London’s FTSE 100 has opened higher this morning, continuing strong momentum from the end of last week and preparing for the chancellor’s speech later today.
Leaks to newspapers and other major media suggested the new Chancellor of the Exchequer will say a Treasury audit has found the last government went £20 billion "over budget", requiring spending cuts and higher taxes. Cuts to spending will include the cancellation of some road and rail projects, while higher taxes are expected on capital gains or inheritance taxes, with other tax reliefs cut.
In company news, Pearson shares tumbled after it reported an underwhelming sales performance in the first half, with top-line revenues falling 6.6% to £1.75 billion. However, adjusted operating profit remained unchanged at £250 million and adjusted earnings per share were steady at 25.6p.
Gambling operator Entain also traded lower after it said its US sportsbook BetMGM would continue to be lossmaking the second half due to the “expectation of greater than planned marketing investment in iGaming”. It comes despite the joint venture with MGM Resorts bringing in $1 billion worth of revenues in the first half of 2024, a 6% year-over-year increase.
