Weekly review
By Josh White
Date: Friday 03 Jan 2025
(Sharecast News) - The FTSE 100 ended New Year-truncated week up 86.99 points, or 1.07%, closing at 8,223.98 on Friday.
Equity view
Budget airline Wizz Air on Friday reported a 1.9% increase in passenger numbers for December on an annual basis, but capacity declined as it continued to ground aircraft due to problems with Pratt & Whitney engines. The company carried 5.06 million passengers last month. Seat capacity was down 3.1% year-on-year with a load factor of 86.5%, up 4.3 percentage points.
GSK announced on Friday that its monoclonal antibody 'Nucala', or mepolizumab, has received approval from China's National Medical Products Administration for the treatment of chronic rhinosinusitis with nasal polyps (CRSwNP) in adults. The FTSE 100 pharmaceuticals giant said the therapy, which targets interleukin-5 (IL-5), would serve as an add-on treatment alongside intranasal corticosteroids for patients whose symptoms were inadequately controlled with systemic corticosteroids or surgery.
Critical power and data transmission products manufacturer Volex announced on Friday that Murat Ticaret Kablo Sanayi, acquired by the company in 2023, had surpassed the EBITDA targets stipulated in the acquisition agreement for the first 12 months post-completion. The AIM-traded firm said that as a result, the first tranche of deferred consideration was now payable to Murat Ticaret's four former owners. Under the terms of the agreement, Volex said it would satisfy 50% of the deferred consideration through the issue of shares, with the total payment comprising €10m in cash and 2,878,830 new ordinary shares of 25p each.
Star Energy Group announced on Friday that it has increased its ownership stake in A14 Energy to 71%, through the acquisition of an additional 20% of the company's issued share capital from joint venture partner Peninsula International. The AIM-traded firm, formerly known as IGas Energy, said the transaction was executed via the exercise of Star Energy's conversion rights, under a €529,614 convertible loan agreement with Peninsula. A14 Energy, through its Croatian subsidiary IGeoPen, holds three geothermal water exploration licences in Croatia's Pannonian Basin, a region considered highly prospective for geothermal energy development.
Animalcare Group announced on Friday that it has completed the acquisition of Randlab, a leading equine veterinary company based in Australia. The AIM-traded firm said the transaction, valued at AUD 120m (£62.2m), was finalised on 3 January, following its initial announcement on 3 December. It said the acquisition included Randlab Australia, its wholly-owned subsidiary Randlab New Zealand, as well as Randlab Pty Ltd and Randlab Middle East Veterinary Medicine Trading Single Owner LLC.
Chrysalis Investments on Thursday said it had reached a settlement with Revolution Beauty over its claim against the troubled AIM-listed cosmetics retailer. Under the terms of the settlement, Revolution Beauty has agreed to pay the former investor "a non-material sum, being less than 1% of the company's market capitalisation" on Jan 2. All other details of the settlement remain confidential.
Phoenix Group Holdings announced the early redemption of its outstanding $250m fixed rate reset perpetual restricted tier 1 contingent convertible notes on Thursday. The FTSE 100 company said the redemption would take place on 4 February, in accordance with the terms outlined in the trust deed and conditions governing the notes. It said the notes, first issued in January 2020, would be redeemed at their principal amount, along with any accrued and unpaid interest up to, but excluding, the redemption date.
Engineering, environmental, and strategic consulting company Ricardo announced on Thursday that it has finalised the sale of its Ricardo Defense division. The London-listed firm said the business was sold to Proteus Enterprises and Gladstone Investment Corporation through GPD Acquisition for $85m (£67.5m), on a cash-free, debt-free basis. It said the proceeds from the transaction would be used to fund Ricardo's acquisition of an 85% stake in E3 Advisory, a leading Australian infrastructure advisory firm.
John Wood Group announced on Thursday that it has completed the sale of its 51% stake in EthosEnergy Group to private equity firm One Equity Partners for a final net cash consideration of $138m. The FTSE 250 company said the transaction included an additional $42m in cash at completion, replacing previously planned loan notes. EthosEnergy, a joint venture between Wood and Siemens Energy, is focussed on rotating equipment and employs about 3,600 people globally.
Vodafone Group has finalised the sale of Vodafone Italy to Swisscom for €8bn in cash, it announced on Thursday. The FTSE 100 telecommunications giant said the deal valued Vodafone Italy at a multiple of 7.6x consensus adjusted EBITDAaL and approximately 26x operating free cash flow for the 2024 financial year, marking the highest OpFCF multiple for any Vodafone market transaction in the past decade.
Logistics firm Bunzl said it would start the first tranche of its £200m 2025 share buyback programme on January 2. The company will buy £50m in shares by March 3 when it releases its annual results.
Autoimmune disease and cancer treatment developer Sareum has revealed that the commercial licence of its jointly developed SRA737 product has been terminated by a biopharma company in the US. SRA737, a clinical-stage oral, selective Checkpoint kinase 1 inhibitor that targets cancer cell replication and DNA damage repair mechanisms, has had a development and commercialisation license with a private biopharma company since January.
ValiRx, a life science company specialising in early-stage cancer therapeutics and women's health, announced a further amendment to its letter of intent with TheoremRx regarding the proposed sub-license of VAL201 on Tuesday. The AIM-traded firm said the exclusivity period, initially set to expire on 31 December, had been extended for a final time until 31 May. It said the extension followed developments disclosed by TheoremRx involving a transaction with an unidentified Nasdaq-listed company.
Hummingbird Resources announced the signing of a $35.6m loan agreement on Tuesday, to support the cash flow needs of its Malian subsidiary, Société des Mines de Komana (SMK). The AIM-traded firm said the agreement, reached with Nioko Resources Corporation, would address its immediate financial challenges as announced earlier in the month. It said the loan, which would carry an annual interest rate of 9%, would be repayable by 31 December 2025.
CleanTech Lithium, a company focused on lithium exploration and development in Chile, updated the market on its application for a special lithium operating contract (CEOL) for the Laguna Verde project on Tuesday, as well as its amended 2024 interim financial results, revised in preparation for a dual listing on the ASX. The AIM-traded firm said it remained on track to submit its CEOL application by early January, ahead of the Chilean government's extended deadline of 31 January.
Online retailer Huddled Group said it had bought the 25% of cosmetic waste seller Boop Beauty that it did not own for £100,000 after talks with founder Yasmine Amr. Huddled added that it had been encouraged by Boop Beauty's trading so far and felt "full ownership better justifies the allocation of additional resources to the business in order to fuel its continued growth".
Walk-through security technology specialist Thruvision Group announced the appointment of its chief financial officer, Victoria Balchin, as its new chief executive officer on Monday, effective 2 January. The AIM-traded firm said the appointment followed a unanimous decision by the board, which determined an internal promotion was in the company's best interests.
Helix Exploration, a company focused on helium exploration and development within the Montana Helium Fairway, announced on Monday that it has entered into a letter of intent to acquire a helium pressure swing adsorption (PSA) processing plant. The AIM-traded firm said it had made a $0.1m down payment as part of the $0.5m acquisition, representing a significant milestone in its plans to become a leading helium producer in Montana. It said the PSA plant, previously operated by Xebec, had a proven track record, having produced 48,000 Mcf per year of high-grade helium with 98.5% uptime.
Zero-carbon fuel cell and hybrid systems developer Proton Motor Power announced plans to operate on a significantly reduced cost basis on Monday, while pursuing the cancellation of its shares from trading on AIM. The firm said the move followed an earlier update on 20 November, with the board citing the cost structure as incompatible with maintaining its listing.
SDX Energy shares were surging on Monday, after it announced the postponement of its general meeting. The AIM-traded firm said the meeting was originally scheduled for 1100 GMT on 31 December in London. It said the delay was due to an unspecified "logistical issue". The company said it would announce a new date for the meeting in due course.
Economic news
Retail footfall in the UK slumped during the so-called Golden Quarter, capping a "disappointing year" for the bricks-and-mortar stores, according to the British Retail Consortium. Total footfall was down 2.2% in the five weeks between 24 November and 28 December, following a 4.5% drop in November, the BRC said on Friday. The later timing of Black Friday meant that the discount shopping holiday fell into December's figures, rather than November's - having a big negative impact on November but improving the December data.
Activity in the UK manufacturing sector contracted more than previously thought in December, according to revised estimates from S&P Global on Thursday, as output, new orders and employment all declined at faster rates. The manufacturing purchasing managers' index for December fell to 47.0, down from 48.0 in November and below the initial estimate of 47.3 released two weeks ago. This was the lowest mark for the PMI in 11 months and was the third straight reading below the key 50-point level, which separates growth from contraction.
UK house prices inched closer to record highs in December, according to Nationwide, though the market is likely to see increased volatility over the next few months ahead of the introduction of new changes to stamp duty. Nationwide reported on Thursday that UK house prices rose 0.7% over the month of December to £269,426, up 4.7% on last year, to sit just below an all-time high (£273,751) recorded in summer 2022. The building society said there was a "clear north-south divide" in house price performance in 2024 with northern regions registering higher price growth than southern regions.
International events
The number of unemployed people in Germany rose by less than forecast last month, keeping the jobless rate unexpectedly steady, according to figures released by the government on Friday. Some 10,000 additional people were without a job in December, giving a total of 2.869m for the month, according to federal labour office data. However, the consensus estimate was looking for 15,000 increase month-on-month.
Tesla reported a decline in annual deliveries for the first time in its history on Thursday, delivering 1.79 million vehicles in 2024 compared to 1.81 million in 2023. Fourth-quarter deliveries reached 495,570, falling short of analysts' expectations, which ranged from 501,000 to 506,763. Shares in the electric car giant dropped by as much as 7% following the announcement. The company's annual production of 1.77 million vehicles narrowly missed its delivery total, indicating an accumulation of inventory.
The decline in American manufacturing activity picked up pace in December, though it wasn't as severe as initially feared, according to revised estimates from S&P Global on Thursday. The US manufacturing purchasing managers' index slipped to 49.4 last month, down from 49.7 in November but up from the flash reading of 48.3 published two weeks ago. While this was better than economists' predictions for no change from the initial estimate, this was still the sixth straight month below the key 50-point level which separates growth from contraction.
Claims for unemployment benefits in the United States unexpectedly declined to their lowest level in nearly eight months over the Christmas period. Initial jobless claims fell to 211,000 in the week ended 28 December, down from a revised 220,00 (initial estimate: 219,000) the week before. This was the fourth straight decline in weekly claims, below the consensus forecast of 222,000 and the lowest weekly reading since the week ended 27 April 2024. The four-week moving average fell to 223,250 from 226,750.
The contraction of the eurozone's manufacturing sector was slightly worse than originally estimated in December, according to revised estimates from S&P Global and the Hamburg Commercial Bank (HCOB). The final reading of the single-currency region's manufacturing purchasing managers' index came in at 45.1, down from the initial estimate of 45.2 released two weeks ago which was unchanged from November. This was the 30th successive sub-50.0 reading - the level which separates contraction and growth - marking two and a half years of continuous decline in factory operating conditions across the eurozone.
Growth in factory sector activity in the People's Republic of China slowed at the end of 2024, amid softer export demand, the results of a closely followed survey revealed. Private sector survey compiler Caixin reported a decline in its manufacturing sector Purchasing Managers' Index from a reading of 51.5 in November to 50.5 for December. Economists had forecast a reading of 51.7. The 50 point level marked the threshold between a contraction and an expansion in the sector with successively lower or higher readings above that mark denoting faster or slower rates of decline or growth.
House price growth in the States drifted lower in October when compared with a year earlier, despite monthly gains. According to the Federal Housing Finance Agency, in seasonally adjusted terms house prices were ahead by 0.4% month-on-month. In terms of annual rates of change on the other hand, house prices rose the most in the Middle Atlantic with a gain of 7.0%, whereas in the Pacific division they increased by just 0.7%.
Economic activity in China perked up at the end of 2024, the results of three surveys revealed. The National Bureau of Statistics factory sector Purchasing Managers' Index slipped from a reading of 50.3 for November to 50.1 in December (consensus: 50.3). Nevertheless, the fact that the PMI remained above the 50 point threshold meant that activity expanded for a third successive month. A separate PMI for services sector activity meanwhile improved from 50.0 to 52.2 - a nine-month high - and a third for construction from 49.7 to 53.2.
Factory sector activity in the Chicago area slowed a bit more quickly at the tail-end of 2024, the results of a closely followed survey revealed. Market News International's Chicago Business Barometer slipped by 3.3 points from the month before to reach 36.9 in December. Economists had forecast an improvement to 42.8. The 50-point level marked the threshold between an expansion or a contraction in activity levels. A key sub-index tracking new orders dropped by 13.5 points, plumbing its lowest reading since May 2020.
Japan's factory activity contracted at a slower pace in December, suggesting the sector could be moving closer to stabilising after months of declines. The final au Jibun Bank Japan manufacturing purchasing managers' index (PMI) rose to 49.6, the highest in three months and slightly above the flash estimate of 49.5. While still below the 50-point threshold that separated growth from contraction, it was still an improvement from November's reading of 49.0.
South Korea's factory output contracted more sharply than anticipated in November, reflecting mounting challenges from slowing exports and waning business confidence. According to Statistics Korea, the industrial output index declined by 0.7% on a seasonally adjusted basis, reversing expectations of a milder 0.4% drop based on a Reuters survey. That followed stagnant growth in October. On an annual basis, factory output grew by a modest 0.1%, a sharp slowdown from October's 6.3% increase and below economists' expectations of a 0.4% rise.
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