The FTSE 100 was weaker on Monday as housebuilders, utilities, and China-focused stocks weighed on the index.

If it weren’t for strength in pharma companies and marginal gains for the UK-focused banks, the FTSE 100’s 0.3% drop would be far more dramatic.

“The FTSE 100 dipped…despite the best efforts of the pharma and banking sectors to take the UK index forwards. Energy stocks acted as a drag while Diageo also gave up some of its recent gains,” said Russ Mould, investment director at AJ Bell.

“Chinese consumers still aren’t splashing the cash, representing yet more evidence that Beijing’s economic stimulus programme isn’t cutting the mustard. Chinese retail sales grew by 3% in November, well below the 4.6% consensus estimate. That’s a big miss and puts even greater pressure on the government to be more creative with its efforts to drive household consumption.”

Investors sold UK-focused shares after news that the UK’s private sector’s employment had fallen at the fastest pace since 2021. An S&P Global Flash UK PMI survey showed employment tumbled amid concerns about the budget and rising taxes.

“Businesses are reporting a triple whammy of gloomy news as 2024 comes to a close, with economic growth stalled, employment slumping and inflation back on the rise,” said Chris Williamson, Chief Business Economist at S&P Global Market Intelligence.

“Economic growth momentum has been lost since the robust expansion seen earlier in the year, as businesses and households have responded negatively to the new Labour government’s downbeat rhetoric and policies.”

So much for Labour’s focus on growth.

Housebuilders Persimmon, Berkeley Group Holdings and Taylor Wimpey felt concerns about the UK economy, with declines between 0.9% and 2.9%.

Entain was the FTSE 100’s top faller after announcing anti-money and counter-terrorism proceedings in Australia. The resultant 6% drop will be a real kick in the teeth for investors who were enjoying the fruits of a strategic shakeup after a prolonged period of poor performance.

“A company would never want the words ‘money laundering’ anywhere near it and that’s why news from gambling outfit Entain is potentially damaging, Russ Mould said.

“The Ladbrokes owner is being taken to court by the Australian regulator, significantly the first time it has launched civil proceedings against an online betting company, over serious non-compliance with the country’s money laundering and anti-terrorism financing laws.

“This doesn’t look to be a one-off incident, with Entain on the block for not conducting appropriate checks on 17 high-risk customers and allegedly helping them obscure their identities. The company’s recent history is chequered – it had to pay out a large sum last year for failing to prevent bribery at a former Turkish subsidiary and paid out fines over anti-money laundering failures in the UK in 2022.

Adsure Services is fast becoming one of London’s dividend heroes. It’s certainly the Aquis Stock Exchange’s dividend king.

The internal audit and business assurance firm has hiked its interim dividend by a bumper 60% to 0.786p after gross profits surged 46% in the half-year period to 30th September.

Adsure Services has now paid or declared 2.266p in dividends since its IPO in 2023. This equates to around 11% of the company’s 20.5p current share price.

Higher profits were driven by a 19% jump in revenue and were achieved despite the company investing in ICT systems to support further growth. Revenue for the period increased to £5.1m from £4.3m in the same period a year prior.  

The significant revenue increase resulted from providing existing clients with additional complimentary services, representing delivery on one of Adsure’s strategic pillars to drive growth.

“The Board is pleased to announce a period of significant growth for the Group, leading to a profitable performance at the interim stage. This success is attributed to the dedication of our staff and the compelling offerings we provide to our customers,” said Kevin Limn, Chief Executive Officer of Adsure Services PLC.

Providing an insight into how investors can expect Adsure to perform in their second half, CEO Kevin Limn pointed to an encouraging start to the period with strength in two leading business areas.

“The second half has started positively, and we are seeing strong momentum across our Risk & Assurance and Risk & Advisory divisions,” Limn said.

Sustainable dividend growth

Adsure Services has everything you want from an income share. Cashflows are reliable and recurring. The board has shown a propensity to pass increases in profit directly onto shareholders. These factors are key to making a share a dividend hero.

Adsure enjoys the reliability of revenues from long-term government-funded organisations, including NHS trust, emergency services, local government and housing associations. Contracts are typically between two and five years, providing clear revenue visibility to support future revenue growth.

In addition to reliable shareholder returns through increasing dividends, Adsure Services offers investors the growth opportunity of cutting-edge technology being developed with the assistance of an Innovate UK grant.

Utilising its deep understanding of government-funded processes at the heart of our everyday lives, Adsure Services has identified opportunities to further improve efficiencies with the use of artificial intelligence. Adsure is developing a proprietary AI large language model designed to help create fresh revenue channels and provide further efficiencies for their clients.