European shares rise, L&G reassures, Gleeson’s cancellation rate shock, and Parsley Box to delist

“Following a slight pullback on Wall Street last night and in Asia on Friday, European stocks bucked the trend to trade higher on the last trading day of the week,” says Russ Mould, Investment Director at AJ Bell.

“After yesterday’s Autumn Statement-driven fall the pound managed to claw back some of its losses versus the US dollar as investors had time to digest the information and the new economic outlook for the UK.

“The message from the event was simple – taxes are going up, there will be big spending cuts, and the economy is looking a bit fragile near-term. None of that should be a surprise, hence why there is relative stability on the markets. A plan is in place to sort out the Government’s finances and consumers and businesses will have to grit their teeth while it is enacted.

“Legal & General topped the list of FTSE 100 risers after it gave a reassuring trading update. Commodity producers were in demand, extending a recent rally for the mining and oil sectors as investors hope the global economic slowdown won’t be as bad as previously feared.

“The housebuilding sector had started to show some cracks in recent weeks and MJ Gleeson has certainly added fuel to the fire. Its cancellation rates have shot up to 41% over the past six weeks and reservation rates have fallen.

“MJ Gleeson is pinning its hopes on the Autumn Statement having provided some clarity to the public on what will happen to taxes and household bills, thereby removing some of the uncertainty around whether it was worth risking a house purchase.

“There remains the problem of affordability which could stop many people from making a property transaction, even if they really wanted to move. However, Gleeson’s properties are already at the more affordable end of the housing market, so it is better placed than many of its peers to push on through.”

Parsley Box

“Another day and another recent IPO goes up in smoke. After the disaster that was Made.com, meals delivery firm Parsley Box is set to cancel its AIM listing.

“Following an £84 million flotation in March 2021 Parsley Box has served up a litany of disasters for shareholders and has effectively lost any support from the market.

“This was evident in a very sorry attempt at a fundraise by Parsley Box earlier this year as investors snubbed the chance to buy new shares and management had to step in.

“While the cost of living crisis didn’t help, the proposition behind Parsley Box always looked a little shaky. Why would people pay more to have premium ready meals delivered when they could easily get them from supermarkets at a much cheaper price?

“The emergence from the pandemic, which had helped drive order growth as the company’s baby boomer demographic was stuck at home, saw orders slow markedly.

“Looking back 2021 is proving to be anything but a vintage year for IPOs with other new names like In The Style, Revolution Beauty and Seraphine seeing their valuations collapse.

“The most high profile of the lot, takeaways platform Deliveroo, is worth around a third of its initial value after an IPO which struggled to get away in the first place.

“While other market newcomers have fared much better, it shows the risks involved for investors when backing a company without a track record on the public markets.”

These articles are for information purposes only and are not a personal recommendation or advice.