Britain’s leading companies have seen their stock market valuation rise by almost £50bn after the post-election rally in share prices gathered pace. In a second day of hefty gains, the FTSE 100 index shrugged off evidence that the economy was struggling in the run up to polling day and closed 165 points higher at 7,519.05. At one stage the FTSE 100 was up by 190 points but still posted its biggest one-day gain since the week following the EU referendum in June 2016. By the close of trading in London, the index was up by 2.25% – adding nearly £42bn to share values. The FTSE 250 – which charts the performance of the next 250 biggest quoted companies – finished up 412 points at 21,920. The 1.92% jump added £7.5bn to valuations.
FirstGroup (FGP) is considering a sale of all its North American businesses, in an apparent reversal of strategy only months after the struggling transport group said it would focus primarily on its US bus operations. The group said it had appointed advisers to explore options, including the potential disposal of First Student, which operates about 43,000 yellow school buses, and First Transit, which provides outsourced public transport. The third US division, Greyhound, which operates the famous intercity coaches, was put up for sale in May. The turnaround comes after FirstGroup was announced the winner of the West Coast Partnership franchise in the UK, which secures a longer term future in rail.
The Serious Fraud Office has charged two former employees of the outsourcing firm Serco Group (SRP) with fraud and false accounting, as its investigation into contracts awarded by the government for the electronic tagging of prisoners continues. Serco said it was “mortified” earlier this year after it paid a £23m fine to the SFO as part of the investigation, which included allegations of charging for tagging people who were either dead, in jail, or had left the country. The SFO said on Monday it had brought charges against Nicholas Woods, the former finance director of Serco Home Affairs, and Simon Marshall, former operations director of field services. Both were charged in relation to representations made to the Ministry of Justice between 2011 and 2013. Woods was also charged with false accounting in relation to the 2011 statutory accounts of Serco Geografix.
Mike Ashley has said more House of Fraser stores will be forced to shut unless the government undertakes a fundamental review of the business rates system, which the boss criticised as “broken and unworkable”. Ashley said the current rates regime “is clearly helping to kill much of what remains of the UK high street” and that large stores were coming under particular pressure from the property-related tax. “We cannot keep loss-making stores open,” Ashley said. He would not say how many stores might close but said a decision would be taken within months. Seven department stores have closed since Sports Direct bought House of Fraser out of administration in August last year, leaving 52 branches. Sports Direct formally changed its name to Frasers Group at a shareholder meeting on Monday.
