Gambling stocks fell heavily in early trading as investors fret about the potential for significant tax hikes targeted at the sector in the budget on 30 October.

The Guardian reported on Friday that the Treasury is “considering a tax raid of up to £3bn” on gambling operators. The paper said that ministers are examining proposals from the Institute for Public Policy Research think-tank to double the 15 per cent betting duty on high-street operators and increase the remote gaming duty paid by online operators from 21 per cent to 50 per cent.

Investec analyst Roberta Ciaccia said these measures “appear too punitive and would likely backfire”. She added that Entain (ENT) and Evoke (EVOK) are “most vulnerable to higher taxes”.

This was clear in share price movements this morning, as Evoke fell 13 per cent and Entain tumbled 11 per cent. Elsewhere, Rank (RNK) slid 7 per cent and Flutter Entertainment (FLTR) was down 5 per cent. CA

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Frasers hikes Mulberry offer

Mike Ashley’s Frasers Group (FRAS) has upped its potential offer for Mulberry (MUL), and attacked the board and management, saying there was “no current commercial plan, turnaround or otherwise”. The new bid is 150p a share, up from 130p a share, valuing the handbag company at £106mn. 

Mulberry’s board said it was considering the new Frasers approach, although warned that the company’s 56-per-cent shareholder Challice had said it had “no interest” in selling its shares to Frasers or supporting a buyout. Mulberry shares hit 135p in response to the update, a 20-per-cent increase. 

“Despite… Mulberry’s catastrophic results, its necessity for emergency funding and difficult market backdrop, Frasers strongly believes it can provide the appropriate insulation and investment to support a much-loved British brand,” the retail group said. AH

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No September rebound for PageGroup 

Recruitment giant PageGroup (PAGE) saw “no improvement” in market conditions last month, with workers remaining wary of moving jobs. Gross profit in the third quarter fell by 13.5 per cent to £201mn on a constant currency basis, with trading in a number of European countries – including France and Germany – deteriorating. 

Converting interviews into accepted offers is “the most significant area of challenge” and permanent recruitment is still performing worse than temporary recruitment. The company has cut its headcount by a further 2 per cent in response. 

PageGroup remains on track to hit its full-year forecasts, however, which were downgraded in July. Operating profit is expected to settle at £58mn, compared with £119mn in 2023. JS 

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Ashmore catches a lift from China 

The apparent ongoing surge in China’s equity has started to spillover into shares with large emerging markets (EM) exposure. EM asset management specialist Ashmore (ASHM) was a beneficiary of this phenomenon with its first quarter update prompting a 5 per cent rise in the share price – the first significant upward movement in more than two years. 

The conclusion that this is largely a euphoric reaction to the China equities market, is borne out, in part, by the update itself. Assets under management (AUM) increased by $2.5bn (£1.9bn) over the period, comprising positive investment performance of $3.2bn and net outflows of $700mn. This was broadly in line with consensus but was unexciting according to some analysts. 

David McCann of Deutsche Numis said: “We do not think these results are sufficient to warrant the recent strong share price performance, which we think has largely been driven by perceived read across from the strength in Chinese Equities”. The broker also noted the strong support from the 8.7 per cent dividend yield. JH