HomeServe bites into Checkatrade, Epiris offloads Audiotonix

London open

The FTSE 100 is expected to open two points higher on Friday, after closing up 0.47% at 7,140.75 on Thursday.

Stocks to watch

Epiris, the portfolio manager of buyout fund Electra Private Equity is to sell its Audiotonix business, which manufactures audio mixing consoles, to European private equity firm Astorg, subject to regulatory approval. From the sale, which is expected to close in the first quarter of 2017, Electra will receive £203m, an uplift of £62m, or 44%, and equivalent to an increase in its net asset value of 133p per share from the value of the investment at the end of last September.

Residential repair and improvements business HomeServe announced on Friday that it has acquired shareholdings in Checkatrade in the UK and Habitissimo in Spain. The FTSE 250 firm said the two separate businesses provide access to high-quality tradespeople performing home repairs and improvements via online platforms. It confirmed it purchased a 40% interest in Checkatrade, and a 70% interest in Habitissimo, with the deals being worth a combined £37m.

In the year to the end of December, Beazley’s pre-tax profit rose to $293.2m from $284m in 2015, as gross premiums written increased 6% to $2.2bn from $2.08bn. Chief executive Andrew Horton said: "Beazley's performance in 2016 was good across the board. Our increased profits were driven by a higher investment return, but the bedrock of our success remains our underwriting performance, which generated a combined ratio of 89% in 2016 despite highly competitive conditions in many of our markets. Overall premium growth doubled to 6% and we were able to develop a number of growth opportunities, particularly in the US, that enabled us to offset areas where market conditions dictated that we cut back."

Newspaper round-up

More than 4,000 City-based bank workers were paid more than €1m (£850,000) in 2015 – including one fund manager who received nearly €34m. New data from the European Banking Authority, a pan-European regulator, showed that 80% of the EU financiers classified as high earners – those receiving more than €1m a year – were based in the UK. – Guardian

Amazon had a bumper holiday, as the online retailer announced a 55% rise in fourth-quarter profit on Thursday for the three months ending 31 December, but its share price fell in after hours trading after the retail and services giant narrowly missed Wall Street’s sales expectations. For years, Amazon eschewed profits for growth, to the criticism of many investors. Profits for the final quarter of 2016 rose to $749m from $482m a year earlier, the seventh straight profitable quarter for Amazon. – Guardian

Rolls-Royce engines will power a fleet of new trains connecting cities in the Midlands and the North. The FTSE 100 engineer is supplying 140 environmentally-friendly power plants for 55 two and three-car commuter trains capable of hitting speeds of up to 100mph and which will be operated on the Northern Connect network. – Telegraph

Leaving the European Union will create opportunities for the UK life sciences sector, the chief executive of AstraZeneca has said. Pascal Soriot said the FTSE 100 company had been working closely with the government on Brexit and spoken with ministers about it this week. “As business people we have to look for opportunities and make the best of it. And there are opportunities for the country, industry and for our company,” he said. – Telegraph

Partners at one of the City’s largest law firms are being forced to inject £50 million into the practice as its cash holdings tumbled by more than 67 per cent. The cash call at Hogan Lovells, one of the Square Mile’s growing breed of transatlantic law firms, will continue over the next five years and involve about 500 full equity partners paying in an average of £100,000 each. The firm confirmed yesterday that partners will, on average, have to increase their capital contributions by 7.5 per cent until 2021. Individual partners could pay much more, depending on their position on the equity ladder. – The Times

US close

US markets drifted sideways on Thursday, as the dollar remained limp while investors pondered a rattled Federal Reserve’s policy statement and combed through more earnings.

The Dow Jones Industrial Average fell 0.1% to 19,871.23, the S&P 500 was down 0.09% to 2,277.40 and the Nasdaq was 0.09% weaker to 5,638 at 1539 GMT.

The Fed stood pat on rates on Wednesday and sounded a positive note on the economic outlook, with some commentators musing that we may not see three rate hikes this year, as had recently been expected.

Dollar weakness seems likely to continue, given the way the US dollar was trading on the day, said analyst Chris Beauchamp at IG, "rallies in the greenback continue to be sold, as investors realise that there is still a long way to go before the next US rate increase".

Naeem Aslam at Think Markets said the Fed had been shaken by Donald Trump's unpredictable and bold actions, even losing its grip on rate decisions to the new President.

"Trump has clearly voiced that he sides with a weaker dollar, and after the appointment of the Supreme Court’s judge, the next big appointment will be the Fed chairperson. Janet Yellen will be leaving next year, however, there are two posts which will need to be refilled this year."