LSE profits surge, Mondi to pay bumper special dividend
London open
The FTSE 100 is expected to open 35 points lower on Friday, having closed down 0.78% at 7,175.64 on Thursday.
Stocks to watch
Alfa Financial Software on Friday said it had won a new contract with an unnamed global equipment manufacturer and finance group. No financial details were revealed, but Alfa said the deal would be multi-year and start in the UK, Spain and Germany before extending to other major geographic markets.
London Stock Exchange Group said full year operating profits rose 47% to £626m. Adjusted operating profit were up 18% at £812m while earnings before interest, tax, depreciation and amortisation increased 19% to £915m.
Takeaway food delivery marketplace Just Eat announced on Friday that its board has appointed Mike Evans to the role of non-executive chairman, with effect from 26 April. The FTSE 100 company said that since 2014, Evans has been non-executive chairman of digital property portal group ZPG. He would join the board of Just Eat as an independent non-executive director and chairman-elect on 6 March, with his appointment as non-executive chairman effective from the conclusion of the company's annual general meeting on 26 April.
Mondi, the South African packaging and paper group, will pay out a bumper special dividend on top of its healthy payout for last year as it reported growth of 7% in revenues and 6% in underlying operating profits.
Newspaper round-up
The board of Carillion dismissed a proposal that could have poured £218m into the government contractor’s ailing pension scheme, believing a month before the company’s collapse that they could still revive its fortunes. Details of a plan drawn up by accountancy firm EY, but rejected by directors, emerged as MPs conducting an inquiry into Carillion’s failure released evidence they said proved “pervasive institutional failings” at the company. - Guardian
The voice of Australia’s coal lobby is under renewed threat as the country’s second biggest miner, Rio Tinto, faces a shareholder revolt over its membership of lobby groups including the Minerals Council of Australia and the role it plays in Australia’s climate and energy debate. Global investors worth $84bn have joined together to file a shareholder motion calling on Rio Tinto to rethink its membership of the MCA, NSW Minerals Council (NSWMC) and the Queensland Resources Council (QRC). It demands Rio Tinto reveal all membership fees paid since 2012, review the consistency of the MCA’s lobbying positions with those held by Rio Tinto, and disclose what it would take for Rio to quit its membership of the MCA. – Guardian
British factories are preparing to shutter some of their operations to help National Grid avert a national gas supply crisis, as freezing temperatures sweep the country. For the first time in almost a decade National Grid said gas supplies will not be enough to meet demand, unless energy-intensive industries agree to use less gas in return for hefty compensation payments levied on to consumer bills. – Telegraph
UK lenders’ use of cheap Bank of England funding surged at the end of 2017, just weeks before the tap was due to be turned off. The central bank’s £140bn Term Funding Scheme (TFS) was launched after the Brexit vote to boost the supply of cheap funding to the real economy. It closed on Wednesday this week. - Telegraph
Siemens is to open Britain’s third train manufacturing plant - if it wins multibillion-pound rolling stock orders for either HS2 or London Underground. With the German engineering group bidding for more than £5 billion of orders for the 225 mph high-speed HS2 trains and the next generation of Tube rolling stock, it has begun plans to build a manufacturing plant at Goole in the East Riding of Yorkshire. It will create 700 manufacturing jobs and 1,700 more in the supply chain. – The Times
There are fears that other high-street retailers could follow Toys R Us and Maplin into financial crisis as City analysts warned that the gloom engulfing the sector was likely to persist. Shares in Mothercare lost more than 12 percent of their value yesterday after falling heavily the previous day, and Next and Debenhams both suffered falls after Toys R Us, the American toy company, and Maplin, the electrical goods retailer, went into administration on Wednesday. – The Times
US close
Wall Street finished lower on Thursday as investors sifted through a slew of economic data, and digested Fed Chair Jerome Powell’s second testimony this week.
The Dow Jones Industrial Average was down 1.68% at 24,608.98, the S&P 500 lost 1.33% to 2,677.67, and the Nasdaq 100 was off 1.52% at 6,750.54.
Investors had been on edge since Tuesday when a hawkish first congressional testimony by Powell spooked markets by adding weight to expectations of four rate hikes rather than three this year.
“Powell’s testimony in front of the House Financial Services Committee on Tuesday was very bullish on the economy and led many to believe that a fourth-rate hike is on the table this year,” Oanda analyst Craig Erlam said earlier in the day.
“While this isn’t a million miles from what markets are pricing in, it did trigger another negative response from markets with US indices falling around two and a half percent since and positioned for further losses today.”
On Thursday, Powell testified in front of the Senate Banking Committee, telling the senators that there weren’t yet any “decisive” signs of wage inflation.
He also said more gains could be made in the US labour market without creating harmful levels of inflation.