British Land footfall outperforms, Royal Mail revenue remains flat

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The FTSE 100 is expected to open seven points higher on Thursday, after closing up 0.38% at 7,247.61 on Wednesday.

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British Land posted its third quarter trading update on Thursday, reporting 314,000 sq ft of retail lettings and renewals during the period - 8.7% ahead of estimated recovery value, with a further 189,000 sq ft under offer. The FTSE 100 company said its retailer sales for the quarter were up 0.6% year-on-year, outperforming the benchmark by 200 basis points, while footfall for the quarter was down 0.6% year-on-year, also outperforming the benchmark by 220 basis points.

The dwindling volume of letters to Father Christmas and other festive missives continued to hold back Royal Mail sales, with revenues remaining flat in the nine months to 25 December. Growth of 9% from the GLS international parcel arm offset the 2% drop in the core UK Parcel, International and Letters (UKPIL) division to keep group sales in line with expectations.

Anglo-Australian miner BHP Billiton and its Brazilian iron-ore joint venture with Vale SA, Samarco Mineracao, have set a 30 June deadline with federal prosecutors in Brazil to settle a $47.5bn claim related a dam failure in November 2015 which killed 19 people. BHP Billiton, Vale and Samarco will initially pay $675m to support compensation and social and environmental remediation of the dam failure.

Newspaper round-up

Janet Yellen, the chairman of the US Federal Reserve, said the economy had come a long way in recovering from the 2008 financial crisis and that she and her colleagues expect the central bank to raise interest rates “a few times a year” until 2019. Ms Yellen also warned that waiting too long to raise rates could risk a “nasty surprise” down the road, but that increasing interest rates too rapidly would push the economy into a new recession. - Telegraph

Britain is ideally placed to secure a services-based trade agreement with Australia, the country’s trade minister said yesterday. Australia was the first country out of the blocks to announce that it wanted to secure preferential access to British markets after the Brexit vote. - The Times

The Serious Fraud Office is within weeks of bringing criminal prosecutions against individuals caught up in the Rolls-Royce bribery scandal, one of the biggest corruption cases in British corporate history. The SFO has confirmed that it is carrying out criminal investigations of former Rolls employees and others, believed to be the middlemen through which the aircraft engine maker paid more than $100 million in bribes to government officials and companies in a dozen countries across five continents. - The Times

The UK’s housing market showed signs of weakness in December, as the number of property sales fell as uncertainty and a shortage of supply kept potential buyers at bay. House price growth also appeared to slow, according to the data from the Royal Institution of Chartered Surveyors (Rics), which polls its members for the monthly survey. - Telegraph

Clydesdale Bank and Yorkshire Bank are to close one third of their branches this year with the loss of 400 jobs and potential inconvenience to tens of thousands of account-holders. CYBG, the owner of both banks, said that it was cutting 79 branches, reducing its network to only 168. - The Times

US close

US equity markets ended mostly higher on Wednesday, while the dollar gained ground following comments from Federal Reserve chair Janet Yellen, although banking heavyweights Goldman Sachs and Citigroup ended in the red.

The Dow Jones Industrial Average ended down 0.1%, but the S&P 500 and the Nasdaq rose 0.2% and 0.3%, respectively.

Meanwhile, oil prices dropped on the strength of the dollar, with West Texas Intermediate down 2.2% to $51.34 per barrel and Brent crude down 2.3% to $54.22.

The greenback recovered from losses in the previous session when President-elect Donald Trump told the Wall Street Journal he was concerned about the dollar’s strength against the yuan.

Comments from Janet Yellen also provided a boost, after she said in a speech that she expects rate hikes a few times a year until the end of 2019.