Latest news with #AJ Bell
The Independent
5 days ago
- Business
- The Independent
Earnings and trade hopes send FTSE 100 to new high
The FTSE 100 posted another record close on Thursday, buoyed by well-received earnings and hopes for a trade deal between the US and Europe, following the Japan-US agreement. The FTSE 100 index closed up 76.88 points, 0.9%, at 9,138.37, a new closing peak. It had earlier hit a new all-time high of 9,158.21. The FTSE 250 closed up 141.92 points, 0.6%, at 22,155.41, and the AIM All-Share closed up 2.88 points, 0.4%, at 776.87. 'The positive sentiment generated by the trade deal agreed between the US and Japan continued to permeate the markets,' said AJ Bell investment director Russ Mould. This was boosted further by 'optimism surrounding trade talks between the US and EU', said Joshua Mahony, chief market analyst at Rostro trading group. In European equities on Thursday, the CAC 40 in Paris fell 0.4%, while the DAX 40 in Frankfurt gained 0.2%. A European Commission spokesman said that he believed a trade deal with the US is 'within reach', AFP reported. According to multiple diplomats, the deal could waive tariffs on aircraft, timber, pharmaceutical products and agricultural goods. This followed a report in the Financial Times late on Wednesday that a trade deal between the EU and the US was close. Meanwhile, the European Central Bank left interest rates unchanged despite a 'challenging' environment and uncertainty caused by trade disputes. The decision, which was expected, leaves the rate on the deposit facility at 2%, on the main refinancing operations at 2.15%, and on the marginal lending facility at 2.4%. The Frankfurt-based lender said the economy has so far proved resilient overall, partly reflecting recent rate cuts, in a 'challenging' global environment but there remains exceptional uncertainty, especially because of trade disputes. The ECB's governing council said it will follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance. ECB president Christine Lagarde said that policymakers were 'in a wait-and-watch situation' and members of the governing council had voted unanimously to keep rates on hold. Risks to growth remained 'tilted to the downside', she said, but the economic outlook could also improve if there is a quick resolution of trade tensions. Matthew Ryan at Ebury said: 'The ECB stuck to the script on Thursday. 'As expected, there was no change in rates and president Lagarde repeated that the bank was both in a 'good place' and a wait-and-see mode, suggesting that the governing council has no plans to alter policy for the time being.' Mr Ryan detected a 'moderately hawkish' tone in Ms Lagarde's comments, as 'she not only expressed confidence over the 2% inflation target, but said that the economy was performing better than expected, while making no attempt to talk down the value of the euro'. But barring a 'blowup' in US-EU trade negotiations, Mr Ryan thinks that the ECB will likely stay on hold through at least the next couple of meetings. The pound eased to 1.3535 dollars late on Thursday in London, compared with 1.3571 dollars at the equities close on Wednesday. The euro traded at 1.1773 dollars, higher against 1.1737 dollars. Against the yen, the dollar was trading higher at 146.79 yen, compared with 146.33 yen. In New York, the Dow Jones Industrial Average was down 0.4%, the S&P 500 traded 0.2% higher as did the Nasdaq Composite. There were mixed fortunes for two of the 'Magnificent Seven' following earnings released after Wednesday's closing bell in New York. Google parent company Alphabet rose 1.7% after better-than-expected second quarter results. 'Google delivered what we believe is a defining quarter with 32% Google Cloud revenue growth, increasing scale of AI search products, and greater benefits from AI across every part of the business,' said analysts at JPMorgan. 'We believe the combination of strong AI-driven Cloud demand and accelerating backlog makes Google Cloud a bigger driver of the bull case going forward,' JPM added. But Tesla fell 7.6% after its second-quarter results underwhelmed. AJ Bell's Russ Mould said the results are 'as ugly as the Cybertruck design, with revenue, profit, margins and free cash flow all in decline. It's difficult to see how Tesla digs itself out of the hole it is in any time soon'. 'Competition is fierce, tariffs are biting, the end of tax credits for electric vehicle buyers in the US could hurt, Elon Musk's political escapades have been a turn-off for many people, and product innovation has failed to make waves,' he added. The yield on the US 10-year Treasury was quoted at 4.4%, stretched from 4.38%. The yield on the US 30-year Treasury was quoted at 4.94%, unmoved from Wednesday. In London, BT surged 10% after what Berenberg called a 'reassuring' first-quarter trading update. Berenberg said earnings before interest, tax, depreciation and amortisation was slightly ahead of consensus, with Openreach the main driver of this beat. In addition, BT said Virgin Media O2 chief financial officer Patricia Cobian will replace Simon Lowth as BT's chief financial officer, joining in the summer of 2026. Mr Lowth has been chief financial officer for for nine years, and will retire following a handover to Ms Cobian. BT will announce the date of Ms Cobian's arrival 'in due course'. Reckitt Benckiser jumped 10% as it raised full-year guidance, lifted its dividend and launched a new share buyback, as it said its strategic reset is bearing fruit. 'This is a strong first-half performance with Core Reckitt growing like-for-like net revenues 4.2%, demonstrating the strength of our Powerbrands and the positive impact of the strategy we launched a year ago,' chief executive Kris Licht said. The maker of Nurofen painkillers and Strepsils lozenges said pre-tax profit fell 14% to £1.31 billion in the six months to June 30 from £1.52 billion a year prior, as revenue slipped 2.6% to £6.98 billion from £7.17 billion. But like-for-like sales rose 1.5% in the half-year, and by 1.9% in the second quarter, Reckitt said. Within core brands, Reckitt said like-for-like sales increased by 4.2%. Reckitt now targets like-for-like net revenue growth of above 4% in 'Core Reckitt' for 2025, improved from previous guidance of 3% to 4% growth. Lloyds Banking Group edged up 0.9% after it increased its dividend ahead of half-year earnings growth and confirmed its full-year guidance, citing strategic progress and strong capital generation. Other blue-chips to benefit from well-received results were Howden Joinery, Vodafone and Airtel Africa, up 8.7%, 3.6% and 7.2% respectively. On the FTSE 250, media firm ITV jumped 13% after its earnings, online trading platform IG rose 8% as it accompanied results with a new share buyback, and an upbeat trading update boosted building materials company Wickes 3%. The biggest risers on the FTSE 100 were BT Group, up 20.8p at 220.2p, Reckitt Benckiser, up 518p at 5,558p, Howden Joinery, up 73p at 908.5p, Airtel Africa, up 13.2p at 196.3p and Ashtead Group, up 191p at 5,048p. The biggest fallers on the FTSE 100 were SSE, down 60.5p at 1,851.5p, Beazley, down 20.5p at 889.5p, Fresnillo, down 30p at 1,433p, 3i Group, down 80p at 4,264p and BP, down 6.8p at 397.7p. Brent oil was quoted higher at 69.40 dollars a barrel in London on Thursday, from 68.24 dollars late Wednesday. Gold eased to 3,373.34 dollars an ounce against 3,412.38 dollars. Friday's local corporate calendar sees half-year results from lender NatWest, property portal Rightmove and a trading statement from pub operator Mitchells & Butlers. The global economic calendar on Friday has UK retail and consumer confidence data plus US durable goods orders figure
Daily Mail
5 days ago
- Business
- Daily Mail
FTSE 100 reaches new peak amid EU-US trade deal prospects
London's FTSE 100 hit a new record yesterday as global stock markets rallied on hopes Europe will follow Japan in striking a trade deal with the US. On another positive day for savers with money in shares through pensions, ISAs and other investments, the index rose 0.4 per cent, or 37.68 points, to 9061.49. Washington and Tokyo signed a deal for Japan to invest £400billion in the US while its goods will face tariffs of 15 per cent – below the 25 per cent Donald Trump had threatened. The US president called it 'the largest trade deal in history'. It fuelled hopes that Europe may secure better terms with the US after Trump threatened levies of 30 per cent. Britain's deal means most exports face a tariff of 10 per cent. 'Global markets are in buoyant mood as the US and Japan secured a trade deal,' said Neil Wilson, UK investor strategist at Saxo Bank. The Footsie has now risen nearly 11 per cent this year. 'News of a trade agreement between the US and Japan is fostering optimism among investors that further deals might be reached before punishing tariffs come into force,' said AJ Bell investment director Russ Mould. 'The news helped drive the FTSE 100 to a new record high and saw gains in other markets across mainland Europe, with focus likely to now turn to the prospects of an agreement being forged between the Trump administration and EU.'
Times
6 days ago
- Business
- Times
Families face red tape nightmare with inheritance tax on pensions
Families will be forced to pay inheritance tax on pensions after the government pushed ahead with plans that had sparked significant opposition. From April 2027 pensions will be added to the value of your estate for inheritance tax purposes in a move that the Treasury says will raise £1.46 billion a year by 2029-30. HM Revenue & Customs estimates that about 10,500 estates in 2027-28 will have to pay inheritance tax in the 2029-30 financial year while 38,500 will face a larger bill. Polling earlier this month by AJ Bell, an investment service, suggested that charging inheritance tax on pensions was the Labour government's most unpopular tax change so far. Some 44 per cent of 2,050 adults surveyed were opposed to the change, with only 21 per cent in favour. Renny Biggins from the Investing and Savings Alliance, which represents more than 270 financial services firms, said it was 'disappointing to see that despite significant pushback from the industry, pensions will form part of inheritance tax calculations'. The government originally proposed that pension schemes would have to work out and pay any inheritance tax due on pension pots, while the executors of the deceased's estate would be responsible for calulating tax due on any other assets, such as a home or a share portfolio. After lobbying by the pensions industry, the government has now said that personal representatives, usually either solicitors or bereaved family members, will be liable for reporting and paying any inheritance tax due on pension pots. They will have to do this within six months of a death to avoid interest being charged on overdue payments. A summary of responses to HMRC's consultation on how the rules would work published on Monday said that 'while many respondents supported the principle of bringing pension wealth into the scope of inheritance tax, the majority strongly opposed the proposal to make pension scheme administrators liable for reporting and paying tax due on the pension component of an estate'. Sir Steve Webb, a former pensions minister, said: 'Life is tough enough when you have just lost a loved one without having extra layers of bureaucracy on top. In future, the person dealing with the estate will need to track down all of the pensions held by the deceased which may have any balances in them, contact the schemes, collate all the information and put it into an online calculator and then work out and pay the IHT bill. • Read more money advice and tips on investing from our experts 'Complications will no doubt arise where the family member cannot track down all of the deceased's pensions or where providers are slow to supply the information needed to work out the IHT bill.' He suggested that the government should 'give serious thought' to changing the penalty rules around late payment of inheritance tax bills to ensure that grieving families were not fined because of delays that pension schemes might cause. Webb, now a partner at the consultancy Lane Clark and Peacock, said: 'While the changes HMRC has made are undoubtedly good news for pension schemes and those who administer them, it is hard to see that they are good news for bereaved families.' You can pass on £325,000 of assets from your estate without your beneficiaries paying any inheritance tax. This rises to £500,000 if you leave your main home to a direct descendant and your estate is worth less than £2 million. Any assets above those thresholds are usually taxed at 40 per cent, but anything left to a spouse or civil partner — including a pension from 2027 — is inheritance tax-free. Including pensions in an estate will close a loophole that gave savers a uniquely tax-efficient way of passing on wealth to the next generation. Those who could afford it could use other assets to live off in retirement, leaving their pension savings untouched to be passed on inheritance tax-free. In one piece of good news for families, the government confirmed that death-in-service benefits payable from pension schemes will still be excluded from inheritance tax. Pete Maddern from the insurer Canada Life said: 'These benefits provide a critical short-term financial lifeline for loved ones following the death of a working-age earner. Including them in the changes risked much wider repercussions not only for grieving families, but also for the employers that provide these benefits for their workforce.'
Yahoo
22-07-2025
- Business
- Yahoo
Should the state pension age be raised above 66? Have your say
Yahoo UK's poll of the week lets you vote and indicate your strength of feeling on one of the week's hot topics. After the poll closes, we'll publish and analyse the results each Friday, giving readers the chance to see how polarising a topic has become and if their view chimes with other Yahoo UK readers. A review into raising the state pension age is needed to ensure the system is "sustainable and affordable for generations to come", Rachel Reeves has said. Speaking to reporters on Tuesday, the chancellor said that as life expectancy increases, it is "right" to look at the age at which people can begin receiving their state pension. The state pension age is currently 66, rising to 67 by 2028, and to 68 between 2044 and 2046, although some have suggested this date could be brought forward. By the 2070s, the number of pensioners in the UK is expected to have increased by more than 50%, while the working age population will have only grown by around 10%, work and pensions secretary Liz Kendall said as she announced a separate review into pensions adequacy. This clearly puts pressure on the government, with the Treasury spending around £138bn on the state pension last year, equivalent to 5% of GDP. The Office for Budget Responsibility (OBR) expects this to rise to 7.7% by the early 2070s. Head of public policy at AJ Bell, Rachel Vahey, said an ageing population "places an increasing burden on taxpayers", and that while future governments may hope for an "improved economy and growing tax receipts", this "can't be guaranteed". The Institute for Fiscal Studies claimed increasing the state pension age is a "coherent response" to people living longer, but warned it "affects poorer people more, as well as those who find it more difficult to remain in paid work at older ages". It said any savings from delaying payouts should be "recycled into making universal credit more generous for those in the run-up to that age". Disabilities and caring responsibilities in older age, which could leave people unable to work, is also a consideration, with the International Longevity Centre UK noting that these factors "vary significantly by region and social class". But what do you think, is raising the state pension age inevitable? Or do you think the current level of 66 strikes a fair balance? Let us know in the polls below. The "elephant in the room", as Vahey describes it, is that the state pension age is "just one lever government has to help manage the cost of the state pension". The other is reforming the triple lock, a cast-iron guarantee that state pensions will rise every year by 2.5%, CPI inflation, or the rise in average earnings, whichever is highest. Yesterday Kendall said that the triple lock is "out of scope" of the newly resurrected Pensions Commission, which will be leading a review into the adequacy of the pensions system. Labour has already committed to keeping the triple lock, which first came into force in 2011, for the entirety of this Parliament. This puts considerable pressure on the Treasury's finances, however, with the OBR expecting the annual cost of this policy to reach £15.5bn by 2030. It said spending on the policy has risen by as much as three times the figure projected in 2012 and questioned whether taxpayers can realistically continue paying for it. 'The UK cannot afford the array of promises that it has made to the public,' the fiscal watchdog's chairman Richard Hughes said. It would be wrong to scrap the pensions triple lock to cover the cost of spiralling on fixed incomes shouldn't pay the price for a broken system. — Sir Alec Shelbrooke MP (@AlecShelbrooke) July 21, 2025 'Precisely what the government does in response to these pressures and the choices that ultimately every country is going to have to make about how they afford their welfare states and their wider public services commitments are issues for politicians.' However, supporters of the triple lock said it helps improve the adequacy of retirement incomes for current and future pensioners, particularly those on lower incomes. A Commons research briefing added that the UK state pension is "low in an international context", with separate Parliamentary figures showing an overall 55.4% replacement rate of pre-retirement earnings from mandatory pensions, compared to an average of 61.4% among similar economies. The government may have tied its hands for now on this issue, but Vahey said that if the newly announced review calls for the state pension age timetable to be accelerated, it "could provide some cover for future governments to look at reforming the triple lock" to avert more dramatic back on Friday to read the results and analysis via the link below. Read more of Yahoo UK's Poll of the Week articles
The Sun
22-07-2025
- Business
- The Sun
How long you'll have to wait to get your state pension
MILLIONS of us may have to wait a little longer to get our state pension. The government has just kicked off a new review into the state pension age, which could mean the goalposts are about to shift. 2 Right now, the state pension age is 66. It's already planned to rise to 67 between 2026 and 2028, and then to 68 between 2044 and 2046. If you're 48 years and three months or younger, your state pension age will be 68. For those aged 64 to 65, the state pension age gradually increases from 66 to 67, depending on your exact age now. However, the latest review could mean the move to 68 happens sooner. Rachel Vahey, head of public policy at AJ Bell, said: "An increase to state pension age from 66 to 67 is already slated to happen between 2026 and 2028. "But it's less clear what will happen after that. "There is also an increase to age 68 pencilled in for 2046, but a faster increase is definitely on the cards. "The first two reviews of the state pension age advocated bringing this forward, but successive governments have treated the issue like a hot potato." So, what does this all mean for you and your retirement plans? How to track down lost pensions worth £1,000s Why is the state pension age being reviewed? The short answer is that we are, on average, living longer. Chancellor Rachel Reeves said a review is needed to keep the state pension system "sustainable and affordable" for everyone, now and in the future. The triple lock, which guarantees state pension increases in line with inflation, wages or 2.5%, has become increasingly expensive, with costs expected to hit £15.5billion by 2030. Experts warn this could make promises to maintain the policy unsustainable without raising the pension age. The government usually reviews the state pension age every six years, but this one is happening early to make sure the rules are fair and match up with how long people are living now. This is the third review of its kind and is set to be completed by March 2029. How is the state pension age changing? The state pension age is currently set to rise from 66 to 67, and this change is already written into law. The increase will be phased in between 2026 and 2028. If you were born before April 6 1960, your state pension age remains 66. This means anyone who is already 65 won't be affected and can start claiming their state pension when they turn 66 next year. If you were born between 6 April 1960 and 5 March 1961 and are now aged between 64 and 65, your state pension age will be 66 plus a few extra months, depending on your exact date of birth. For anyone born on or after March 6 1961, your state pension age will be 67. The state pension age is then planned to rise again from 67 to 68 between 2044 and 2046 under current law. Again, this affects people based on their date of birth. This schedule is now subject to review but, as of now, affects people based on their date of birth and current age. If you were born before April 6 1977, your state pension age will stay at 67. This means anyone older than 48 years and 3 months will still be able to claim their state pension at 67. But if you're younger than this, you'll have to wait until you're 68 to claim your state pension. You can easily find out when you'll get your state pension using our handy tool. Just enter your date of birth, and it will tell you. How will a higher state pension age affect my retirement? By James Flanders, Chief Consumer Reporter: Raising the state pension age means people will have to wait longer to get their government-funded pension, which can be tough for those who rely on it as their main source of income. It's especially challenging for people in physically demanding jobs or those with little in the way of savings, as they'll need to figure out how to cover the gap between stopping work and qualifying for the state pension. But the good news is that private pensions give you more choice. Right now, you can access private pensions from age 55, although this will increase to 57 in April 2028. If you've been saving into a workplace pension or a personal pension, you could retire earlier than the state pension age, depending on how much you've saved. You can take the money as a lump sum, set up regular payments, or even leave it invested to grow. For those with enough savings, this flexibility means you can plan retirement around what works for you. But if your private pension isn't enough, you might find yourself working longer and waiting for the state pension to kick in. It's a reminder of why starting to save early and keeping an eye on your pension pot is so important for creating options later in life. What could change in future? The big question is whether the move to a state pension age of 68 will be brought forward. An earlier government review, called the Cridland Review, recommended this rise should happen much sooner - between 2037 and 2039. If the Cridland Review proposals are adopted, you could end up waiting a lot longer to claim your state pension. If you were born before April 6 1970 and are now 55 years and three months old or older, your state pension age would stay at 67, so nothing would change for you. However, if you're older than this and were born between April 6 1970 and April 5 1971, your state pension age would fall somewhere between 67 and 68. For anyone born on or after 6 April 1971, the state pension age would be 68. This means if you're 54 years and 3 months old now, you wouldn't be able to claim your state pension until you turn 68. The big question is whether the state pension age will rise to 68 sooner than planned. The government has decided to do another review instead of following the Cridland Review. This new review, led by Dr Suzy Morrissey, will happen within the next two years. It will explore all options for raising the pension age to 68 but must give at least ten years' notice before making any changes. This means anyone retiring before 2037 won't be affected. How does the state pension work? AT the moment the current state pension is paid to both men and women from age 66 - but it's due to rise to 67 by 2028 and 68 by 2046. The state pension is a recurring payment from the government most Brits start getting when they reach State Pension age. But not everyone gets the same amount, and you are awarded depending on your National Insurance record. For most pensioners, it forms only part of their retirement income, as they could have other pots from a workplace pension, earning and savings. The new state pension is based on people's National Insurance records. Workers must have 35 qualifying years of National Insurance to get the maximum amount of the new state pension. You earn National Insurance qualifying years through work, or by getting credits, for instance when you are looking after children and claiming child benefit. If you have gaps, you can top up your record by paying in voluntary National Insurance contributions. To get the old, full basic state pension, you will need 30 years of contributions or credits. You will need at least 10 years on your NI record to get any state pension. 2
