Galliford Try wins series of road improvement contracts, TUI reiterates forecast fall in profits
London open
The FTSE 100 is expected to open 16 points higher on Tuesday, having closed down 0.26% at 7,326.08 on Monday.
Stocks to watch
Building group Galliford Try said its Highways business had won a series of UK road improvement contracts worth a total of £461m. The largest of the schemes is a series of five projects worth £300m to upgrade the A47 between Great Yarmouth and Peterborough. The work includes dualling single carriageways, road widening and construction of new junctions, bridges and other structures. Start on site is anticipated to be in 2021/22, the company said in a statement on Tuesday.
Travel operator TUI reiterated its forecast of a fall in full year profits and warned Brexit worries, Boeing 737 MAX groundings and airline overcapacity would continue to pose challenges in the new fiscal year. It added that it was offering replacement flights to its customers booked on Thomas Cook holidays after the rival firm collapsed on Monday, stranding hundreds of thousands of holidaymakers.
Card Factory reported a 14% reduction in interim profit before tax to £24.3m on Tuesday, as a 12% increase in store wages drove costs overshadowed a 6% increase in revenues, which climbed to £195.6m after the opening of 26 new locations. Even so, the greetings card retailer announced a special dividend of 5p per share alongside its unchanged interim dividend of 2.9p.
Workspace Group confirmed the appointment of Graham Clemett as its permanent chief executive officer with immediate effect on Tuesday morning. The FTSE 250 company noted Clemett had been serving as interim CEO since June, when his predecessor Jamie Hopkins stepped down. He had been with Workspace for more than 12 years, the board added, having joined as finance director in July 2007.
Newspaper round-up
While thousands of holidaymakers were waiting in overseas airports for the government’s emergency airlift to get them home and Thomas Cook staff were losing their jobs, former bosses of the stricken travel firm came under fire for receiving payouts worth more than £35m in the last 12 years. Manny Fontenla-Novoa, who led the acquisition spree that saddled the company with more than £1bn of debt, was handed more than £17m in just over four years as boss of Thomas Cook, boosted by bonuses awarded for slashing 2,800 jobs following the merger with MyTravel. He quit in 2011 as the tour operator came close to collapse. – Guardian
More than a third of the UK’s bank branches have shut for good in less than five years, while hundreds of those that remain have reduced their opening hours, according to a report. The consumer group Which? found there were 3,303 closures to the bank branch network between January 2015 and last month, as banks continued to shut branches at an “alarming rate”. – Guardian
Hedge funds betting on the demise of Thomas Cook are set to pocket hundreds of millions of pounds following the travel giant’s collapse into liquidation. Speculators will profit from the tour operator’s woes after short-selling its shares and using credit default swaps (CDS) - derivatives that pay out to investors if a company defaults on its debt. The failure to secure a last-gasp rescue deal puts the hedge funds in line for a $250m (£201m) windfall from the risky default insurance, Bloomberg calculated. – Telegraph
Lloyd’s of London has pledged urgent action to overhaul its culture after finding that almost one in 10 staff had witnessed sexual harassment at the City institution. A survey of more than 6,000 Lloyd’s workers laid bare the scale of the challenge facing the 333-year-old insurance market, which has been rocked by allegations of sexual harassment and bullying towards female staff. – Telegraph
Swiss prosecutors have opened a criminal inquiry after one of the most senior former bankers at Credit Suisse complained that the bank had hired private detectives who tailed and threatened him. Iqbal Khan, former head of Credit Suisse’s international wealth management division, was in the three-month interim between leaving the bank and joining UBS, its arch-rival, when the incident is said to have happened last Tuesday. – The Times
“Market conditions” have prompted Metro Bank to halt a plan to raise £250 million from a bond issuance to investors. The bank said late yesterday that it had “decided not to proceed at this time”. The about-turn may unnerve shareholders in the troubled bank, which has been hit by an accounting error and regulatory investigations. – The Times
US close
Wall Street stocks turned in a mixed performance on Monday as truncated trade talks and weak data out of Europe left market participants worried about the state of the global economy.
At the close, the Dow Jones Industrial Average was up 0.06% at 26,949.99, while the S&P 500 closed 0.01% lower at 2,991.78 and the Nasdaq Composite saw out the session 0.06% weaker at 8,112.46.
The Dow closed 14.92 points firmer even as sentiment took a hit ahead of the bell after trade talks between the US and China were cut short. Chinese officials described the discussions as "constructive" and said both sides would remain in contact.
Donald Trump said China would be increasing its purchases of US agricultural products as part of the bilateral trade deal but the early end to the talks was seen by some investors as an indication that the two nations were, in fact, no closer to finalising a trade deal.
Earlier, the eurozone manufacturing PMI for September came in at 45.6, down from 47.0 the month before and well below an expected reading of 47.3. European stocks fell broadly on the weak data.
Moving back stateside, the US manufacturing sector hit a five-month high in September and the services sector grew at its fastest pace in two months, according to IHS Markit.
However, IHS cautioned that the manufacturing data still remained among the weakest since 2016 and that "prospects also look gloomy", with inflows of new business down to the lowest level seen in a decade.