Forex takes fizz out of Coca-Cola HBC, Tui Group revenues descend

London open

The FTSE 100 is expected to open 29.2 points lower on Thursday, after closing up 0.22% at 6,866.42 on Wednesday.

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European soft drink bottler Coca-Cola HBC reported its results for the six-month period to 1 July on Thursday morning, with FX-neutral net sales revenue growing by 2.4%, or 3.0% taking into account the one less selling day. The FTSE 100 company said currencies were continuing to impact adversely, leading to a 3.6% decline in net sales revenue to €1.193bn. It posted a “robust increase” in FX-neutral revenue per case of 2.4% to €4.02, mainly due to better pricing trends across all segments compared to the prior-year period and a 110 basis point improvement in package mix. “We are pleased with the strong performance in the first half of the year,” said chief executive Dimitris Lois. “The business delivered robust revenue growth and significant margin expansion, driven by improved pricing and mix trends, good progress on operating costs and a favourable input cost environment.”

Tui Group's revenues shrank in the third quarter but the travel group was still confident of hitting its full year targets and said it was pleased with the start to early trading for the winter season and Summer 2017. Turnover of €4.6bn in the three months to 30 June was down 5.7% on the same period, and short of analysts expectations, while earnings before interest, tax, depreciation and amortisation rose 1.1% to €180m.

Legal & General Group has agreed the sale of its Cofunds investment platform to Aegon for £140m. The acquisition, which includes the Investor Portfolio Service platform as well as Cofunds' retail and institutional business, will increase the Solvency II surplus by £125m, and its Economic Capital surplus by £105m.

Newspaper round-up

The number of homes on the market hit a record low in July as house price growth slumped on the uncertainty in the wake of the Brexit referendum. The level of market activity, such as the amount of new buyer inquiries and the number of agreed sales, continued to fall, according to the Royal Institution of Chartered Surveyors (Rics). – Telegraph

Julian Assange will be questioned by Swedish prosecutors inside the Ecuadorean embassy in London, in a possible breakthrough to the impasse over his case. The Ecuadorian attorney general delivered a document agreeing to a request by the Swedish prosecutor to question the founder of WikiLeaks. – Guardian

Taxpayers face a big rise in the bill for cleaning up the first generation of nuclear power stations in Britain after the company that was wrongly awarded the contract raised its estimate by £1.6 billion. Cavendish Fluor Partnership (CFP), a joint venture led by Babcock, the British defence and engineering company, has told the Nuclear Decommissioning Authority (NDA) that the cost of cleaning up the 12 Magnox reactors will rise by 18 per cent to more than £10 billion, The Times has learnt. – The Times

Investors flocked to sell government bonds to the Bank of England yesterday, restoring confidence in its new £60 billion stimulus plan, which had taken a knock on Tuesday when it failed to attract enough sellers. The reverse auction of gilts with maturities of 7 to 15 years was well subscribed, attracting offers to sell £5.5 billion of stock, nearly five times the £1.17 billion the Bank ended up buying. – The Times

Some optimism has returned to the UK housing market as the initial shock of the Brexit vote begins to wear off. In the June Royal Institution of Chartered Surveyors survey of estate agents and surveyors, carried out in the immediate aftermath of the vote, a large majority said they believed house prices would fall this year. – Financial Times

US close

US stocks finished slightly lower on Wednesday as oil prices sagged and investors were through corporate earnings in the absence of economic data.

The Dow Jones Industrial Average closed down 37 points or 0.2% at 18,495.66, the S&P 500 fell 6 points or 0.3% to 2,175.49 and the Nasdaq came off 0.4% from its all-time peak close to 5,204.58.

However the indices remain close to their record highs amid the summer's low trading volumes and bullish mood among US investors.

"Markets are being driven by sentiment, and the main sentiment seems to be that the US Federal Reserve is in no rush to raise interest rates," said IG analyst Joshua Mahony.

"That’s pushed the US dollar down to a six-week low against other major currencies, and lifted metals prices including the gold price. Global equity indices are little changed amid dwindling August volumes, but that means US stock indices remain close to their record highs."

Oil prices, having flattened earlier lows, slid lower as the session developed after the US Energy Information Administration revised its outlook for US crude production higher.

The EIA now expects output to average 8.73m barrels a day this year and 8.31m barrels a day next year, up from its previous forecast of 8.61m per day and 8.2m a day, respectively.