London pre-open: Stocks to nudge up as investors mull stress tests results
London stocks were set to nudge higher at the open on Tuesday as investors digested the results of the Bank of England's latest stress tests.
The FTSE 100 was expected to open three points higher at 7,387.
The Bank of England said none of the seven high street banks needs to strengthen its capital position as a result of its stress tests, the first time this has happened since tests were launched in 2014.
In the test, banks incur hypothetical losses of around £50bn in the first two years of the stress, which, the Bank said, would have wiped out the common equity capital base of the UK banking system ten years ago.
Although none of the banks failed the stress tests, Barclays and Royal Bank of Scotland fell below the their systemic reference points, which are the capital ratios required to withstand any shocks to the financial system without needing a bailout. Last year, both banks were told to build up their finances.
In other corporate news, Royal Dutch Shell will begin paying a cash dividend again in the fourth quarter of this year as a strategy update from the oil giant saw cash flow targets and pledge to continue cutting debt.
Ahead of the Anglo-Dutch group's 'management day', chief executive Ben van Beurden said his team was confident it can "cancel its scrip dividend programme while still investing at sufficient levels to maintain value accretive growth in the portfolio".
Greencore posted a 56.5% improvement in revenues for the year to 29 September, to £2.32bn, with its adjusted EBITDA ahead 37.1% at £189.7m. The group said its adjusted operating profit was 37.4% higher than last year at £140.1m, after the acquisition of Peacock Foods, while the board kept its proposed dividend steady at 5.47p.
Pets at Home announced that Ian Kellett, group chief executive officer, has informed the board of his desire to step away from corporate life and pursue his own personal business interests. As part of the board's succession plan, it therefore announced that Peter Pritchard - currently CEO of its retail division - would succeed Kellet as group CEO when he leaves.