HSBC completes Brazil business sale, Kier says trading in line

London’s FTSE 100 is expected to open 23 points higher than Friday’s close at 6,600.

Stocks to watch

HSBC confirmed the completion of the sale of its Brazil business on Monday, after announcing on 8 June that it had received all necessary regulatory approvals for the transaction.

The bank had put HSBC Brazil on the market as part of its efforts to streamline the global business, accepting an offer from Banco Bradesco.

“The sale of HSBC Brazil represents a significant step in HSBC's stated goal to optimise its global network and reduce complexity,” the board said in the announcement.

HSBC previously confirmed the deal was worth $5.2bn in an all-cash transaction.

Capita announced the appointment of Ian Powell as a non-executive director and chairman designate on Monday, taking effect from 1 September.

The FTSE 100 firm said Powell would officially succeed Martin Bolland as non-executive chairman on 1 January 2017.

Until the end of June, Ian Powell was chairman and senior partner of PricewaterhouseCoopers UK.

Conditions in the offshore industry remain depressed, reflecting global economic uncertainty, which will see profits for 2016 come in "materially lower" than in the full-year 2015, Clarkson said in a trading update.

However, overall transaction volumes within the broking division continued to grow, albeit alongside declining activity in the financial division. The shipbroker referenced the sharp fall seen in the Baltic Dry Index to all-time during the first quarter of the year.

Property investment company Kennedy Wilson Europe said it has achieved a major milestone at its Baggot Plaza, Dublin project, reaching practical completion and handing the building over to the governor and company of the Bank of Ireland.

The FTSE 250 firm entered into an agreement for lease with the Bank of Ireland in May 2015, for a 25-year lease of the entire building at a headline rent of €47.50 per square foot.

Property, residential, construction and services group Kier did its best to reassure investors over the company’s viability on Monday, in the wake of the EU referendum.

Since the announcement of its interim results on 17 March, the FTSE 250 group said its underlying trading performance has remained in line with management expectations.

It added that the EU referendum result has created some uncertainty, albeit with no impact on the business to date.

In the news

Britain’s decision to leave the EU will force companies that rely on migrant labour to rethink their business models, if it leads to restrictions on low-skilled immigration. For some, robots may be the most likely replacement, according to a report by the Resolution Foundation think-tank. Almost one third of the workforce in food manufacturing are EU migrants. More than a fifth of domestic personnel are from the EU, and more than one in eight workers in sectors ranging from agriculture to warehousing and textiles manufacturing. – Financial Times

George Osborne is planning to slash corporation tax to less than 15 per cent in an effort to woo business deterred from investing in a post-Brexit Britain as part of his new five-point plan to galvanise the economy. While the chancellor did not backtrack on his warning that leaving the EU could push the country into recession, he told the Financial Times: “We must focus on the horizon and the journey ahead and make the most of the hand we’ve been dealt.” – Financial Times

The Pension Regulator should be given new powers to block company deals so that employees and pensioners are better protected in the wake of events such as the collapse of BHS, the former chair of the Pension Protection Fund has said. Lady Judge, who stepped down last month, said the regulator was not equipped to deal with situations such as that at BHS, sold by Sir Philip Green to Dominic Chappell for £1 last year and now left with an estimated £571m pensions black hole. – Guardian

The weakness in the pound will absorb some of the shock of the Brexit vote as it weighs on domestic business spending in the next few months, according to the Confederation of British Industry (CBI). The business group said the boost to exporters, whose goods will become relatively cheaper after the decline in sterling, could provide politicians some breathing space to ensure long-term global trade links are maintained. – Telegraph

Britain’s private equity industry group has set out a post-Brexit plan including access to the single market and accepting freedom of movement, as data shows that funds have held off high-value deals in the lead-up to the referendum. British buy-out firms invested £6bn in the first half of the year, down from £9bn in the previous six months to December, as investors were less likely to strike mega-deals, according to Imperial College London’s Centre for Management Buy-Out Research. – Telegraph

Billions of pounds of European funding for UK clean energy projects including offshore wind farms as well as universities and other big infrastructure schemes have been jeopardised by Britain’s vote to quit the EU. Britain is a 16 per cent shareholder in the European Investment Bank (EIB), which in the past decade has lent more than £42 billion at super-cheap rates to wind farms, hospitals, railways, social housing and a string of other projects. – The Times

US close

US stocks finished higher on Friday ahead of the Fourth of July long weekend as investors set Brexit worries aside and weighed a batch of economic data.

The Dow Jones Industrial Average rose 0.10%, the S&P 500 increased 0.19% and Nasdaq climbed 0.41%.

Oil prices were also higher with West Texas Intermediate crude up 1.7% to $49.17 per barrel and Brent up 1.7% to $50.58 per barrel at 2058 BST.