Just Eat hits index as Deliveroo sets out challenge

LONDON

THE FTSE 100 ended the day flat, having been dragged down by Just Eat shares on competition fears from Deliveroo.

The index closed lower by 0.1 point at 7,703.71 points after a near five per cent or 40p drop in Just Eat’s stock price to 810p, making it the worst blue chip performer.

It follows an announcement by rival Deliveroo that restaurants will now have the choice of fulfilling orders using their own drivers.

Eateries previously had to use Deliveroo’s fleet. The move will pit Deliveroo against Just Eat, which only offers a platform for restaurants to sell and deliver food with their own drivers.

Sterling staged a mild recovery against the US dollar, to trade about 0.05% higher at 1.337.

The UK currency originally slumped in the wake of data showing inflation holding steady at 2.4% in May.

But investors later turned attention to the US Federal Reserve meeting, which is expected to deliver another interest rate hike.

Against the euro, the pound was down 0.3% at 1.135.

In oil markets, Brent crude jump 1.2% to $76.35 per barrel after data from the Energy Information Administration showed a larger than expected drop in US stockpiles.

In UK stocks, WPP dropped 11.5p to 1,235p as the advertising giant faced a bruising AGM where nearly a third of shareholders rejected a bumper payout for outgoing chief executive Sir Martin Sorrell.

Top bosses also faced a flood of questions surrounding Sir Martin’s controversial departure and WPP’S trajectory as it searches for his replacement.

Sainsbury shares rose 1.6p to 308.2p despite news the grocery giant’s chief executive will be hauled before MPS to explain how the supermarket’s proposed £12 billion merger with Asda will impact farmers, suppliers and consumers.

Away from the top tier index, Dixons Carphone shares suffered after the retailer revealed 5.9 million customer bank card details and 1.2m personal data records were hacked during a cyber attack last year.

Shares in pub group JD Wetherspoon fell 10p to 1,260p amid news that it will replace Champagne and wheat beers produced in France and Germany with more drinks from the UK – and those from outside the EU – in the run up to Brexit.

The switch will affect all 880 Wetherspoon pubs from July 9.

Biffa tumbled 6p to 235.5p after announcing long-standing boss Ian Wakelin will replaced by the firm’s finance chief Michael Topham after eight years on the job.

The biggest risers on the FTSE 100 were Glencore up 14.4p at 398p, Hargreaves Lansdown up 44p at 2,059p, International Consolidated Airlines Group up 12.8p at 712.2p, and Easyjet up 30p at 1,782.5p.

The biggest fallers on the FTSE 100 were Just Eat down 40p at 810p, Standard Chartered down 12.7p at 724.1p, Sky down 23p at 1,335p, and DCC down 115p at 7,170p.

NEW YORK

US stocks ended a choppy session lower yesterday after the Federal Reserve raised interest rates as expected and projected a slightly faster pace of rate hikes this year.

Two more hikes are now expected by the end of this year, compared with one previously.

The central bank, which raised its benchmark overnight lending rate a quarter of a percentage point to a range of between 1.75 per cent and 2%, also dropped its longstanding pledge to stimulate the economy “for some time.”

“The expectation now is for four rate increases in total in 2018. Consensus had been more like three, moving toward four, so I think that’s a bit of a surprise,” said Katie Nixon, chief investment officer at Northern Trust Wealth Management in Chicago.

“It seems as if the Fed is much more confident now in inflation reaching, in fact maybe breaching a little bit, their target, so they are pulling forward some of the rate increases.”

Fresh projections from the policymakers suggested that inflation would run above the Fed’s 2% target, hitting 2.1% this year and remaining there through 2020.

Stocks were volatile after the statement but ended near the lows of the session.

The Dow Jones Industrial Average fell 119.53 points to 25,201.2, the S&P 500 lost 11.22 points to 2,775.63 and the Nasdaq Composite dropped 8.10 points to 7,695.70.