Royal Mail tightens full-year guidance, Domino's Pizza sees busiest week ever in UK
London open
The FTSE 100 is expected to open 18 points higher on Tuesday, having closed down 0.91% at 6,747.0 on Monday.
Stocks to watch
BHP on Tuesday said says no agreement had been reached over the financial obligations of its Samarco joint venture following the 2015 mine disaster that killed 19 people. BHP said in a statement that Samarco's operations will only restart if it is “safe, economically viable and has the support of the community and regulators”. The statement came after a second dam burst in Brazil on Friday at a mine owned solely by Brazil's Vale, which owns half of Samarco that has killed 65 people with fears the death toll could rise into the hundreds.
Royal Mail tightened up its full-year profit guidance after what it said was a busy Christmas period. The letters and parcels group now expects to deliver adjusted group operating profit before transformation costs of £500-530m, from the £500-550m previously indicated.
Domino’s Pizza Group updated the market on its fourth quarter trading on Tuesday, reporting a 5.8% uptick in organic group system sales, with UK system sales up 6.0% and UK like-for-like sales up 4.5%. The FTSE 250 company, which holds the master franchise for Domino’s Pizza in several European countries, said its saw its “busiest week ever” in the run-up to Christmas, and reported “strong” digital performance, with online sales up 10.8%. However, due to weaker sales progress outside the UK and Ireland, and business integration challenges in Norway, full-year underlying profit before tax was now expected to be at the lower end of the consensus range of £93.9m to £98.2m.
Newspaper round-up
The owner of Oddbins has warned staff of job losses in the near future as the off-licence business said it had appointed advisers to look at options for the future after an “extremely tough” Christmas. In an email to staff at European Food Brokers group, which also includes Wine Cellar Trading and Whittalls Wine Merchants, directors said they had concluded that its retail businesses “cannot continue in their current form” and may have to be sold. – Guardian
Parliament is facing a day of further Brexit deadlock after Theresa May swung the government’s weight behind an amendment that would send her back to Brussels to demand an alternative to the Irish border backstop, splintering Conservative support. The chances of the amendment, championed by the senior backbencher Sir Graham Brady, are on a knife-edge after Tory Brexiters split over whether they should back the change, while pro-remain MPs suggested they would vote against. – Guardian
Patisserie Valerie sales were in secret decline for at least three years before the discovery of the accounting black hole that triggered its collapse, The Daily Telegraph can reveal. Documents containing the stricken cafe chain’s finances show revenues from "un-loved" established stores were falling even as the management team under executive chairman Luke Johnson pursued an "ambitious roll-out plan". – Telegraph
Google has unveiled plans to offer anti-hacking technology called Project Shield to political organisations in Europe, amid fears of election tampering ahead of the European Union elections in May. Google's experimental incubator Jigsaw has said it will offer free cyber protection to political parties and candidates from Tuesday after citing a "pressing concern" to defend elections from digital attacks. – Telegraph
Britain’s biggest accountancy firms are pushing to delay sweeping reforms to the industry, including a forced separation of their businesses, before parliamentary hearings this week. The heads of Deloitte, KPMG, EY and PwC have written to the Commons business committee to say the competition watchdog should postpone moves to overhaul the audit market until the completion of a separate review by Donald Brydon, chairman of the London Stock Exchange, which could take another 12 months. – The Times
US close
US stocks finished well into the red on Monday, as investors eyed this week's trade talks between the US and China and a slew of earnings releases - including a major earnings miss by one of the Dow's major blue chip outfits and one of Wall Street's tech darlings.
The Dow Jones Industrial Average ended the session down 0.84% at 24,528.22, the S&P 500 was off 0.78% at 2,643.85, and the Nasdaq 100 was 1.33% lower at 6,697.09.
US stocks were heading south from the opening bell earlier, after the President warned that another government shutdown could be on the horizon, just days after the nation's longest had drawn to a close.
There was also a massive earnings miss by Caterpillar, which took a significant chunk out of the Dow.
Blaming "lower demand" in China, the maker of construction and mining equipment said that sales in Asia/Pacific fell during the quarter.