FTSE 100 close: UK stocks end higher, Wall Street meme-stocks soar again
- FTSE 100 gains 13 points
- Vodafone investors shrug off divi cut
- GameStop and AMC Entertainment Surge
- Flutter Entertainment advocates for stamp duty removal
- Centrica Shares up amid Ofgem consultation
FTSE 100 gained points
The FTSE 100 index closed 13 points higher, finishing at 8,428.
It marked a broad optimism across the market, despite mixed economic data, with a number of blue-chips trading higher.
Retail firms were on the front foot helped by Curry which in this morning’s financials confirmed it had returned to growth and upped its guidance.
Also on the docket was Flutter, as the Paddy-Power parent posted its last set of results before its switch to the US.
Elsewhere Ocado and BT, both heavily shorted stocks, saw significant gains, with Ocado leading the pack with a 9.4% increase.
Vodafone investors shrugged off divi cut
Vodafone shares traded higher, up nearly 5% to 73.40p, as shareholders shrugged off a dividend cut and instead welcomed what was a described as a pragmatic move that will help the telco supported a paydown of debt and new investment aimed at unlocking growth.
“While painful, the cut looks a sensible move,” said Russ Mould, investment director at AJ Bell.
Its expected that the divi cut enables around €1 billion of debt to be reduced per year, albeit standing at €33.2 billion that debt pile is substantial.
“From a share price perspective, less debt means less risk and less risk can mean a higher share price, or at least persuade investors to pay a higher multiple to access a company’s earnings and cash flow, all other things being equal.”
GameStop and AMC Entertainment Surge
In New York, meme stocks GameStop and AMC Entertainment were again soaring as a fresh ‘short squeeze’ was amplified by social-media stock traders – embodied by ‘Roaring Kitty’, aka Keith Gill.
GameStop's stock doubled in early trades, before settling at a 63% gain, marking a 195% increase over the past five days.
AMC, meanwhile, jumped 70% to $8.93, a 180% rise over five days.
The GameStop rally has inflicted significant losses on short sellers who had reportedly been targeting the stock.
Market data, from Ortex, indicates that shorters stand to lose some $1.2 billion today alone, and their total losses amount to around $2.5 billion for the past month. Thi
Market experts caution against the volatility associated with such speculative trading, as they did in 2021, meanwhile, the rapid rise in price for the so-called meme-stocks continues.
Flutter Entertainment Advocates for Stamp Duty Removal
Peter Jackson, CEO of Flutter Entertainment, has called for the removal of the 0.5% stamp duty on share purchases to help invigorate the London Stock Exchange (LSE).
The tax, he argues, hampers market growth and deters companies from listing in the UK.
Flutter, which owns Betfair and Sky Bet, plans to shift its primary listing to the US, driven by the success of its FanDuel sportsbook and better valuations.
Jackson's comments highlight broader concerns about the competitiveness of the LSE and the need for policy changes to attract and retain listings.
This move aligns with a trend of companies seeking more favorable market conditions abroad.
Centrica Shares Up Amid Ofgem Consultation
British Gas owner Centrica saw its shares move higher on Tuesday after UK energy regulator Ofgem's announced a consultation on lifting the ban on energy firms offering cheaper deals to new customers.
This ban, implemented during the energy crisis, may be removed earlier than planned to stimulate competition and lower prices.
Martin Lewis, founder of MoneySavingExpert, supports this move, emphasizing the need to encourage market competition to benefit consumers.
