Tuesday, 23 February: 1989 ring a bell for anyone? Bar it being the fifth studio album by Taylor Swift, it was also the last time Standard Chartered recorded a full year loss, until today. The emerging markets focused bank have also axed its final dividend as volatile markets, weak commodities and low interest rates took their toll. The shares plummeted more than 10% in the first hour of Tuesday trading as the bank reported a loss before tax of $1.5bn after including restructuring costs of $1.8bn. To add to its woes, the bank revealed it is still being investigated for its failing in its defences against financial crime. Standard Chartered ended the day at the foot of the FTSE, lower by 6.7%.
2006 – Barcelona beat Arsenal in the UEFA Champions League Final in Paris (the two teams meet tonight in the knock-out stages of the competition). 2006 is also the last time Ladbrokes reported a loss as betting tax changes and shop closures contributed to the bookmaker’s loss. The proposed merger of Ladbrokes and Coral looks set to go ahead and Ladbrokes’ latest results include a £19.8m merger cost. Despite these reported losses, revenues actually rose by 3.2% to £1.1bn. The British bookmaker maintained their gains over the course of the day, ending trading +5.6%.
Moving back to the major news of the weekend and the decision that we, as voters decide whether the UK leaves the European Union or not. Chairmen or Chief Execs of 36 FTSE 100 Companies, including BT, Vodafone and EasyJet, have signed a letter published in the Times saying an EU exit would deter investment in the UK. FTSE bosses were amongst 198 signatures, which included the bosses of Heathrow and Gatwick airports. A bit of simple maths indicates that nearly two-thirds of the FTSE 100 have not signed the letter backing the campaign to stay in the EU, with notable absentees such as RBS and Barclays. David Cameron begins the first of a series of national tours dates today (hope readers from Berkshire enjoyed Mr Cameron’s visit). In case you missed it, June 23rd is the date set for the referendum vote.
During afternoon trading, London Stock Exchange (LSE) confirmed they are in merger talks with Germany’s Deutsche Boerse. This is the third time the two separate entities have discussed a merger, with previous discussions held in 2000 and in 2004-05. Under these most recent talks, the LSE would own 45.6%. The combined business would have a single board, with an equal number of directors from each company, continuing under the two current brand names. LSE shares shot to the top of the FTSE 100 following the announcement, making gains of more than 20%, ending the day +13.7%.
At the close European indices were down with the FTSE 100 -1.3%, the CAC 40 -1.4%, and the DAX -1.6%. The S&P 500 and the Dow Jones are both down by 1%.