The FTSE 100 hasn’t moved much over the whole week, ending Friday 24 September at 7,053 points for a modest 1.2% gain on the week. But it’s taken a roundabout route getting there, dropping sharply on Monday morning before easing back over the rest of the week.
London’s top index started out dropping quickly into negative territory on the back of falling Asian markets. Chinese property developer Evergrande Group is facing a debt crisis, and fears for its future have been spreading. Bond holders in particular are feeling the pressure.
Growing fears over energy prices didn’t help, though that didn’t do BP and Shell any harm. The two big oilies saw their share prices gain 5% and 6% respectively.
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Inflation climbing
Financial sector stocks got off to a poor start in a week in which the Bank of England predicted the annual inflation rate will exceed 4% by the end of the year. The BoE kept interest rates on hold at 0.1% for now. The banks’ falls recovered in the second half of the week, with the sector ending the week pretty much flat overall.
Over in the insurance business, Prudential had a particularly bad start. The insurer announced plans for a new £2bn listing on the Hong Kong stock market on Monday. And the stock plunged by as much as 9% at one point during the day. But it did recover some of the loss as the week progressed. The Pru’s shares ended Friday on a slightly less painful dip of 4%. Other insurance stocks, including Aviva, had an unexciting week and didn’t really go anywhere.
Top FTSE 100 winner
Entain, the owner of Coral, Ladbrokes, and bwin, was the FTSE 100’s biggest winner of the week. After an initial spike on Tuesday, the Entain share priced ended the week a healthy 13% ahead. It’s all down to a $20bn takeover approach from US sports betting firm DraftKings. While acknowledging the bid, the Entain board have so far held back on their response. It looks like the story might have further to go.
The FTSE 100 aviation sector enjoyed an unusually bright week. US rules on admitting travellers from the UK are being eased. And the British government is replacing its ever-changing traffic light system with something a bit simpler. On top of that, International Consolidated Airlines told us it does not intend to raise any new equity.
Aviation gains
The IAG share price climbed as a result, ending Friday on a 17% gain. Rolls-Royce Group, getting a boost from the growing airline optimism, saw its shares improve 20% over the week. Even the easyJet share price picked up 8% by Friday, after news of its rights issue had previously sent it plunging.
Royal Mail Group released a decent looking trading update on Thursday, but it didn’t have a very positive effect on recent share price weakness. Royal Mail shares finished Friday a percent down. The shares have fallen 20% since 2021’s high point in June. But they have still more than doubled over the past two years.
