BUSINESS LIVE: Unemployment falls as wage growth eases; Just Group ups guidance; Dowlais

Keywords Studios has acquired Wushu Studios, a Liverpool-based leading game development studio.

The video games services business said the deal consists of an upfront cash fee as well as an ‘earn-out component’, meaning the cost will be contingent on performance.

(PA) – Google will use its upcoming phone launch to “get the jump” on its rivals and try to “claim leadership” of the AI market in smartphones, an expert has said.

The US firm is widely expected to introduce its Pixel 9 smartphone range during its Made by Google event on Tuesday evening.

The launch is taking place earlier than normal, and will see Google make its announcement before Apple unveils the next iPhone, which is traditionally introduced in September.

Ben Wood, smartphone expert and chief analyst at CCS Insight, said Google is trying to get ahead of its rival with new AI tools.

“It is interesting Google is holding this event in August rather than the usual timing of October. We believe this is an effort to get the jump on Apple’s iPhone event in September, particularly in terms of AI announcements,” he said.

“Apple will likely focus on why the iPhone is ‘the best phone for AI’ and it would be no surprise to see some overlap in the potential use cases of the new Pixel phones and the new iPhone.”

Just Group shares soared by 13 per cent on Tuesday morning after the life insurer said it expects to ‘substantially exceed’ annual profit forecasts.

The retirement specialist revealed its underlying operating profits jumped by 44 per cent to £249million in the six months ending June, partly thanks to growth in new business.

Grocery price inflation has risen for the first time in 17 months, analysts revealed today after football fans spent £10million on beer on the day of the Euro 2024 final.

Experts at Kantar said UK supermarket prices were 1.8 per cent higher than a year ago over the month to August 4, nudging up slightly from 1.6 per cent in July.

AstraZeneca has been tipped to become Britain’s first £200billion company.

The pharma giant has ‘much business momentum and news upcoming’ alongside a ‘broad and deep’ pipeline of drugs, according to broker TD Cowen.

London-listed stocks have inched higher at the open amid broader gains in the run-up to crucial inflation numbers in the US and the UK.

The indices are set to extend their rally for a third consecutive session after closing lower for a second straight week on Friday.

Pharma and biotech and industrial support services lead broader gains with a 0.7 per cent rise each.

Most sectors trend upwards, while automobile and parts lead declines, pulled down by a 10.2 per cent fall in Dowlais Group.

The company has sunk to the bottom of the FTSE 250 after it said it was exploring a potential sale of its GKN Powder Metallurgy unit, among other options, and cut its annual revenue forecast.

The sectoral index fell to its lowest level since early 2009.

Among other stocks, Just Group has surged 10 per cent to top the FTSE 250 after it said it expected to exceed its previous 2024 profit forecast after its first-half earnings surpassed market expectations.

Households in England and Wales are set to get extra compensation from ‘broken’ water firms due to a government crackdown on customer service.

BT shares are in the spotlight again after another foreign billionaire snapped up a stake in the group.

Indian tycoon Sunil Bharti Mittal is the latest tycoon to buy a holding in the telecoms group, becoming its largest shareholder through his investment firm Bharti Enterprises.

Wilko’s former owners do not plan to help plug the collapsed retailer’s £70million pension hole – in another blow to thousands of former workers.

The discount chain went bust a year ago with the loss of 12,500 jobs and closure of 398 stores.

Sam North, market analyst at eToro:

‘Following a significant wobble in the US jobs report at the beginning of the month, eyes were on the UK’s report to see how contagious it was. The weaker-than-expected report out of the States spooked the market, which contributed to the big sell-off last Monday, but those wanting to see similar headlines out of the UK were left disappointed.

‘We are off to a good start in a week full of UK data. The jobs data sparked a strong market reaction, driven by a significant drop in the unemployment rate and a notable increase in employment figures.

‘This robust labour market performance has more than compensated for slightly softer wage growth, which was influenced by the previous year’s NHS bonus payments.

‘As a result, we saw GBP/USD gain momentum, lifting from 1.2779 to a session high of 1.2801, underscoring market confidence in the UK’s economic resilience. The focus will now move to tomorrow’s inflation report, with the Bank of England hoping to see a number steady at around 2%.’

UK wage growth slowed to its lowest for more than two years as the rate of unemployment also surprisingly dropped, according to official figures.

The Office for National Statistics (ONS) revealed that regular wage growth was 5.4 per cent year on year over the three months to June.

However, this slipped from 5.7 per cent in the previous three months and represented the smallest increase since the period to July 2022.

Dowlais Group is exploring a potential sale of its GKN Powder Metallurgy unit among other options, after the company cut its annual revenue forecast due to subdued production volumes at its automotive unit.

The company, which was spun off from aerospace supplier Melrose Industries in April 2023, said it now expected its 2024 adjusted revenue to fall by mid to high single-digits.

It had earlier expected its 2024 revenue to be ‘slightly below’ the year-ago level.

The unit Dowlais is exploring options for manufactures powder metal parts for the automotive and industrial sectors and is the group’s second-largest business by revenue.

Dowlais also sold its hydrogen business for a nominal amount and will take a £18million hit from the disposal in 2024, the group said.

Thomas Pugh, economist at RSM UK:

‘The labour market looks like it is continuing to recover after last years mini-recession.

‘Employment grew by 97,000 in the three months to June compared with the previous three months. This, combined with a 27,000 rise in the number of inactive people, which now stands at 9.41m – some 22.2% of the working age population – was enough to bring the unemployment rate back down to 4.2%.

‘If wage growth does continue to fall over the rest of this year,  it would give the MPC ample cover to cut rates again towards the end of the year, probably in November, and then be more aggressive in its rate cutting cycle in 2025, so we currently have four cuts pencilled in for next year.’

Universal Music has inked a deal with Facebook owner Meta as it tries to calm concerns over artificial intelligence.

The world’s biggest music label signed an agreement with the social media giant which will allow users to share songs without breaching copyright.

Just Group has upped its 2024 profit forecast after the insurer’s first-half earnings surpassed market expectations on strong new businesses in retail and pension risk transfers.

The firm, which specialises in annuities – also known as pensions that pay a fixed income for life – has reaped the benefits of soaring demand for insurance for corporate pension schemes known as bulk annuities.

Underlying operating profit rose 44 per cent to £249million in the six months to 30 June, compared with analysts’ average forecast of £208million in a company-compiled consensus.

In March, the London-listed company forecast at least double its 2021 operating profits of £211million for this year.

Just Group said on Tuesday it expects to ‘substantially’ exceed that forecas

The UK unemployment rate fell to 4.2 per cent in the three months to June 2024, beating forecasts of 4.5 er cent, as wage inflation also eased over the period, fresh data from the Office for National Statistics shows.

Average weekly earnings, excluding bonuses, were 5.4 per cent higher than a year earlier during the period, in-line with forecasts and down from 5.8 per cent in the previous three-month stretch.

The Bank of England said it would continue to keep a close eye on wage growth when it cut interest rates on 1 August after keeping them at a 16-year high of 5.25 per cent for nearly a year.