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FTSE CLOSE: Brexit Party reversal sends pound higher

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After falling more than 1 per cent at some point today, the FTSE 100 rebounded a bit to close down 0.4 per cent, or 30.84 points, at 7,328.54. 

Meanwhile the pound was given a boost by Nigel Farage’s Brexit Party, after it announced it will not field candidates in seats the Conservatives won in the 2017 general election. 

Sterling rose by nearly 1 per cent against the dollar and hit a six-month-high against the euro, although by market’s close it had lost some of those earlier gains. 

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Best of BS Opinion: Boosting economic growth, income tax slabs, and more

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Reviving should be the top priority for the government. In this context, Finance Minister Nirmala Sitharaman recently hinted that the government was considering lowering and rationalising personal rates, among other measures, to boost

While there is no certainty of an cut translating into more spending as during tough times the tendency is to save more, a simpler regime with reasonable tax rates can be expected to help improve compliance and increase the base, argues our lead editorial.

The unconscionable neglect of exports and the external sector has impacted competitiveness, productivity and GDP growth, writes former commerce secretary Rahul Khullar.

Former chief economic adviser Arvind Subramanian and others note that the NSS figure for consumption growth appears implausible when judged against other indicators. But so does the national income accounts (NIA) figure.

The reality probably lies somewhere in between: consumption was better than implied by the NSS figures, but not quite as good as that implied by the NIA. Click here to read

Popular sentiment and public outrage are cited to somehow justify recourse to instant and drastic “justice.” This is opening the door to mob rule. Responsibility of political leadership lies not in pandering to such popular sentiment but in ensuring that the law of the land is always upheld, writes former foreign secretary Shyam Saran.

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“We need to change this notion that one who supports the Bill and the BJP is a patriot and one who opposes it is anti-national. The government should answer all the issues raised on the [Citizenship (Amendment)] Bill.

Maharashtra Chief Minister Uddhav Thackeray

First Published: Wed, December 11 2019. 06:10 IST

Source: Business Standard

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Asos of India Koovs rescued by founder Labour peer Lord Waheed Alli

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Rescue: Koovs founder Lord Waheed Alli

Rescue: Koovs founder Lord Waheed Alli

Rescue: Koovs founder Lord Waheed Alli

A Labour peer has saved online fashion retailer Koovs from collapse after buying it when it went into administration.

Bosses at Koovs, dubbed the Asos of India, had hoped for a major investment from shareholder Future Lifestyle Fashions – part of India’s largest retail group – but the cash failed to arrive. That left the door open for Lord Waheed Alli, who founded the firm, to step in.

He said: ‘I could not stand by and allow all the hard work which has been put in to be destroyed, with the loss of jobs and the damage to our suppliers which would have followed.

‘The action we have taken means Koovs and its trading subsidiary can continue to operate and jobs, creditors and customers are protected.’

Shares were suspended at 11.30am yesterday at 3.2p. They listed at 200p in 2014.

Alli, who oversaw Asos as its chairman for 12 years, had attempted to turn Koovs into Asia’s answer to the online fashion giant by cashing in on India’s growing younger affluent shoppers.

He has ploughed around £17million of his own cash into Koovs since founding it in 2012.

 

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MARKET REPORT: Rolls-Royce rocked as top shareholder quits the board

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Fresh turbulence has hit Rolls-Royce after its largest shareholder quit the board.

Bradley Singer, a representative of the activist investor Value Act, is stepping down from the engine maker after almost four years as a director.

He joined in March 2016 after Value Act bought a more than 10 per cent stake in Rolls, which was recovering from profit warnings.

Nosedive: Rolls-Royce has struggled with problems with a set of engines called the Trent 1000, which is set to cost it £2.4bn

Nosedive: Rolls-Royce has struggled with problems with a set of engines called the Trent 1000, which is set to cost it £2.4bn

Nosedive: Rolls-Royce has struggled with problems with a set of engines called the Trent 1000, which is set to cost it £2.4bn

Value Act cut its holding from 10.48 per cent to 9.35 per cent this year, but Singer’s departure has spooked shareholders, who are preparing for it to sell its entire stake.

It comes as Rolls has struggled with problems with a set of engines called the Trent 1000, which is set to cost it £2.4billion, and as another US activist, Harris Associates, has bought a 7 per cent chunk of the company.

Rolls’ shares fell by as much as 5 per cent before closing down 3.3 per cent, or 24p, at 701p.

BAE Systems was knocked by reports that US President Donald Trump’s administration is putting pressure on Japan to choose a US defence company to develop its new fighter jet rather than BAE.

Tokyo can either work with BAE, work with US group Lockheed Martin or develop a new plane domestically. BAE shares fell 0.9 per cent, or 4.8p, to 551.4p.

Stock Watch – Futura Medical 

Futura Medical fell after the pharma group reported unexpected results from tests of a gel for erectile dysfunction. 

Trials showed it worked but also that a placebo gel containing some of the active ingredients worked too.

This meant the trial failed to meet its goal to beat the placebo, though Futura said this could be a ‘simpler route’ to getting regulatory approval.

Investors had expected a positive result against the placebo gel. Stock fell 49.1 per cent, or 14.25p, to 14.75p.

Flailing oil and gas explorer Tullow Oil made modest gains yesterday, rising 14.3 per cent, or 5.7p, to 45.64p, as bargain hunters scooped up its stock.

On Monday the shares dived 72 per cent after it went into crisis mode – suspending the dividend, sacking the boss and revising down forecasts amid problems at its sites in Ghana.

IT group Computacenter was one of the FTSE 250’s top risers after it surprised investors with an unscheduled update that said it now expects full-year profits to be higher than guided. Shares rose 4.7 per cent, or 72p, to 1605p.

But convenience store chain McColl’s sank (down 4.7 per cent, or 1.95p, to 39.4p) after a mini profit warning, saying it would narrowly miss forecasts after a ‘challenging’ year where it was stung by weaker consumer spending and poor weather over the summer.

At the other end of the retail spectrum, Watches of Switzerland dipped 1.2 per cent, or 4p, to 320p, despite posting a 112 per cent rise in first-half profits to £26.5million.

The Rolex seller said demand was strong in the US and UK. It has bought four more Fraser Hart-branded showrooms in Britain.

Elsewhere, Bloomsbury Publishing lost ground, as the Harry Potter publisher said it has snapped up London-based theatre publisher Oberon Books for £1.2million. It dropped 0.4 per cent, or 1p, to 261p.

Digger and construction equipment rental group Ashtead said it will shake up its business in Britain to adapt to the tricky trading environment for building firms, and warned it could be hit by foreign currency moves. 

It fell 6.62 per cent, or 146p, to close at 2220p, as the warnings took the shine off a 6 per cent rise in half-year profits to £633million.

That dragged on the FTSE 100, which closed 0.5 per cent, or 20.14 points, down at 7213.76, while the FTSE 250 tumbled 0.9 per cent, or 141.55 points, to 20,781.09.

It was a mixed bag for Marks and Spencer and online fashion firm Asos, which were both handed analyst upgrades.

RBC brokers bumped up M&S from ‘sector perform’ to ‘outperform’, but its shares fell 0.9 per cent, or 1.9p, to 206.4p, while HSBC moved Asos from a ‘hold’ to a ‘buy’ rating as they said it was turning a corner after a difficult year. 

Asos rose 0.1 per cent, or 4p, higher, to 2956p.

Domino’s Pizza Group slid into the red after chairman Stephen Hemsley, who has been in the role since early 2010, said he would leave on December 29. Its shares shed 1.9 per cent, or 5.9p, to 300.1p.

 

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