Rio Tinto warns of Mongolia costs blowout, CRH to offload Europe distribution business
London open
The FTSE 100 is expected to open 11 points lower on Tuesday, having closed up 0.34% at 7,531.72 on Monday.
Stocks to watch
Rio Tinto on Tuesday said costs at its Oyu Tolgoi underground copper mine in Mongolia would blow out by up to $1.9bn with a delay of up to 30 months. The multi-national mining giant said the capital cost of the project had now risen to an estimated $6.5bn - $7.2bn from an original estimate of $5.3bn. The mine's delay was due to its geology, Rio said in a statement, adding that it expected to determine the preferred mine design and a final estimate of cost in the second half of 2020.
Experian reported first quarter revenue growth of 4% at actual exchange rates, falling in line with expectations as strong growth in North America was driven by a first time contribution from newly acquired AllClear ID, a Texas-based identity theft protection business. However, the credit reporting company's UK revenue declined by 6% amid lower returns from the region's decisioning and B2B segments.
Building materials group CRH has reached agreement to divest of its Europe distribution business to private equity funds managed by Blackstone, it announced on Tuesday, for an enterprise value of €1.64bn, payable in cash. The FTSE 100 company said the transaction remained subject to regulatory approval. It said the business comprised its entire general builders merchants business in Europe, including its sanitary heating and plumbing business, with the divestment following a “comprehensive” strategic review over the last several months.
Newspaper round-up
London and the southern regions of England are facing a dearth of teachers, nurses and police officers as rising rents make housing in large parts of the UK unaffordable for key public sector workers. A report by the consultancy firm PricewaterhouseCoopers said there was an urgent need to increase the supply of homes after it found that the failure of public sector pay to keep pace with soaring housing costs had made it increasingly hard for workers on modest incomes to make ends meet. – Guardian
Plans to build a 300-metre (1,000ft) skyscraper dubbed “the Tulip” in the City of London near the Thames have been thrown out by the capital’s mayor, Sadiq Khan. The building, designed by Norman Foster’s architectural practice, would have been the second tallest in western Europe, but its design was deemed not to be good enough for such a prime location. – Guardian
The Government will guarantee loans of £500m to Jaguar Land Rover after Britain’s biggest car maker said it would develop and produce new electric vehicles in the UK. The guarantee is being provided by UK Export Finance, the state-backed credit agency, under a new “general export facility” intended to boost exports. – Telegraph
US close
Stocks on Wall Street finished in the green on Monday, having surged to new highs during the previous week after Federal Reserve chairman Jerome Powell hinted that an interest rate cut could be on the horizon.
The Dow Jones Industrial Average ended the session up 0.1% at 27,359.16, the S&P 500 added 0.02% to 3,014.30, and the Nasdaq 100 was ahead 0.3% at 7,966.93.
At the open, the Dow was just 7.47 points firmer, dipping in and out of the red after closing above 27,000 for the first time on Thursday, and with Friday's gain bringing its advance for the week to 1.5%.
Market participants had an eye firmly fixed on developments in Washington's ongoing trade war with Beijing after Reuters revealed on Sunday that the US was looking to push through the approval of licenses to allow companies to start trading with Chinese telecommunications giant Huawei within two to four weeks.
Figures released out of China overnight showed that economic growth in the Asian giant slowed to a year-on-year pace of 6.2% during the second quarter, the slowest clip since 1992.