Endeavour Mining upbeat on Cote d'Ivoire drilling, FirstGroup to beat full-year expectations

London open

The FTSE 100 is expected to open 17 points lower on Wednesday, having closed up 1.82% on Tuesday at 7,628.21.

Stocks to watch

Gold producer Endeavour Mining has said that it's about 70% of the way through planned drilling at its key Côte d’Ivoire project for 2023, but results so far have been promising. The company, with exploration assets across West Africa, said 123km has been drilled at its Tanda-Iguela projects so far this year with plans for an additional 55 kilometres before the year is out, well ahead of the 70 kilometres initially planned. Over 108 kilometres of drilling has taken place at the Assafou deposit, with the goal of converting 'inferred' resources to 'indicated' status and extending the mineralised system.

FirstGroup said in an update on Wednesday that it was expecting improved full-year profits in both its rail and bus divisions, citing stronger-than-expected demand and agreed variable fee payments with the Department for Transport for First Rail, and robust passenger volumes plus pension fund changes for First Bus. Corporate actions included managing Greyhound pension liabilities and purchasing a portion of its 2024 bonds. As a result, 2024 group adjusted operating and attributable profits were expected to surpass previous board expectations by £14 to £20m and £7m to £10m, respectively, with an anticipated year-end adjusted net cash position of £20m to £30m.

Newspaper round-up

The International Monetary Fund has warned that a surge in oil prices caused by war in the Middle East could hobble the already ‘limping’ global economic recovery. The president of the World Bank, Ajay Banga, said the conflict was ‘an economic shock we don’t need’. Israel’s war with Hamas adds to turbulence on financial markets already convulsed by worries about ‘higher for longer’ interest rates. - Daily Mail

Bidders are lining up a potential takeover of Currys’ Greek and Cypriot business. The electricals retailer said that a strategic review of Kotsovolos, which had begun in June, had elicited interest from “several potential buyers who in turn have submitted non-binding offers”. The FTSE 250 company said the board and its advisers were “evaluating” the bids and would provide a further update “when appropriate”. The news drove a rise in Currys’ shares of 2¼p, or 5 per cent, to 49¼p. - The Times

The proportion of homeowners taking out mortgages of 35 years or longer has jumped as borrowers try to offset the impact of higher interest rates, the Bank of England has warned. Threadneedle Street signalled yesterday that it was watching the developments in the mortgage market closely as homeowners look for ways to limit the steep rises they face in monthly mortgage payments. It said that the share of new mortgage lending on terms of at least 35 years had climbed from 4 per cent in the first quarter of 2021 to 12 per cent in the three months to the end of June. - The Times

Rural homeowners whose views and properties are blighted by new electricity pylons and cables could be offered home insulation, heat pumps and other energy efficiency measures by National Grid. Ben Wilson, National Grid’s chief strategy officer, said the company wanted people living alongside pylons and cabling to benefit from the infrastructure, which must be rolled out at scale as part of the shift to net zero. - Telegraph

US close

US stocks gained on Tuesday as bond yields tumbled on the back of yet more indications from the Federal Reserve that they are in no rush to tighten monetary policy just yet.

The Dow Jones Industrial Average closed 0.4% higher at 33,739, the S&P 500 gained 0.5% to 4,358, while the Nasdaq finished up 0.6% at 13,563.

Fed vice chair Philip Jefferson and Dallas Fed president Lorie Logan on Monday both highlighted how the recent spike in Treasury yields may have altered their outlook since the last policy meeting, with higher rates potentially doing enough of a job to keep financial conditions restrictive enough.

On Tuesday, Atlanta Fed President Raphael Bostic doubled down on the view, saying that the central bank is likely done tightening for now. Referring to bringing inflation down to the 2% target, Bostic said: "I actually don't think we need to increase rates anymore."

After being closed on Monday for Columbus Day and Indigenous Peoples Day, bond markets opened to see strong gains in US Treasuries, with the yield on a 10-year note sinking 15 basis points to 4.655%.