Weekly review

Equity view

BT Group acquired TalkTalk out of administration on a debt-free basis, in a deal that marked a significant consolidation of the UK telecoms market. The acquisition gave BT control of the struggling broadband provider, which had faced mounting financial difficulties.

Informa announced the £2.24bn acquisition of Clarion Events, alongside an equity fundraising to help finance the transaction. The deal marked another major expansion of the group's international events business.

Clarkson said it expected full-year earnings of at least £135m after exceptionally strong trading in August and September. The shipping broker attributed the performance to geopolitical disruption, which had increased volatility in freight markets and pushed some shipping rates to record levels.

Asos shares slumped after customers received messages through the online fashion retailer's app claiming the company had been hacked. The company confirmed that more customer details than initially thought had been accessed after attackers compromised an employee account.

Shell said third-quarter refining margins were expected to hit a record $42 a barrel, compared with $24 in the preceding quarter. The oil major also increased its estimate for gas production over the period.

Pennon shares tumbled after the water utility announced a rights issue and dividend reduction as part of a sweeping operational and financial restructuring. The group outlined plans to increase investment while addressing challenges across its water operations.

Rank Group shares fell after the Gambling Commission announced a £5m settlement involving three casino businesses operated by the group. The regulatory action followed failings relating to anti-money laundering controls and social responsibility requirements.

Tesco raised the lower end of its annual profit guidance and increased its share buyback programme after first-half adjusted operating profit climbed 6.5% to £1.78bn. The supermarket chain now expects full-year adjusted operating profit of £3.15bn to £3.30bn, while its buyback was lifted to £950m from £750m. Shares rallied more than 6% following the announcement.

Imperial Brands reaffirmed its full-year guidance and unveiled a further £1.5bn share buyback for the 2027 financial year, following the completion of its £1.45bn programme for 2026. The tobacco company said it remained on track to achieve its key financial targets.

Standard Life through a discounted placing worth £436m. The disposal put pressure on the stock despite no corresponding change to the company's underlying trading performance.

Rightmove surged following speculation that the online property portal could be a takeover target. The sharp rise followed a report on markets blog Betaville, although no formal approach had been confirmed.

Oxford Metrics cut its full-year revenue and profit expectations following weaker-than-anticipated trading, sending its shares lower. The motion-capture specialist also announced an acquisition of Move AI assets and launched a £3m share buyback programme.

DCC Energy agreed to sell its technology distribution division, Nexora, to funds managed by One Equity Partners in a transaction valuing the business at $725m on a cash- and debt-free basis. The disposal represented another step in the group's restructuring and portfolio simplification.

Airtel Money, the mobile financial services arm of Airtel Africa, made its London market debut, with shares falling during their first day of conditional trading. The flotation gave investors a separately traded exposure to the African mobile payments business.

UK economic news

The downturn in the UK construction sector eased in September, although activity continued to contract. The S&P Global construction purchasing managers' index rose to 46.1 from 44.3 in August, remaining below the 50 threshold separating growth from contraction. The decline in output was the slowest since January, with housing remaining the weakest-performing segment.

Bank of England policymaker Catherine Mann warned that inflation could become more deeply entrenched, reinforcing her argument for further interest rate increases. Mann said inflation was likely to reach around 4% around the turn of the year, roughly twice the Bank's target. She has voted for a quarter-point increase at each of the past two Monetary Policy Committee meetings.

UK house prices were unchanged in September, according to figures from Lloyds, following a 0.3% decline in August. Annual house price inflation was also flat, compared with a 0.4% fall the previous month. The average UK property price stood at £298,441, with Northern Ireland recording the strongest annual growth and London the biggest decline.

The UK housing market remained under pressure in September, according to the Royal Institution of Chartered Surveyors. Its headline house price balance slipped to -32% from -28% in August, while the balance for new buyer enquiries fell to -22% from -18%. Rics said renewed expectations of higher interest rates were weighing on buyer confidence and sales activity.

UK retail footfall declined in September, prompting the British Retail Consortium to call on the government to reduce the cost burden facing retailers. The trade body warned of continued pressures on physical stores and the challenges facing the sector amid difficult trading conditions.

International economic news

Eurozone investor sentiment weakened in October, retreating from a four-year high as concerns about the French economic outlook weighed on confidence. The latest Sentix survey pointed to a deterioration in forward-looking expectations among analysts and institutional investors.

US services activity accelerated sharply in September, with the S&P Global services PMI rising to 58.8 and the composite PMI reaching 58.4. Both readings signalled the fastest expansion in more than five years, highlighting the resilience of the US economy despite elevated borrowing costs.

Eurozone construction activity remained firmly in contraction territory in September, with the S&P Global construction PMI edging up to 43.4 from 43.0 in August. Housebuilding suffered its steepest downturn since February 2025, while new orders continued to fall and cost pressures intensified.

The US trade deficit widened sharply in August, as imports increased more rapidly than exports. The goods and services deficit rose to $105.6bn from a revised $92.8bn in July, with imports climbing $17.2bn to $420.8bn and exports rising $4.5bn to $315.2bn.

German industrial production rose more than expected in August, increasing by 2.0% on the month against forecasts of a 0.5% gain. Construction output jumped 9.3% and machinery and equipment manufacturing grew 5.3%, although automotive production fell 5.4%.

US mortgage applications declined for a fifth successive week, falling 4.2% in the week ended 2 October to their lowest level since January 2025. Refinancing applications dropped 7.5%, while home purchase applications fell 2.1%, as the average 30-year fixed mortgage rate reached 7.49%, its highest in nearly three years.

German exports unexpectedly declined in August, falling by 0.8% as weaker demand across key overseas markets weighed on trade. The contraction highlighted continuing pressure on Europe's largest economy despite signs of recovery elsewhere in its industrial sector.

US initial jobless claims declined to near multi-decade lows, indicating continued resilience in the labour market. The figures added to evidence of a robust US economy as investors reassessed the outlook for Federal Reserve interest rates against a backdrop of persistently high government bond yields.