The Telegraph
FTSE falls 2.5pc as sell-off accelerates
The Hut Group soared to its highest level in almost a month, marking its best trading day on record after raising more than $ 1bn (£706m) in new equity. Gains came after Softbank, the Japanese technology powerhouse, was revealed late on Monday as the cornerstone backer of a $ 1bn (£710m) fund raising intended to fuel the retailer’s growth. The deal gives Softbank the right to buy a 19.9pc stake in THG Ingenuity for $ 1.6bn. “THG Ingenuity is a technology and operating platform which is used by big blue chip corporate brands like Nestle, Procter and Gamble and Johnson and Johnson for their ecommerce operations. It is here that the real growth potential lies with an operation that operates across 5 continents, and what appears to have prompted the big investment from Softbank,” said CMC Markets’ Michael Hewson. Chief executive Matt Moulding said the funds would allow him to “invest aggressively” and unlock partnerships with other Softbank companies. THG also announced the acquisition of American beauty brand Bentley Laboratories for $ 255m, which is expected to boost full year revenues by $ 77m when completed. Shares gained as much as 17pc in early trading before closing the day up 11.9pc, or 71p, to 667p – the highest level since April 16. It was a rare bright spot for London’s markets, with just one blue-chip company – London Stock Exchange – and 10 mid-cap firms ending the day in the green. British stocks joined a global sell-off to clock their worst day since late October after a sudden crumble in big US tech stocks overnight due to inflation concerns. The benchmark fell back below the 7,000 level, losing 175.69 points by the end of the day to close at 6,947.99. The FTSE 250 shed 530.05 points to 22,167.14 – its lowest level in almost three weeks. Investors are growing anxious about a surge in inflation that could mean central banks will withdraw their ultra-loose monetary policies earlier than forecast. Among companies, Scottish Mortgage Investment Trust – known for backing technology stocks – shed 54.5p to £10.84, its lowest level since early March, following the sell-off on Wall Street overnight. British Airways’ owner IAG was the biggest loser on the top flight after raising another €825m (£709m) in seven-year debt in a bid to shore up its finances. It said it is burning through about €175m each week while most of its flights remain grounded. Shares closed 15.53p lower at 194.32p, joined in the red by other airline rivals. It was followed by engineering firm Renishaw after struggling to attract takeover interest due to what is being considered a high price tag. Shares dropped 405p to £56.52.