut, with some even speculating that the Fed might increase rates again in the near future. Chair Jerome Powell is expected to face numerous questions about the outlook for rates in his upcoming press conference, especially considering President Trump's insistence on lower interest rates. BNP Paribas analysts predict that Powell will also be questioned about the "tail risk of rate hikes." They anticipate a cautious response from him, suggesting rate hikes are less likely but could be considered if necessary to ensure a soft landing for inflation and growth. This contrasts sharply with the economic outlook for the ECB. ING's global head of macro, Carsten Brzeski, believes a rate cut is a "no-brainer" given the weak growth outlook. Despite the ECB cutting rates four times in 2024, bringing the benchmark interest rate down to three per cent, Brzeski argues this is still too high. He stated: "The deposit interest rate is still restrictive and too restrictive for the eurozone economy’s current weak state," Economic growth figures due on Thursday are predicted to show a mere 0.1 per cent increase in the fourth quarter, significantly weaker than the US. The IMF's latest forecasts suggest that the US will grow by 1.9 per cent next year, while the euro area will only grow by 1.0 per cent. Given such a weak growth outlook, traders are anticipating four or five rate cuts from the ECB this year, despite some signs of building inflationary pressures.

Jobs saved as Horizon Works Marketing assets acquired

Jobs have been saved at an established North East marketing agency following its administration. Horizon Works Marketing, which had operated from a base in Cramlington, called in administrators following challenges stemming from the Covid pandemic. The firm's founder says it is now looking positively to 2025 after a new company has been established to continue trading under the Horizon Works name, with 10 jobs secured in the process. Insolvency experts at KBL Advisory were appointed to Horizon Works late last year. Founder and managing director Samantha Vassallo acquired the assets of Horizonworks Marketing Limited and has established Horizon Works Limited. The business, which is now based out of the Blyth Workspace building at the Port of Blyth, was originally set up in 2010 and has established a specialism in business to business marketing services for innovation and technology-led manufacturing and engineering businesses. Its team of marketers, writers, designers, digital experts and PR and communications specialists provide a range of services including strategy creation, marketing campaigns, SEO, brand development, media relations and digital development. In the 15 years since its inception, Horizon Works has carried out work for a variety of clients across the automotive, process, engineering, energy and technology sectors - many of them North East-based and others further afield. It is also an affiliate partner of several sector-based groups such as the Engineering and Manufacturing Network, a Fit for Defence partner of Make UK Defence, and is a member of the North East Automotive Alliance (NEAA), NOF and the Entrepreneurs’ Forum. Samantha Vassallo, managing director of Horizon Works, said: "The restructure was necessary due to legacy financial pressure resulting from the Covid-19 pandemic. All jobs have been safeguarded and the specialist team that Horizon Works has built up over 15 years remains in place.

Lloyds Bank to cut bonuses of senior staff who don't go into the office

Senior executives at Lloyds Bank may face a reduction in their bonuses if they fail to attend the office at least twice a week, as per recent reports. The Guardian has reported that the bank is considering office attendance as part of its bonus targets for approximately 60,000 of its top-ranking employees. This move is the latest in a series of attempts by companies to encourage employees to return to the office more frequently following the shift in working habits brought about by the pandemic, as reported by City AM. Many employers in white-collar industries have maintained hybrid working models post-lockdown due to the increased flexibility it offers their workforce. A study conducted by the Centre for Cities revealed that Londoners are now spending an average of 2.7 days per week in the office, a decrease from roughly four days prior to the pandemic. However, concerns are mounting that remote working could negatively impact productivity and employee development due to the lack of opportunities for face-to-face interaction. Consequently, businesses globally are attempting to revert to pre-pandemic working conditions. JP Morgan recently informed its staff that they will be required to work in the office full-time from March, joining companies such as Amazon which also mandates a five-day office week. However, these changes have not been universally well-received. Last week, City AM disclosed that advertising giant WPP will require its staff to come into the office four days a week, leading to over 10,000 individuals signing a petition urging the company to reconsider its stance.

UK sees surge in crypto ownership with 7 million Brits investing in digital assets

Crypto and digital assets have been identified as the third most popular investment over the past year, spurred by a 49 per cent increase in online searches, according to Whisky and Wealth Club's research. The study placed cryptocurrencies among the top three performing alternative investment sectors, alongside peer-to-peer lending and music royalties, as reported by City AM. Despite their well-known volatility, digital assets continue to draw in aspiring investors looking for high-risk, high-reward opportunities. CoinShares reported that global crypto investment reached an all-time high of $44bn (£35bn) in 2024. AJ Bell also recently stated that "2024 was a breakout year for Bitcoin", reflecting the growing popularity of crypto investment. The FCA’s research indicates that 7m people in the UK currently hold some form of cryptocurrency, a figure comparable to the number of people who own a Stocks and Shares ISA. Peer-to-peer lending took the top spot with a 243 per cent rise in popularity, followed by music royalties with a 202 per cent increase. Cryptocurrencies completed the top three, demonstrating a rising interest in alternative investments as UK investors seek to diversify their portfolios beyond traditional assets like stocks and bonds.

De La Rue's stock soars after £246m takeover bid by Edi Truell's firms

According to reports, Bank of England supplier De La Rue has received a £246m takeover proposal, causing its shares to leap over 12 per cent. The banknote manufacturer was given a conditional offer of 125p per share, roughly 25 per cent above its stock price prior to the announcement, by entities linked to private entrepreneur Edi Truell, as reported by City AM. This takeover bid is said to hinge on the successful £300m disposal of its authentication division to New York-listed Crane NXT, a deal disclosed in October. After facing a spate of challenges, the latest being compelled to postpone substantial pension contributions to its retirement fund, the sale materialised. Last month, De La Rue reported that it had been approached by Truell and his associated firms Disruptive Capital GP and Pension SuperFund Capital, with an interest to purchase up to 40 per cent of the business at the same 125p rate. At the time, Truell informed the Financial Times he did not intend to acquire a majority interest in De La Rue, commenting that he had "been in conversations for some time" regarding an investment in the company. Today, De La Rue announced that this partial offer is no longer being considered. Back in July, De La Rue had confirmed talks about selling part of the company — a decision that coincided with the disclosure of the printer’s annual results which had been delayed while seeking a suitable buyer. The company posted a decline in earnings as expected, owing to "substantial trading difficulties", which resulted in an 11.3% drop in revenue from £350m to £310m. Conversely, its authentication division's revenue experienced a 12.5% increase, exceeding the company's target of £100m. The De La Rue share price has surged over 30% in the past year, bouncing back from its all-time low in June 2023. According to the UK Takeover Code, Truell has until 5pm on 6 February to submit a formal offer.

Fintech giant Clearbank reports first full-year results as it expands across Europe

London-based fintech firm, Clearbank, has announced its full-year results at the group level for the first time, following its expansion across Europe. The company, which facilitates real-time clearing and embedded banking, reported a 63% increase in its fee-based income to £53.3m, as reported by City AM. Total deposits managed by the fintech reached £10.8bn, marking a 77% increase from 2023. However, despite these positive figures, Clearbank recorded a pre-tax loss of £4.4m on an adjusted basis at the group level. This loss was attributed to costs associated with its European expansion and the implementation of its new group structure. Nevertheless, the UK arm of the business maintained profitability for the second consecutive year, posting a pre-tax profit of £9.9m. Speaking to City AM, Clearbank's CEO Mark Fairless expressed satisfaction with the company's performance in 2024. He explained that the growth in fee income outpacing interest income was an "intentional" strategy, given the fluctuating macroeconomic climate and declining interest rates. With Clearbank now operating in 11 European markets and having received its European banking license in July, Fairless stated that growing the European bank is currently the main focus. He added: "Once we're more progressed with that, we're turning our attention to the US, which would be the next leg of the strategy." While the fintech is experiencing rapid growth, Fairless stated: "We're not focused on necessarily a unicorn crown." He emphasised that building a sustainable business and supportive infrastructure remains their top priority. When questioned about a potential IPO for Clearbank, Fairless responded: "All options are on the table." However, he couldn't commit to a specific listing, stating they would "take the call closer to the time". "So obviously, the vast majority of our presence is in the UK at the moment, that will balance out to Europe and then we'll enter the US market." "And then I think we'd look at what option would fit us best." Fairless also praised the thriving fintech climate in the Square Mile. "There's clearly a competitive market in the UK for that and we I think its recognised as a differentiator in the UK." He continued: "What's important is that we are supported in that kind of growth and in that sector and I think there's lots of conversations going on on that front."

FTSE 100 sees modest gains in 2024, lagging behind tech-driven US markets

The FTSE 100 saw a modest return of just 5.8 per cent in 2024, despite a last-minute sell-off in the final weeks of December. Hopes for a 'Santa rally' were dashed as the index fell by 1.7 per cent in December. However, it still marked its best performance since 2021 when the blue-chip index returned 14.3 per cent, followed by a 0.9 per cent rise in 2022 and a 3.8 per cent increase in 2023. After reaching an all-time high on 15 May due to rate cut expectations, the FTSE 100 hovered around 8,200 in the second half of the year, as reported by City AM. Hopes for a repeat of this success in the summer were quickly quashed by fears of a US recession that surfaced in early August. A series of disappointing economic data and mediocre results from the Magnificent Seven sent global markets into a downward spiral during the summer. While most markets, particularly the US, bounced back quickly, the FTSE 100 was burdened by higher-than-expected inflation and sluggish economic growth. "UK performance pales in comparison to returns seen in tech-dominated markets across the pond," commented Matt Britzman, senior equity researcher at Hargreaves Lansdown. "It played second fiddle to the tech-fuelled US markets, where AI excitement sent the S&P 500 soaring," he added. The FTSE 100 experienced another dip amid Budget speculation in November, hitting its lowest point since April in the week following the fiscal event. The FTSE AIM 100 emerged as the worst performer of any UK index, experiencing a downturn of over six per cent across the year and tumbling to a 52-week low just yesterday. This trend was heavily influenced by the Budget's new policy to apply inheritance tax to AIM-listed shares, which incited speculative trading and triggered a near seven per cent fall in the third quarter. On the other hand, the FTSE 250, known for its alignment with domestic markets, grew by 5.7 per cent, reaching its apex since February 2022 in the summer months.

Lloyds and Natwest 'too good to ignore' - Barclays analysts

Shares in Lloyds and Natwest have been deemed "too good to ignore" by Barclays analysts, who foresee bumper profits driven by higher interest rates and low unemployment. The analysts have revised their profit forecasts upwards, anticipating a significant increase in net interest income (NII) as the market adjusts its expectations for the pace of interest rate cuts in the future, as reported by City AM. NII, which measures the difference between the interest banks pay on deposits and what they earn from loans and other assets, is expected to rise with higher rates, allowing banks to charge more for lending. According to Barclays' projections, the Bank Rate is set to reach four per cent by the end of this year and then decrease to 3.5 per cent by the end of 2026, which is notably higher than predictions from three months prior. "A repricing higher in UK rates expectations sees us lift our NII estimates," stated Aman Rakkar and Grace Dargan in a note released today. Their rate forecasts are slightly more bullish than current market pricing, indicating potential upside risks to Barclays’ projections. Despite the prospect of sustained higher interest rates, the analysts maintain that credit risks for UK banks "remain low". They suggest that even if the unemployment rate were to rise to around five per cent, it would be a "non-event" for Lloyds and Natwest due to their prime loan books. Rakkar and Dargan also noted that broader market conditions have become more favourable. "Deposits are growing, competition has eased, savings rates are being cut...and mix is shifting positively," the analysts noted. They also suggested that the recent sell-off in UK government debt could provide a boost for Natwest shares. Higher yields make gilts an "attractive asset class", which could prompt banks to shift from "politically sensitive reserves" – deposits held at the Bank of England which earn Bank Rate – and opt for higher returns on gilts. Barclays analysts predict that thanks to these factors, Natwest will report pretax profit of £6.6bn in 2025 and £7.5bn in 2026, which is eight per cent and ten per cent ahead of consensus respectively. Lloyds is projected to report underlying pretax profit of £6.5bn in 2025 and £8.0bn in 2026, slightly less than 11 per cent ahead of market consensus for both years. "UK banks (are) on course to deliver among the strongest earnings growth and capital returns across European banks, at an ongoing discount," they concluded.

US dollar on the longest losing streak since 2015 as de-dollarisation fears grow

The US dollar has plummeted 0.7% today, marking its fifth consecutive day of decline, as the market reevaluates the currency's standing in the global economy. The DXY index, which monitors the dollar's value relative to a basket of currencies, sank to its lowest level in three years during trading today, as reported by City AM. Since the beginning of April, which Trump hailed as 'Liberation Day,' the dollar index has dropped by more than 4% as investors offload their US assets amid concerns over the country's growth prospects. In a statement on Friday evening, President Trump emphasized that the dollar would invariably remain "the currency of choice" and asserted that "if a nation said we're not going to be on the dollar, I would tell you that within about one phone call they would be back on the dollar". However, Michael Brown, senior research strategist at Pepperstone, cautioned about the risk "of moving away from a decades-long period of dollar and US hegemony." Brown acknowledged that currently, there is no alternative to the dollar as a reserve currency, and the tariffs that shook confidence in the dollar last week have been temporarily suspended. "However, the incoherence with which economic policy is being made, coupled with the credibility erosion caused by president Trump's constant u-turns and 'governing by tweet' modus operandi, is clearly creating more than a few jitters," the strategist noted. Brown conceded that there was no alternative to the dollar as a reserve currency for now and that the tariffs which shook confidence in the dollar last week had been put on hold for the time being. "Fundamentally, even though the ridiculous 'reciprocal' tariffs have been paused (for now), the prospect of those levies being imposed again will continue to linger. "De-dollarisation is now a real, and frankly scary, prospect," Brown commented. The US dollar took a hit due to imposed China tariffs, according to insights shared on Friday by ING analysts. They indicated that Trump's escalating tariffs on China contributed to the dollar's sharp decline. Since the US may find it challenging to quickly replace many of the imports from China, this could lead to heightened inflationary risks for the American currency. The euro has emerged as the biggest winner from the dollar's depreciation, achieving a five percent increase since 'Liberation Day'. It is perceived widely as one of the few options for investors moving away from US assets. ING analysts observed that officials at the European Central Bank appear to be promoting the euro as a robust alternative to the US dollar right now.

Barclays and Natwest stock plunge is 'looming global recession' warning

The FTSE 100's leading banks have dragged down the index in light of President Trump's tariff offensives, with experts cautioning that their losses might signal an impending global recession. Barclays saw its shares drop nearly five per cent in midday trading on Monday and has endured a nearly 20 per cent fall in the past five days, as reported by City AM. NatWest also experienced a dip of over seven per cent after the market opened, but later reclaimed some of its lost ground. By midday, it was down by one per cent. Susannah Streeter, money and markets chief at Hargreaves Lansdown, commented: "Banks are seen as barometers for economic health, and given the steep losses, red lights are flashing about a looming global recession." As of Monday, the FTSE 350 banking sector index had declined by two per cent. Before being hit hard by tariffs, this sector was the FTSE 100's second-best performer out of the other 39 sub-groups in February. In the last month, the index has shed close to 16 per cent of its value. Nevertheless, Lloyds registered a slight recovery on Monday, nudging up by 0.1 per cent at midday. Equity analysts Vivek Raja and Gary Greenwood from Shore Capital remarked: "Changes in economic activity levels could affect demand for credit and bad debt formation." They also noted that Asia-focused banks such as HSBC and Standard Chartered may bear greater impacts compared to largely UK-focused peers like Barclays, Lloyds, and NatWest. Raja and Greenwood have indicated that the moderation of interest rates and their future trajectory could affect lenders' net interest margins, a crucial measure of a bank's profitability from lending activities. "Increased market turbulence could dampen capital markets activity levels while potentially boosting market activity," the analysts further commented. Speaking to City AM, Greenwood suggested that domestic banks are likely to have corporate clients "that are directly exposed to tariffs". He added, "Banks are essentially just leveraged plays on the underlying economies in which they operate." For smaller and mid-cap banks, Raja and Greenwood foresee a lesser impact. They noted that Arbuthnot Latham, Paragon, and Vanquis are "domestically focused and therefore less at risk from the international trade fallout". Despite not experiencing losses as significant as their FTSE 100 counterparts, these smaller lenders have not been able to avoid the global sell-off.

HSBC and Barclays shares tumble as Trump's new tariffs shake up FTSE 100

Shares in Britain's leading banks plummeted in early trading on Thursday following President Trump's tariff announcement, which sent shockwaves through the London stock market. Europe's largest bank, HSBC, saw its shares tumble by over 5%, with Barclays experiencing a fall of more than 4%, as reported by City AM. Standard Chartered, a member of the FTSE 100 index, suffered the brunt of the sell-off, with its share price dropping over 7%. The FTSE 100 index itself retreated beyond 1% as the markets opened, reacting to Trump's decision to impose a 10% tariff on UK imports to the USA. Dan Coatsworth, an investment analyst at AJ Bell, commented to City AM: "With so much uncertainty around the global economy as a result of Liberation Day, it seems as if fewer investors want to own banks despite many paying generous dividends which can provide comfort during rocky market conditions." He remarked that banking is inherently tied to economic fortunes, contributing to the sector's vulnerability in the worldwide market downturn: "Banking is an economically sensitive industry, which explains why shares in the sector have been caught up in the global market sell-off." Coatsworth pointed out the specific challenges for HSBC and Standard Chartered: "Trump's tariffs are particularly punishing for various parts of Asia and that puts HSBC and Standard Chartered in the firing line given their major reliance on that part of the world." He continued to illustrate the broader implications: "Businesses will be spooked by tariffs and that could lead to reduced investment, which in turns suggests less demand to borrow from banks or for advisory services on M&A activity." Coatsworth also highlighted Brexit's impact: "The same applies to Europe and the US which are key places where Barclays does business." Barclays, HSBC and Standard Chartered all have significant operations beyond the UK, including in the US and Asia. A deceleration in global trade could result in reduced revenue for these banks due to a decreased demand for their services in facilitating international partnerships through trade finance and other financial services.

Lloyds Banking Group to transform head office with £200m investment

Lloyds Banking Group is set to pour £200m into the revamp of the Scottish Widows headquarters, making it the financial giant's primary hub in Scotland. The renovation of the Port Hamilton building on Morrison Street, Edinburgh, executed in collaboration with Drum Property Group, pledges to bolster Lloyds' presence in the Scottish capital where approximately 10,000 staff are based, as reported by City AM. For nearly three decades, the building has served as the core office of Scottish Widows and is expected to retain its role post-upgrade in 2027, continuing to oversee pensions and investments. This eight-storey property, spanning 325,000 sq ft and known for its distinctive curved roof, stands out as an iconic edifice in Edinburgh’s financial district. According to Lloyds, this initiative is part of a broader commitment to cultivate a more sustainable and environmentally friendly office network across the UK, advancing towards their net zero ambitions. This endeavour aligns with the group's previous movements, including last year's full refurbishment of the Bristol office and relocation to Leeds’ most eco-efficient office space. However, earlier this month, City AM detailed Lloyds’ plans to shutter its Liverpool facility later this year, a decision affecting around 500 employees. This closure is seen as part of a wider strategy to maintain "fewer, better-equipped" offices and streamline operational costs. In a statement, Lloyds confirmed that no jobs have been cut as part of the closure plans. Instead, employees at the office will be asked to relocate to its Cawley House office in Chester. The bank added that 80 per cent of employees based in Speke are currently working remotely or will be doing so when the building closes. This news follows reports that senior staff at Lloyds Bank may face bonus cuts if they do not attend the office at least twice a week. Chira Barua, CEO of Scottish Widows, commented: "There’s a real buzz in the fintech scene in Scotland and we’re committed to staying right in the centre of it." He further stated: "We’ve made huge progress in connecting customers with their financial futures and we’re starting to see how powerful digital engagement and gamification will be in the future." He also noted the potential to make a significant difference for customers, saying: "There’s huge potential to help make a real difference for our customers’ lives and we’re right out in front building all the parts we need to innovate in a massive way." Sharon Doherty, chief people and places officer at Lloyds Banking Group, added: "We’re creating modern, inclusive, sustainable and fun workplaces where our people love to work." She also mentioned the improvements made to their offices across the UK, stating: "We’ve already made significant improvements to our offices across the UK, with more to come." "And our redesigned home in the centre of Edinburgh will help us connect, collaborate and spark the creativity to deliver great outcomes for our customers." Graeme Bone, group managing director at Drum Property Group, commented on the £200m redevelopment of Port Hamilton as "The £200m redevelopment of Port Hamilton presents an exceptional opportunity for Lloyds Banking Group to upgrade and enhance one of Edinburgh’s landmark buildings and deliver an exceptional working environment for Lloyds colleagues in an unrivalled location."

FTSE 100's best and worst-performing stocks of 2024 - from British Airways owner to JD Sports

The FTSE 100 yielded a return of 5.8 per cent in 2024, but beneath the surface, a distinct divide has emerged between the winners and losers of the blue-chip index. Several stocks have been dropped from London's main index, including Burberry, Easyjet, and Ocado, making way for heavyweights such as Games Workshop and Alliance Witan. Approximately half of the index has generated a double-digit return, with eighteen companies growing by more than 30 per cent, indicating some clear victors. The top-performing FTSE 100 stock in 2024 was British Airways' parent company, International Consolidated Airlines, which nearly doubled in value over the year, as reported by City AM. The airline embarked on a £7bn transformation plan this year, with analysts optimistic about its long-term benefits. Rolls-Royce was a close second, gaining over 90 per cent throughout 2024. The Derby-based giant profited from a resurgence in the aviation sector and increasing interest in nuclear power. Over the past two years, Rolls-Royce has returned more than 500 per cent. Natwest was the third best-performing stock on the FTSE 100, growing by over 80 per cent. A robust set of results boosted the Big Four bank in October when it reported a 26 per cent increase in third-quarter profit. Barclays' stock reached a nine-year high in October, buoyed by high profits from its investment banking division and a resilient performance from Barclays' UK bank. The FTSE 100's best-performing stocks have seen impressive returns, with International Consolidated Airlines leading the pack at a 93.5% increase, followed closely by Rolls-Royce and Natwest with 90.7% and 80.5% respectively. DS Smith and Barclays also performed well, with gains of 77% and 72.7%. Conversely, examining the poorest performers reveals that two retailers have felt the brunt of market challenges. JD Sports experienced a significant drop, losing over 40% of its value. "JD Sports started the year with a profit warning caused by mild weather and heavy discounting affecting pre-Christmas 2023 sales," explained AJ Bell analyst Dan Coatsworth. "The share price took a beating and only started to recover in earnest during the summer. The retailer was subsequently knocked for six by more weather problems and complaints that the US election hurt demand."

Close Brothers CEO steps down after four months of medical leave

Adrian Sainsbury has resigned as the group chief executive of Close Brothers after a four-month medical leave. Sainsbury, who took up the CEO role in 2020 following over a decade at the firm, initially joined Close Brothers as the head of its commercial division and later became director of the banking subsidiary in 2013, as reported by City AM. His medical leave began in September, which was described by the merchant bank as temporary. "He is recuperating well and expected to make a full recovery," the company stated today. In the interim, Mike Morgan has been appointed as the new group CEO, having covered for Sainsbury during his absence. Morgan presented the bank's full-year results last September, which included plans to divest its asset management division to bolster capital in light of costs from the motor finance review. A recent court ruling has caused turmoil in the motor finance sector, with RBC predicting a potential £640m financial impact on Close Brothers, nearly twice its market valuation. The company resumed its motor finance lending in November, introducing measures to ensure broker compliance with new regulations. Morgan, who has served as the group finance director for Close Brothers for 15 years and held prior positions at the Royal Bank of Scotland and Scottish Provident, expressed admiration for the firm. "During my time at Close Brothers I have been deeply impressed by the enduring strength of our business model, and the dedication and expertise of our people," Sainsbury remarked in a statement. He also extended his gratitude to the team: "I would like to thank the team at Close Brothers for their commitment and support, and wish them every success for the years to come."

New office for wealth management firm

A personal wealth management and investment firm has opened a new office in the heart of Birmingham's business district. London-based Canaccord Wealth has relocated its Birmingham team to 4 St Philip's Place following a recent round of senior appointments. Two experienced investment managers, Paul Fielding and Roger Sedgwick, joined the firm recently, bringing a combined 65 years of wealth management to the team, alongside Kathryn Sargent as the new intermediary business development manager. Mr Fielding also serves as deputy board director of business improvement district Colmore BID. Email newsletters BusinessLive is your home for business news from across the West Midlands including Birmingham, the Black Country, Solihull, Coventry and Staffordshire. Click through here to sign up for our email newsletter and also view the broad range of other bulletins we offer including weekly sector-specific updates. We will also send out 'Breaking News' emails for any stories which must be seen right away. LinkedIn For all the latest stories, views and polls, follow our BusinessLive West Midlands LinkedIn page here. Duncan Stratford, managing director of UK wealth management, said: "The opening of our brand-new Birmingham office is another important step in our journey to becoming the best wealth manager by service and performance in the UK. "We're committed to supporting clients with a progressive approach underpinned by industry leading technology. Our new location positions us perfectly to achieve this. "Paul, Roger and Kathyrn embody our 'above and beyond' ethos and bring a wealth of expertise and energy that will help us continue to deliver exceptional value for our clients." Roger Sedgwick, who has 37 years of industry experience, added: "The culture and energy at Canaccord Wealth are what inspired me to join. "I'm excited to contribute to its growth here in Birmingham." Wealth planning director Toby Carpenter said: "We're building something truly special here in Birmingham - a small but dynamic team with big ambitions.

Investors pull a record £10bn out of UK stock funds - with no sign of recovery

Funds focused on UK stocks endured their most disappointing year on record last year, as investors withdrew nearly £10 billion from the market, new figures have disclosed. While global equity funds attracted a historic inflow of £27.2 billion throughout 2024, UK-centric funds experienced a notable exodus, bleeding roughly £9.6 billion in their slowest year to date when compared to the wider market's performance, Calastone's data indicates, as reported by City AM. US funds secured net inflows of £11.9 billion during 2024, a stark increase from the mere £5 million in 2023, with over half of those inflows recorded in the first quarter of 2024. This stark contrast between London-focused funds and those investing in international equities emphasises the predicament facing the London Stock Exchange and exemplifies the considerable challenges confronting both the City and government officials. Up until November, there was a prolonged trend of outflows from UK equity funds lasting 41 consecutive months, with the pace intensifying in October as investors sought to evade the potential blow of an extensive capital gains tax (CGT) rise threatened by Rachel Reeves. Persistent withdrawals have exerted downward pressure on valuations within the capital and heightened concerns over a potential drift of companies to overseas markets. Calastone reported that the total outflow of £9.56 billion throughout the year remained lower than in 2023 but stressed that "set against the huge inflows to equity funds overall during the year, it was the worst relative performance seen by the unloved UK-equity sector". The rate of redemptions decelerated towards the year's end, with December's net sales of £221m representing the slowest level of outflows since May 2021. November witnessed a resurgence of investors into the market following Reeves' less than anticipated CGT hike. Enhancing the cash flow into the London Stock Exchange is viewed as a significant challenge for lawmakers and investors in their quest to rejuvenate the City of London's fortunes. Despite the Financial Conduct Authority revamping its listing rules in July to attract more firms to the market, numerous companies cited a lack of liquidity as one of the primary reasons for their departure from the exchange in 2024. A mere 17 firms went public on the London Stock Exchange last year, while bids worth some £52bn were made on listed companies. Additionally, a total of 88 firms abandoned their main listing on the London Stock Exchange. Pressure is mounting on Keir Starmer and Rachel Reeves to revitalise the City with robust policy measures and tax incentives. A survey conducted by City AM and Freshwater this week revealed that over half of voters believe the government needs to do more to restore the Square Mile's fortunes. A stamp duty on share trading has been central to warnings that the UK is penalising investors in its domestic market and losing ground to rivals such as the US, where no equivalent charge exists. "Not only does this disincentivise investment in UK equities, it also makes them less attractive than those in other jurisdictions," commented John Godfrey, managing director of public affairs at the City UK. Reeves announced that financial services will be integral to the government’s "growth mission" during her inaugural Mansion House address to the sector. She unveiled a range of initiatives, including the introduction of a new private stock market system known as Pisces.

HSBC and Standard Chartered shares plummet as 'outsized' tariffs bite

Shares in banking behemoths HSBC and Standard Chartered have suffered a sharp decline amidst escalating global trade tensions. In early Monday trading, HSBC's shares dipped nearly three per cent, bringing its losses over the past five days to a staggering 15 per cent, as reported by City AM. Standard Chartered saw an even steeper fall of nearly four per cent, with its five-day losses approaching 20 per cent. The banks, which both have significant operations in Asia, are feeling the impact of hefty tariffs imposed by US President Donald Trump on Asian economies. China has been hit with a new 34 per cent tariff, raising its total import tax to 54 per cent following Trump's 'Liberation Day' speech, where he increased the levy from an earlier 20 per cent. In retaliation, China imposed a 34 per cent reciprocal tariff on US goods, criticising Trump's tactics as "inconsistent with international trade rules". Additionally, Taiwan received a 34 per cent tariff and Vietnam was burdened with a 46 per cent levy. Financial analyst William Howlett from Quilter Cheviot highlighted that banks carry some of the "biggest risks" amid the intensifying trade war. He commented: "Fundamentally, banks are levered plays on the economies in which they operate." Given the severe tariffs targeting Asian economies, Howlett noted it's no surprise that "the Asian banks (HSBC and Standard Chartered) have sold off the most." John Cronin, the founder of SeaPoint insights, pointed out that HSBC and Standard Chartered are more vulnerable than their UK counterparts to tariff issues "given their dependence on global trade glows and their presence in jurisdictions that will be subject to higher tariffs than the UK." HSBC stands as one of the top international banks in Asia, with its origins dating back to Hong Kong and Shanghai, and it covers various business segments in the region such as retail banking, wealth management, and commercial banking. Standard Chartered primarily targets emerging markets across Asia, Africa, and the Middle East, with a particular emphasis on Asia's burgeoning middle class in nations like India, China, and Indonesia by providing an array of retail services, including savings and checking accounts.

Cheshire HR software firm makes Appraisd acquisition as it vows global growth

Private equity-backed HR software specialist Talos360 has acquired global performance management software platform Appraisd in what bosses say is an “important milestone” in its growth plans. Warrington-based Talos360 won investment from mid-market private equity firm LDC in 2022. Hundreds of businesses use its applicant tracking system and talent tracking technology to recruit and retain staff. Meanwhile London’s Appraisd was founded in 2012 and its performance management systems are used by hundreds of clients across 65 countries to support activities from appraisals to probation reviews. The acquisition was funded by LDC and the value was not disclosed. Talos360 says the deal will help it to grow globally and to work with customers across the USA, Singapore, South Africa, UAE, Australia, and Canada, alongside its established presence in Europe. Janette Martin, CEO at Talos360, said: “This is a pivotal moment for our business. “We’re passionate about developing proprietary award-winning talent technology for our clients, and now, in 2025, we’re delighted to welcome Appraisd as a key highlight of our Talent Operating System. Talos360 customers can now access even more innovative talent technology to develop their people, helping HR, leadership and management teams to achieve the best results for their business. “This move reinforces our commitment to creating a seamless, data-driven employee journey, from hire to retire and reflects our ambitions to continually solve the challenges faced by HR professionals to optimise workforce management.” Appraisd founder and CEO Roly Walter will be joining Talos360. He said: “As a people-first business, it was important that Appraisd found the right home, within the right team and culture. With a great blend of product fit and company values I’m excited to see what the future holds for Appraisd within the Talos360 product family, and the ambitious growth strategy ahead.” John Clarke, partner at LDC, added, “This acquisition represents a key milestone for Talos360, as it expands and diversifies its product portfolio. Appraisd is a fantastic strategic fit which has enjoyed strong growth historically and we are looking forward to supporting the Talos360 management team in integrating Appraisd into its business.”

Bank of London appoints former Credit Suisse UK boss Christopher Horne as new CEO

The Bank of London, a fintech 'unicorn' facing challenges, has today appointed the former UK head of Credit Suisse, Christopher Horne, as its new CEO. This move comes as the bank seeks to recover from a series of setbacks and the abrupt departure of its founder last year, as reported by City AM. The digital clearing bank announced that Horne, who previously led the unsuccessful Swiss lender's UK subsidiaries, would assume the role of CEO pending approval from the City regulator. "This is a unique opportunity to redefine what a bank can be — resilient, innovative, and aligned with the evolving needs of our clients and stakeholders," said Horne in a statement. "Together with the talented team at [Bank of London], I look forward to building a future that inspires trust and delivers lasting value." The Bank of London stated that Horne's appointment "highlights the bank’s commitment to innovation, governance, and long-term growth", adding that he would steer the company "into its next phase of growth and transformation". This recruitment marks the latest in a series of remedial actions taken by the firm after it was thrown into chaos last year following the exit of founder Anthony Watson. Days after Watson’s departure, City AM disclosed that the company had been served with a winding-up petition from HMRC over an unpaid tax bill, which it later settled. Shortly thereafter, investor Mangrove Capital spearheaded a £42m capital injection into the bank. Mangrove has since spearheaded a turnaround effort, appointing several new members to its board. High-profile figures including Peter Mandelson and Carlyle Group CEO, Harvey Schwarz, exited the board in October. Catherine Brown, chair of the firm’s UK Board, commented on Horne’s appointment today, stating it "reflects our commitment to building a leadership team that embodies excellence and vision". She added: "His wealth of experience will be instrumental in driving operational excellence and positioning the bank as a leader in the financial services sector."

Former Bank of England policymaker says 'hold' rates at 4.5 per cent in May

Former Bank of England rate-setter Jonathan Haskel has indicated that current high inflation levels warrant maintaining interest rates at 4.5 per cent in May. Investors and analysts, anticipating a cut in interest rates next month to address concerns over low growth, are pricing in up to three additional reductions by year's end, as reported by City AM. However, Haskel, who served on the Bank's Monetary Policy Committee (MPC) until August of the previous year, argued for a "wait and see" stance despite potential deflationary impacts from President Trump's tariffs. In conversations with City AM, Haskel remarked: "Core inflation in the UK, dominated by domestically generated service sector inflation, is above target-consistent levels," and stated, "Thus, and given the uncertainty around what the enduring tariff level will be, I would favour a 'wait and see' policy and so hold UK rates at the next meeting." February saw inflation reach 2.8 per cent, spurred by a five per cent surge in services prices, well above the Bank of England's consumer price inflation (CPI) aim of two per cent. Haskel acknowledged that the comprehensive tariffs would put a damper on economic activity and inhibit growth as global markets adjust to open trading with the US. He also agreed with current MPC members Swati Dhingra and Megan Greene that such tariffs would exert a "deflationary for the UK economy" effect on the UK economy. According to Haskel, the influx of cheap goods from countries like China, which is subject to tariffs exceeding 100%, would likely drive prices down. Nevertheless, he maintained his stance. These comments offer a glimpse into the thought process of the more hawkish MPC members, who are growing increasingly concerned about persistent inflation. Clare Lombardelli, a current MPC member, expressed uncertainty about the impact of Trump's tariffs on inflation, citing the potential for retaliatory measures from other countries. Haskel's views diverge from those of former deputy Bank governor Charlie Bean, who advocated for a rate cut of up to 50 basis points. David Blanchflower, a former rate-setter, even suggested convening an emergency meeting before May 8. Kallum Pickering of Peel Hunt, who typically takes a hawkish stance on monetary policy, argued that the Bank has an "easy" decision to cut interest rates, as high inflation is no longer a concern due to tariffs. "We can worry a lot less about inflation, and therefore we can start easing a little bit faster," he told City AM. "Growth is likely to be weaker, so rates need to come down." Pickering suggested that Andrew Bailey should advise the Prime Minister to refrain from imposing reciprocal tariffs, thereby avoiding a near-term inflation shock. He also stated that predictions of inflation potentially reaching as high as 3.75 per cent were not "irrelevant". "It's not even worth paying attention to economic data that is telling you about the economy before the US dramatically escalated tariffs. It's just, it's redundant." Pickering further suggested that the elevated gilt yields, which are increasing borrowing costs, were a consequence of fears surrounding low growth and these changes provided further justification for the Bank to reduce interest rates. "In a strange way, if the Bank of England were actually to go a little bit quicker with rate cuts and support growth expectations, it would probably have the effect of reducing bond yields in the long run because markets would worry less about recession risk." Central banks around the world are rapidly responding to the impacts of a full-blown trade war. Policymakers in India and New Zealand cut interest rates on Wednesday. Reserve Bank of India Governor Sanjay Malhotra said "concerns on trade frictions are coming true." The US Federal Reserve has come under pressure from JP Morgan executive Bob Michele – and the US president himself – to cut interest rates. Federal Reserve Bank of Minneapolis President Neel Kashkari said high inflation expectations in the US would delay interest rate cuts while some analysts believe that markets may have overestimated the number of cuts due to be made this year. "The Fed is being held back from providing additional policy rate cuts because there is limited evidence that the economy needs immediate additional support," Seema Shah, chief global strategist at Principal Asset Management, told City AM. "In order to cut rates, the Fed needs to believe that softer growth will exert downward pressure on inflation in the medium term and inflation expectations must remain anchored."

UK's major banks face downturn as FTSE 100 slips amid new US tariffs

The FTSE 100's major banks were once again in the red on Friday, amidst heightened concerns over tariffs. Shares in Natwest and Barclays plummeted by over 6% in early trading, making them the top losers on the index. HSBC and Lloyds followed closely, with losses exceeding 5%, while Standard Chartered suffered a 4% decline, as reported by City AM. The FTSE 350 bank index took a significant hit, tumbling nearly 6% and accumulating a 10% loss over the past five days. The FTSE 100 as a whole saw a decline of up to 1.7% on Friday morning. In a statement, Barclays analysts noted: "These new tariffs will dampen the global economic outlook, both globally and in Europe, which bodes poorly for earnings." "Our economists believe that recession risks have risen, with policy support from governments and central banks crucial to gauge the extent of downside risks." According to Vivek Raja, an equity analyst at Shore Capital: "The shock and awe of Trump's capricious foreign policy strategy has created acute anxiety, which is typically not conducive to the health of financial markets." "We expect more turbulence and emotional share price responses over the coming days. The impact of tariff wars on the fundamentals of our UK financials stock coverage will be indirect." Raja added that changes in economic growth, wealth formation, inflation, interest rates, financial markets, and regional differences would negatively impact business models. Raja suggested that lenders with an Asian focus, such as HSBC and Standard Chartered, would likely face the most significant impacts compared to their more UK-domestic counterparts. Trump imposed a 10 per cent tariff on UK imports to the US, which he stated was the baseline for all countries. In his 'Liberation Day' speech, Asian economies were subjected to some of the highest levies.

Newcastle Financial Advisers snaps up County Durham company as owners retire

The financial advice arm of Newcastle Building Society has snapped up a County Durham business as part of its growth strategy. Newcastle Financial Advisers Ltd has acquired Chester-le-Street based Orchard Financial Management, a deal which adds around 200 customers to the business, following the founders’ retirement. The Wallsend based business provides advice on investment, retirement, inheritance tax planning and protection advice through the Society’s network of branches across the North East, Cumbria and North Yorkshire. The firm said the addition of Orchard gives the new customers access to face-to-face financial advice services throughout the mutual’s network of 32 locations. Graeme Leigh founded Orchard Financial Management in 1998 to provide advice on investments and pensions as well as protection and he has grown the business through word-of-mouth recommendations alongside his wife Michele. The pair have now decided to retire, saying they were drawn to Newcastle Financial Advisers because of its commitment to building long-term relationships with customers, and expertise in the market. Mr Leigh said: “The top priority for Orchard Financial Management was to find the right and trusted home for our clients. Newcastle Financial Advisers has a fantastic reputation and we’re impressed by its strong high street presence both in County Durham and throughout the North East, North Yorkshire and Cumbria, which will help to ensure a smooth transition and integration of our local client base.” Iain Lightfoot, managing director of Newcastle Financial Advisers, said: “We’re pleased to be able to welcome Orchard Financial Management’s customers to Newcastle Financial Advisers Limited. Graeme’s focus on fostering long-term relationships based on a foundation of trust is one that very much aligns with our own purpose, and the acquisition of his business therefore feels like an organic fit for Newcastle Financial Advisers.

Saga reports surge in profits as demand for cruises among over-50s soars

Saga, the travel and financial services provider for the over-50s demographic, has announced profits surpassing market predictions, fuelled by a surge in cruise demand. The firm revealed this morning that its underlying pre-tax profit for the year ending January 31 stood at £47.8m, marking a 25% increase year on year, as reported by City AM. Annual revenue rose by 4% to reach £588.3m, while net debt decreased by 7% to £590.5m. Earnings before interest, tax, depreciation and amortisation (EBITDA) climbed 18% to £137.1m. CEO Mike Hazel attributed this progress to "[Progress] was driven by the strength of our Travel businesses, with especially high levels of customer demand for our differentiated ocean and river cruise offers." Over the past year, Saga announced a 20-year partnership with Belgian insurance titan Ageas for motor and home insurance, which resulted in Saga's price-comparison website, pricing, claims handling, and customer service activities being taken over by Ageas. Additionally, Saga agreed to sell off its insurance underwriting business. According to Hazel, these strategic decisions, coupled with robust trading performance, enabled Saga to refinance its long-term corporate debt, replacing its 2026 debt maturities with new long-term credit facilities. "The new facilities provide us with significant financing headroom and flexibility as we move forward," Hazell added. "Following the completion of these important objectives, our focus has shifted to the long-term growth plans for the Group, building on our established businesses by continuing to explore complementary partnerships and unlocking new avenues for growth beyond our current business and product lines," he added.

FW Capital reaches £6m lending milestone for £130m Wales fund

FW Capital has invested more than £6m from the British Business Bank’s Investment Fund for Wales to back the growth of indigenous small firms. The £130m fund, from the economic development bank of the UK Government, was launched in November 2023. FW Capital, a subsidiary of the Development Bank of Wales, won the fund management contract to deliver its large debt element with can lend from £100,000 up to £2m. To date it has made more than 20 debt deals to SMEs ranging in value from £100,000 to £500,000. Blossom Beauty, a beauty and cosmetics firm based in Neath is one of the businesses to have benefitted with a £150,000 loan. The business is run by experienced beauticians Jenny Dobson, a qualified make-up artist and part-time nurse Fiona Spinks. Increased customer numbers and the small size of existing premises, which Ms Dobson opened in 2020, led to her considering opening another salon in the town with Ms Spinks. Support from the Investment Fund for Wales helped them buy new equipment and cover other set-up costs for their new premises in a former Next store in the centre of Neath which closed in 2019. Don't miss the latest news and analysis with our regular Wales newsletters – sign up here for free Ms Dobson said: “The support we’ve had has been fantastic. We’ve already seen really strong demand for what we’re offering at Blossom, and we’re already booked up for the next few weeks – which is a huge sign of confidence in what we’re doing. We couldn’t be more excited by this opportunity.” Andrew Drummond, an investment executive at FW Capital, said: “It was a pleasure to support Jenny and the team at Blossom in taking on and setting up their new site. They’re a fantastic example of a successful, growing business, bringing custom and footfall back to an important town centre site. “We’re proud of the support we’re able to offer to businesses like Blossom and wish them every success as they continue their growth journey.” Other businesses already supported by FW Capital from the fund include Palmers Scaffolding, the UK’s oldest scaffolding business, based in Deeside and Reel Labels Solutions, a printing specialist based in Pontyclun. Bethan Bannister, senior investment manager, nations and regions investment funds at British Business Bank, said: “The Investment Fund for Wales was launched to support ambitious businesses like Blossom with their plans to scale and grow.

London's stock market falls to 35th on global IPO rankings in 'difficult year'

Global initial public offerings (IPOs) saw a three per cent decrease in 2024, marking the lowest value since 2008, with the UK ranking 35th among all stock exchanges. According to data provided by the London Stock Exchange to City AM, there were 1,145 IPOs worldwide in 2024, down from 1,271 the previous year. The data, which excludes secondary listings, direct listings, Spacs and closed end trusts, showed the poorest number of global IPOs since 2019, when only 1,118 companies debuted, and the third worst in over a decade, as reported by City AM. Meanwhile, the value of IPOs dropped three per cent to $108.4bn (£86.4bn), the lowest since 2008 when proceeds fell to $94.8bn (£75.6bn), the only time IPO value has fallen below $100bn in two decades. Data up to 17 December revealed that every quarter in 2024 saw fewer than 300 floats globally, a trend not seen since the second quarter of 2020. London’s stock exchange ranked 35th globally for IPOs, raising just $576.7m (£459m), or 0.53 per cent of the global market. However, when including follow-on fundraising, the UK jumped to fifth place, raising $28bn (£22bn) with 73 issuances, a 53 per cent increase from 2023. This included two $3bn follow-ons from Haleon, both of which made it into the top ten largest follow-ons globally in 2024. India topped the global charts for Initial Public Offerings (IPOs), with its National Stock Exchange raking in £14.5bn from 252 offerings, while the Bombay Stock Exchange was not far behind, bringing in £13bn from 139 offerings. The largest IPO of the year was the £4.1bn float of real estate investment trust Lineage in the US, followed by India’s £2.6bn Hyundai Motor India.

Ward Hadaway hails record revenues as key hires across the North spur growth

Revenue has increased to record levels at Newcastle law firm Ward Hadaway thanks to growth across its offices in the North of England. Newly published accounts for the firm, which also has bases in Leeds and Manchester, show revenue was boosted 7% to £48.1m in the year to the end of April 2024. At the same time, operating profits dipped only slightly from £17.28m to £17.19m and profits before members' remuneration and profit shares remained broadly unchanged at £17.2m. Ward Hadaway has talked of its ambition to top £100m turnover by 2034 and managing partner Steven Petrie, who took up the leading role in April last year, reaffirmed those plans. He said: "These financial results from 2023-24 represent a really strong foundation on which to build, as we strive to realise our ambitious long-term growth plans, remaining independent and increasing our turnover by over 50% in the next five years and achieving £100m by 2034. It's really encouraging to see the positive impact our strategic investments are already having on our business, including our ability to attract, recruit, retain and engage excellent people to the firm." The full service firm said that it had focused on making key hires and developing its workforce, including the addition of eight new partners. In May last year, Nick Gholkar was appointed executive partner of the Newcastle office to work alongside Emma Digby and Liz Bottrill in their equivalent roles in the Leeds and Manchester offices. During 2024 headcount at the firm increased by more than 100. That number included the recruitment of 14 new trainee solicitors and one solicitor apprentice across its offices, making the business 500-people strong. Retention of the newly qualified lawyers was said to have brought organic growth. Mr Petrie added: "We provide an environment where individuals can excel at every level, offering guidance, growth opportunities and the tools to fulfil their full potential. Our people are fundamental to our success. We are well-positioned to build on what we have already achieved and to deliver on our ambitious growth objectives." Elsewhere in the accounts, Mr Petrie repeated comments made at the time of his appointment last year about work to adapt to the challenges of the "rapidly changing" legal market. Ward Hadaway said it had made significant investments in technology and set up an innovation-focussed team, made up of staff from all parts of the business, to look at the role of artificial intelligence in delivering legal services.

AJ Bell's trading update reveals boom in new customers and assets

AJ Bell has reported a significant growth with assets under administration soaring to £89.5bn by the end of 2024, an indication of the investment platform's appealing eight per cent customer increase over the year. The trading platform enjoyed a 17 per cent surge in assets throughout the previous year, with a three per cent rise in the final quarter, according to its latest trading update, as reported by City AM. The customer base has nearly reached 561,000, largely owing to its direct-to-consumer platform, which saw a four per cent uptick in users during the year's last quarter. The rate at which advised customers expanded was more modest, experiencing a two per cent growth within the same period, bringing the total to 174,000. "During the quarter we continued to see the benefits of our dual-channel model and the high-quality propositions that we offer to both the advised and D2C market segments," commented AJ Bell's chief Michael Summersgill. The investment firm witnessed robust net inflows across both its platform and investments operations during the final quarter, achieving £1.4bn and £400m respectively. Particularly notable was the direct-to-consumer sector, which secured net inflows of £1.1bn, marking a hefty 57 per cent jump from the equivalent quarter in 2023. "Ahead of the October Budget, speculation around the tax treatment of pensions caused a short-term behavioural change among retail investors, which normalised quickly once the content of the Budget became known," Summersgill added. The company's chief executive stated: "The strong start to the year positions us well as we approach the busy tax year end period. We remain focused on the significant long-term growth opportunity that exists in the platform market. Our dual-channel approach and continued investments into our propositions and brand mean we are well-placed to continue our strong growth." AJ Bell recently received an upgrade from Shore Capital, moving from a Hold to a Buy rating, based on the weakness in its share price and the long-term need for people to save for retirement.

Newcastle recruitment company Lead Candidate launches own drive for new employees

A Newcastle recruitment company has launched its own drive for more staff on the back of growth in the bioscience sector. Lead Candidate was launched in 2020 when its founders, Raman Sehgal, Fiona Cruickshank and Andrew Mears, saw a need for a better talent solution in the life sciences industry. The solution was to create a talent consultancy that champions partnership, offering strategic advice to help business and individuals in the region and beyond to achieve their goals. Last year saw the business reach significant milestones in which it trebled in size, hired a vice president to be its first US-based team member, and its also moved into a brand new Newcastle city centre head office at 8 Nelson Street – the former Cafe Royal building that is also home to Mowgli restaurant and which has undergone a £1.5m makeover. This year, the business is looking to grow 30% further, allowing it to create several new jobs. Andrew Mears, CEO and co-founder, said: “Lead Candidate was created out of a commitment from its founders to unlock the potential of organisations through people and a recognition that the solutions available to businesses in our sector hadn’t kept pace with the market. Today our team of experts are working with customers across the US and Europe to make a positive impact on the careers of individuals and the amazing businesses that occupy the life sciences outsourcing sector. “It’s an exciting time for us, and these developments enable us to better serve our current and future customers around the globe. With no plans to slow down, we’re aiming to grow a further 30% in 2025, which will create several new employment opportunities in the North East. Right now, we’re looking for multiple talent partners and a customer development manager to join us in transforming the talent landscape.” The firm specialises in a niche area of life sciences, working with organisations that provide outsourced support to the pharma and bio sectors. The outsourcing companies offer services across the entire process of bringing medicines to the patients that need them. Mr Mears says the region’s rich expertise within bio sciences places the company well for future growth. He said: “While the pharma and bio outsourcing sector is niche, it’s a fast-growing market. Although we’re based in the North East Lead Candidate operates globally, partnering with companies all over the world, with a particular focus on the US and Europe. We support our partners in recruiting talent at all levels and functions, from entry-level lab scientists to key C-suite appointments. "The North East is home to an active life sciences sector, with major organisations such as CPI, who we’ve supported in the past, Sterling Pharma, and Quotient Sciences. There’s also a thriving biotech industry, with hubs like the Biosphere at the Newcastle Helix providing laboratory space for life science innovation and R&D in the region. “We’re also lucky to be surrounded by some top-tier academic institutions like Newcastle University, Northumbria University, the University of Sunderland, and Durham University. These institutions play a pivotal role in feeding and expanding the local life sciences community, with a thriving start-up community spinning out of academia.” While poised for growth, Mr Mears added that challenges are evident in the North East. He said: “There is significant optimism in the industry, driven by anticipated revenue growth due to market expansion. However, there are still challenges in terms of funding gaps. Many companies in the region struggle to secure the financial backing that would allow them to scale. The North East is also impacted by a lack of Government-backed funding which limits growth and opportunities for local businesses. Despite the presence of several prestigious academic institutions, a skills shortage still exists with demand outweighing the available talent. “Recently, we have seen businesses founded in the region move out of the area to more attractive life sciences hubs in the North West and South of the country due to improved access to funding and skills.”