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FTSE 100 closes in the red as markets jittery ahead of Fed interest rate decision

The UK's premier index closed down around 22 points at 7,038, while the FTSE 250 shed over 55 points at 19,668.
Gold brick on US dollar
Markets around the globe have their eyes on the Fed
  • FTSE 100 closes down around 22pts

  • Mining stocks wanted as dollar retreats

  • All eyes and ears on Fed's interest rate decision

 

FTSE 100 closed in the red as sterling  strengthened as traders fret about a potential trade war and ahead of the Fed's interest rate decision.

The UK's premier index closed down around 22 points at 7,038, while the FTSE 250 shed over 55 points at 19,668.

In currencies, the pound is up 0.37% against the Euro, and up by 0.53% against the US dollar.

David Madden, at CMC Markets, said earlier: "Dealers continue to be on edge as the talk of a trade war adds to the negative sentiment.

"The EU are talking about levying a tax on digital revenue as a way of clamping down on tech giants paying a relatively small amount of tax in Europe. This has added to the jitters surrounding the possibility of a trade war."

Big miners were supporting Footsie, with Evraz plc (LON:EVR) up 3.35% to 432.30p, while copper titan Antofagasta (LON:ANTO) added 2.88% to 971.8p.

On the losing side, Kingfisher plc (LON:KGF) shares shed over 10% to 301.60p after disappointing full-year results.

3pm: Mining stocks in support

Mining stocks are providing some much-needed support to a supine top-shares index.

The FTSE 10 was down 29 at 7,033 but would have been lower still were it not for the likes of Antofagasta PLC (LON:ANTO), Anglo American PLC (LON:AAL) and BHP Billiton plc (LON:BLT), which were up 3.6%, 1.3% and 1.1% respectively.

Fellow traveller Evraz plc (LON:EVR), the steel maker, was also going well, up 2.8%.

The US dollar was having a thin time of it on the foreign exchange markets; a weak dollar is normally good for minerals stocks.

Antofagasta got an extra boost from AlphaValue, which changed its rating on the stock from 'reduce' to 'add'.

In other broker action, online gaming group 888 Holdings Public Limited Company (LON:888) was friendless after Numis Securities moved to 'hold' from 'add' following yesterday's results statement.

“Earnings quality continues to improve with regulated revenues now 70% of the group; however, the regulatory situation in the UK and particularly Germany continues to become more challenging,” Numis noted.

“Whilst 888 remains a well-diversified online gaming company with attractive proprietary technology, we think only M&A would lift the shares in the near term,” it added.

1.45pm: Slow count-down begins to the Fed's press conference

Looking at the FTSE 100 is like looking at a stopped clock at the moment.

The FTSE 100 was down 33 at 7,028, more or less where it has been since about 9.30am.

Traders are waiting for the press conference that will follow the US Federal Reserve's interest rate announcement today.

A similar sense of ennui was evident in New York, where the Dow Jones was down 26 points, or 0.1%, at 24,702. The broader-based SP 500 was also down 0.1%, at 2,714 (down 2.7 points).

“The Fed concludes its two day meeting later on today, after which it is widely expected to raise interest rates by 25 basis points [a quarter of a percentage point]. The hike is 94% priced in according to CME Group and so any reaction to this could be relatively muted. What will be of much more interest to investors is the economic projections which, aside from offering updated growth and inflation forecasts, will offer crucial insight into how policy makers see interest rates moving,” commented Craig Erlam at Oanda.com.

“The announcement will also be followed by Jerome Powell’s first press conference as Fed Chairman, during which he will likely be quizzed on any updates to the projections. In the current environment, he will also likely be questioned on the downside risks to the forecasts, most notably a trade war that US President Donald Trump appears so at ease engaging in,” Erlam added.

Investors will also be looking for word on the Fed’s quantitative easing (QE) programme, according to Tom Elliott, deVere Group's international investment strategist.

“The sheer size of the programme makes its unwinding potentially hazardous for financial markets. Will the Fed continue to unwind the programme by US$10bn a month, taking the Fed’s balance sheet slowly down from its a peak of US$4.5 trillion, to Powell’s stated aim of US$2.5 tr to US$3 tr in four years? Or will it accelerate the unwinding, if Powell decides to use the unwinding of QE as an active policy tool by which to take liquidity out of the economy?” Elliott wondered.

“He could, for instance, start actively selling bonds in the market in addition to not replacing expiring bonds. Since this will coincide with the Treasury issuing ever-more bonds to finance the widening budget deficit, an over-supply of Treasuries may disrupt financial markets,” Elliott surmised.

12.45pm: CBI Industrial Trends points to slow-down in UK manufacturing activity

Adding to the welter of economic data to plough through today was the CBI Industrial Trends survey for March.

The survey showed further signs of a slow-down, according to Pantheon Macro, which was not what the market bulls wanted to hear.

The FTSE 100 remained firmly in the red, down 28 at 7,033.

The CBI reported that the total orders balance fell to +4 in March, from +10 in February, below the consensus forecast of +8.

“The CBI’s survey adds to evidence that the revival in the manufacturing sector reached its peak pace in late 2017 and has cooled this year,” suggested Samuel Tombs, the chief UK economist at Pantheon.

“The total orders balance fell to its lowest level since October. Note too that the balance has a strong seasonal pattern; our seasonally adjusted version fell to +1, from +8 in February, its lowest level since December 2016,” Tombs added.

“Stock levels rose at the fastest rate since June 2013, so the output expectations balance dropped to +16, from +24. At March’s level, the balance is consistent with quarter-on-quarter growth in manufacturing output slowing to about 0.3%, from 1.0% in January.  The slow-down in orders growth in March appears to have domestic origins—the export orders balance held steady at +10—although the boost to growth in export orders likely will wear off soon, now that nearly two years have passed since sterling’s depreciation,” Tombs predicted.

On the corporate front, there was some rare cheer from the retail sector as Mothercare plc (LON:MTC) climbed 1.3p to 17p on the confirmation that talks with its lenders are “progressing constructively”.

Niche media firm Future PLC (LON:FUTR) was another stock to defy the wider market trend, rising 16p to 370p as it acquired five titles from Haymarket Media Group for £14mln; the five titles were What Hi-Fi?, Stuff, FourFourTwo, Practical Caravan and Practical Motorhome.

11.45am: Micro Focus back under the microscope

Shares in Micro Focus PLC (LON:MCRO) were under pressure again on Wednesday after Tuesday share price collapse.

The stock was the top faller on the FTSE 100, which was down 29 points at 7,032.

Micro Focus shed another 75.6p at 915.80p after yesterday's warning on revenues.

This morning it was revealed the chief financial officer, Chris Kennedy, had purchased 10,000 shares at 928p a pop.

Senior independent non-executive director Karen Slatford bought 9,915 shares at just over a tenner a throw, Darren Roos – also a non-executive director – bought 4,926 shares at 1,009.56p each and executive chairman Kevin Loosemore,

Other than that, there was not a lot of blue-chip corporate news-flow to drag traders' minds away from macro data, other than GKN PLC's (LON:GKN) latest missive in its bid battle with Melrose Industries PLC (LON:MRS).

GKN took issue with Melrose's description of GKN's plans to merge its Driveline business with Dana Incorporated as a “hasty and ill-thought-through transaction”; GKN claims it has been considering a combination with Dana Incorporated for a number of years.

Melrose's main selling point so far as investors are concerned is the expertise of its management team, as it has a history of picking up undervalued assets and making them sweat, but GKN claimed “Melrose is a novice in automotive” and “is little better placed in aerospace”.

Shares in GKN were up 1.3p at 426.1p in a falling market.

10.45am: The Footsie adopts a holding pattern

The FTSE 100 was in a holding pattern ahead of the US central bank's interest rate decision later today.

Depending on who you read, a rate rise is either “a done deal” or “roughly 90%” certain.

“Markets are pricing in a roughly 90% chance of a hike this week, the first of three or four anticipated this year, so the focus is on the dot plot and the accompanying language from chair Jay Powell,” said Neil Wilson at ETC Capital.

“For risk, markets will want the Fed to hold off indicating four hikes in 2018 but keep up its confident assessment of the economy. This will in large part depend on how policy-makers assess inflationary pressures – if they think inflation is coming they might accelerate the path of rate hikes - but there is a much bigger risk that the Fed sticks to three in 2018 but raises forecasts for 2019 and that could knock equities and give a boost to USD [US dollar],” Wilson said.

James Hughes at AXI Trader is among those that think a rate rise is nailed on.

“It’s a done deal, rates in the US will go up by at least 25 basis points today in Jerome Powell’s first FOMC meeting as chairman, but it will be the accompanying statement that causes the biggest fuss, and the indication of either three or four rate hikes in 2018. For the first time in a long time probability for a rate hike is at 100% with a 2.3% chance of a 50 basis point [bp] hike,” Hughes said.

Turning his sights on the UK employment data, Hughes said: “The UK jobs report shows strong numbers across the board as the average hourly earnings reading showed an increase to 2.8% from the 2.6% previously expected, with a revision to last month’s number to 2.7%. The move here shows that stagnant wage growth is now showing much clearer signs of moving higher - something that will please the Bank of England, and could see interest rates move higher in the UK quicker than expected.”

 “All round these are positive figures with the ILO unemployment rate dropping to 4.3%, with wages higher and looking on a strong growth rate, and inflation falling lower, it could be that the period of lower interest rates may finally be over. Probability of a rate hike at tomorrow’s BoE MPC meeting remains fairly low at 15.7% but the May probability has now jumped higher to 65.2% for a 23bp hike,” Hughes said.

On the corporate front, analysts are trying to suss why information technology infrastructure specialist Softcat PLC (LON:SCT) was the biggest mid-cap faller this morning after what looked like solid interims.

The FTSE 100 was down 30 at 7,031.

READ Softcat slides after strong interims fail to prevent profit-taking

“Why is it one of the worst performers on the FTSE 250 today? After all, customer growth had slowed a little but gross profit per customer was materially higher,” observed Russ Mould, the investment director at AJ Bell.

“Seemingly subtle hints on future trading can be seized on by the market and a close look at the outlook statement which accompanies the numbers helps reveal why the shares have nosedived.

“Chief executive Martin Hellawell says: 'the board is confident is meeting its expectations for the full year, but we have some important months ahead and will remain very focussed on continuing to deliver outstanding service for our customers’.

“The key word here is ‘but’. This almost amounts to a mild profit warning and for a company like Softcat, which was previously trading on a lofty valuation, even the possibility of a worse than expected performance is enough to drive investors to the exit door,” Mould suggested.

10.15am: Footsie continues to drift as pundits argue over timing of likely UK rate rise

The blue-chip index continued to drift lower after the release of unemployment and earnings data.

The FTSE 100 was down 39 at 7,022 with fallers outnumbering risers by around five-to-one.

The release of earnings data has had the pundits trying to predict what this means for the Bank of England's interest rate policy; the bank's Monetary Policy Committee is meeting tomorrow but is not expected to increase interest rates this time round.

“Another rise in average wages is clearly welcome given Consumer Price Inflation (CPI) has fallen to a seven-month low but we’re not out of the woods quite yet as wages in real terms were still lower by 0.2% and the extent to which the pressure on hard-pressed household budgets has been eased by rising wages is, for now, still unclear,” suggested Jacob Deppe, head of trading at Infinox.

"Most households have had to endure living costs outstripping wages for at least the past year and others for far longer but given the wages data lags behind the CPI data and that the unemployment rate for November to January was at its lowest level since 1975, it is possible to forecast that wages will continue to edge up.

“If that proves to be the case it may encourage the Bank of England to raise rates in May to help bring inflation back to its 2% target,” Deppe suggested.

Chris Williamson at IHS Markit said signs of accelerating pay growth raise the prospect of interest rates being hiked again in May.

“Data from the Office for National Statistics showed underlying pay growth (excluding bonuses) rising at an annual rate of 2.6% in the three months to January, the highest rate since November 2016. Total pay, including bonuses, was up 2.8% on a year ago, which is the fastest increase since September 2015 and takes pay growth above inflation for the first time in nine months,” Williamson noted.

“Private sector pay growth accelerated to 3.0%, though excluding bonuses the increase was a more modest 2.7%, though that was still the fastest rate for more than a year. In the public sector, regular pay growth of 2.1% was the fastest since October 2012,” he added.

“In a sign that companies remain optimistic about business conditions, employment grew by 168,000 in the three months to January. The unemployment rate meanwhile slipped back down to 4.3%, its joint-lowest since the 1970’s, underscoring the tightness of the labour market. As highlighted by recent recruitment survey data, a lack of suitably skilled workers (and in some cases even unskilled staff) has meant employers are having to offer higher pay,” Williamson said.

“With inflation at 2.7%, the economy showing resilient growth in the first quarter, according to survey data, and the Brexit transition deal adding some certainty to business conditions over the next two years, the upturn in pay growth opens the door for policy-makers keen to get some interest rates hikes under their belts,” Williamson concluded.

9.45am: Footsie continues to drift lower following release of labour market data

Earnings are still failing to outpace inflation, according to the latest labour market figures from the Office for National Statistics (ONS).

Latest estimates covering the November to January period show that average weekly earnings for employees in Great Britain in real terms (that is, adjusted for price inflation) fell by 0.2% excluding bonuses, but were unchanged including bonuses, compared with a year earlier.

There were 1.45 million unemployed people (people not in work but seeking and available to work), 24,000 more than for August to October 2017 but 127,000 fewer than for a year earlier.

The unemployment rate (the proportion of those in work plus those unemployed, that were unemployed) was 4.3%, down from 4.7% for a year earlier and the joint lowest since 1975.

"Employment and unemployment levels were both up on the quarter, with the employment rate returning to its joint highest ever. ‘Economically inactive’ people – those who are neither working nor looking for a job – fell by their largest amount in almost five and a half years, however,” said Matt Hughes, a Senior statistician at the ONS.

“Total earnings growth continues to nudge upwards in cash terms; however, earnings are still failing to outpace inflation,” he added.

The FTSE 100 eased a bit more following the release of the figures, sliding to 7,030, down 32 points.

9.20am: Kingfisher leads the top-shares index lower

All of yesterday's gains have been surrendered by the FTSE 100 this morning.

The top-shares index was down 22 at 7,039, with B&Q owner Kingfisher PLC (LON:KGF) leading the retreat after disappointing full-year results.

“After the struggles of DFS and Carpetright, these results are further evidence that Brits are cutting back on big-ticket domestic items,” said George Salmon at Hargreaves Lansdown.

“Profits have actually come in slightly above expectations, but this has been driven by UK cost savings and a less bad than expected showing from the French business,” he added.

Shares in Kingfisher were down 8.1% at 310.2p in the first hour of trading.

“The main headline of these results is the weakness in the UK. Fourth quarter like-for-like sales have slumped at B&Q, while the wheels are also turning that little bit slower at Screwfix, which has so often bailed out the UK business in recent years. Kingfisher says the outlook for both businesses is uncertain, so the worry for investors is B&Q sales trends remain in the red.

“On the plus side, Kingfisher is working towards some serious cost savings and operational improvements. While progress is being made with these self-help measures, the changes are proving far from simple to implement. All told, things look difficult,” Salmon concluded.

Elsewhere in the retail sector Moss Bros Group (LON:MOSB) was being taken to the cleaners after a profit warning.

The shares lost around a fifth of their value after what broker Liberum Capital Markets called “a very disappointing trading update”.

The full-year dividend is to be chopped to 4p from 5.89p in the previous financial year, which Liberum said was a sensible move.

“This is a disappointing move but unlike many other retailers that have constrained balance sheets and leverage issues (some of which have released RNS’s accordingly today), Moss Bros remains in strong health with cash on the balance sheet and its investment programme (particularly in eCommerce) should not be impacted,” Liberum said.

“While risks of further cuts remain and the outlook is somewhat more uncertain, we remain supportive that this is a management team that is well positioned to steer Moss Bros through these more challenging times,” it concluded, as it stuck with its 'hold' rating. 

8.40am: Positive start fails to materialise

The FTSE 100 made a subdued start to proceedings, falling 13 points to 7,048.0 as the City’s traders opted to keep their powder dry ahead of the interest rate decision later by the US Federal Reserve.

All the analysts and economists polled by Reuters ahead of the meeting expect a quarter point rise in the cost of borrowing.

In London and looking at the market, the morning’s big casualty was Kingfisher (LON:KGF), the owner of B&Q.

Difficult trading in the UK compounded the retailer’s woes in France with shares off 6.4% in the wake of full-year results.

Richard Hunter, markets guru at Interactive Investor, called the performance “uninspiring”.

“As has become expected, Screwfix made a strong contribution to progress, whilst the Polish unit has also improved,” he added.

“Overall group sales are up, cost savings are falling out of the turnaround plan and the fact that digital now accounts for half of the group’s sales positions the company well in the rapidly changing technology environment.

“Meanwhile, the share buyback programme will remain supportive and an increase to the dividend is a sign of management confidence in prospects.”

On the FTSE 250, Ocado (LON:OCDO) was off 1.8% after Goldman Sachs downgraded stock in online grocer to ‘neutral’ from ‘buy’.

Proactive news headlines:

Directa Plus Plc (LON:DCTA) has announced an agreement with Italian firm Sartec Srl to jointly develop a commercial-scale industrial system based on the company’s graphene-based Grafysorber product for treating oil-contaminated produced water.

Range Resources Ltd’s (LON:RRL) drilling arm has won a contract with Shell to work over one of the oil major’s onshore Trinidad wells. Range acquired RRDSL at the end of last year and this is the first contract award so far in 2018.

accesso Technology Group PLC (LON:ACSO), which provides queuing technology pioneered in theme parks, enjoyed a strong year and said it remained confident on the outlook for 2018. Revenues for the 12 months ended December 31 grew just over 30% to US$133.4mln, while underlying earnings (EBITDA) were up 29% at US$24.6mln.

Marketing and media analytics specialist Ebiquity plc (LON:EBQ) saw faster revenue growth in the second half of 2017. Revenue for 2017 was up 4.6% to £87.4mln from £83.6mln the year before, pretty much in line with market expectations, with like-for-like (LFL) growth of 0.8% on a constant currency (CC) basis.

Employee services provider Personal Group Holdings plc (LON:PGH) has seen a continuation of record new insurance sales in the first two months of 2018. In its full-year results statement for 2017, the group hailed its fifth successive year of record new insurance sales and it looks like 2018 has continued in the same vein.

Action Hotels PLC (LON:AHCG) said its new operation on Melbourne’s South Wharf has opened ahead of schedule with AUS$3.5mln in advanced bookings. The 347-room operation will be branded Novotel and operated by French hospitality giant Accor.

Cadence Minerals Plc (LON:KDNC) (OTC:KDNCY) said it has been issued shares in Australian-listed Clancy Exploration Limited (ASX:CLY) as compensation for the discovery of third party priority over overlapping licenses in Austria.

Aminex PLC (LON:AEX) has revealed that it is in discussions with Eclipse Investments LLC regarding a possible farm-out of part of its interest in the Ntorya appraisal area in Tanzania. The group noted that Eclipse is a wholly-owned subsidiary of the Zubair Corporation and is the company's largest shareholder. 

Eland Oil & Gas PLC (LON:ELA) has decided to pause drilling operations at the Opuama field, in Nigeria, as the programme had continued to encounter intermittent power problems. It is making arranged for new back-up power engines to be delivered to site, though they aren’t expected until April.

SDX Energy Inc (LON:SDX) (CVE:SDX) told investors it has successfully completed the SAH-2 well, on the Sebou permit onshore Morocco, for production which will begin in a few days. The company said that the well achieved an average flow rate of conventional natural gas of 12.9mln cubic feet per day, seeing a maximum rate of 13.5mln cubic feet per day.

The Marketing Group PLC (NASDAQ OMX:TMG) has announced that its subsidiary TRUTH has undertaken the first successful deployment of an advertising campaign using blockchain smart contract technology. The Nasdaq First North-listed firm said TRUTH - the world’s first global blockchain-enabled media agency - ran the campaign for a national publisher for ten days until 19 March 2018, which saw it fully disclose all fees involved to the client.

Kibo Mining PLC has welcomed comments from Tanzania’s president pledging to support the private sector and indicating an agreement with a new energy contractor is close to being signed. Noting recent comment in the press regarding comments made at the 11th Tanzania National Business Council (TNBC) meeting, the AIM-listed energy and resources firm’s CEO, Louis Cotzee said: "It is heartening to see the winds of change blowing from Tanzania.

Caledonia Mining Corporation PLC (LON:CMCL) told investors it achieved a new production record at the Blanket mine, in Zimbabwe, where it unearthed 56,133 ounces of gold during 2017 - some 11.5% more than in the preceding year. The company, in financial results for the year, reported an average gold price of US$1,243 per ounce (up from S$1,232 in the year before) and it said gross profit amounted to US$26.32mln, up from US$23.49mln.

i3 Energy PLC (LON:I3E) told investors that it will be issuing US$500,000 worth of shares to James Caird Asset Management from the conversion of debt. It noted that following the conversion the investment group retains US$1.5mln of loan notes.

Alba Mineral Resources PLC (LON:ALBA), an investor in the Horse Hill project, has further strengthened its oil and gas team with the appointment of Feroz Sultan as a special adviser. Sultan joins Sue Corrigan who has hired earlier this month as technical consultant.

APQ Global Limited (LON:APQ), the emerging markets income company, announced a further appointment to its International Advisory Council, with Dimieari Von Kemedi who will focus on opportunities in West Africa. The group said Kemedi has had a career spanning civil society, government and private sectors and is well acquainted with social and economic trends in West Africa.

Jubilee Metals Group PLC (LON:JLP) has announced the appointment of Shard Capital Partners LLP as its broker with immediate effect.

Metminco Limited (LON:MNC) (ASX:MNC) announced that today it requested it be placed on a trading halt on the Australian Stock Exchange as it expects to make an announcement to the market in relation to revised terms of the capital raising it initially announced on 5 March 2018.

6.45am: Positive start predicted 

The FTSE 100 was expected to continue yesterday's advance on Wednesday, ahead of an expected hike in US interest rates today.

The top-shares index, which yesterday rose 18 points to 7,061, was trading at around 7,071 on spread betting sites.

“We expect traders to be airing on the side of caution in trading on Wednesday, as eyes remain firmly fixed on the Fed rate announcement and press conference later today. The big question is not whether the Fed will hike today, that is as good as certain; however, three hikes or four is still a dividing question,” commented Jasper Lawler at LCG.

“It will be worth keeping an eye on bond yields, any signs of a more aggressive path to tightening by the Fed could push yields higher. Since high yields were a catalyst to last month's heavy sell-off, traders are going to be wary of a repeat performance,” he added.

Danske Bank said it expects the Fed to increase its target range by a quarter of a point to 1.50-1.75% as “the economy is strong”.

“Among other things, Powell's testimony from February points to a continuation of the gradual hiking cycle, as he expects inflation to increase and stabilise at 2%, so he does not view the economy fundamentally differently from Janet Yellen. As everyone expects a hike, the updated 'dots' are more important and we expect the Fed to maintain the three hikes signal for this year but show more confidence in the signal, as more of the dovish members now seem to support this,” the bank opined.

US markets bounced back yesterday, with the Dow Jones average up 116 at 24,727 and the S&P 500 up 4 at 2,717.

Heading into the close, Asian markets were mixed.

In Japan, the Nikkei 225 was down 100 points at 21,381 but in Hong Kong the Hang Seng was up 165.

Closer to home, worries over the health of the UK retail sector will make full-year results from B&Q owner Kingfisher PLC (LON:KGF) a key focus on Wednesday.

In a preview, Graham Spooner, research analyst at The Share Centre noted: “The last update from Kingfisher, a third-quarter statement in November, was notable for signs of continued weakness in the French businesses although the company said it remained on track to deliver full-year profit targets.”

The market consensus is for Kingfisher to deliver pre-tax profit of £733mln on revenue of £11.64bn. The dividend is expected to nudge up to 10.64p from 10.4p.

On the macro front, the Fed is not the only central bank with an interest rate decision to make; the Bank of England's (BoE) policy makers meet on Thursday to make their decision, so the main interest in the latest UK labour market statistics today will be on the average earnings data rather than an expected fall in unemployment numbers.

With Tuesday’s official data having shown a bigger than expected fall in UK inflation, down to 2.7% in February from 3.0% in the previous month, the BoE will be looking to see if wage growth can climb up towards that level having lagged price increases for a long while.

That could be a trigger for the central bank to raise UK interest rates in the near term, though no moves are expected on Thursday.

Significant events expected

Federal Reserve interest rate decision (6.15pm London time)

Finals: Kingfisher PLC (LON:KGF), Accesso Technology Group PLC (LON:ACSO), Alpha Fx Group PLC (LON:AFX), Brave Bison Group PLC (LON:BBSN), Centaur Media PLC (LON:CAU), Cambian Group PLC (LON:CMBN), Ebiquity plc (LON:EBQ), Empiric Student Property PLC (LON:ESP), Ferrexpo PLC (LON:FXPO), IFG Group PLC (LON:IFP), IGas Energy Plc (LON:IGAS), International Public PartnershipsLtd (LON:INPP), Medaphor Group PLC (LON:MED), Personal Group Holdings plc (LON:PGH), Premier Technical Services Group PLC (LON:PTSG), Science in Sport PLC (LON:SIS), Ten Entertainment Group PLC (LON:TEG), Vectura Group PLC (LON:VEC), Xaar PLC (LON:XAR)

Interims: SCS Group PLC (LON:SCS), Softcat PLC (LON:SCT)

Economic data: UK unemployment, average earnings; UK public sector finances; CBI UK industrial trends survey; US existing home sales

Around the markets

  • Sterling: US$1.4012, up 0.13 cents
  • 10-year gilt: yielding 1.486%
  • US treasuries 10-year: yielding 2.897%
  • Gold: US$1,313.70 an ounce, up US$1.80
  • Brent crude: US$67/59 a barrel, up 17 cents
  • Bitcoin: £6,482.80, up £57.74

Business headlines

The Daily Telegraph

BMW headquarters raided over emissions cheating allegations: BMW has been raided by German authorities investigating the luxury car maker over claims it cheated pollution controls.

Ocado could tap investors for more cash in hunt for further international deals: Ocado will ask shareholders to foot the bill for its ambitious expansion plans as it eyes more deals to supply its technology to international grocery chains.

Polyus Gold looks to rise above Russia tensions in pitch to the City: Polyus Gold is hoping investors will look beyond geopolitical tensions with Russia and back its ambitious expansion plans, after staging its first capital markets day in the City.

Cambridge Analytica suspends chief executive Alexander Nix after video showed boasts about bribes: Cambridge Analytica’s boss, Alexander Nix, has been suspended with immediate effect after Channel 4 broadcast footage of the chief executive boasting of using bribes and women to swing elections, amid mounting pressure over data revelations.

The Times

City attacks Aviva bid to cancel preference shares: Some of the City’s largest investors have clashed with Aviva over its controversial plan to cancel £450 million of preference shares, many of which are owned by pensioners and charities.

British steel exporters hit by ‘America First’ tariffs: President Trump fired another shot in an escalating trade dispute with Britain last night as his administration imposed punitive customs duties on imports of British steel products.

Glencore bets on coal with US$1.7 billion Rio deal: Glencore is poised to acquire two Australian coal mining projects from Rio Tinto, strengthening its position in the coal industry as others quit in response to environmental concerns.

De La Rue loses ground after finance chief’s exit: A surprise warning of weaker profits at De La Rue and the sudden departure of its chief Financial Officer unnerved investors yesterday.

Bitcoin will become the world’s single currency, tech chief says: Bitcoin will overtake the dollar in importance as it becomes the single global currency of the internet within a decade, Jack Dorsey, one of Silicon Valley’s leading entrepreneurs, has said.

Google’s pledges US$300 million to support quality journalism: Google is to encourage users to sign up for digital news and magazine subscriptions as it responds to criticism from the publishing industry that it drains money from quality journalism.

Apple supplier’s earnings hit: IQE revealed yesterday that sales within its licensing unit fell from £6.7 million to £1.9 million last year. These are generated by the company’s joint ventures with universities in Cardiff and Singapore, which short sellers have suggested appear not to have any customers other than IQE.

The Independent

ITV reveals gender pay gap of 16% and bonus gap of 49%: The broadcaster said in its gender pay gap report for 2017 that the gap exists “because of the make-up of our workforce”. Although ITV employs more women than men, with women making up 53% of the workforce, the company said more men than women work in the most Senior or highly paid roles, and more women than men work in lower paying roles.

Wagamama launches app that could mean no longer waiting for the bill: Restaurant chain Wagamama has launched a payment app allowing diners to order, eat and walk out without waiting for the bill. The chain said the wagamamago app will save diners an average of 12 minutes at every meal by not having to wait for the bill to arrive and then go through the process of paying.

New inquiry into Volkswagen diesel emissions and market manipulation launched by German prosecutors: Volkswagen said on Tuesday that its global headquarters were searched again by German prosecutors in early March as part of an investigation into its diesel emissions scandal, confirming a magazine report.

The Guardian

Inflation dips to 2.7% as impact of Brexit vote starts to fade: Inflation fell further than expected last month, as the impact of the Brexit vote on the price of petrol and food began to fade, easing the pressure on squeezed British households.

PwC faces MPs over accusations of ‘milking the Carillion cow dry’: Partners from PricewaterhouseCoopers will be questioned by the work and pensions committee on Wednesday about the accounting firm’s role in the collapse of Carillion, with PwC accused of attempting to “milk the Carillion cow dry”.

Daily Mail

House builder Bellway expects to sell record 10,000 new homes this year as profits jump amid ‘robust’ market: Bellway said it expects to sell a record 10,000 new homes this year as it posted another rise in profits after continuing to benefit from rising prices and the Government’s Help to Buy.

Online gambling company 888 sinks as it says Auf Wiedersehen to Germany after web betting clampdown: Online gambling company 888 may cash in its chips in Germany following a clampdown on internet betting firms. A German court dealt 888 and rivals a blow last week when it ruled it was illegal for online gambling sites to operate in the state of Baden-Wurttemberg.

Pay up, Jamie! Chef’s bust steak restaurant chain owes thousands to small suppliers: Jamie Oliver is under pressure to fork out £6.7 million owed to creditors, including millions to small businesses, after his upmarket steak restaurant crashed into administration.

Daily Express

Petro cryptocurrency banned in United States as Venezuela claims Trump is running scared: cryptocurrency coin petro has been banned from use in the United States as Donald Trump is allegedly “afraid” of the rise of Venezuela’s digital currency.

The Scottish Herald

Oil prices rise amid Middle East tensions: Oil was in focus on Tuesday after prices rose sharply amid fears of supply disruptions in the Middle East, as the US considers re-imposing sanctions on Iran.

The Scotsman

North Sea oil and gas outlook remains ‘uncertain’: Oil and gas production in the North Sea is forecast to grow by 5% in 2018, however low levels of drilling mean the outlook for future years is “much more uncertain”.

Scotland’s digital tech industry expects a ‘positive’ 2018: Trade body ScotlandIS, representing more than 300 software, telecoms, IT and digital agency businesses, says in its Scottish Technology Industry Survey that confidence is high, with optimism on sales, profits and overseas expansion.

Brexit deal sparks furious row over Scotland’s fishing industry: A post-Brexit transition deal struck with Brussels has been condemned as a “sell-out” after it was revealed that the UK will have to abide by quotas imposed by Brussels in 2020.

City AM

New Look has been outmanoeuvred by cheaper and digital rivals: Earlier this month, high-street fashion retailer New Look announced that it planned to close 60 stores as part of a rescue deal aimed at preventing the firm entering administration.

KPMG appointed to handle Mothercare refinancing: The retail chain is in talks with its lenders about raising money for a turnaround and has drafted in KPMG to advise on securing waivers to its financial covenants.

Former BHS boss Darren Topp steps down from role as LK Bennett chief executive: Topp, who became chief executive of BHS after it was bought by serial bankrupt Dominic Chappell, was appointed to lead LK Bennett in September 2016, months after BHS went into administration. 


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