Signature Aviation underlying profits descend, Taylor Wimpey to resume dividend payouts

London open

The FTSE 100 is expected to open 17 points lower on Tuesday, having closed up 1.62% on Monday at 6,588.53.

Stocks to watch

Private jet servicing company Signature Aviation said underlying annual profits fell by two thirds as the Covid-19 pandemic hit air travel. The company, which is set to be taken over by a consortium of private equity funds, said underlying pre-tax profit fell 60.8% to $114.2m. “Our US Business and General Aviation markets have recovered strongly from the low point of 77% down in April 2020. January 2021 flight activity recovered to be 12.5% down year on year, and February was down 17%,” the company said on Tuesday.

Taylor Wimpey is to resume dividend payouts, the UK housebuilder said on Tuesday, after sales and profits met expectations during an otherwise "unusual and volatile year". Revenues in the year to 31 December came in at £2.79bn, a 36% fall on the previous year, while operating profits tumbled 65% to £300.3m. Pre-tax profits were down 69% at £264.4m, while adjusted basic earnings per share were 6.5p, compared to 20.3p in 2019.

Weir Group reported a 1% fall in revenue at constant currency in its final results on Tuesday, to £1.97bn, on the back of a 14% drop in orders to £1.86bn. The FTSE 250 engineering company said its adjusted operating profit was flat at constant currency at £305m, as adjusted earnings per share fell 5% on a reported currency basis to 74.4p. Its net debt improved by £106m through the year, to £1.05bn as at 31 December.

Newspaper round-up

City firms revealed in the final months of 2020 that they planned to shift nearly £100bn in assets to the EU, taking the total value of assets lost to the bloc since the Brexit vote to £1.3 trillion, according to a new survey. The data from consulting group EY pointed to a last-minute push by firms before 31 December after the UK-EU trade deal did not offer concessions for the UK’s dominant financial services sector. It forced companies to move staff and assets to the continent in order to continue serving EU customers. - Guardian

The City watchdog is scrapping performance-related pay and bonuses for senior executives, and also plans to impose salary cuts, as it faces criticism over its handling of the London Capital & Finance (LC&F) investment scandal. After an outcry about the Financial Conduct Authority’s failure to properly police the collapsed firm, the regulator’s chair, Charles Randell, told MPs that there would be a crackdown on remuneration. He said: “We decided that the consequences that flow from this should be collective. It was clearly the case that the FCA wasn’t sufficiently joined up across its various activities.” - Guardian

Hedge fund billionaire Sir Chris Hohn has landed one of the biggest annual paydays ever recorded in Britain after handing himself $479m (£344m) following soaring profits at his firm. The sum paid to 54-year-old Sir Chris by The Children's Investment Fund (TCI) exceeds previous bonanzas such as the £320m handed to Bet365 boss Denise Coates in 2018, which catapulted her ahead of celebrities such as Taylor Swift and cemented her position as the world's best-paid woman. - Telegraph

Greensill Capital was under pressure last night after Credit Suisse suspended funds investing in the controversial lender’s products and as it emerged that SoftBank had substantially written down its $1.5 billion investment in it. The British company, which is advised by David Cameron, the former prime minister, is believed to have appointed administrators and could file for insolvency within days. - The Times

Klarna, the “buy now pay later” finance company, has tripled in value to $31 billion in six months based on the terms of a new capital raising. The Swedish financial technology group said it had raised $1 billion from new and existing shareholders in a fundraising that was oversubscribed by four times. It declared itself the most valuable unlisted fintech in Europe and the second most valuable in the world. - The Times

US close

Wall Street stocks closed sharply higher on Monday as Treasury yields retreated from last week's highs and some positive vaccine news helped boost sentiment among investors.

At the close, the Dow Jones Industrial Average was up 1.95% at 31,535.51, while the S&P 500 was 2.38% firmer at 3,901.82 and the Nasdaq Composite saw out the session 3.01% stronger at 13,588.83.

The Dow Jones closed 603.14 points higher on Monday, reversing Friday's whopping 469.64 point loss amid elevated bond yields.

The 10-year Treasury yield slid to 1.44% on Monday, down two whole basis points from Friday and well off its recent high of 1.6% that rattled investors and major indices.

In addition to cooling bond yields, news that the Centers for Disease Control and Prevention advisory panel had unanimously voted to recommend Johnson & Johnson's one-shot Covid-19 vaccine for people over the age of 18 years gave sentiment a boost throughout the session.