BUSINESS LIVE: Wage growth eases; IDS boosted by election deliveries; Frasers profits soar

Just before close, the FTSE 100 was 0.34% up at 8,214.9.

Meanwhile, the FTSE 250 was 0.82% higher at 21,267.33.

Rachel Reeves today hinted at tax hikes or spending cuts to come in her first Budget this autumn as she warned of ‘difficult decisions’ over the public finances.

The Chancellor said she would be ‘really clear and honest’ about the ‘scale of the challenge’ facing the new Labour Government.

The Bank of England said on Thursday that a ‘global payments issue’ was affecting the interbank payments service CHAPS, delaying some high-value and time-sensitive payments including some house purchases.

The Bank said in a statement: ‘We are mindful of the impact this is likely to have and are working closely with a third-party supplier, industry and other authorities to resolve the issue as promptly as possible.’

Two more high street banks have announced they are cutting mortgage rates as home loan costs continue to drift downwards.

NatWest is lowering a number of products by up to 0.23 percentage points and TSB is cutting deals by up to 0.15 percentage points having already lowered rates at the start of the week.

(PA) – Electricity giant SSE said it generated nearly two-thirds more renewable energy in the early summer months than in the same period last year.

The London-listed company said output from its renewables division was 60% higher in the three months to June 30, which it said was down to better weather conditions and more capacity.

SSE said the increase in green generation to 2,596 GWh reflects “a return to more normalised weather conditions over the period, in addition to year-on-year capacity increases”.

Gas-fired generation fell 10% to 3,714 GWh over the period, the company said in a trading statement ahead of its annual general meeting on Thursday.

SSE said its first quarter financials were in line with expectations and it is on course for its previously announced £20.5 billion investment plan over the next five years, just over one-third of which will go towards renewables.

It said it expects to reach around nine gigawatts of installed capacity by 2026/27, largely from offshore wind farm projects.

Evoke shares slumped on Thursday as the William Hill owner warned first-half profits would significantly miss expectations.

The firm’s share price was 12.8 per cent down at 75.3p at 12:30pm after it told investors that adjusted earnings before nasties would be around £35million to £40million ‘behind plan’ this fiscal year.

Labour was accused of planning a ‘WFH charter for idlers’ today in the wake of the King’s Speech.

Keir Starmer has been warned the radical overhaul of employment rights featured in his first legislative package risks mass job losses and firms going bust.

Labour’s plan to build 1.5million homes in England in five years is at risk due to a shortage of skilled workers, industry chiefs have warned.

Sir Keir Starmer hopes that easing planning restrictions and reintroducing compulsory housebuilding targets for councils will prompt a construction boom.

Pret A Manger is to end its ‘too good to be true’ subscription that got customers five barista-made drinks a day for £30 a month.

The coffee chain broke the news today in an email to Club Pret subscribers in which they told customers it was ‘time to rethink how it works’.

Dunelm is browsing sites for new stores after rising sales showed shoppers were responding well to its smaller format stores.

In the latest quarter, Dunelm opened a new store in Brighton and relocated its Edinburgh store ‘to a better site’, taking its total store openings to six for the full year.

Frasers remains committed to maintaining a presence on the high street, the group’s boss told MailOnline and This is Money.

The retailer, which owns, among other brands, House of Fraser, Sports Direct and Gieves & Hawkes, reported a 13 per cent rise in annual profit on Thursday.

AJ Bell has hailed ‘strong momentum’ so far in 2024 after the group reported record assets and growing customer numbers.

The DIY investment company revealed assets under administration at its platform business climbed to £83.7billion in the three months ending June.

Royal Mail revenues were bolstered by general election-related mail and stamp price hikes, making up for fewer letters deliveries in recent months.

Parent company International Distribution Services (IDS) made £2billion in revenues in the three months to June, up from £1.8billion a year earlier.

More than £260billion was wiped off the value of the three biggest companies in the world amid fears that US relations with China and Taiwan could turn sour.

Shares in Apple dropped more than 2 per cent while Microsoft fell 1 per cent and Nvidia was down more than 6 per cent – hitting investors in Britain whose savings and pensions are exposed to the US tech titans.

Last month, 210,000 people descended on Glastonbury Festival for its 52nd year, to see the likes of Coldplay, Dua Lipa and SZA take to the famous Pyramid Stage.

Given the fierce competition to secure tickets for this and other big musical events, many would assume the festival industry is thriving – but the truth is far from it when you look beyond the biggest names.

Harland & Wolff insisted it is still in talks with ministers over a £200million lifeline after reports Labour was set to block its request for help.

In an update to the London stock market yesterday, the shipyard behind the Titanic said no decision has been made by the Government about guaranteeing a loan to keep it afloat.

Speaking to MailOnline and This is Money, Frasers Michael Murray CEO said the results were ‘very positive’.

‘We believe we have a plan which is working.

‘We have the best brands,growing international investment in the Nordic region (XXL ASA),the Netherlands(Twin Sports)and Indonesia(opening Sports Direct stores) and the launch of the new Fraser’s Plus card is very exciting.

‘Our commitment to the High Street will continue.

‘We have invested in space in several retail centres and believe people do want to go out to shop.

‘We hope the new Government will look at reducing business rates which are holding us back.They say they are committed to business,so we hope that they will help retailers.

‘It is going to be the survival of the fittest and we are confident we are in a good place to continue to grow.’

The Body Shop is set to be rescued by British tycoon Mike Jatania.

The fate of the beauty retailer has been hanging in the balance since February when its administration triggered 759 job losses and the closure of 82 shops.

Pernod Ricard will ditch wine brands including Jacob’s Creek to focus on spirits.

The drinks giant will offload parts of its wine portfolio to the owners of Australia’s Accolade Wines, dumping names such as Stoneleigh and Campo Viejo, and other wines made in Australia, New Zealand and Spain.

Retail guru Mary Portas has backed the opposition to the proposed UK stock market listing by fast-fashion giant Shein.

Known as ‘Mary Queen of Shops’ after her TV show, she joined the launch of a ‘Say No to Shein’ campaign calling on the London Stock Exchange to block the Chinese retailer’s £50billion flotation.

She said: ‘This is a company with allegations of unethical business practices, modern slavery and violating labour laws. Surely we are better than this?’

Royal Mail has seen its sales bolstered by General Election mail and stamp price hikes, despite delivering fewer letters in recent months, its parent company revealed.

International Distribution Services (IDS) also said it was urging shareholders to accept the offer to be bought by Czech billionaire Daniel Kretinsky.

The postal service made £2billion in revenues in the three months to June, up from £1.8 billion a year earlier.

The number of total parcels delivered jumped by 11 per cent to 315 million year-on-year.

However, it saw the volume of addressed letters – which excludes election mail – decline by 4% per centcompared with the year prior.

But total revenues from letters increased by 11 per cent, driven by millions of poll cards, postal votes and candidate mail during the UK General Election campaign.

IDS said the jump was also driven by price increases, with the cost of some first and second-class stamps going up in April.

Across the group – which also includes European parcel firm GLS – revenues increased by 8 per cent to £3.3 billion over the latest quarter.

Frasers profits soared 13.1 per cent in the year to 28 April, with the Sports Direct owner forecasting more growth in its new financial year as it benefits from a plan to shift the group upmarket.

FTSE 100-listed Frasers, controlled by founder Mike Ashley, is pursuing what it calls an ‘elevation strategy’ with investments in flagship stores and in online operations, and the strengthening of ties with brands such as Nike, Adidas and The North Face. Its shares are up 10 per cent year-on-year.

The group’s brands also include House of Fraser, Flannels, USC and Jack Wills, and it holds strategic equity stakes in a raft of other retailers including Hugo Boss , ASOS, Boohoo, Currys and AO World.

Frasers made an annual adjusted pre-tax profit of £544.8million, at the top end of its guidance range of £500million to £55 million and up from £478million made in 2022/23.

‘Our successful Elevation Strategy is powering our strong financial performance, with strategic brand relationships giving us better access to product across the Frasers Group,’ it said.

It forecast profit of £575million to £625million for its new financial year – a year that has Euro 2024 behind it and the Paris Olympics coming up.

‘We remain confident that our strategy will drive continued strong performance, and we expect significant synergies from both our automation programme and the integration of acquisitions,’ Frasers added.

The pound climbed above $1.30 yesterday for the first time in a year after higher-than-expected inflation figures dented hopes of interest rate cuts.

And it topped €1.19 versus the euro, its strongest for nearly two years, in a boost to British holidaymakers.

Elsewhere, markets were gripped by the path of interest rates across the Atlantic, where, in contrast, hopes of a cut by the US Federal Reserve are growing.

That has sent gold prices to $2,483 per ounce, a fresh all-time high.

Luke Bartholomew, deputy chief economist at Abrdn:

‘There were no nasty surprises for the Bank of England in today’s labour market report, with wage growth continuing to slow in line with expectations.

‘Household spending should continue to be supported by wages growing well in excess of inflation.

‘But the double edge to this sword is that wage growth is still well above a level that the Bank would consider consistent with its 2% inflation target. So policy makers need confidence that wage growth will slow further before embarking on rate cuts.

‘Given the mixed data recently, if the BoE does plan on cutting in August – which we still just about expect – then the market may benefit from some guidance to this effect from key Bank decision makers very soon.’

Hetal Mehta, head of economic research at St. James’s Place:

‘No big surprises in the labour market data today, the tight labour market was relatively stable.

‘The slight decline in wage growth will be welcome to the Bank of England after the disappointing services inflation yesterday.

‘There is still some key data to come before the August Monetary Policy Report but the decision is very finely balanced.’

Wages excluding bonuses grew by 5.7 per cent in the three months to the end of May, in-line with forecasts and down from 6 per cent, data from the Office for National Statistics shows.

Wage growth has been closely watched by the Bank of England as it ponders the timing of its first interest rate cut. Economists say the BoE may now delay it first cut until September as wage growth remains well above the headline consumer price inflation rate of 2 per cent.