General News

FTSE set to rise ahead of Sunak’s spending review – live updates

FTSE set to rise ahead of Sunak’s spending review – live updates
Rishi Sunak – TOLGA AKMEN/AFP via Getty Images

08:21 AM

Genus shares pop as performance beats expectations

Shares in animal genetics company Genus has popped higher the morning, after the FTSE 250 group said its performance in the four months to the end of October was “ahead of expectations”.

In a trading update ahead of its annual gneral meeting today, Genus said it had seen good demand from China as the country’s pig herds recover from the devastation of African swine fever.

Its porcine business saw “strong growth” in all regions except North America, where Covid-19 caused a short-term surplus of animals for slaughter due to a shortfall in processing capacity.

Genus said it anticipates continued headwinds due to Covid-19, but said its trading momentum means it “is likely to perform ahead of its previous profit growth expectations for the financial year 2021”.

08:05 AM

European market rises slightly

European markets have opened slightly higher, building on solid gains yesterday. The FTSE 100 needs plenty more of these to claw back its 2020 losses.

Bloomberg TV - Bloomberg TV
Bloomberg TV – Bloomberg TV

07:55 AM

What the Chancellor will announce today

Sunak  - Leon Neal/Getty Images
Sunak – Leon Neal/Getty Images

 There’s not much mystery around the Chancellor’s announcement today – most of it has already been briefed out by the Treasury. Rishi Sunak will announce a £4.3bn package aimed at getting one million people back to work and staving off an unemployment surge.

As my colleagues Gordon Rayner and Harry Yorke reported yesterday:

The Office for Budget Responsibility, the Treasury’s watchdog, is expected to predict that unemployment, currently at 4.8 per cent, could go as high as eight per cent by the summer – after the end of the furlough scheme – before it starts to fall.

The OBR is also expected to forecast that the economy will have shrunk by 10 per cent by the end of this year – the worst performance in 300 years. The Resolution Foundation think tank believes the OBR will forecast a permanent reduction of three per cent in the UK’s GDP due to the economic “scarring” of coronavirus – the equivalent of £1,000 per person.

Here are some of the key announcements expected (some of which are just re-packaging of existing measures):

  • The Chancellor will pledge to “create and support” hundreds of thousands of jobs through tens of billions of pounds of investment in infrastructure, including roads, houses, railways and cycle lanes.

  • A £2.9 billion Restart scheme will help the long-term unemployed to find jobs by giving them “intensive, tailored” support to meet their individual circumstances. Another £1.4 billion will be allocated to Job Centres, helping the short-term unemployed back into work.

  • Mr Sunak will also extend the apprenticeship hiring incentive – which pays employers £2,000 for every new apprentice they hire – to the end of March, when the new tier system of Covid restrictions will end. The jobs schemes will effectively replace the furlough scheme, which finishes on March 31.

  • He is expected to announce a freeze on public sector pay to help claw back some of the cost of Covid support, as well as reducing foreign aid spending from 0.7 per cent of national income to 0.5 per cent.

  • He will also confirm a £375 million package to support skills by offering people training to change career.

It’s likely that the Chancellor may have held back some measures in order to secure further favourable coverage in Thursday’s papers.

The OBR’s forecast is the latest in a string of warnings about a looming unemployment spike, which has not materialised as quickly as was feared earlier in the year – something which can be attributed in part to the huge popularity of the furlough scheme.

The Chancellor’s attempts to wind down the Government’s job support schemes ended in failure as new lockdowns forced the Treasury to issue continued support, and furlough itself is now set to run until the end of March.

That has caused forecasters to push back the predictions about when the damage dealt to the UK economy by Covid-19 will manifest itself clearly in the labour market to mid-2021.

07:03 AM

Agenda: Market rally set to continue

Good morning. The FTSE 100 is set to push higher at the open ahead of Rishi Sunak’s spending review later today.

The Chancellor will speak in the House of Commons around 12:30pm and is expected to announce a raft of measures to boost public services and help the unemployed. 

The pound also climbed to $1.34 overnight as Brexit trade talks appear to be nearing a conclusion. 

5 things to start your day 

1) Councils get powers to shut down firms for flouting Covid rules: Downing Street has allowed councils to temporarily closing premises for up to a week for flouting Covid rules.

2) Arcadia hired independent pension trustees to help tackle deficit: Sir Philip Green’s retail empire drafted in independent pension trustees from Dalriada last September, to help tackle its pension deficit.

3) Pubs set to miss out on selling 180m pints under tough new rules: If all wet-led pubs are put under tiers two or three, the industry will lose up to £1.5bn in sales in Dec, with lost beer sales equalling 180m pints.

4) Elon Musk overtakes Bill Gates to become world’s second-richest person: The 49-year-old founder of Tesla is now worth $128bn, overtaking the Microsoft co-founder following the carmaker’s share price surge.

5) Chinese companies set to invest billions in Brexit Britain: Chinese firms said they will invest billions in Britain post-Brexit, and create thousands of jobs in the next few years, despite souring relations.

What happened overnight 

World shares rallied to a record peak on Wednesday, following an overnight surge that saw the Dow Jones benchmark crack 30,000 for the first time as investors cheered a dramatically improved global outlook.

The formal start of US president-elect Joe Biden’s transition to the White House and increasing confidence a Covid-19 vaccine would be ready soon ushered in renewed appetite for global shares.

Reports that Mr Biden planned to nominate former Federal Reserve Chair Janet Yellen as Treasury Secretary – a move that could shift the focus heavily toward efforts to tackle growing economic inequality – also cheered markets.

That pushed MSCI’s broadest gauge of world stocks up 0.2pc to a record level. Its index of Asia-Pacific shares outside Japan gained 0.45pc while Japan’s Nikkei rallied 1.7pc to a 29-year high.

On Wall Street on Tuesday, the Dow Jones Industrial Average rose 1.54pc to 30,046.24 while the S&P 500 gained 1.62pc, to 3,635.41, also a record high. The Nasdaq Composite added 1.31pc.

E-mini futures for the S&P 500 rose another 0.5pc in early Wednesday trade.

Coming up today

Corporate: Brewin Dolphin, Virgin Money UK, AB Dynamics (Full-year results); Babcock, De La Rue, United Utilities, Hicl, Liontrust (Interim results); Melrose Industries, Rotork (Trading update)

Economics: UK Spending Review, Fed Minutes; Personal Spending (Oct)/US Q3 GDP; HMRC Eat Out to Help Out statistics; ECB Financial Stability review

About the author


Tori Holland

After being a professional journalist for 5 years and understanding the ups and downs of health care sector all over the world, Tori shifted her focus to the digital world. Today, she works as a contributor for News Brig with a knack for covering general and health news in the best possible format.

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