Rentokil and Howdens see rises in profit, Standard Chartered warns on income growth
The FTSE 100 is expected to open 98 points lower on Thursday, having closed up 0.35% at 7,042.47 on Wednesday.
Stocks to watch
Rentokil posted a rise in full-year profit on Thursday as it benefited from an increasing presence in growth markets and higher levels of customer retention.
Building materials group Howdens Joinery reported a rise in annual pre-tax profits as it opened new depots, adding that it had lifted stock levels for products sourced from China due to the coronavirus. Pre-tax profits rose 9.3% to £260.7m, rising faster than sales, Howden said on Thursday. Group revenue increased 4.8% to £1.6bn as gross margin also improved. “With respect to coronavirus, we are monitoring our supply chain closely and have increased forward stock levels for product sourced from China, whilst reviewing alternative sources and means of supply.”
Standard Chartered warned income growth would be lower than its target in 2020 as the Asia-focused bank reported an 8% increase in 2019 underlying profit. The FTSE 100 lender said low interest rates, slower global growth, a weaker Hong Kong economy and the coronavirus outbreak would push income growth below its 5-7% medium-term goal. Achieving the group's 10% return on equity target will take longer than expected, it added. Underlying pre tax profit for the year to the end of December rose to $4.2bn from $3.9bn a year earlier as income increased 2% to $15.3bn.
Hikma Pharmaceuticals announced on Thursday that itself and Glenmark Specialty have signed an exclusive United States license agreement to commercialise ‘Ryaltris’, or olopatadine hydrochloride and mometasone furoate nasal spray, which is an investigational fixed-dose combination nasal spray for the treatment of seasonal allergic rhinitis. The FTSE 100 pharmaceuticals company said that under the deal, Glenmark would be responsible for the continued development and regulatory approval of Ryaltris by the FDA, while Hikma would commercialise Ryaltris in the US, and would also be able to produce the product using its nasal manufacturing capabilities in Ohio. It would provide Glenmark with an upfront payment, regulatory approval and commercial milestone payments as well as royalties.
Boris Johnson’s government has been told to “go big or go home” if it is to truly “level up” the country and heal social division, with the former head of the civil service warning that transport investment alone will not eliminate the imbalances between London and the rest of the UK. Bob Kerslake, who ran the civil service from 2011 to 2014, issued the ultimatum as head of the UK2070 commission, an independent inquiry into the deep–rooted geographical inequalities within the UK. – Guardian
Walmart is in talks to sell a majority stake in Asda, the UK’s third-largest supermarket chain. The US retailer said it was talking to a “small number of interested parties” about a possible investment in Asda. It is understood to be looking to retain a minority stake in the business, two decades after it moved into the British market by acquiring the grocer. – Guardian
The boss of Heathrow says Boris Johnson risks “walking naked” into post-Brexit trade talks if he refuses to back the building of a third runway following a crucial court ruling on Thursday. With the expansion decision on a knife edge, John Holland-Kaye warned that Britain will lose out to Continental rivals if the controversial plan is shelved - leaving the Prime Minister unable to fulfill his pledge to make the country a champion of free trade. – Telegraph
NMC Health has fired its chief executive after an investigation revealed the private hospital operator had been locked into secret loans to major shareholders' companies without the knowledge of the board. In an extraordinary statement published after markets closed on Wednesday, the FTSE 100 company said it had guaranteed loans taken out by companies owned by two major shareholders – including founder and former chairman BR Shetty. – Telegraph
Ballot papers for industrial action that could lead to the first national postal strike in more than a decade will be sent out next week. Yesterday the Communication Workers Union formally served notice of the ballot in a row over Royal Mail’s attempts to bring in automated parcel-sorting hubs and delivery schedules — or what the union called a campaign of “management propaganda, an insulting so-called ‘pay offer’ and impositions of drastic changes without agreement”. – The Times
Wall Street’s benchmark was back into the red by the close on Wednesday, with the S&P 500 also falling further after its worst two-day run in four years.
The Dow Jones Industrial Average ended the session down 0.46% at 20,957.59 and the S&P 500 lost 0.38% to 3,116.39, while the Nasdaq Composite managed gains of 0.17% to settle at 8,980.77.
At the open, the Dow was 319.57 points higher on Wednesday after stocks recorded some heavy losses in the previous session amid concerns about a potentially prolonged global economic slowdown in the wake of the Wuhan coronavirus outbreak.
Tuesday's sell-off accelerated after US health officials cautioned that the virus was "likely" to spread throughout the nation.
The 10-year Treasury yield bounced back to 1.36% early on Wednesday, recovering from a record low of 1.31% during the previous session.
In coronavirus headlines, South Korea reported 169 new cases overnight, bringing the country's total to 1,146, while in Italy, infections hit 325. China reported 406 new confirmed cases and another 52 deaths.