Reddit is aiming for a $6bn valuation when it lists its shares on the New York stock exchange. Photograph: Rafael Henrique/SOPA Images/REX/Shutterstock
Reddit is aiming for a $6bn valuation when it lists its shares on the New York stock exchange. Photograph: Rafael Henrique/SOPA Images/REX/Shutterstock
Closing summary: Reddit hopes to raise $500m in stock market float
Reddit will give bankers and investors a sense of whether demand for new stock market issues has picked up, after an extended slowdown.
The US social media company has been slower to shoot for profits than some other rivals, but it is still aiming for a tasty big tech valuation at more than $6bn, according to a filing on Monday.
The hoped-for valuation would value Reddit at $6.4bn at the top end – although that is lower than the $10bn valuation it achieved at its last fundraising in 2021.
In other business news today:
Bitcoin hit a new record above $72,000 for the first time.
Heathrow airport saw further growth last month with its busiest-ever February, as passenger numbers surpassed pre-Covid levels.
People from ethnic minority backgrounds now lead 12 of the UK’s top 100 listed companies, according to a wide ranging review into diversity in business, up from the seven recorded last year.
UK culture secretary Lucy Frazer has received reports submitted by competition and media regulators ahead of deciding whether a more detailed regulatory probe is needed into a planned £600mn takeover of one of the Daily Telegraph owner by a UAE-backed consortium.
You can continue to follow the Guardian’s live coverage from around the world:
In the UK, Tice says he will be ‘surprised’ if Reform UK does not get more Tory MPs joining
Lookahead: US and UK central banks wait for data on inflation pressures
Stock markets have fallen back across the world on Monday, but investors will be more focused on important data to come in the next few days.
In the US traders’ eyes will be on inflation figures, due on Tuesday. Economists expect price rises to remain at 3.1%, according to a poll.
Any surprise either way has the potential to prompt a scramble by investors to readjust. The Federal Reserve is due to announce its latest monetary policy decision next wee. Nobody expects any movement, but investors are nervously awaiting signals for when the Fed will consider cutting interest rates – once inflation falls durably.
Reuters reports:
An unexpected uptick in consumer and producer price pressures in January has raised some fears that inflation could see another bout of strength. Traders will be watching Tuesday’s data for confirmation that inflation is staying sticky, or for proof that January’s data was an anomaly due to seasonal factors.
In the UK the Office for National Statistics will publish labour market statistics on Tuesday. Unemployment is expected to stay steady at 3.8%, according to Reuters polling.
Imogen Bachra, head of non-dollar rates strategy at NatWest bank, said:
Given that wage growth is one of the MPC’s key indicators in determining the underlying persistence of inflation (and that there still exist question marks over many other parts of the labour market data set), this week’s wage growth will be important in determining the BoE’s reaction function over the coming months.
She said the data will not “add fuel to the early rate cut fire” because wage growth will stay about steady at an annual rate of 5.6%. However, that will not be enough to give the Bank of England the green light to slash rates at its next meeting on 21 March.
That will be followed on Wednesday by UK GDP data for January. The economists’ consensus is for a 0.2% rebound. That would provide some small relief to prime minister Rishi Sunak, after December’s data showed that the UK entered recession at the end of 2023.
If a rebound is confirmed (and watch out for revisions), that would probably eliminate any chance of an “early” interest rate cut, according to Matthew Ryan, head of market strategy at financial services firm Ebury. He said:
As things stand now, markets are not pricing in a full chance of a cut until August, a relatively hawkish stance that is providing solid support for sterling.
People from ethnic minority backgrounds now lead 12 of the UK’s top 100 listed companies, according to a wide ranging review into diversity in business, up from the seven recorded last year.
The latest figures from the Parker Review also show that 96 of the top 100 companies had at least one ethnic minority board member as of 31 December 2023, but only 56 firms had more than one.
Diploma, Frasers Group, Howden Joinery and Intermediate Capital Group were the companies without any representation.
The Parker Review was launched in 2017 and carries out a voluntary annual census on ethnic minority makeup of boards of the FTSE 350 companies, and the 50 largest private companies.
On its launch it set the target for every board in the FTSE 250 to have at least one board member from an ethnic minority background by next year, while all FTSE 100 companies were tasked with hitting the goal by 2021.
Of the 222 FTSE 250 companies that responded to the survey, 175 (79%) had some ethnic diversity on their board, which was an increase from the 149 that met the target last year.
The review chair David Tyler described the figures as showing “good progress in driving up diversity” but urged those in the FTSE 250 to do all they could to increase numbers over the coming 12 months.
For the first time, the review also looked into representation in senior management teams, which showed that 13% of all FTSE 100 managers being from an ethnic minority background, and 12% of FTSE 250 firms.
The committee team did find that only 36 of the 50 private companies that it had invited to respond, had provided figures, and called for more responses in future years.
Of those that did respond, 22 (61%) had at least one board member from an ethnic minority background. The review has set a target that all private companies have at least one ethnic minority board member by 2027.
Heathrow enjoys record February with busiest year expected
Gwyn Topham
A Qatar-owned Airbus A380 aircraft coming into land at London Heathrow airport. Photograph: Maureen McLean/REX/Shutterstock
Heathrow airport saw further growth last month with its busiest-ever February, as passenger numbers surpassed pre-Covid levels.
The London hub averaged 200,000 passengers per day through the month, with the leap year bringing the total to 5.8m passengers – although it had hit the monthly record before the extra day.
Numbers were up 10% from last year, while the half-term holiday was its strongest to date, with more than 2m passengers travelling through, boosted by the winter sun and ski market.
The airport has reported record traffic in three of the past four months and is expecting 2024 to become the busiest on record.
Heathrow chief executive Thomas Woldbye is expected to unveil further plans to maximise capacity at the London hub in the coming months, including a decision on whether to push forward plans for a third runway.
UK culture secretary receives reports on planned Telegraph takeover
Jane Croft
Copies of The Daily Telegraph are displayed on a rack in a supermarket in London in January. Photograph: Belinda Jiao/Reuters
UK culture secretary Lucy Frazer has received reports submitted by competition and media regulators ahead of deciding whether a more detailed regulatory probe is needed into a planned £600mn takeover of one of the Daily Telegraph owner by a UAE-backed consortium.
Reports on the proposed takeover for the Daily Telegraph and Spectator magazine were submitted to Fraser by 9am on Monday by Ofcom, the media regulator and the Competition and Markets Authority (CMA), which examines monopoly issues. The CMA confirmed in a statement on Monday that it had delivered its report to Fraser on jurisdictional and competition matters.
The proposed deal by RedBird IMI has been fiercely opposed by many Tory MPs and peers who have raised concerns about press freedom. Redbird IMI is a partnership between a fund backed by sheikh Mansour bin Zayed Al Nahyan, the UAE’s vice-president, and the US investment firm RedBird Capital Partners.
Redbird IMI is majority owned by International Media Investments (IMI) backed by sheikh Mansour. Mansour is best known in the UK as being the ultimate owner of Manchester City football club. US investor Redbird is run by Jeff Zucker, a former CNN president.
IMI has teamed up with Redbird for the transaction which aims to take over the titles in exchange for repaying £1.15bn of debts owed to Lloyds Banking Group by its current owners, the billionaire Barclay family.
Grounds for ministers to refer a media takeover to a detailed investigation by regulators include the need for accurate presentation of news, free expression of opinion and – specifically regarding newspapers – a sufficient plurality of views and persons with control of ownership.
Reddit seeks $6bn valuation in New York stock float
Reddit is seeking to list shares on the New York stock exchange. Photograph: Dado Ruvić/Reuters
Social network Reddit is hoping for a valuation of as much as $6.4bn when it floats shares on the New York stock exchange.
Reddit said it will sell 22m shares valued at between $31 and $34 each, in a filing published on Monday.
The social network is one of the most popular forums for online culture, with “subreddits” on a huge array of topics. However, it is still lossmaking – it lost $90m in 2023.
The listing will not be Reddit’s first run-in with financial markets. One subreddit, r/wallstreetbets, was behind a huge surge in market volatility in early 2021 when retail investors banded together to ruin hedge funds shorting various companies, including retailer GameStop and cinema chain AMC Entertainment.
It will be intriguing to see if Reddit itself becomes a target of those same retail investors. The company is certainly aware of the risks: it said r/wallstreetbets could cause “exteme volatility:
Reddit, in their IPO, lists wallstreetbets as a risk factor in their registration statement pic.twitter.com/Fr0bph0MpH
UK to allow creation of cryptocurrency-backed investments – for pros only
The UK’s financial regulator has said it will allow the creation of cryptocurrency debt instruments on financial exchanges – but only for professional investors.
The Financial Conduct Authority (FCA) said on Monday that it “will not object to requests from recognised investment exchanges to create a UK listed market segment for cryptoasset-backed exchange-traded notes (ETN)”.
The London Stock Exchange today outlined the process for admitting a crypto ETN. It said any new products would need to be “physically backed, i.e., non-leveraged; (b) has a market price or other value measure of the underlying that is reliable and publicly available; and (c) has bitcoin or ethereum underlying cryptoassets.”
The limit to professional investors only is there because the FCA believes that cryptocurrency products “are ill-suited for retail consumers due to the harm they pose”. Those harms are mostly in the form of steep losses for people who piled into crypto – a renewed risk with bitcoin back at a record high. The FCA said:
The FCA continues to remind people that cryptoassets are high risk and largely unregulated. Those who invest should be prepared to lose all their money.
But even if it is not exactly a ringing endorsement from the FCA, it does add to the sense that the long-awaited “institutionalisation” of cryptocurrency – the increasing interest from big banks and investors – is gaining some momentum.
Vinyl and air fryers replace hand sanitiser and bakeware in UK inflation basket
Shoppers in the Love Vinyl record shop in Hoxton, east London. Photograph: John Stillwell/PA
The UK “shopping basket” used to calculate inflation has had its annual update. Out: pandemic-era hand sanitiser. In: air fryers, and a stunning return for the vinyl record.
The Office for National Statistics (ONS) tries to make the basket as representative as possible of the typical shopper’s habits to try to get the most accurate gauge of inflationary pressure. That means that the basket ends up being a good way of tracking the changing tastes of British consumers.
Additions: air fryers, vinyl music, gluten free bread, and edible sunflower seeds.
Removals: hand hygiene gel, hot rotisserie cooked chicken, and bakeware.
It is not just vinyl that represents a comeback for physical media despite digital dominance: a card game has been added to the basket as well.
And a hint at a future inclusion related to the rise of the electric car:
We also considered adding electric car charging at public sites to the basket but decided against for this year. We will continue to monitor it with a view to introducing it in future.
You can read the full report from the Guardian’s Phillip Inman here:
Side note: this intro sounds like a bid for the next office karaoke:
Not since Simply Red’s album Stars topped the album charts in 1992 have vinyl records been included in the basket of goods used to calculate annual inflation, but a surge in sales over recent years has brought them back as a marker of UK shop prices.
Mick Hucknall of Simply Red performs on stage in 2019. Photograph: Tabatha Fireman/Getty Images for Bauer Media
Good morning, and welcome to our live coverage of business, economics and financial markets.
Bitcoin went through a deep “crypto winter” after hitting its previous heights, but after a remarkable rally it is now hitting new heights above $71,000.
The cryptocurrency on Monday morning UK time hit a record of $71,209, adding further to a rally from less than $16,000 in late 2022.
The price of bitcoin had surged to a record of $68,550 in November 2021 amid euphoria from retail investors – many of whom had received money to help them through the coronavirus pandemic lockdowns. Historically low interest rates were also thought by many economists to have helped drive the price higher.
Bitcoin has rallied in value after its price slumped from its previous heights. Photograph: Coinbase
The crypto winter meant that many of the same investors who had piled in to the cryptocurrency were burned. However, institutional investors have shown increasing interest in the biggest cryptocurrency by market value after the US regulator approved new bitcoin exchange-traded funds (ETFs).
In UK corporate news, mid-sized electronics retailer Currys appears to have fended off interest from US private equity investors Elliott Advisors.
Currys on Monday reported that Elliott had declined to make a formal offer after its approaches were rejected by the retailer’s board.
International private equity investors have targeted UK companies, which are undervalued compared to their peers on many metrics.
In a statement to the stock market, Elliott said:
Elliott Advisors (UK) Limited, acting on behalf of the funds it advises confirms that, following multiple attempts to engage with Currys’ Board, all of which were rejected, it is not in an informed position to make an improved offer for Currys on the basis of the public information available to it. Elliott therefore confirms it does not intend to make an offer for Currys.
Under the UK’s takeover rules, Elliott will be unable to make a new bid for Currys for at least six months (unless it gains the approval of the Currys board or there is a change in circumstances).
The agenda
9am GMT: Deadline for UK regulator to submit reports on proposed sale of Telegraph Media Group.
9:30am GMT: UK update to consumer price index basket
