BUSINESS LIVE: Domino’s company files for bankruptcy in Russia

Home prices have fallen at their strongest pace since August 2018 as sellers try to pull interest amid tight living costs and rising interest rates.

Average asking prices fell by 1.9 percent compared to July, according to figures from real estate website Rightmove.

It meant the typical home was on the market for £364,895 – down from £371,907 a month earlier. Prices also fell 0.1 percent compared to the same month last year – the first year-over-year drop in asking prices since 2019.

Homebuilders top the list of fallers this morning amid mounting concerns about the housing market following a profit warning by Crest Nicholson and weak home price data.

Average asking prices for new sellers fell 1.9 percent this month to £364,895, the biggest drop in August since 2018, according to Rightmove.

Meanwhile, homebuilder Crest Nicholson warned of lower earnings after seeing transaction levels weaken further across the industry in recent weeks, sending shares down nearly 11 percent.

Taylor Wimpey, Redrow, Persimmon and Vistry were the other biggest fallers, with stocks falling between 2 and 3 percent.

Russ Mold, director of investment at AJ Bell, said:

Weak house price data is hardly a surprise. The economic uncertainty is great, mortgage costs are skyrocketing and the Help to Buy scheme is coming to an end.

However, Crest Nicholson’s profit warning has exposed the magnitude of the impact of a housing market slowdown on the housing sector.

New home sales have fallen alarmingly, and while not all developers in the space are created equal, the news, coupled with Rightmove’s latest reading on the real estate market, has had a knock-on effect on stock prices across the rest of the industry this year. morning.

The Domino’s Pizza franchisee in Russia will file for bankruptcy for its operations in the country amid an “increasingly challenging climate.”

DP Eurasia, which also owns the chain’s franchise in Turkey, Georgia and Azerbaijan, said it was abandoning previous plans for a sale of its DPRussia business and would leave the country.

Charlie Huggins, Quality Shares Portfolio Manager at Wealth Club:

“Today’s earnings warning from Crest Nicholson suggests that rising interest rates and higher mortgage payments are really starting to bite.

Crest Nicholson has seen trading conditions deteriorate significantly during the summer months. This means that the group’s profit before tax for the year is expected to be about a third lower than previous expectations.

“The cost of borrowing has skyrocketed, and this has led to fewer homebuyers getting bigger and fewer first-time buyers. The end of the Help to Buy scheme has added to this pressure, making it even more difficult for first-time buyers to get up the housing ladder.

“The housing market is on very shaky foundations. While inflation appears to be easing, the Bank of England is expected to tighten the screw further in the coming months. As such, it seems unlikely that trading terms for Crest Nicholson or his colleagues will improve any time soon.”

Victoria Scholar, Chief Investment Officer at Interactive Investor:

European markets have opened cautiously higher. After hitting a near 5-month low on Friday, the FTSE 100 is posting modest gains with BP heading towards the top of the index as underlying oil prices rise amid tightening supply offsetting weak demand.

Homebuilders are at the bottom of the blue-chip index after Crest Nicholson sharply revised down his earnings forecast for the year. In Germany, producer prices fell 6% year-on-year in July, the first drop since November 2020.

China surprised the markets by opting for a more modest than expected interest rate cut. It cut its one-year lending benchmark rate by 10 basis points and kept its five-year rate unchanged, despite forecasts for a 15 basis point cut in the two.

Nevertheless, the prime rate for one-year loans is now at a record low of 3.45%. Chinese equities fell to a nine-month low and the yuan continues to suffer. US 10-year Treasury yields reached their highest level since 2007 against their Chinese counterpart.

“All eyes will be on the Jackson Hole central bank symposium in Wyoming later this week for clues on the future path for interest rates.”

The FTSE 100 is poised to break a losing streak, recovering from the six-week lows reached in the previous session, as a rise in energy stocks drives the blue-chip index into positivity territory.

However, the FTSE 250 has fallen again as homebuilders fall on disappointing industry data and earnings.

Data from the website Rightmove showed that asking prices for homes in Britain fell sharply this month as rising mortgage payments caused sellers to lower their expectations of what they can get for their properties.

It was the biggest monthly drop for August since 2018 and twice as steep as the usual summer drop.

Crest Nicholson is down 14.4 percent after the homebuilder slashed its annual profit expectations.

Oil and gas stocks rose 1 percent on a rise in oil prices as global supply tightened on lower exports from Saudi Arabia and Russia.

(PA) – Travel companies and a consumer group are urging the Prime Minister to “act decisively on behalf of British holidaymakers” by enabling the aviation regulator to fine airlines.

In a joint letter to Rishi Sunak, they called for the King’s November 7 speech to include a bill aimed at strengthening the Civil Aviation Authority (CAA)’s ability to enforce violations of consumer rules.

Signatories included holiday companies loveholidays, On the Beach, Riviera Travel and Thomas Cook consumer group Which? and travel companies the Association of Independent Tour Operators and Advantage Travel Partnership.

Thousands of flights to and from UK airports have been canceled this summer due to problems such as air traffic control restrictions and wildfires in Rhodes and other Greek islands.

Many affected holidaymakers claim that airlines ignored their legal responsibilities during the disruption, including booking customers a ticket with a rival airline to get them to their destination as quickly as possible, and providing meals and accommodation.

The letter to Mr. Sunak stated: “As a coalition of consumer advocates and travel organisations, we urge you to show your support for UK holidaymakers affected by this summer’s air traffic disruption by agreeing to strengthen the Civil Aviation Authority’s enforcement powers (CAA) through this fall’s King’s Speech.”

The National Trust has come under pressure from the grandson of one of its biggest donors over its relationship with Barclays — and the bank’s ties to the fossil fuel industry.

Dominic Acland said his grandfather Sir Richard Acland, an environmentalist who donated his 17,000-acre ancestral estates to the charity in 1944, “would be shocked that the National Trust is banking with Barclays.”

The number of UK financial services jobs has reached an all-time high – a sign that much of the gloom about the sector is misplaced.

City Secretary Andrew Griffith said it showed the industry is “a jewel in Britain’s crown that not even the doomsters can deny”.

British homebuilder Crest Nicholson has slashed its annual profit expectations in the wake of tough market conditions as high interest rates and persistent inflation drove homebuyers away.

The FTSE 250 homebuilder said transaction levels continued to weaken across the sector, particularly in recent weeks as mortgages rose in price.

The group therefore does not expect a material improvement in trading conditions before the end of the year on October 31, 2023.

The company now expects full-year pre-tax adjusted profit to be around £50m.

The London-listed master franchise for Domino’s Pizza, DP Eurasia, which operates in Turkey, Russia, Azerbaijan and Georgia, will file for bankruptcy of its Russian operations.

The group said: ‘With the increasingly challenging environment, DPRussia’s direct holding company has now been forced to take this step, which will lead to the termination of the attempted sale of DPRussia as a going concern and, inevitably, the presence of the Group in Russia.

“A bankruptcy petition from DPRussia will be filed in due course in accordance with relevant legal requirements.”