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(Alliance News) - UK house prices set another record high in June, according to figures from mortgage lender Nationwide on Thursday, although growth slowed amid tentative signs of a slowdown in the housing market.
On an annual basis, the Nationwide house price index rose by 10.7% in June, slowing from the 11.2% climb in May. The print also was just shy of the market forecast of 10.8%.
House prices grew 0.3% monthly in June, easing from 0.9% growth in May and missed the 0.5% consensus estimate.
The average price for a UK home climbed to a new record high at GBP271,613 in June, up from GBP269,914 in May, Nationwide said.
"There are tentative signs of a slowdown, with the number of mortgages approved for house purchases falling back towards pre-pandemic levels in April and surveyors reporting some softening in new buyer enquiries. Nevertheless, the housing market has retained a surprising amount of momentum given the mounting pressure on household budgets from high inflation, which has already driven consumer confidence to a record low," said Nationwide economist Robert Gardner.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 1.6% at 7,196.49
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Hang Seng: down 0.5% at 21,898.98
Nikkei 225: closed down 1.5% at 26,393.04
S&P/ASX 200: closed down 2.0% at 6,568.10
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DJIA: closed up 82.32 points, or 0.3%, at 31,029.31
S&P 500: closed down 0.1% at 3,818.83
Nasdaq Composite: closed marginally lower, down 3.65 points at 11,177.89
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EUR: soft at USD1.0450 (USD1.0470)
GBP: up at USD1.2150 (USD1.2126)
USD: soft at JPY136.30 (JPY136.69)
Gold: flat at USD1,816.22 per ounce (USD1,816.73)
Oil (Brent): down at USD115.80 a barrel (USD118.78)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Thursday's key economic events still to come
OPEC and non-OPEC ministerial meeting.
1000 CEST eurozone unemployment
0830 EDT US initial jobless claims
0830 EDT US personal consumption expenditures
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The UK economy grew at the same pace as previously estimated, data from the Office of National Statistics showed. On an annual basis, UK gross domestic product expanded an unrevised 8.7% in the first quarter, picking up pace from 6.6% growth in the final quarter of 2021. On a quarterly basis, the UK economy grew an unrevised 0.8% in the first quarter, slowing from a 1.3% expansion in the fourth quarter. "Our latest estimate for economic growth in the first quarter is unrevised as a whole, showing the UK economy continued to recover from the pandemic," said ONS Director of Economic Statistics Darren Morgan.
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UK car production in May increased for the first time since June of last year, according to figures from Society of Motor Manufacturers & Traders. The country produced 62,284 units, up 13% from May of last year. Production for UK buyers jumped by 40%, while production for export rose 8.9%. However, the SMMT noted that output of cars remains 46% below 2019, before the pandemic, and still is suffering from supply chain problems, rising costs and disruption caused by the war in Ukraine.
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BROKER RATING CHANGES
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Jefferies cuts National Grid to 'hold' (buy) - price target 1,070 (1,060) pence
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JPMorgan cuts Intertek to 'neutral' (overweight) - price target 5,300 (6,000) pence
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Barclays raises Virgin Money UK to 'overweight' (equal weight) - price target 200 (245) pence
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COMPANIES - FTSE 100
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Bunzl said it expects to deliver "very strong" growth over the six period to June 30, reflecting the "resilience and strength" its business model. Bunzl said revenue in the first half is expected to increase year-on-year by 16% at actual exchange rates and by 12% to 13% at constant exchange rates, with inflation continuing to drive underlying revenue growth and acquisitions further supplementing growth. Adjusted operating margin for the first half is expected to be slightly higher than historical annual levels, it noted. Bunzl upgraded its guidance for the year on the basis of the strong revenue growth to date and announced acquisitions, though no actual figures were provided. At constant exchange rates, Bunzl now expects "very good" revenue growth in 2022, driven by good organic revenue growth and the positive contribution of acquisitions announced over the past year. Growth of the base business is expected to be only partially offset by the further normalisation of sales of Covid-19 related products, albeit these are expected to remain ahead of 2019 levels, the company said. Bunzl also continues to expect its operating margin in 2022 to be slightly higher than historical levels.
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IAG said it is converting 14 A320neo family airplane options, announced in back in 2013, into firm orders for 11 A320neos and three A321neos. IAG said this was in addition to the conversion of eight A320neo family options which IAG exercised in March 2022 for six A320neos and two A321neos. These aircraft will be delivered in 2024 and 2025 and will be used to replace A320ceo family aircraft in airline group's short-haul fleet, said IAG, which owns British Airways, Iberia, Aer Lingus and other airlines.
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WPP said it has agreed to acquire the business of Bower House Digital, a marketing technology services agency in Australia, for an undisclosed sum. WPP said the acquisition is aligned with its accelerated growth strategy and focused M&A approach to build on existing digital experience capabilities. Rose Herceg, WPP president of Australia & New Zealand, said: "Companies are seeking one integrated communications solution that combines creativity, technology and data. Bower House Digital's knowledge in marketing technology will further strengthen our digital expertise in Australia and New Zealand. I'm excited to welcome the Bower House Digital team and clients to WPP."
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COMPANIES - FTSE 250
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Ascential said it has acquired Intrepid E-Commerce Services, a provider of e-commerce execution services to brands in South East Asia. The acquisition is for an initial USD57 million in cash, plus deferred consideration payable over four years, contingent on meeting financial targets. This results in an estimated total of between USD100 million and USD197 million, it said. "Intrepid's strong presence in South East Asia, alongside its proven expertise operating across the major marketplaces in this important region, further enhances the capabilities and global reach of our Digital Commerce business," said CEO Duncan Painter.
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COMPANIES - SMALL CAP
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Audax Management Co sold 5.0 million shares of GB Group at 400 pence per share, worth GBP20 million, in a placing run by Numis Securities. The sale represented a 2.0% stake in the identity data intelligence firm. Audax retains 4.6m shares, a 1.8% stake. The plan for the sale was first announced after the London market close on Wednesday.
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COMPANIES - GLOBAL
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Samsung Electronics became the first chipmaker in the world to mass produce advanced 3-nanometre microchips, the company said, as it seeks to catch up with Taiwan's TSMC. The new chips will be smaller, more powerful and efficient, and will be used in high-performance computing applications before being put into gadgets such as mobile phones. "Compared to 5nm process, the first-generation 3nm process can reduce power consumption by up to 45%, improve performance by 23% and reduce area by 16%," Samsung said in a statement. The South Korean conglomerate last month announced a five-year plan to invest KRW450 trillion, about USD356 billion, saying it would "bring forward the mass production of chips based on the 3-nanometer process".
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Thursday's shareholder meetings
3i Group PLC - AGM
Ashtead Technology Holdings PLC - AGM
Borders & Southern Petroleum PLC - AGM
Caspian Sunrise PLC - AGM
Cobra Resources PLC - AGM
Crimson Tide PLC - AGM
ECSC Group PLC - AGM
Evraz PLC - AGM
Gresham House Energy Storage Fund PLC - AGM
GRIT Investment Trust PLC - AGM
Gulf Marine Services PLC - AGM
Hamak Gold Ltd - AGM
Hemogenyx Pharmaceuticals PLC - AGM
Immotion Group PLC - AGM
Inspiration Healthcare Group PLC - AGM
Inspired PLC - AGM
Jadestone Energy PLC - AGM
Kanabo Group PLC - AGM
Kropz PLC - AGM
Likewise Group PLC - AGM
Live Co Group PLC - AGM
Location Sciences Group PLC - AGM
LoopUp Group PLC - AGM
M&C Saatchi PLC - AGM
Microsaic Systems PLC - AGM
Nostra Terra Oil & Gas Co - AGM
Pathfinder Minerals PLC - AGM
Playtech PLC - AGM
Primorus Investments PLC - AGM
Rockfire Resources PLC - AGM
Roquefort Therapeutics PLC - AGM
Sanne Group PLC - AGM
Scottish Mortgage Investment Trust PLC - AGM
Serica Energy PLC - AGM
Supply@ME Capital PLC - AGM
Surface Transforms PLC - AGM
Synairgen PLC - AGM
Tower Resources PLC - AGM
Trainline PLC - AGM
ValiRx PLC - AGM
Victoria Oil & Gas PLC - AGM
Watchstone Group PLC - AGM
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By Tom Waite; thomaslwaite@alliancenews.com
Copyright 2022 Alliance News Limited. All Rights Reserved.
