Sales growth unchanged at WH Smith, British American Tobacco performing 'very well'

London open

The FTSE 100 is expected to open down eight points on Wednesday, after closing down 0.15% at 7,500.44 on Tuesday.

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Sales growth at WH Smith remained almost unchanged in the third quarter, with the retailer's profits margins said to be improving. For the 15 weeks to 10 June, the group reported total sales up 2% compared to the same period last year and flat like-for-like sales, as it had for the first half of the year.

British American Tobacco posted a pre-close trading update for its first half on Wednesday, with the board saying the business continued to perform “very well”, in line with expectations. The FTSE 100 firm said first half revenue was expected to benefit from “good pricing”, with first half volumes lapping a strong prior year comparator and impacted by the phasing of shipments in a number of key markets, including Pakistan. Full year volume was expected to outperform the industry, which BAT’s board anticipated would be down around 4%.

Newspaper round-up

Technology companies such as Google and Facebook must do more to curb the “poisonous propaganda” that fuels terror attacks such as the atrocities in London and Manchester, the prime minister has said, launching a UK-French pact to explore new ways to curb the spread of online hate. At a bilateral meeting in Paris on Tuesday, both French president Emmanuel Macron and Theresa May agreed to explore creating a new legal liability for tech companies if they fail to remove inflammatory content, which could include penalties such as fines. – Guardian

Brussels has published proposals that could force London’s prized euro-clearing trade out of the City after Brexit, as the EU plans for life without Europe’s biggest financial centre. While the plans stop short of forced relocation after Brexit in 2019, they would give the EU greater oversight and the power to compel “systemically important” firms to move to the continent in the name of protecting financial stability. – Guardian

Three cars parked directly in front of BP’s headquarters in St James’ Square this morning were plugged into electric charging sockets, poignant symbols of the green revolutionsweeping global markets. The unveiling of the BP Statistical Review of World Energy is an annual ritual. This year it tells us that a profound rupture has occurred as technology advances by leaps and bounds, and humanity finds alternatives to fossil fuels faster than almost anybody thought possible. – Telegraph

Volkswagen is facing its biggest legal challenge in Europe over the “dieselgate” scandal with a UK class action against the car maker teaming up with a similar claim in the Netherlands. British law firm Harcus Sinclair has joined forces to unite its 41,000 claimants with as many as 180,000 affected VW drivers in Europe to create a international "super claim". – Telegraph

One of the City’s biggest investment groups has strongly criticised the stock market regime that is set to allow a small London-listed company to be taken private, leaving furious minority investors lumbered with unlisted and illiquid shares. Euan Stirling, head of governance at Standard Life, attacked the unusual plan by Fusionex International, an AIM-listed tiddler that makes computer software. “It feels like the company has been taken from us without our consent,” he said. – The Times

Unsecured creditors to Jaeger are owed close to £50 million with suppliers from all over the world hardest hit after the collapse of the fashion chain. An administrator’s report filed by Alix Partners shows that unsecured creditors across the four trading companies that make up the fashion company are owed a total of £49.17 million. However, only creditors to Jaeger Company’s Shops Limited, the main trading company, which are owed £29.92 million in total, are expected to make any recovery, albeit less than 2p in the pound. – The Times

US close

US stocks ended higher on Tuesday with the Dow and S&P 500 at records as technology stocks rebounded from the recent selloff ahead of an expected rate hike by the Federal Reserve.

The Dow Jones Industrial Average closed up 0.4% to 21,328.47, the S&P 500 rose 0.5% to 2,440.35 and the tech-heavy Nasdaq finished 0.7% higher at 6,220.37 as technology stocks - which have rallied sharply in the last 12 months - recovered from their recent loses. Facebook, Apple and Microsoft all ended in the black.

Tuesday marked the first day of the Fed’s two-day rate setting meeting, with a second rate hike for the year already largely priced in.

Eric Lascelles, chief economist at RBC Global Asset Management, said: "The Fed’s long-awaited June decision beckons. There, markets assign a 90% likelihood to another 25bps rate hike and this would be the second rate increase this year. This expectation seems about right given recent Fed statements and the reasonable health of the US economy.”