Next lifts full-year guidance, SSE Renewables entering Japan market
London open
The FTSE 100 is expected to open four points higher on Wednesday, having closed down 0.5% at 7,028.10 on Tuesday.
Stocks to watch
UK fashion retailer Next lifted full-year guidance as it reported a rise in interim profits and sales as stores reopened from Covid pandemic lockdowns. The company on Wednesday forecast pre-tax profit of £800m, up 6.9% from 2019 and £36m ahead of previous guidance of £764m. Full price sales for the rest of the year were expected to be 10% higher from 2019. Profit for the six months to July 31 on a two-year basis rose 5.9% to £346.7m driven by a 7.6% increase in group sales to £2.2bn.
SSE announced that its renewables operation has signed an agreement with Pacifico Energy, one of Japan's largest developers of renewable energy, to create a joint ownership company that will pursue offshore wind energy development projects in Japan. The FTSE 100 company said the creation of the joint ownership company would involve the acquisition of an 80% interest in an offshore wind development platform from Pacifico Energy and its affiliates for $208m (£153.48m), of which $30m would be deferred subject to a number of conditions.
Newspaper round-up
Britain’s supply chain strain could last until after Christmas, Boris Johnson has admitted as he urged motorists to stop panic-buying fuel by insisting supplies were “improving” – despite thousands of forecourts remaining dry. The prime minister intervened after being accused by Labour of “reducing the country to chaos” with car queues continuing to build up and fights breaking out at petrol stations, while teachers and hospital workers were left unable to get to work. - Guardian
Almost 2.5 million BT customers could receive up to £500 each after a tribunal approved an attempt to launch a class action against the telecoms company over claims it overcharged them for their landline telephone services. The competition appeal tribunal (CAT) has allowed Justin Le Patourel, the founder of consumer group Collective Action on Landlines (Call), to bring the landmark £600m case on behalf of 2.3 million landline-only customers against BT. - Guardian
Euan Blair, son of former prime minister Tony Blair, has amassed a paper fortune of more than £160m after securing a record investment for his education technology start-up. Multiverse, which aims to reduce reliance on university graduates by connecting major companies and tech firms with apprentices and school leavers, achieved a valuation of $875m (£646m) by clinching new backing from US investors. - Telegraph
The easyJet founder Sir Stelios Haji-Ioannou has lost his grip on the budget airline he launched a quarter of a century ago after the company raised £1.2bn of extra cash. Sir Stelios's blocking stake has been diluted after he chose not to purchase new shares in a rights issue following a takeover swoop by low-cost rival Wizz Air. - Telegraph
Shareholders in Wise, the money transfer group, are expected to seek an explanation after its billionaire co-founder and chief executive was named, shamed and fined as a “deliberate defaulter” by HM Revenue & Customs.” Kristo Kaarmann was placed on a list of “deliberate tax defaulters” by HMRC, raising questions about his fitness to head an authorised financial institution. - The Times
US close
Wall Street stocks closed lower across the board on Tuesday as rising bond yields, negative data points, and testimony from Federal Reserve chairman Jerome Powell all weighed on the market.
At the close, the Dow Jones Industrial Average was down 1.63% at 34,299.99, while the S&P 500 was 2.04% weaker at 4,352.63 and the Nasdaq Composite saw out the session 2.83% softer at 14,546.68.
The Dow closed 569.38 points lower on Tuesday, easily erasing gains recorded in the previous session, as the yield on the benchmark 10-year Treasury note continued to advance early on Tuesday, sitting at around 1.545%. The yield on the 30-year Treasury note also rose to 2.094%.
Market participants thumbed over testimony from Federal Reserve chair Jerome Powell, who, in prepared remarks delivered in front of the Senate Banking Committee, cautioned that inflation might persist longer than originally expected.
"Inflation is elevated and will likely remain so in coming months before moderating," Powell said. "As the economy continues to reopen and spending rebounds, we are seeing upward pressure on prices, particularly due to supply bottlenecks in some sectors. These effects have been larger and longer-lasting than anticipated, but they will abate, and as they do, inflation is expected to drop back toward our longer-run 2.0% goal."