Profits fall at M&S, earnings slump for SSE
The FTSE 100 is expected to open 20 points higher on Wednesday, having closed up 0.25% at 7,328.92.
Stocks to watch
Marks & Spencer's annual profit fell almost 10% as underlying revenue declined across the retail chain's food and clothing and home divisions. Pre-tax profit before adjustments for the year to the end of March dropped 9.9% to £523.2m as revenue fell 3% to £10.38bn. M&S also announced terms of a rights issue to raise £601.3m gross. Chief Executive Steve Rowe said the company's transformation had not been consistent and that trade was volatile with results likely to be better in the second half of the current financial year
Adjusted pre-tax profits at energy provider SSE slumped 38% to £725.7m, reflecting a £284.9m adjusted operating loss previously forecast in Energy Portfolio Management. The company added that Brexit worries and Labour's proposed renationalisation policy if it was elected had caused “significant” uncertainty. SSE, which is on of the so-called 'Big Six' providers, said earlier in May it was cutting 444 jobs in its struggling retail business, blaming tough competition and government-imposed cap on energy prices.
IG Group Holdings said on Wednesday that the low levels of volatility and market activity it experienced in the third quarter of the financial year had continued into the first two months of the final quarter. The FTSE 250 financial trading firm said that in the first three weeks of May, market conditions had been more favourable, and as a result, revenue in the fourth quarter ending 31 May was expected to be around £115m, compared to £108m in the third quarter. It said its full-year net trading revenue was projected to be around £475m, still down from £569m year-on-year.
Boris Johnson is launching a bid to court One Nation Conservative MPs in the group of centrist liberals run by Amber Rudd, as he tries to pitch himself as a candidate who can appeal beyond right wing Brexit supporters. The former foreign secretary, who is favourite to be the next Conservative leader, is backed by Brexit hardliner Jacob Rees-Mogg but infuriated many Tory colleagues by backing Theresa May’s deal after months of campaigning against it. – Guardian
Banks and one of Britain’s biggest food suppliers are poised to pursue Jamie Oliver over debts after the chef’s empire of restaurants collapsed. The Daily Telegraph understands Mr Oliver provided personal guarantees to lending giant HSBC and distributor Brakes after a previous restructuring, allowing them to claim against him personally for any unpaid bills. – Telegraph
Theresa May needs to relax her planned clampdown on migrant workers post-Brexit to avoid destroying the construction sector and any chance it has of hitting government house-building targets, a Tory Brexiteer-led group of MPs has concluded. The All-Party Parliamentary Group for SME housebuilders warned in a new report that the construction industry “cannot absorb the shock to the system” of a swift change to the measures ministers propose in place of EU free movement: “The shock of the Government’s own immigration initiative could perversely be the reason why the Government subsequently does not hit its target for 300,000 new homes a year.” - Telegraph
A leading accountancy firm could face a record £12.5 million fine for misconduct after signing off on accounts for the world’s largest custodian bank, despite its failure to keep customers’ money safe during the financial crisis. KPMG “defeated” the British regulatory system by giving BNY Mellon a clean bill of health, exposing its clients and the wider financial system to the possible insolvency of the bank, the industry watchdog has said. – The Times
Metro Bank has felt the wrath of its shareholders at its general meeting after a disastrous accounting error wiped about £1.5 billion from the company’s value. Investors rebuked the two non-executive directors of the bank’s audit and risk oversight committees. More than a quarter voted against the reappointments of Stuart Bernau, 67, who led the committee until March, and Gene Lockhart, 69. – The Times
US stocks closed higher on Tuesday as a mild semblance of calm seemingly returned to markets following Monday's tech sell-off.
At the close, the Dow Jones Industrial Average was up 0.77% at 25,877.33, while the S&P 500 had gained 0.85% to 2,864.36 and the Nasdaq closed 1.08% firmer at 7,785.72.
The Dow closed 197 points higher after the White House decided to temporarily ease the trade restrictions imposed on Chinese telecommunications giant Huawei Technologies late last week.
The Commerce Department will allow Huawei to purchase American-made goods in order to maintain existing networks and provide software updates to existing Huawei handsets until 19 August as part of an effort to minimise disruption for its users across the globe.
Despite the reprieve, Huawei chief executive Ren Zhengfei took aim at Washington on Tuesday, stating Donald Trump had underestimated just how powerful the company would be in the 5G space and revealed the firm had been stockpiling chips, leaving it well prepared for the blacklisting.