Glencore shuttering Mutanda cobalt mine, Spirax-Sarco leaves full-year forecasts unchanged
London open
The FTSE 100 is expected to open 13 points higher on Wednesday, having closed down 0.72% at 7,171.69 on Tuesday.
Stocks to watch
Glencore said it was shuttering its Mutanda cobalt mine in response to a plunge in prices and higher costs as the miner reported a sharp fall in adjusted core earnings. The company on Wednesday said adjusted earnings before interest, tax, depreciation and amortisation fell 32% to $5.6bn, reflecting a “challenging economic backdrop for our commodity mix”.
Spirax-Sarco left full year forecasts unchanged on Wednesday as it reported that strong first half organic sales growth of 8% surpassed expectations but indicated that this would be offset by weakened industrial production growth forecasts for the second half of the year. The steam management systems manufacturer also warned of profitability deterioration in its Chromalox thermal technology company, where adjusted operating profit fell by 37% and margins slipped from 14.7% to 9.7%.
AstraZeneca and its partner MSD announced positive results from the phase 3 ‘PROfound’ trial of Lynparza (olaparib) in men with metastatic castration-resistant prostate cancer who had a homologous recombination repair gene mutation, and had progressed on prior treatment with new hormonal anticancer treatments on Wednesday. The FTSE 100 pharmaceuticals giant said results from the trial showed a “statistically significant and clinically meaningful” improvement in the primary endpoint of radiographic progression-free survival with Lynparza, compared enzalutamide or abiraterone. It said the safety and tolerability profile of Lynparza was generally consistent with previous trials.
Newspaper round-up
Amazon won praise when it raised its minimum wage to $15 an hour in October 2018. Since then, the company has responded to criticism over its working conditions by claiming it is an industry leader in compensation, but a Guardian investigation has revealed many workers take issue with this messaging, as serious workplace issues remain that they say are still not being addressed. They include claims workers are being punished for injuries; the elimination of bonuses and stock options, which has lessened the impact of the wage rise; poor working conditions; higher productivity demands and the hiring of temporary workers who do not have the same benefits as Amazon staff. – Guardian
The scale of the challenge UK broadcasters face in the streaming era has been thrown into stark relief by a new report, which estimates that 34 extra series of the BBC hit Bodyguard – or 14 more Love Islands – would have needed to air last year to make up for the drop in traditional TV viewing as audiences flock to rivals including Netflix, Amazon and YouTube. The report, by the media regulator Ofcom, highlights the huge growth in popularity of streaming services in the UK. The number of subscribers to the three most popular - Netflix, Amazon and Sky’s Now TV - leapt by almost a quarter last year to 19.1m. – Guardian
Bitcoin investors could soon receive tax bills on their holdings of digital coins as HM Revenue & Customs has written to some of the biggest cryptocurrency exchanges in pursuit of information. In the past week, exchanges such a Coinbase and Etoro, which are websites where investors can buy crypto coins, received requests from the taxman for details about their customers, according to specialist publication Coindesk. – Telegraph
Smaller listed companies are considering going private because the collapse of Neil Woodford’s Equity Income Fund has damaged investors’ demand for less liquid stocks. Edison, an independent investment research firm, said that the fallout after the star stock picker suspended redemptions on his main fund had led to increased scrutiny around the liquidity of companies worth up to £500 million. – The Times
Labour has asked Boris Johnson to investigate claims that Sajid Javid watered down a compensation scheme in order to save banks billions of pounds at the expense of thousands of small and medium-sized companies. John McDonnell, the shadow chancellor, said that he would ask the prime minister to clarify the Treasury’s role in altering the criteria for a redress process for widespread mis-selling of interest rate hedging products. – The Times
US close
Wall Street stocks closed sharply higher on Tuesday, bouncing back from their worst day so far this year in the previous session as trade tensions eased somewhat.
At the close, the Dow Jones Industrial Average was up 1.21% at 26,029.52, while the S&P 500 closed 1.30% firmer at 2,881.77 and the Nasdaq Composite saw out the session 1.39% stronger at 7,833.27.
The Dow closed 311.78 points higher after stocks finished well in the red on Monday, following on from heavy losses seen across Asian indices overnight.
Monday's sell-off began last week when Donald Trump surprised everyone with a round of new tariffs on Chinese goods. Markets took an even more negative turn when, come Monday, Chinese authorities allowed the yuan to break to its lowest level against the US dollar in over a decade.
In response, the US Treasury Department designated China a currency manipulator and Trump took to Twitter to voice his disgust at both the move and his own central bank.
"China dropped the price of their currency to an almost a historic low. It's called 'currency manipulation'. Are you listening Federal Reserve? This is a major violation which will greatly weaken China over time!," he said.