A bricklayer, wearing technology which vibrates when he breaches social distancing guidelines, on a residential construction site near Farnborough – Luke MacGregor /Bloomberg
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FTSE rises to post-pandemic high
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Job vacancies surge at fastest pace in 23 years
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Rapid growth for British construction
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Scottish election results create uncertainty for the pound
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US’ Dow Jones hits record level ahead of jobs data
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11:48 AM
Fuels demand rebounds in response to vaccines
UK fuel sales are at their highest since the beginning of the pandemic, the latest sign that oil demand is rebounding in countries with high levels of Covid-19 vaccination.
Bloomberg has more details:
Sales of gasoline and diesel surged to 19,377 liters per filling station on April 30, the highest since just before the country’s first Covid-19 lockdown began last March. That’s higher than during the peak of the 2020 summer vacation season.
The recovery in demand is of interest to oil traders because it offers a glimpse of what will happen in large fuel-consuming nations as they get through their vaccination programs. The U.K., which has given at least one dose to more than half its population, is in the midst of a steady economic reopening plan that’s set to conclude in June.
11:39 AM
Money round-up
Here’s a round-up of today’s coverage by The Telegraph’s money team:
11:17 AM
Meggitt’s shares surge after reports of Woodward bid
Aircraft parts maker Meggitt’s shares surged almost 15pc after reports that US peer Woodward could be mulling a bid for the FTSE 250 business, reports my colleague Alan Tovey.
Analysts at Jefferies said Meggitt would “fit nicely” with Woodward, which is said to be on the hunt for acquisitions after a merger with Hexcel failed last year because of the pandemic.
Meggitt, which has a market cap of £3.6bn and makes components and sub-systems for the aerospace, defence and energy markets, has been hit hard by coronavirus, with demand for aircraft parts falling as air travel collapsed.
At the annual results in March Tony Wood, chief executive, said that Meggitt’s business which supplies civil aerospace with components such as brakes and sensors had been “punched on the nose” by the pandemic, with sales 41pc lower.
Woodward, which is valued at $ 8bn (£5.8bn), derives two thirds of its revenues from aerospace products, with major clients including Boeing and GE.
Neither Meggitt or Woodward commented on the prospect of an approach, which was first reported by Dealreporter.
11:10 AM
Miners lead the FTSE 100
Miners are leading the FTSE 100, following the ascent of crude and metal prices.
Anglo American was up 3.75pc and Glencore was close behind, up 3.38pc.
Copper has soared to an all time record on expectations of a global demand boom and iron ore has also peaked to record highs.
10:56 AM
FTSE 250 peaks at new record
The FTSE 250 index has hit a new record high today, jumping 1pc to 22,724 points and lead by St Modwena Properties after an acquisition bid by Blackstone Group.
10:44 AM
David Cameron and Lex Greensill to be quizzed by MPs
Former Prime Minister David Cameron and Lex Greensill will appear before MPs to account for the failure of finance firm Greensill and its lobbying of government before it imploded, reports my colleague Alan Tovey.
Mel Stride, chairman of the Treasury Select Committee, said:
We are determined to answer the key question as to whether HM Treasury responded appropriately to the lobbying on behalf of Greensill Capital, including that carried out by David Cameron.
We also want to establish what lessons there are from Greensill’s collapse for the operation of the financial system.
Read the full story here.
10:19 AM
Travel industry hopes government announcement will kick-start recovery
Rows of empty EasyJet check-in desks are seen in the North Terminal at Gatwick Airport – Leon Neal /Getty Images Europe
The government is expected to announce which countries will be open for quarantine-free holidays under its traffic light system later today.
Transport secretary Grant Shapps will give a briefing at 5pm to unveil new travel rules based on a traffic light system. People in England currently face fines for holidaying abroad. Scotland, Wales and Northern Ireland have not yet announced when their travel rules will be relaxed.
However David Trunkfield, hospitality and leisure leader, at PwC said the summer will still face disruption with just 12pc of consumers saying they will plan an international holiday when restrictions are lifted.
This ongoing uncertainty over travel will hinder businesses who need to plan for reopening and manage their cash flow requirements. The travel sector has largely been in hibernation mode and so the real cash crunch will come when businesses have to start paying suppliers as operations resume.
More positively, any diverted spend from travellers who choose not to holiday abroad this summer is good news for UK leisure destinations, who want to attract domestic tourists, as well as retail and hospitality operators, who will benefit from consumers spending money at home.
09:47 AM
City wathcdog delays decision on open-ended property funds after lobbying blitz
The Financial Conduct Authority has delayed its outcome on the regulator’s consultation on open-ended property funds, saying it will not decide on a final policy position until Q3 at the earliest.
Ryan Hughes, head of active portfolios at AJ Bell, comments:
The consultation on the liquidity mismatch on property funds, with its proposals to put in place a notice period for redemptions, was controversial not least because of the operational challenges that it clearly presented and the very real risk that it would have potentially caused property funds to once again suspend as investors rushed to exit before any notice periods kicked in.
The news that the FCA is delaying the conclusion of the consultation and linking it in to a consultation on Long Term Asset Funds shows just how hard property asset managers have lobbied for the FCA to take a different approach.
09:06 AM
St Modwen shares climb, after £1.2bn Blackstone offer
Investment company Blackstone Group has made a £1.21bn proposal to acquire St Modwen, a real estate company that develops and manages industrial properties.
St Modwen’s shares surged to the top of the FTSE 250 as a result, up 18.66pc.
Bloomberg has more details:
The 542 pence a share offer values the U.K. property developer at about £1.2 billion pounds, a 21pc premium to the company’s closing price on Thursday, according to statements from both firms on Friday. St. Modwen’s board would likely recommend the non-binding conditional offer unanimously, should a firm intention be announced, the company said in its statement.
Competition for warehouse properties across Europe has intensified as global investors including Goldman Sachs Group Inc., Cerberus Capital Management LP and GIC Pte bet on rising rents fuelled by demand from e- commerce. That’s prompting investors like Blackstone to turn to more complex deals including buying public companies as they look to add scale to their warehouse portfolios.
08:52 AM
British construction activity expands rapidly in April
A view of tower blocks under construction and the redevelopment of Battersea Power station which are part of the VNEB (Vauxhall, Nine Elms and Battersea) regeneration in south London – Aaron Chown/PA
British construction activity expanded quickly last month, almost matching a six-year record set in March.
The IHS Markit/ CIPS construction Purchasing Managers’ Index (PMI) came in slightly below expectations, easing to 61.6 in April from 61.7 in March. Economists had predicted 62.3.
However the survey’s gauge of new orders lifted to its highest level since September 2014.
08:38 AM
Scottish election creates pound uncertainty
Scotland’s First Minister and leader of the Scottish National Party (SNP), Nicola Sturgeon campaigns in Dumbarton, Scotland on May 5 – ANDY BUCHANAN /AFP
The FTSE 100 is experiencing new momentum as it trades above 7,100 for the first time since February 2020, says AJ Bell investment director Russ Mould.
“This might lead some investors to begin eyeing the record high of the index close to 7,900 in May 2018,” he adds.
However Mould says the Scottish election results threatens to create fresh uncertainty:
The results of the Scottish elections should start to come in over the course of Friday and Saturday with potentially significant implications for the currency markets.
An outright majority would be seen as a mandate for the SNP to call a second independence referendum – prompting uncertainty and likely hitting the relative value of the pound.
08:27 AM
Dollar near one week lows in anticipation of US jobs data
The dollar is near one week lows today, ahead of a release of US jobs data which is expected to reinforce hopes for a strong economic recovery and increase investors’ appetite for risk.
Against a basket of major currencies, the dollar index was at 90.841. It is on track for a loss of around 0.5pc on the week, after seeing two week lows yesterday.
US payrolls data is predicted to show employers hired close to a million workers in April as the economy reopened. The figures are expected at 1230 GMT.
08:11 AM
Twitter suspends accounts acting as megaphone for Trump
Former President Donald Trump looks at his phone during a roundtable with governors in 2020 – Alex Brandon /AP
Twitter has suspended several accounts sharing messages from the new website of former US President Donald Trump, reports my colleague Matthew Field.
Accounts set up to share multiple posts from the ex-President’s website, From The Desk of Donald J Trump, were barred by Twitter over “ban evasion”.
A Twitter spokesperson said: “As stated in our ban evasion policy, we’ll take enforcement action on accounts whose apparent intent is to replace or promote content affiliated with a suspended account.” The Trump campaign has said it had nothing to do with the accounts.
The move comes after Facebook’s decision to suspend the account of the former President was upheld by its Oversight Board, a Facebook funded review board for its moderation decisions.
However, the Board said Facebook would have to look again at its decision to make the ban indefinite and decide whether or not to delete the account for good.
You can read more about Trump’s Facebook ban here.
08:01 AM
European stocks lift to records high
European stocks lifted to record highs this morning, after economic data from Germany added to an optimistic outlook of a speedy recovery after the pandemic shock.
Data revealed German companies increased their exports for the eleventh month in a row in March, with growth coming in at twice the rate economists had predicted, at 1.2pc.
German sportswear brand Adidas surged 7.1pc after it raised its 2021 sales outlook.
07:40 AM
Citi considers launching cryptocurrency services
One of the world’s largest currency trading banks, Citigroup, is considering offering cryptocurrency services after a surge in interest from clients.
Itay Tuchman, global head of foreign exchange told the Financial Times no decision had been made yet but trading, custody and financing were all under consideration.
07:27 AM
FTSE 100 opens on pandemic high, up 0.5pc
The FTSE 100 has risen 37 points to 7113 this morning and is now at its highest since February 2020.
Melrose Industries has risen 2.33pc, followed closely by Avast PLC and Pearson PLC.
07:12 AM
Hiring surges as economy reopens
A waiter prepares for the closing of a pub in London’s Soho area – Alberto Pezzali /AP
Hiring surged in April as the economy reopened sending vacancies soaring at the fastest pace in 23 years, reports my colleague Tim Wallace.
Demand for staff is rising in almost every industry, according to the Recruitment and Employment Confederation (REC) and KPMG, with IT and computing jobs leading the way as the shift to online and remote working looks set to stay.
Businesses are also keen to hire engineers, accountants and financial specialists, and hotel and catering staff.
It means that the worst fears of a huge spike in unemployment, caused by the deepest recession in more than 300 years, may yet be avoided.
The only industry which has not seen an uptick in vacancies is retail, despite the reopening of the high street. However shops are still bringing back workers from furlough which may be dampening demand for new employees.
Companies are even struggling with a skills shortage, said REC chief executive Neil Carberry, as the type of work on offer is shifting, and unemployment is concentrated among the young who have struggled to get their first jobs in the pandemic.
“A year ago we thought we’d have an unemployment problem, a job-creation problem. We are not going to have that – the job market is remarkably robust, it has bounced back,” he said.
“What we have is a job access problem, which is how do young people find the paths to these growing sectors, and how to help those who need to retrain.”
It comes as the number of workers on furlough dropped again.
Businesses reported that 13pc of the workforce was on furlough in mid-April, down from 17pc in late March, according to the Office for National Statistics (ONS).
Almost one-third of the retail and wholesale workforce is expected to return from furlough in the coming weeks.
Numbers from HMRC show just under 4.2m jobs were furloughed at the end of March, down from more than 4.7m at the end of February.
Of those, around three-quarters are fully furloughed with one-quarter partially furloughed.
By industry, there were still just over 1m on furlough in hotels and hospitality, down from almost 1.2m at the end of February, while retail, wholesale and vehicle repair accounted for another 825,600, down by more than 100,000 on the month.
06:56 AM
Activist sells out of Barclays
Activist Edward Bramson has sold out of Barclays, bringing to an end a campaign that started in 2018 when he bought a 5pc stake and began agitating for the lender to sell off its investment banking arm.
“A new investment opportunity that it has identified offers a better return to the company’s shareholders than a continuing investment in Barclays,” Bramson’s Sherborne fund said in a statement, without further identifying its new position.
The activist investor has been a fierce critic of chief executive Jes Staley’s strategy to boost the securities unit and urged the board to mimic cutbacks at Deutsche Bank to improve profitability. But its proposals gained little traction and strong recent results at the investment bank unit only strengthened Staley’s position.
Sherborne said in a separate letter to investors on Friday that its new investment “hasn’t yet reached the public disclosure threshold”, Bloomberg reported.
06:49 AM
BA owner posts first-quarter loss
British Airways-owner IAG reported a €1.2bn (£1bn) pre-tax loss for the three months to the end of March as the pandemic restricted travel, and forecast only a small rise in capacity to 25pc for the April-June quarter.
Flying at just 20pc capacity in the three months to the end of March resulted in the group posting the operating loss before exceptional items of €1.14bn, slightly better than the City had forecast.
IAG, which also owns Iberia and Vueling in Spain and Aer Lingus in Ireland, said it reduced weekly cash burn to €175m, a better performance than had been previously guided.
06:38 AM
FTSE to open higher
Good morning. The FTSE 100 is tipped to open higher as European markets follow Asia in heading for a strong finish to the week.
5 things to start your day
1) Brussels bid to cut off the City is backfiring, watchdog warns: Financial Conduct Authority chief Nikhil Rathi says European banks suffering from EU reluctance to grant equivalence for UK finance firms.
2) Oxford Nanopore executive hits out at critics of float timetable: Top exec criticised media commentary suggesting the firm should speed up its listing to provide greater transparency over its operations.
3) John Lewis nightmare: boss resurfaces at rival Sainsbury’s: Paula Nickolds will oversee the retailer’s general merchandise, Argos, Habitat and Tu clothing ranges and sit on its operating board.
4) Gupta closes in on £200m rescue for Liberty Steel: Liberty Steel is thrashing out details of a new working capital facility with US-based White Oak Global Advisors to get back to full production.
5) How the Bank of England plans to wind down support without scuppering the recovery: Slowing the pace of bond-buying is tricky as markets have reacted badly in the past, but the economic recovery means it must happen.
What happened overnight
Asian markets rallied on Friday following a record-breaking finish on Wall Street as traders keenly await a key US jobs report. Tokyo, Hong Kong, Shanghai, Sydney, Seoul, Singapore, Taipei and Manila were all up, though Wellington and Jakarta edged down.
Coming up today
Corporate: IAG, InterContinental (Trading update)
Economics: Construction PMI (UK), exports, imports, trade balance (Ger), unemployment rate, consumer credit (US)