BP to take $2bn hit, Wood Group signs six-year deal with Shell
London open
The FTSE 100 is expected to open seven points higher on Tuesday, having closed down 0.13% on Monday at 8,193.49.
Stocks to watch
BP said it would take a hit of up to $2bn in the second quarter relating to asset impairments and onerous contract provisions, including charges relating to the ongoing review of its Gelsenkirchen refinery in Germany. The oil and gas giant also forecast flat upstream production in the second quarter, while its gas marketing and trading result was also expected to be average following a strong result in the first quarter.
SSE said on Tuesday that it was advancing the development of a 2GW offshore wind farm in the IJmuiden Ver Wind Farm Zone in the Netherlands, in partnership with AFG, with plans to finalise investment decisions by late 2025 and commission the project by the end of the decade. The FTSE 100 electricity giant said the Dutch government had awarded the consortium a 40-year lease for the site, including a grid connection, and required it to reimburse €20m for environmental studies. It said the project was its first seabed award in the Dutch offshore wind market, expanding its offshore wind pipeline to 9.3GW and aligning with the Netherlands' target of 21GW by 2032 and 50GW by 2040.
Engineering and consulting firm Wood Group has signed a six-year contract with energy giant Shell to provide brownfield engineering, procurement, and construction management for the latter’s Prelude floating liquefied natural gas platform facility in Western Australia. “We are delighted to build on our 70-year global relationship with Shell to deliver integrated brownfield engineering solutions for Prelude, the world’s largest floating offshore gas facility,” said Wood’s chief executive Ken Gilmartin.
Newspaper round-up
Meta has claimed news is not the antidote to misinformation and disinformation spreading on Facebook and Instagram, as the company continues to push back against being forced to pay media companies for news in Australia. Meta announced in March it would not enter into new agreements with media companies to pay for news following the end of contracts signed in 2021 under the Morrison government’s news media bargaining code. – Guardian
At the World AI Conference in Shanghai last week, one of China’s leading artificial intelligence companies, SenseTime, unveiled its latest model, SenseNova 5.5. The model showed off its ability to identify and describe a stuffed toy puppy (wearing a SenseTime cap), offered feedback on a drawing of a rabbit, and instantly read and summarised a page of text. According to SenseTime, SenseNova 5.5 is comparable with GPT-4o, the flagship artificial intelligence model of the Microsoft-backed US company OpenAI. – Guardian
Sir Keir Starmer’s choice of a leading advocate of HS2 as rail minister has stoked industry hopes that scrapped parts of the project may be revived. While the primary task facing Lord Hendy, whose appointment was announced on Monday, will be to oversee Labour’s renationalisation of train operators, he’s also likely to prove a strong advocate for expanding the network. Lord Hendy, who previously worked closely with Boris Johnson and sat as a crossbench peer, last year criticised Rishi Sunak’s decision to halt HS2 at Birmingham, choosing to speak out despite his position as chairman of the state-owned track operator Network Rail. – Telegraph
French state energy giant EDF has pulled out of the competition to build mini-nuclear reactors in Britain, as it takes its blueprints back to the drawing board. The company had been vying with five others to win government support for its small modular reactor (SMR) design, with two winners set to be chosen by the end of the year. But with submissions for the latest stage of the competition due at 4pm on Monday, it is understood that EDF put forward no design and has effectively now withdrawn from the running. – Telegraph
A Tesla shareholder is calling for more than $7 billion in lawyers’ fees to be paid by the electric car maker, after he successfully challenged Elon Musk’s record-breaking pay package. Richard Tornetta, who owned nine shares in Tesla when he sued over Musk’s pay package in 2018, is pursuing the legal fee on behalf of three law firms that represented him in a battle he ultimately won in January when Musk’s $56 billion package was voided by a judge in Delaware. – The Times
US close
Wall Street stocks turned in a mixed performance on Monday as investors prepared for the beginning of Q2 corporate earnings season later in the week.
At the close, the Dow Jones Industrial Average was down 0.08% at 39,344.79, while the S&P 500 advanced 0.10% to 5,572.85 and the Nasdaq Composite saw out the session 0.28% firmer at 18,403.74.
The Dow closed 31.08 points lower on Monday, taking a bite out of gains recorded in the previous session.
Market participants were patiently awaiting the release of earnings from a number of major US banks later in the week, as well as quarterly numbers from the likes of PepsiCo and Delta Air Lines.
June's consumer price index, slated for release on Thursday, will also draw much investor attention, as will last month's producer price index on Friday.