Berkeley expecting top-end profits, Amec to share in large US defense contract

London open

The FTSE 100 is expected to open nine points lower on Friday, after closing up 0.64% at 7,415.95 on Thursday.

Stocks to watch

Property group Berkeley said full year pre-tax profits are expected to be at the top end of analysts' expectations, with the actual outturn dependent upon completion timing on Berkeley's larger developments. It added that a “similar level of profitability” was anticipated for the 2018 financial year. However, Berkeley said underlying reservations in the seven months since the Brexit referendum effect - August to February - were down 16% on the comparable period last year, with the last two months ahead of last year.

Manager and developer of student accommodation, Unite Students, acquired an asset under development in Durham for £34m. The 'forward funded' asset will be opened in September 2018 and will provide a home for 363 students. It is expected to deliver a yield on cost of 6.4% in its first year of operation and based on current valuations, it will be valued at a yield of 5.5%, resulting in a profit on cost of approximately £5m, £1.1m of which will be Unite’s share.

China's largest oil company has triggered its option to acquire the rest of Tullow Oil's interest in Ugandan oil exploration licences. Tullow in January agreed to farm-down 21.57% of its 33.33% interests in four exploration areas in Uganda to France's Total for a total consideration of $900m, which China National Offshore Oil Corporation has also now requested to do too.

The US Food and Drug Administration issued a complete response letter to AstraZeneca regarding its new drug hyperkalaemia, after it delayed its regulatory approval in the country. Following the issue of the letter the FDA has inspected the manufacturing facility of the drug, sodium zirconium cyclosilicate (ZS-9) at ZS Pharma, the company’s subsidiary which is developing the drug.

Amec Foster Wheeler announced on Friday it was awarded a contract with the US Air Force Civil Engineer Center to sustain and improve Air Force and other US Department of Defense installations worldwide. The FTSE 250 company said the five-year contract has an aggregate maximum value of $950m for the multiple awardees, and was estimated to reach completion by 2022. Under the contract, Amec Foster Wheeler will compete for design-build and design-bid-build task orders for new construction, renovation, site work, demolition, and emergency response in environments that could be considered “remote and challenging” worldwide.

Newspaper round-up

Theresa May stepped up the pressure on Nicola Sturgeon, accusing the SNP leader of forcing a “fundamentally unfair” independence referendum that would damage Brexit negotiations. In an article for The Times, the prime minister toughens her stance against starting talks over a second independence vote before spring 2019 — the timetable set out by Ms Sturgeon in a surprise announcement this week.

Nicola Sturgeon accused Theresa May of sealing the fate of the United Kingdom after the prime minister rejected her demand for a second Scottish independence referendum before the Brexit talks conclude. The first minister said May’s stance was “completely outrageous and unacceptable”, hours after the prime minister had insisted that “now is not the time” for the referendum that the SNP had hoped to stage between autumn 2019 and spring 2019. - Guardian

Moderate Conservative backbenchers have rallied behind Philip Hammond and said Theresa May should have done more to defend his plan to increase national insurance contributions for the self-employed. The chancellor ditched his plan put forward in the budget on 8 March after a public backlash from some Tories and private concerns among cabinet ministers. But other backbenchers criticised the prime minister’s treatment of Hammond. - Guardian

Shoppers are expected to spend less money this year as rising inflation begins to hit people's purse strings, a report by PwC claims. Consumer spending growth is expected to hover at around 2 per cent this year and fall to 1.7 per cent next year, compared to the 3 per cent growth seen in 2016, according to the accountancy giant. - Daily Mail

People who voted to remain in the European Union have defied conventional wisdom and gone on more of a spending spree since the referendum than those who elected to leave. The counterintuitive behaviour was revealed in a survey which found that overall British consumers were still spending robustly and showed little sign of stopping in the short term. - The Times

US close

US stocks ended their mini rally on Thursday, as gains made after the Federal Reserve raised interest rates in the previous session were eroded.

The Dow Jones Industrial Average closed almost 16 points lower at 20,932.55, the S&P 500 fell nearly four points to 2,381.38.

Tech stocks nudged the Nasdaq minutely higher, up less than a point to 5,900.76, while the Russell 2000 small cap index also held onto its gains from Wednesday's more cautious FOMC announcement.

"The small caps had been under pressure thus far in March but they have posted a firm rebound and now look poised to benefit once more from the combination of gradual rate increases and solid economic growth that prevails in the US," said analyst Chris Beauchamp at IG.

The large cap indices were weighed down by some energy stocks, which were under pressure again from the recent oil price wobble.

Chevron recovered from its worst early losses to close almost 1% lower, while rival ExxonMobil rebounded into positive territory.