FTSE 100 Live 20 June: Sainsbury's Bank sold to NatWest; Bank of England interest rate decision

LIVE – Updated at 08:47

Dealmaking action and the Bank of England interest rates decision provide much of today’s City interest.

NatWest has picked up Sainsbury’s Bank while Tate & Lyle is buying a US firm for £1.4 billion.

The Bank of England no-change decision comes with traders looking to August or September for a first rate cut.

FTSE 100 Live Thursday

• NatWest buys Sainsbury's Bank
• Food firm in £1.4 billion swoop
• YouGov warning hits shares

Sainsbury's deal boosts shares, CMC Markets and Energean lead FTSE 250

08:35 , Graeme Evans

Sainsbury’s is the best performer in the FTSE 100 index, up 2% or 5.2p to 264.8p after announcing the sale of its banking operations to NatWest.

Rolls-Royce has also added 7.2p to 479.7p, with BT Group among other stronger blue chips following a gain of 0.9p to 142.15p.

The FTSE 100 index is 13.62 points higher at 8218.73.

In the FTSE 250, results by CMC Markets sent shares in the financial markets platform up by 8% or 23.3p to 304.3p.

OIl and gas firm Energean followed, lifting 6% or 63.2p to 1095.2p after promising a special dividend in the wake of today’s sale of assets in Egypt, Croatia and Italy.

Tate & Lyle fell 22.5p to 654.5p after announcing a £1.4 billion US takeover, while the profit warning by YouGov caused its AIM-listed shares to slide by 36% or 296.4p to 523.6p.

Elections fail to lift YouGov

07:56 , Daniel O'Boyle

Ahead of the general election hasn’t been enough to ensure YouGov hits its targets, as the pollster issued a profit warning this morning.

The business said it has “seen lower sales bookings than anticipated” and so now expects revenue to fall between £324 million and £327 million. Profits are expected to fall between £41 million and £44 million.

That comes despite 2024 being the busiest year of elections on record, with well over a billion people voting. While election polls are the best-known part of YouGov’s business, market research and data products tend to be a bigger part of YouGov’s profits.

YouGov said: “We continue to see increased demand for our customised research solutions, however, sales in our data products division have remained slow and we continue to see declines in fast-turnaround research services. Geographically we have seen challenges in EMEA, particularly in the DACH [Germany, Austria and Switzerland] region.

“As we move into FY25, we will focus on optimising our cost base and prioritising investment in key growth areas such as upgrading our Data Products, continuing to build out our AI capabilities and enhancing our sales organisation to further capitalise on YouGov's unique asset: its high-quality global panel and proprietary dataset.”

Rishi Sunak walks back into 10 Downing Street after his announcement (AP)

Tate & Lyle in £1.4 billion swoop to buy CP Kelco

07:35 , Michael Hunter

FTSE 250 food and drink business Tate & Lyle has announced a £1.4 billion deal to buy CP Kelco of the US.

Kelco makes ingredients including a range of gums used to thicken and stabilise food products.

The deal comes amid a rise in popularity of plant-based and sustainable foods. Kelco has described itself as a “nature-based ingredients” firm.

Tate & Lyle has been turning itself into what it describes as “a growth-focused speciality food and beverage solutions business”.

It said today that the deal “is expected to drive stronger revenue growth and significant adjusted [earnings] ]margin improvement over the next few years.“

Tate also said it will continue with a £215 million plan to return capital to shareholders after the sale of its near-50% stake in Primient, a maker of corn starches, which it completed last month.

Nick Hampton, Tate’s CEO, said the Kelco deal

“Creates a leading, global speciality food and beverage solutions business, ideally placed to benefit from the structural trends towards more plant-based, clean-label and sustainable ingredients and solutions.”

Sainsbury's Bank sold to Natwest in £125 million deal

07:19 , Simon Hunt

Sainsbury’s is to sell its banking arm to NatWest in a £125 million deal.

NatWest Group expects to acquire approximately £2.5 billion of gross customer assets, comprising £1.4 billion of unsecured personal loans and £1.1 billion of credit cards balances, together with approximately £2.6 billion of customer deposits.

As part of the transaction NatWest Group also expects to add around one million customer accounts.

NatWest CEO Paul Thwaite said: “This transaction is a great opportunity to accelerate the growth of our Retail Banking business at attractive returns, in line with our strategic priorities. As well as a complementary customer base, the transaction is expected to add scale to our credit card and unsecured personal lending business within existing risk appetite.”

FTSE 100 seen higher, pound at $1.27 ahead of interest rate decision

07:15 , Graeme Evans

The FTSE 100 index is forecast to open 16 points higher at 8221, a performance influenced by yesterday’s closure of US markets for Juneteenth.

Trading will resume on Wall Street later with the S&P 500 index at a record high after Nvidia overtook Microsoft as the world’s most valuable company.

The Bank of England’s interest rate decision at noon is unlikely to influence matters in London, given expectations for another meeting on hold at 5.25%.

Yesterday’s sticky inflation reading from the services sector means traders are expecting August or even September as the most likely month for a cut.

The pound traded at $1.27 ahead of today’s meeting, while the Brent Crude price continues to be near a seven-week high of $85 a barrel.

Recap: Yesterday's top stories

06:44 , Simon Hunt

Good morning from the Standard City desk.

The FTSE 100 nudged up on Wednesday after data showed that inflation has returned to the Government’s official target for the first time since July 2021.

The blue-chip index rose 14 points to 8,205, a 0.2% rise.

Wednesday’s gains came after official figures on consumer price inflation (CPI) showed the measure has fallen back to the Government’s target of 2%.

Rishi Sunak declared “we’ve got there” after the milestone was confirmed, insisting that it shows the economy has “turned the corner” after a long stretch of above-target inflation.

The news has raised hopes the Bank of England policymakers will to cut the base interest rate from 5.25% this afternoon.

But experts cautioned that a rate cut this summer could be less likely until the majority of the Bank’s Monetary Policy Committee (MPC) feel certain that inflation is under control.

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Here’s a summary of our other top headlines from yesterday:

• Boss of London’s biggest housebuilder Berkeley lashes out at regulatory and tax burden that has “stifled investment, housing delivery and growth”
• Warhammer maker Games Workshop pays £18 million out to its staff as profits for the year to 2 June top £200 million
• Vodafone raises £1.5bn through sale of 18% holding in Induian telecoms company Indus Towers
• Canary Wharf veteran Sir George Iacobescu to bow out after 36 years at the Docklands developer, 27 as CEO or chairman
• Young’s delivers record profits of £49.4 million as it acquired 60 new pubs amid strong sales.