A Tesco profit upgrade today continued the strong week for London investors.
The blue-chip index yesterday closed at a record high after a strong performance by drugs stocks including AstraZeneca.
The IPO market was also given a lift today with the “groundbreaking” dual listing of electric grid and data centre developer Fermi.
FTSE 100 Live Thursday
- Tesco lifts profit guidance
- IPO boost for London
- Morgan Sindall upgrades
Market update: Tesco shares surge on upgrade, Experian down 6%
10:22 , Graeme EvansA results-day surge for Tesco shares today offset a big fall by Experian as the FTSE 100 index struggled to build on this week’s record-breaking run.
London’s top flight posted a new peak of 9475 in early dealings before later settling at 9452.93, a rise of 6.50 points in a performance behind the rest of Europe.
Defensive stocks weighed as National Grid lost 10p to 1065p, United Utilities fell 9.5p to 1140.5p and British Gas owner Centrica dipped 2.65p to 168.15p.
British American Tobacco fell 3% or 104p to 3802p after its shares were marked ex-dividend, while BT Group eased 3.15p to 188.35p as Exane BNP cut its stance to Underperform from Neutral.
Financial data firm Experian slumped to the bottom of the FTSE 100, down 6% or 233p to 3442p amid fears over the potential impact of a product launch by a US-based analytics software business.
Fico said its new direct-to-reseller license approach marked a “turning point” in how credit scores are delivered and priced across the mortgage industry.
On the risers board, Tesco traded at a fresh multi-year high after the supermarket highlighted its market dominance with an upgrade to full-year profit guidance.
The group overcame elevated levels of competition and higher wage costs to deliver a 1.5% increase in operating profit to £1.67 billion. Inflation and volume growth drove a 5.1% rise in sales to £33 billion.
Shares lifted 4% or 17.2p to 446.9p as Tesco also pledged to pay an interim dividend of 4.80p, an increase of 12.9% on a year earlier.
Marks & Spencer benefited from the stronger guidance as shares rose 10.1p to 376.3p ahead of its own interim results due next month.
Other risers included private equity group 3i, which benefited from an upgraded Buy recommendation by UBS analysts to lift 132p to 4274p.
The FTSE 250 index rose 49.49 points to 22,099.19, with Morgan Sindall up another 11% or 500p to 4875p after the construction and fit-out business delivered the latest in a long line of profit upgrades.
FTSE 100 weakens after bright start, Experian down 6%
09:28 , Graeme EvansThe FTSE 100 index has fallen back after peaking at a record 9475 in early dealings.
The top flight’s fall of 10.30 points to 9436.13 compared with gains of more than 0.7% for benchmarks in Paris and Frankfurt.
BT Group shares fell 2.75p to 188.75p after Exane BNP cut its recommendation to Underperform, while financial data firm Experian reversed 6% or 240p to 3435p.
Other fallers included British Gas owner Centrica, Rolls-Royce and renewable energy firm SSE.
Tesco share price run continues as results impress
09:04 , Graeme EvansTesco shares have risen 2% or 10.3p to 440p after the supermarket’s half-year performance overcame elevated levels of competition and higher wage costs.
Inflation and volume growth drove a 5.1% rise in sales to £33 billion, with margin pressures reflected in a smaller 1.5% increase in operating profit to £1.67 billion.
Tesco lifted full-year profit guidance to between £2.9 billion and £3.1 billion and said it intended to pay an interim dividend of 4.80p, up 12.9% on a year earlier.
Hargreaves Lansdown analyst Derren Nathan said: “Underlying operating profit of £1.7 billion came in a shade ahead of market forecasts, but intensified competition and cost pressures meant that growth in profits lagged sales by some margin.
“Still, management was confident enough to raise the mid-point of full-year profit guidance by 5% to £3 billion. It’s not a spectacular change, but every little helps.”
The shares have risen 18% so far this year. Shore Capital analyst Clive Black said: “The stock has been deservedly re-rated, so maybe short-term profit taking may ensue, but for the medium-to-long-term investor, this stock has a lot more to give.”
Victoria Scholar, head of investment at interactive investor, added: “Expectations were high going into today’s results, yet the juggernaut still managed to impress investors with an uplift to its profit guidance.
“Rival supermarkets typically take market share from each other rather than Tesco. That’s partly why the stock is largely viewed as the preferred play in the sector.”
Thames Water lenders propose new rescue deal
08:46 , Graeme EvansA group of Thames Water lenders has put forward a new rescue deal for the debt-laden supplier.
London & Valley Water – a consortium of the supplier’s main creditors, including investors and financial institutions – has pledged an extra £1 billion in investment, and plans to write off around a third of the firm’s near-£20 billion debt pile.
The group said its offer was “more ambitious, delivers greater value for customers and follows three months of discussion with and feedback from Ofwat” to help turn around Thames Water.
Morgan Sindall shares at record after latest upgrade
08:33 , Graeme EvansMorgan Sindall shares today hit a fresh record after the construction firm delivered the latest in a recent run of profit upgrades.
The group, whose operations also include partnership housebuilding, said results for 2025 will be significantly ahead of its previous expectations.
The latest upgrade follows a further strengthening in the performance of its Morgan Lovell and Overbury fit-out division.
The division’s secured order book stood at £1.6 billion at the end of August, an increase of 8% on the half-year stage.
The FTSE 250-listed company’s shares rose 10% or 447p to 4822p, leaving them 24% higher this year.
FTSE 100 momentum continues, Tesco shares higher
08:13 , Graeme EvansThe FTSE 100 index has built on last night’s record position by lifting another 0.2% or 18.40 points to 9464.83.
Tesco shares rose 2% or 8.1p to 437.8p after the supermarket giant sweetened annual profit guidance alongside half-year results.
AstraZeneca followed yesterday’s big jump of 11% with a further rise of 66p to 12,502p.
FTSE 250-listed Morgan Sindall rose another 9% or 407p to 4782p after the construction and fit-out business delivered the latest in a run of profit upgrades.
Data centre IPO boosts London market
07:51 , Graeme EvansThe City’s moribund IPO market was today boosted by the “groundbreaking” dual listing of electric grid and data centre developer Fermi.
At more than $13 billion (£9.6 billion), it is the largest IPO on the London stock exchange by offering size this year and the biggest by market capitalisation since September 2020.
The London listing follows yesterday’s IPO on Nasdaq, when the share price shot up 55% from the opening price of $21 on the first day of trading
The Texas based company, which is raising $681 million through the listings, is planning to build 15 million sq ft of AI data centre capacity, powered by a mix of natural gas, solar, battery storage, and four planned nuclear reactors.
Tesco lifts profits guidance, market share at 28.4%
07:14 , Graeme EvansSupermarket giant Tesco today lifted profit guidance for the financial year after posting interim results ahead of City expectations.
The group now sees an adjusted operating profit between £2.9 billion and £3.1 billion, an increase from the previous range of between £2.7 billion and £3 billion.
The figure for the first six months of the year of £1.67 billion rose 1.5% on a year earlier, slightly ahead of the £1.6 billion forecast.
UK market share rose 77 basis points to 28.4% as Tesco has now gained share for 28 consecutive four-week periods. Like-for-like sales rose 4.9% in the UK.
Tesco said: “Competitive intensity remains elevated. However, in the first half, a better-than-expected customer response to our actions and the benefit of an extended period of good weather have helped offset the cost of our investments.”
Chief executive Ken Murphy said he was pleased with the first half performance, which builds on “already strong momentum”.
He added: “The steps we have taken to keep prices down for customers have improved our price position relative to the market.”
FTSE 100 set to build on record, US markets higher
07:12 , Graeme EvansThe record run of the FTSE 100 index is set to continue, with futures trading pointing to a 0.3% rise at today’s opening bell.
Gains of 11% for AstraZeneca and 6% for GSK last night helped London’s top flight rise by 1% or 96 points to an all-time high close of 9446.43.
US markets also finished in positive territory, despite the first day of a US government shutdown.
The S&P 500 rose 0.3%, the Nasdaq Composite lifted 0.4% and the Dow Jones Industrial Average edged up 0.1%.
The price of gold remains in record territory at $3868 an ounce, while Brent Crude is 0.5% higher at $65.69 a barrel.
