BUSINESS LIVE: Plus500 experiences a decline in profits due to a decrease in trading volumes
By Live Commentary
Published: 07:36 BST, 14 August 2023 | Updated: 08:28 BST, 14 August 2023
In the early trading, the FTSE 100 has dropped by 0.3 percent. Today, Plus500, Lok’nStore Group, and L’Occitane are among the companies providing reports and trading updates. Read the Business Live blog for Monday, 14 August below.
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Rural areas experience a surge in the launch of almost 100,000 new businesses
(PA) – Research shows that nearly 100,000 small businesses have emerged in rural areas of the UK over the past year. The increase in female and older entrepreneurs has contributed to this boom, as stated by GoDaddy’s Venture Forward research initiative. This growth can be attributed to the pandemic, which led many individuals to move out of major cities in search of better housing options and opportunities for remote work. The latest data from over 2.3 million microbusinesses in the UK, which are defined as firms with less than ten employees, reveals that 25.9 percent of these businesses are now located in rural areas, up from 24.1 percent a year ago. The research also indicates that 94,464 new startups were launched in rural areas within the previous twelve months. GoDaddy experts credit technological advancements for enabling the establishment of businesses in remote parts of the country.
Market opens with the FTSE 100 down 0.3%; FTSE 250 decreases by 0.1%
Trading in London has begun on a negative note, with both the FTSE 100 and FTSE 250 experiencing declines. Mining and oil companies are the primary contributors to the decline in the FTSE 100, as concerns over China’s economic recovery and its property market weighed on investor sentiment. Energy stocks have fallen by 1.1 percent due to worries about China’s economic rebound and a strong dollar. Industrial metal miners have slipped by 1.2 percent, tracking the decrease in base metal prices. China’s new bank loans have dropped in July, and key credit indicators have also weakened, reflecting the country’s struggling economic recovery. Geopolitical tensions have added to the worries, following an incident where a Russian warship fired warning shots at a cargo ship in the Black Sea. Plus500’s shares have increased by 3.2 percent after the company reported higher earnings and announced a new share buyback program.
US-China tech dispute weighs on global markets
Richard Hunter, head of markets at Interactive Investor, remarks on the poor performance of Asian markets due to various factors. In addition to concerns about inflation coming from the US, the ongoing technology security dispute between the US and China has negatively impacted investor sentiment. Furthermore, the strength of the dollar has put pressure on the Japanese yen, although this has benefited exporters. The Chinese property sector’s weakness is also a cause for concern, as some developers struggle to meet their financial obligations. The lack of communication from authorities regarding monetary stimulus is notable and may change after the release of retail sales and industrial output data later in the week. These releases are expected to reflect China’s current economic challenges. The UK market is influenced by these global factors, with companies exposed to China experiencing declines. The FTSE 100 has only seen a modest 0.8 percent increase so far this year. The FTSE 250, on the other hand, has been negatively affected by potential interest rate increases, and with modest positive growth but limited opportunities, it has declined by 0.3 percent.
Loophole in legal crackdown on dirty money allows oligarchs to hide funds
Concerns arise as a loophole that enables criminals, kleptocrats, and oligarchs to conceal their wealth remains unaddressed by the government. This unexpected development follows the implementation of transparency regulations that require offshore companies with property in England and Wales to disclose their ultimate owner in a public register of overseas entities.
Nigel Farage accuses NatWest of delaying debanking review
Nigel Farage has accused NatWest of stalling the review of the closure of his bank account, accusing the bank of kicking the matter “into the long grass”. The debanking scandal, which involves banks terminating accounts without warning based on individuals’ political views, continues to impact the banking sector. Farage’s account was closed by Coutts due to his political beliefs, sparking widespread controversy and criticism.
Graham Norton’s wine sales reach 3.7 million bottles
Sales of Graham Norton’s wine have exploded as consumers increasingly seek out celebrity alcohol brands. The TV host’s GN label, which was launched ten years ago, sold over 3.7 million bottles last year according to its New Zealand producer, Invivo. To meet the rising demand, the company has had to purchase additional vineyards.
Plus500 experiences a decline in profits due to a decrease in trading volumes
Plus500 has reported a 43 percent decrease in profits for the first half of the year, attributed to a drop in trading volumes on the online platform. Core profit for the six months ending in June fell from $305.3 million to $174.1 million compared to the previous year. Additionally, the London-listed company announced a $60 million share buyback program. Plus500 attributes its strong performance during the first half of the year to its market-leading technology and consistent ability to attract and retain high-value customers. The company’s diverse revenue streams, expanded product offerings, and strong customer relationships, along with the growth drivers in its target markets, contribute to its ability to achieve growth and provide attractive returns to shareholders. Plus500 is also making progress in its strategic priorities, particularly in the US futures market and regulatory expansions into the UAE and Bahamas. The company’s track record of delivering excellent shareholder returns places it among the top companies in the FTSE All-Share Index for total returns over the past decade.
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