Category: Market News

Croma Security Solutions Group (LSE:CSSG) has acquired A. Butler & Sons, which trades as William Channon, in a cash transaction estimated at £1 million and funded from the group’s existing resources.

The acquisition gives Croma a permanent presence in London and adds William Channon’s commercial locksmith and access control operations to its existing security services network.

William Channon recorded £1.1 million turnover in 2025

Based in Holborn and founded in 1917, William Channon serves commercial customers including museums and universities.

The business generated unaudited turnover of £1.1 million in 2025 and recorded a small pre-tax loss. Its net assets were broadly in line with the estimated £1 million purchase price.

William Channon’s managing director will remain involved for a short transition period on a consultancy basis.

Croma plans to restructure the acquired business and said it sees opportunities for cost synergies and for offering additional security services to William Channon’s existing and larger corporate customers.

Acquisition expands Croma’s London operations

The transaction forms part of Croma’s acquisition strategy following the sale of its man guarding business in 2023. The company has been acquiring and integrating locksmith businesses as it develops a national network of security centres.

The William Channon acquisition provides Croma with a base in the London market while adding an established commercial customer portfolio to the group.

Croma Security Solutions Group provides locksmith, fire and security services to domestic and commercial customers. The AIM-listed company is headquartered in Southampton and operates security centres serving sectors including health, education, leisure, entertainment and utilities.

The Permian Basin is entering a multi-year period of natural gas infrastructure expansion that could address longstanding transportation constraints while supporting continued production growth, according to Citi.

Unlike previous investment cycles, the bank believes the latest wave of infrastructure spending is being underpinned by structural demand growth. Expanding U.S. LNG exports and rising power requirements from AI data centers are encouraging companies to commit to new capacity earlier and at greater scale.

Citi expects these trends to eventually make the Permian the largest natural gas-producing basin in the U.S., complementing its existing position as the country’s leading source of crude oil.

Pipeline expansion could improve Waha pricing

Four recently announced infrastructure projects represent an inflection point for the Permian gas market, according to Citi.

Combined with capacity additions already underway and the expected acceleration in U.S. LNG exports, the new projects could help narrow Waha Hub price differentials and improve the economics of oil-focused drilling through 2030.

Permian natural gas production expanded substantially over recent years, rising from 17.2 billion cubic feet per day in 2021 to an estimated 27.6 bcf/d in 2025.

Pipeline capacity did not increase quickly enough to absorb that additional output, contributing to pricing disruptions at Waha during 2024 and 2025. The imbalance became even more pronounced during the first half of 2026.

AI electricity demand adds another source of gas consumption

Growing LNG exports are expected to provide an increasingly important source of demand for U.S. natural gas through the remainder of the decade.

Domestic electricity consumption could also play a larger role. The U.S. Energy Information Administration’s August 2026 Short-Term Energy Outlook forecasts that natural gas consumption by the power sector will reach a record 46.1 bcf/d during summer 2027.

That would be approximately 6% above consumption levels during the summers of both 2025 and 2026.

The trend is particularly significant in Texas. Natural gas-fired generation within ERCOT is projected to increase by roughly 22% between summer 2025 and summer 2027, with data center-related electricity demand accounting for much of the expected growth.

Texas regulators recently paused new interconnection approvals, however, leading the EIA to lower its 2027 projection.

Producers look to secure long-term takeaway capacity

Citi expects exploration and production companies operating in the Permian to take a more active role in securing access to pipeline infrastructure.

Strategies could include taking equity stakes in pipelines and entering long-term agreements that guarantee transportation capacity.

The bank pointed to Devon Energy and Diamondback Energy (NASDAQ:FANG) through Solitude, along with Exxon Mobil’s relationship with Targa Resources, as examples of producers seeking greater control over their gas transportation requirements.

Such arrangements could become increasingly important as associated gas production rises alongside continued oil drilling.

Storage data suggests tighter gas market

Gas-focused exploration and production stocks have risen around 4.4% over the past month, even as forward natural gas strip prices have remained broadly unchanged and prompt-month prices continue to trade at depressed levels.

Citi’s storage model provides another indication that underlying supply-and-demand conditions could be somewhat tighter than headline pricing suggests.

Actual inventory additions have consistently undershot the bank’s forecasts over the past month, with the difference averaging approximately 1.6 bcf/d.

JPMorgan expects equities to continue advancing into the end of the year, but believes the next stage of the rally will be characterised by changing market leadership rather than an indiscriminate rise across stocks.

“In equities, we stay constructive into year-end, expecting a grind higher with rotation rather than a broad melt-up move,” strategist Fabio Bassi wrote.

The recent rebound in semiconductor shares is viewed by the bank as a sign that risk appetite is recovering tactically. JPMorgan also believes the Federal Reserve’s willingness to remain patient should help limit volatility, leaving positioning and dispersion as important drivers of market performance.

Semiconductors offer opportunities after repricing

Quality Growth and hyperscalers remain among JPMorgan’s preferred equity exposures. The bank also sees semiconductors as increasingly attractive following the sector’s recent repricing.

A favourable combination of continued disinflation and a Fed that keeps monetary policy unchanged could allow participation in the equity rally to expand, JPMorgan said.

The bank is also monitoring developments in bond markets after a significant selloff in longer-dated debt led to renewed steepening of developed-market yield curves.

JPMorgan said part of the move reflects supply-driven “crowding out,” with the substantial capital expenditure requirements of hyperscalers competing with sovereign governments for available capital. At the same time, growing confidence that AI spending can ultimately be monetised is improving expectations for real investment returns.

Bond selloff does not point to policy error, JPMorgan says

The increase in longer-term yields is not currently viewed by JPMorgan as a warning that monetary policy has become dangerously restrictive.

“Higher long-end yields and steeper curves may reflect higher demand for capital and investment opportunities more than policy-error fears,” the bank wrote.

JPMorgan’s central scenario assumes term premiums rise only modestly from current levels. Under those conditions, the bank does not expect higher long-term yields to become a trigger for widespread risk aversion.

Fed debate likely to continue beyond Jackson Hole

The US Treasury’s decision to increase buybacks of 10-year and 30-year debt also attracted JPMorgan’s attention. The bank said the larger purchases suggested policymakers were uncomfortable with the recent rise in long-term yields.

JPMorgan does not expect Jackson Hole to resolve the debate over how the Fed will respond to changing economic conditions.

For equities, the bank therefore continues to see a constructive backdrop, with further upside potentially coming through sector and style rotation rather than a broad market melt-up.

The rapid expansion of leveraged and inverse single-stock ETFs in the US is beginning to show signs of strain, as shrinking average fund sizes and a sharp rise in closures raise questions about how many products the market can sustain.

Investor appetite for leveraged exposure has grown alongside a volatile bull market, encouraging issuers to introduce products designed to multiply the daily performance of individual stocks. The trend became particularly visible in June, when such products represented as much as half of all new ETF launches.

The proliferation of funds, however, means more issuers are competing for a limited pool of speculative capital.

“The market for these is saturated and there’s only so much money out there chasing this kind of product,” said Morningstar analyst Daniel Sotiroff. “A few firms at the top end up commanding the lion’s share of the money, and then there’s a long tail of also-rans who are struggling to attract assets.”

Average leveraged ETF assets fall sharply

Industry observers generally view $50 million to $100 million in assets during a fund’s first one or two years as a rough threshold for establishing a sustainable ETF. Products that fail to reach that scale may struggle to generate enough revenue for their sponsors to cover costs.

Some funds have comfortably exceeded that level. The GraniteShares 2x Long NVDA Daily ETF has grown to approximately $3.9 billion, demonstrating the potential demand for leveraged exposure to heavily traded stocks.

Across the broader category, however, assets are substantially smaller.

Morningstar Direct figures show average assets in leveraged ETFs have fallen from $272.2 million at the end of 2024 to $63.3 million currently. Half of the funds have accumulated less than $7 million.

Second wave moves further into speculative stocks

The nature of new launches is also changing as issuers search for additional opportunities.

Vident president Amrita Nandakumar believes the industry is nearing the end of a second expansion wave, with newer offerings increasingly “scraping the bottom of the barrel” by targeting smaller, more speculative and less established stocks.

Despite those concerns, launches have continued at a record pace. Some 244 leveraged ETFs had debuted by mid-August, already exceeding the 229 introduced throughout 2025.

“The first wave we saw a few years ago, and it involved creating leveraged ETFs tied to the names that you’d expect, big, widely watched and volatile companies” such as Nvidia, Tesla and Alphabet, Nandakumar said.

The subsequent wave has expanded well beyond those established companies. New filings include leveraged products targeting smaller stocks, private companies that have yet to file for an IPO and even recently launched AI-themed ETFs.

“You don’t necessarily see these products being listed on the biggest or most stable companies any longer,” said Elisabeth Kashner, director of global funds research at FactSet.

Fund closures signal market consolidation

The expanding range of products has been accompanied by a significant increase in closures. Morningstar said 63 leveraged single-stock funds have shut down in the US so far in 2026, compared with only three last year.

Tradr ETFs has closed products linked to MongoDB and Datadog after both software companies were hit by selling pressure earlier in the year amid concerns about disruption from artificial intelligence.

“We are consistently evaluating our suite of funds to gauge investor demand,” said Matt Markiewicz, head of product and capital markets at Tradr.

GraniteShares also liquidated a 2x leveraged ETF tied to Lucid Group following a roughly 51% one-day collapse in the electric vehicle maker’s shares on July 14. Because a 2x product seeks to multiply the underlying stock’s daily move, a decline of that scale can effectively reduce its net asset value to zero.

“If a fund is below break even or shows no real signs of adoption by the market, we’ll close it,” GraniteShares CEO Will Rhind said, without commenting specifically on the Lucid-linked product.

Corgi Invest continues aggressive expansion

Not every issuer is pulling back. Silicon Valley-based Corgi Invest has launched 127 leveraged or inverse single-stock products this year and intends to expand its range further.

Founder Emily Yuan said the company does not intend to rapidly close funds simply because they are initially small.

Corgi’s products currently hold an average of around $1 million each, but Yuan expects lower fees to help the firm compete for investor assets.

“If you make good products, the money will come,” she said.

Equity market leadership has historically undergone a significant rotation when the Federal Reserve starts raising interest rates, with Value tending to hold up better than Growth and small caps initially coming under pressure, according to Barclays.

The analysis comes as financial markets increasingly price in the possibility of a Fed rate increase by the first FOMC meeting of 2027. That shift has occurred even as expectations for inflation over the near and medium term have eased.

Barclays economists remain more cautious about the prospect of tightening and expect no rate increases during the first half of 2027. Recent inflation readings, they said, should be “sufficiently benign to keep most FOMC members on hold pending further evidence.”

Energy leads before the first Fed hike

To assess the potential market implications, Barclays examined five tightening cycles going back to February 1994 and compared sector and factor performance immediately before and after the first rate increase.

According to the bank, “the onset of a Fed hiking cycle has historically marked a clear inflection point for equity leadership.”

The S&P 500 generated a median return of 2.2% during the three months before the first hike, while small-cap stocks delivered roughly flat performance.

Energy and Industrials stood out during the run-up to higher rates, each recording median gains exceeding 7.5%. Communication Services moved in the opposite direction, falling approximately 2%.

Financials suffer once rates begin rising

The historical picture became less favourable after the first rate increase. The Russell 2000 fell by a median 7.2% during the subsequent quarter, considerably worse than the S&P 500’s median decline of 3.9%.

Financials were the weakest-performing sector, posting a median loss of 8.4%. Health Care, Utilities and Consumer Staples also struggled, despite their traditionally defensive characteristics.

Energy proved the exception, generating a modest median gain of 0.3%.

Barclays said Financials can be hurt by the combination of tighter financial conditions and flattening yield curves, which weigh on lending margins. Defensive sectors have also historically experienced valuation pressure when a rate increase signals confidence from policymakers that the economy can withstand tighter monetary conditions.

Value advantage strongest among small caps

Within style factors, Barclays found that Value has “generally fared better than Growth, especially within small caps.”

Large-cap Growth historically trailed Value over the two quarters following the first rate increase. Among smaller companies, the difference was greater, with the shift “even more pronounced among small caps, where Growth trails Value sharply within the first two months of the hiking cycle.”

Momentum typically performs strongly in advance of the first hike but becomes more range-bound once tightening is underway.

The Fama-French small-over-large factor has also tended to weaken during approximately the first two months of a hiking cycle, before subsequently entering a more sustained recovery.

JPMorgan Chase is adjusting its approach to loans secured against shares in newly public companies as it looks to expand its business with wealthy individuals connected to the technology sector, according to a Financial Times report published Tuesday.

The bank normally requires a company to have been publicly traded for at least 135 days before accepting its stock as collateral for a loan.

That restriction was reportedly relaxed in connection with SpaceX’s June initial public offering. Before the company went public, JPMorgan advised its bankers that lending against shares in Elon Musk’s rocket and AI business could begin sooner than would typically be permitted under the bank’s policy, the FT said.

Bank could extend flexibility to Anthropic

A similar approach could potentially be applied to Anthropic when the Claude developer reaches the public markets, according to JPMorgan bankers cited by the Financial Times.

Such a move would give the bank greater flexibility when serving technology founders, executives and shareholders whose wealth may be heavily concentrated in shares of companies that have only recently completed an IPO.

JPMorgan has not yet made a final decision regarding Anthropic, however, and its eventual lending policy for the company’s shares remains subject to change, according to the report.