Weekly review

The FTSE 100 ended the week up 121.15 points, or 1.6%, closing at 7,697.51 on Friday.

Equity view

The US Food and Drug Administration has approved the Wainua nerve disease treatment jointly developed by AstraZeneca and Ionis Pharmaceuticals. The green light marks the first-ever regulatory approval in the US for the treatment of adults with polyneuropathy of hereditary transthyretin-mediated amyloidosis.

IP Group announced its participation in a follow-on funding round for an unnamed portfolio company on Friday, expecting to realise a net fair value gain of £40m, or 4p per share. The FTSE 250 firm said it had committed $15m (£11.8m) to the funding round, subject to certain conditions, with the transaction set to conclude in mid-January.

EnQuest announced an agreement with RockRose UKCS 10 Ltd, a subsidiary of Viaro Energy, over the sale of a 15% working interest in both the Bressay field and the EnQuest Producer floating production, storage, and offloading (FPSO) vessel on Friday. The London-listed firm said both assets are in the UK North Sea.

Software firm Bidstack shares surged on Friday after settling its legal dispute with partner Azerion and agreeing to a new commercial partnership. Azerion will pay €3.0m to Bidstack for the settlement and new agreement, while the companies intend to have their collaboration up and running in 2024.

Hargreaves Services said it is hiking its dividend payout by 70% despite delivering a profit warning to the market on Thursday. The AIM-listed company, which provides services to the environmental, industrial and property sectors, said trading conditions in its Germany joint venture, Hargreaves Raw Material Services (HRMS), were worse than expected due to reduced commodity prices and an economic slowdown. It now expects to record a net loss for the division in the first half and for full-year pre-tax profit from HRMC to be just one-quarter of that expected initially.

Data analytics and consulting firm GlobalData is selling a 40% stake in its healthcare division to private-equity group Inflexion for £434m, allowing it to de-leverage the balance sheet and accelerate M&A. As part of a new growth plan and company reorganisation that will see it refocus on three divisions – healthcare, consumer and tech – GlobalData said the investment will "provide flexibility for accelerated value-creating M&A across the group".

Swiss telecommunications firm Swisscom has been mulling over an offer for Vodafone's Italian operations early next year, according to Bloomberg, potentially countering a rival bid from Iliad SA. The potential deal will see Vodafone's mobile service combine with Swisscom's Fastweb SpA fibre broadband carrier in the country.

Smart Metering Systems fell on Thursday after shareholder PrimeStone and its founders, Alan Foy and Steve Timoney, said they planned to oppose its £1.3bn acquisition by US private equity firm KKR. PrimeStone and the founders - who collectively control around 17.8% of SMS's issued share capital - said they were "disappointed" with the 955p a share offer price and intend to vote against it.

Chile-based copper miner Antofagasta said it was going ahead with the $4.4bn construction of a second concentrator at its Centinela operation to boost production. The concentrator is expected to produce an additional 170,000 tonnes of copper equivalent tonnes a year, comprising 144,000 tonnes of copper production, 130,000 ounces of gold and 3,500 tonnes of molybdenum, with a 36-year mine life.

Anglo American has said it is finally seeing signs of a rebalancing in the diamond market after De Beers' final tender of the year saw a pick-up in revenues, after a considerable slide in sales over 2023. The value of rough diamond sales from its 10th sales cycle of 2023 amounted to $130m, up from $86m in cycle nine and $80m in cycle eight.

International insurance giant Prudential has approved a capital increase for its business in Mainland China to drive growth. CITIC-Prudential Life (CPL), a 50/50 joint venture with China's CITIC Bank, is increasing its registered capital by RMB2.5bn ($351m), with each shareholder contributing equal cash.

Shares in "digital youth publisher" LBG Media dropped by 10% on Wednesday after the LADbible owner seemingly underwhelmed the market with revenue and profit growth guidance for the year. The publisher said it expects to report revenues of £67m for the 2023 financial year, up 6.6% on last year, as it has "further deepened its market leadership position".

Energy storage investment firm Gore Street Energy Storage Fund has announced a share placement worth £15.8m to hand over 14m shares to long-term strategic partner Nidec Motor Corporation in return for more engineering, procurement and construction (EPC) work. The placing was priced at 112.9p per share, being the most recently announced net asset value per share as of 30 September.

Clothing retailer Superdry issued a profit warning on Tuesday, saying a challenging trading environment and warm weather hit it. Superdry noted in an update that the external environment has proven "challenging", and trading has been "significantly" below management expectations, with full-year profits "expected to reflect this weaker trading seen to date".

Banknote printer De La Rue reiterated its full-year guidance on Tuesday after the group's interim profits came ahead of previous forecasts. De La Rue said authentication revenue rose 5.7% to £48.1m in the six months ended 30 September, while currency revenue fell 2.6% to £113.4m.

Centamin announced a substantial increase in its proven and probable (P&P) mineral reserves on Tuesday. The FTSE 250 company said Sukari's reserves reached 5.8 million ounces - a 10% boost compared to the 5.3 million ounce estimate in the new life of mine plan.

Games Workshop has struck an exclusive rights deal with Amazon to develop its Warhammer 40,000 game into films, television series, and associated merchandising rights. Under the terms of the agreement, Games Workshop Amazon can also license equivalent rights in the Warhammer Fantasy universe following the release of the initial Warhammer 40,000 production.

British speciality chemicals company Croda International is searching for a new chief financial officer after announcing that its current CFO will leave the group next year. Croda also confirmed that its full-year outlook for 2023 remains unchanged, though profits will be at the lower end of guidance.

Bulmers and Magners owner C&C Group said on Monday that it has appointed Andrew Andrea as chief financial officer with effect from 1 March 2024. Ralph Findlay, who has served as executive chair since May 2023, will revert to the role of non-executive chair following a short transition period after Andrea joins the group.

Shaftesbury Capital, the London-focused real estate group formed from the tie-up of Shaftesbury Plc and Capital & Counties, is saying goodbye to three board members as it works to slim down its organisational structure in the wake of March's merger. Following last week's announcement that chief operating officer Chris Ward would be stepping down from the board and will not be replaced, the group said it is looking to reduce its executive team.

Economic news

Rail fare increases are set to rise by 4.9% from early next year after the Department for Transport announced another cap on ticket price increases. The rise would be notably lower than the historically used July retail price index (RPI) figure and down on the 6.4% rise earlier this year.

According to figures released on Friday by the Office for National Statistics, the UK economy shrank in the third quarter, raising the risk of recession. The economy contracted by 0.1% from July to September, down from a previous estimate of no growth.

The decline in house prices has started to flow as buyers and sellers become more aligned on pricing, according to online property platform Zoopla on Friday, which revealed that new house sales were up 17% year-on-year in November. The annual improvement comes while buyer demand has also risen 19%, Zoopla said, as the number of homes available for sale – up 25% on last November – is "boosting choice and supporting sales".

According to official data published on Friday, UK retail sales volumes rose by 1.3% in November compared with the prior month, boosted by heavily discounted Black Friday deals. The change followed zero growth in October, revised from a fall of 0.3%, said the Office for National Statistics.

Activity in the UK's private sector declined again in the three months to December, marking the 18th month in a row without growth, according to the Confederation of British Industry's Growth Indicator released on Friday. The CBI Growth Indicator, which surveyed 661 firms about their output, sales and business volumes across manufacturing, services and distributive trades, found that the composite index of output volumes was -8 this month.

The downturn in the UK retail sector deepened in December following a disappointing festive period, according to a survey released on Thursday. The latest Distributive Trades Survey from the Confederation of British Industry showed that the retail sales balance fell to -32 from -11 in the year to November. This marked the eighth consecutive monthly decline.

According to figures released by the Office for National Statistics on Thursday, the UK government borrowed more than expected last month. Public sector net borrowing, excluding public sector banks, came in at £14.3bn. This was below November 2022's £15.2bn but above consensus forecasts of £13bn. It also marked the fourth-highest November borrowing since monthly records began in 1993.

The annual rate of decline in UK house prices dropped in October to its steepest level in 12 years, according to figures out on Wednesday by the Office for National Statistics. Average house prices in the UK were £288,000 in October, some £3,000 lower than October 2022, the ONS said in a statement. The 1.2% year-on-year fall was worse than the revised 0.6% drop in September and the lowest rate of decline since October 2011.

UK inflation eased more than expected in November, according to figures released on Wednesday by the Office for National Statistics, boosting rate cut hopes for next year. Consumer price inflation slowed to 3.9% from 4.6% in October. This marked the lowest reading since September 2021 and was below analysts' expectations of 4.4%.

Output in the UK manufacturing sector stabilised in December, but orders remained subdued, according to a survey released on Tuesday. The Confederation of British Industry's monthly order book balance rose to -23 from -35 in November. This was above consensus expectations for a balance of -29 but still considered "below normal".

International events

Angola is leaving the Organization of the Petroleum Exporting Countries (OPEC), which is thought to be in response to the cartel's demands to cut output to ensure price stability. Confirming earlier chatter from domestic news agency ANGOP, Angola's oil minister, Diamantino Azevedo, spoke on public television to say that being part of OPEC was no longer in the country's best interests.

The downturn in manufacturing activity in the Philadelphia region worsened more than expected in December, according to the Philly Federal Reserve on Thursday. The Manufacturing Business Outlook Survey found that the current general activity index dropped to -10.5 this month from -5.9 in November.

The US economy grew less than previously estimated in the third quarter, according to figures released on Thursday by the Commerce Department. GDP from July to September was revised to 4.9% from 5.2% in the second estimate. Economists were expecting growth to be unrevised.

Americans lined up for unemployment benefits at an accelerated clip in the week ended 16 December but remained near the previous week's two-month low. According to the Labor Department, initial jobless claims rose by 2,000 to 205,000 last week, well below consensus expectations of 215,000 and underscoring relative tightness in the US labour market.

Existing US home sales increased month-on-month in November, their first increase in five months. According to the National Association of Realtors, it rose 0.8% month-on-month to a seasonally adjusted annualised rate of 3.82m units in November, rebounding from 3.79m in October - the lowest since August 2010. The figures came ahead of forecasts of 3.77m, principally due to a fall in mortgage rates.

According to the Conference Board, consumer confidence in the US jumped in December as perceptions of current and future conditions turned more optimistic. The closely watched monthly release of the consumer confidence index rose to 110.7 this month, up from 101.0 in November, which was revised down from initial estimates.

According to the Mortgage Bankers Association of America, US mortgage applications fell 1.5% in the week ended 15 December, dropping from a 7.4% surge a week earlier and halting a six-week run of increased applications. Applications to refinance a home dropped by 2% but remained 18% higher year-on-year. In comparison, applications to purchase a home were 1% lower week-on-week but also remained 18% higher annually.

Construction output in the eurozone fell in October, more or less wiping out the previous month's growth, according to figures released Wednesday by Eurostat. Production was down 1.0% month-on-month in the single-currency region after an upwardly revised 0.9% gain in September following the initial estimate of 0.4% growth.

German consumer sentiment should improve in the new year. However, concerns about the impact of geopolitical crises and food inflation continue to cause uncertainty, according to a survey published on Wednesday. The GfK/NIM consumer sentiment index rose to -25.1 points heading into January from a revised -27.6 the month before and above expectations of a -27.0 reading.

China kept benchmark lending rates unchanged as expected on Wednesday. The one-year loan prime rate (LPR) was held at 3.45%, and the five-year - on which mortgages are based - was 4.20%.