17th June 2021
Last night investors around the world breathed a sigh of relief when the US central bank released an upbeat statement on its view of the US economy. It confirmed that it will keep interest rates unchanged and that it believes rising inflation is a transitory phenomenon. But it did flag that rate hikes could be on the horizon in 2023.
Made.com makes its stock market debut
Remote working puts 6 million UK jobs at risk
Yesterday's market moves
FTSE 100 +0.2% 7,185 FTSE 250 -0.1% 22,618
The FTSE 100 extended its winning streak to a fifth day, inching a further 0.2% higher to remain at its best since February 2020. The FTSE 250, at an all-time high earlier this month, dipped 0.1%.Inflation in the UK picked up by more than expected last month to 2.1% fuelled by more expensive clothing, petrol and meals out as the economy reopened. The sharp-eyed readers out there will notice that this is above the Bank of England’s target of 2%. The debate remains whether this level of inflation is temporary or likely to hold at these levels.
RETAILMade.com makes its stock market debut
What’s going on?Online furniture retailer, Made.com, listed on the London Stock Exchange yesterday pricing each share at 200p, valuing the business at £775 million – less that the £1 billion initially predicted. On the first day shares fell as much as 8% before recovering to close down 2%.The company raised £100 million from new shareholders that it will use to expand further into Europe.
Why is this important?Founded 11 years ago in London, Made.com has become known for its sleek furnishings aimed at Millennials that it sells in the UK and a handful of other European countries. As an ecommerce retailer, the company has performed well during the pandemic with more of us wanting to make our home surroundings more aesthetically pleasing during lockdown.The company reported revenue growth of 30% in 2020 to £315 million with over 1 million customers but it’s not yet profitable.So why were shares down on day one? The success of a public listing is a lot to do with timing:
Investors could be losing their appetite for companies going public. In the first quarter of this year, there were 20 public market debuts in London - the strongest start to the year since 2007. In the past week three companies have put their plans to go public on hold due to the crowded market.
Some investors think that Made.com will face more competition now that the high street has reopened so may have had its peak during lockdown.
TakeawayAlthough it’s been a busy year for the London stock market listings, Made.com has added its name to the list of businesses that have had disappointing first days.Food delivery app Deliveroo and chip designer Alphawave came to the market earlier in 2021 and are trading well below their initial list price.
WORKRemote working puts 6 million UK jobs at risk
Work from home life has been a game changer for millions during the pandemic with many of us likely to do it more often even as offices reopen. But a new report from the Tony Blair Institute for Global Change warns that remote working could mean up to 5.9 million UK jobs – one in five - could be outsourced to other countries.
The Institute classified these roles as "Anywhere Jobs", with characteristics that mean they can be done remotely as efficiently or more efficiently than in an office. These jobs include graphic designers, accountants and marketing managers many of which are based in London and the Southeast.In the past, it was typically manufacturing jobs that were outsourced or offshored. Professional office-based jobs had been sheltered from the pressures of globalisation, however, the mass experiment with remote work during the pandemic changed this.The report suggests that the government takes action to protect the jobs and also attract well-paid, remote workers from abroad. Its recommendations include strengthening infrastructure like transport and broadband as well as retraining workers in softer, interpersonal skills.
Stat of the day
Around 11 million UK Adults invest in an ISA...about the same number of Brits have already speculated in Bitcoin
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