Weekly Review

The FTSE 100 finished up 96.39 points on the week at 6,750.76.

Equity view

Consumer products giant Reckitt Benckiser Group has unveiled the proposed timetable for the demerger of its RB Pharmaceuticals business, which will have a separate UK listing under the name of Indivior.

First-quarter underlying results at Smiths Group were lower than last year, but the technology and engineering firm said it still remains on track for the full year.

British Land grew its total portfolio valuation increase 7.2% and net asset value by 11% in the first half, with improving demand for office space in the capital and restricted supply lifting prices.

Insurance industry services supplier Quindell has confirmed it has agreed to part company with founder Robert Terry and two other directors after a controversial share transaction.

Boosted by a strongly improved performance in the UK life business in the third quarter, Prudential's new business profits were well ahead of expectations for the year-to-date.

Budget airline Easyjet posted record annual profits for the fourth year in a row and proposed a rise in its dividend of more than a third.

Lloyds Banking Group is set to give hundreds of pounds each back to almost 10,000 current and former employees, who were refused a pay rise.

Former state-owned British postal operator Royal Mail reported higher first-half revenue after a better-than-expected performance from its letters business, but warned that its key parcels market remained challenging.

Parliament's decision to scrap the restrictive 'beer tie', which links pub landlords' rent and supplies to their parent pub companies, might have "serious unintended consequences" on the industry, according to pub groups.

Although first-half revenue dropped by a quarter at Johnson Matthey after the loss of a major contract with Anglo American Platinum, the chemical and sustainable technologies group lifted its dividend by 9% after profits improved.

The Financial Conduct Authority and the Bank of England have fined Royal Bank of Scotland £56m for the computer failures that hit more than over 6.5m UK customers for several weeks in 2012.

Interim results from engineer Babcock International impressed investors after profits, earnings and cash hit or beat targets.

British Gas and Direct Energy owner Centrica has warned that its full year and 2015 earnings will be lower than previously guided due to "a number of challenges" including low oil and gas prices, cold weather in the US, warm weather in the UK and boiler inspections at its power stations.

Oil major Royal Dutch Shell has raised $600m from the sale of its interest in an oil field in Nigeria, as part of its ongoing two-year disposal programme.

European aircraft maker Airbus has won a deal to supply 50 aircraft from Delta Air Lines, with Rolls Royce to supply engines and support worth $5bn.

RBS has admitted to an error it made when calculating its capital ratio for the latest round of stress tests in Europe, saying it had "overstated" its estimated common equity tier-1 ratio

Economic news

Prime Minister David Cameron has warned of the risk of a second global financial crisis amid a weak Eurozone economy.

The British grocery market has lurched into decline for the first time since records began 20 years ago, a survey showed on Tuesday, piling pressure on supermarkets ahead of crucial Christmas trading. Sales fell 0.2% in the 12 weeks to 9 November.

UK car manufacturing dropped last month as global economic uncertainty took its toll on the industry. Volumes fell 6.7% in October to 150,060 units, leaving year-to-date volumes down 0.3%, according to the British Society of Motor Manufacturers & Traders.

Reports of a cooling UK property market appear to have been overstated as house prices reached a new high in September, according to the Office of National Statistics. Official figures record an annual increase of 12.1% in UK house prices in September, a seven-year high, and a month-on-month rise of 0.5%.

As expected, at its meeting of 6 November the Monetary Policy Committee opted to keep its main policy rate unchanged at 0.5% by a margin of seven votes in favour and two against.

UK households have signalled the second highest confidence about their finances since 2009, with savings falling to the slowest rate in the Markit’s survey history. The monthly Household Finance index climbed to a seven-month high in November to 42.7, up from 41.8 in the previous month.

UK retail sales soared last month, advancing by 0.8% month-on-month and 4.3% on the year, according to the Office for National Statistics (ONS), led by non-food sales.

International events

Japan unexpectedly entered a technical recession, defined as two successive quarters of contraction, in the third quarter, according to GDP data this week.

The news was followed by Japanese prime minister Shinzo Abe calling a snap election, expected to be held on 14 December, and announcing a delay to an unpopular but necessary sales tax hike.

German economic sentiment rose more than forecast in November, in a rare positive sign for the euro-area amid a weak economy and low inflation.

The Chinese manufacturing stagnated in November, according to the HSBC PMI released this week, which fell to the break-even point of 50. Growth in the Eurozone and US manufacturing sectors, as reported by the Markit PMIs, also slowed down.

US consumer prices were flat month-on-month and rose by 1.7% year-on-year, according to the Bureau of Labor Statistics.

The European Central Bank will boost asset purchases if inflation remains low for too long, according to president Mario Draghi. The central bank would “do what we must” to help address dangerously low inflation and a stagnant economy, he said.

China slashed its cost of borrowing for the first time in two years in a bid to kick-start its flagging economy. The country's central bank reduced one-year benchmark lending rates by 40 basis points to 5.6% to lift an economy on course for its slowest annual growth in more than two decades.