Royal Mail buys Canada's Rosenau, Electrocomponents lifts guidance

London open

The FTSE 100 was expected to open flat on Friday, having closed up 1.17% on Thursday at 7,078.04.

Stocks to watch

Royal Mail said it had bought Canadian logistics company Rosenau Transport for CAD$360m (£210.5m). Rosenau is one of the largest independent freight carriers in Western Canada, Royal Mail said on Friday, adding the deal was being done via its international General Logistics Systems arm (GLS).

Chemring said on Friday that it has retired a contingent liability of up to £15m after HMRC confirmed that an inquiry into its participation in the UK’s Controlled Foreign Company Finance exemption has been closed. HMRC concluded that Chemring was not a beneficiary of State Aid in the periods ending 2013 to 2018.

Electronic parts distributor Electrocomponents lifted annual guidance after reporting interim trading ahead of expectations, but said supply chain issues would persist. Like-for-like revenue For the six months to September 30 rose 31% year on year and 22% higher compared with 2019 before the Covid pandemic struck. Full-year revenue growth and adjusted operating profit margin were forecast to be slightly ahead of previous guidance.

Newspaper round-up

The risk of power cuts to factories and homes this winter has increased, the National Grid warned, as the business secretary prepared for a crunch meeting with industry bosses concerned the energy crisis may force them to scale back production. The price of gas and electricity has soared in recent weeks, leading to the collapse of multiple energy suppliers and prompting warnings of higher costs for consumers, factory shutdowns and increased pollution as plants switch to dirtier but cheaper fuels. - Guardian

The US Senate has approved a deal to extend the government’s borrowing authority into December. The compromise between Republican and Democratic leaders would temporarily avert an unprecedented federal default that experts say would have devastated the economy. With a 50-48 vote, senators agreed to increase the borrowing limit by $480bn, sufficient to prevent the US government from defaulting by keeping debt payments up until 3 December. - Guardian

Ireland has been forced to abandon its low tax business model in the face of pressure from Joe Biden, putting the country's status as a haven for global companies at risk. The sacrosanct 12.5pc tax rate has been the cornerstone of the Irish economy for almost two decades, and helped attract some of the world’s biggest corporations, such as Facebook and Google, to set up their European headquarters in the country. - Telegraph

Checkout.com, one of Europe’s most valuable private companies, had a 73 per cent rise in UK and European sales last year as it benefited from the boom in online shopping. The payment processor, which was valued at $15 billion in a January funding round, recorded revenues of $252.7 million last year in its UK business, up from $146.4 million in 2019. - The Times

The mining equipment supplier Weir Group expects its profit to be trimmed by up to £40 million as the result of a cyberattack, it said in an update. The FTSE250 company said that many of its systems had to be shut down, disrupting orders into next year. - The Times

US close

Wall Street stocks were in positive territory at the close on Thursday, as Congress reached agreement to stave off the US debt limit for the time being, avoiding a government default, with jobless claims surprising to the downside.

At the close, the Dow Jones Industrial Average was up 0.98% at 34,754.94, the S&P 500 added 0.83% to 4,399.76, and the Nasdaq Composite was 1.05% firmer at 14,654.02.

The Dow Jones closed 337.95 points higher on Thursday, extending gains recorded in the previous session.

Major indices got a boost early in the session on news that Senate Minority Leader Mitch McConnell had offered a short-term suspension proposal to Senate Democrats that will raise the debt ceiling by a certain amount and allow the government to continue operating until December.

Tech stocks were in the green, with Twitter up 4.37%, Nvidia ahead 1.81% and Advanced Micro Devices 2.71% higher.