Admiral lifts dividend, Bob Murphy steps down from Cobham
London open
The FTSE 100 is expected to open eight points higher on Wednesday, having closed down 0.68% at 6,893.92 on Tuesday.
Stocks to watch
Insurer Admiral lifted its interim dividend by almost a quarter as the UK car and home insurance businesses cruised ahead and price comparison site confused.com saw UK profits surge. With its domestic markets offering prime growth conditions, Admiral has taken the opportunity to launch its Elephant brand into two new countries oversea as its longer-established European unit moved closer to profitability.
Aerospace and defence group Cobham said chief executive officer Bob Murphy will step down from his role by the end of 2016 to pursue other opportunities and will be succeeded by David Lockwood no later than 1 January 2017. Lockwood is currently CEO of FTSE 250 technology company Laird, where he has been in the role for four years. Prior to that, he was vice president of global defence & security at BT Global Services.
Motor retail and aftersales service company Lookers announced its results for the six months to 30 June on Wednesday, with revenue increasing 33% to £2.34bn, from £1.75bn at the same time last year. The FTSE 250 firm recorded operating profit growth of 20% to £59.1m, while adjusted profit before tax increased 16% to £50.1m. Lookers’ board declared an increase in the interim dividend of 20% to 1.28p per share, compared to 1.97p a year ago. “We have worked hard at pursuing the strategic priorities for the business which we laid out in March; having the right brands and locations alongside excellent execution,” said chief executive Andy Bruce.
Newspaper round-up
Apple plans to open its first research and development centre in China later this year, the latest in a series of steps to bolster its presence in a vital region as sales slow down. Tim Cook, Apple’s chief executive, revealed the plans to increase investment in local R&D during a meeting this week with Zhang Gaoli, China’s vice premier. – Financial Times
City firms that help businesses run tax avoidance schemes could face huge financial penalties under fresh Government proposals. Banks, accountancy firms and lawyers could be forced to hand over underpaid tax if they are found to have broken the law. Currently, advisers who facilitate tax avoidance by exploiting loopholes and complex schemes face little risk, while their clients can be hit with heavy fines if they are defeated in court by HM Revenue and Customs. – Telegraph
The US justice department is reported to have found evidence of Volkswagen acting criminally in connection with the emissions cheating scandal that plunged the German company into crisis. Federal prosecutors are weighing up whether to criminally charge VW and its employees or accept a multibillion-dollar settlement, according to the Wall Street Journal. The justice department and VW declined to comment on the discussions, which are said to have a soft deadline of Christmas 2016. – Guardian
A £3.4 billion bid for William Hill hung by a thread last night amid indications that Rank Group and 888 Holdings may be ready to throw in their cards. The bidding partners have had two offers rejected over the past ten days and are under pressure to up the ante again to persuade the William Hill board to agree to talks by this Sunday’s bid deadline. – The Times
Karen Millen has lost a High Court battle with her old company to regain the rights to use her name in business. The fashion designer sold the retail chain she founded with her ex-husband, Kevin Stanford, to Baugur, the Icelandic investor, for £95 million in 2004. The deal barred her from using her name in future ventures. – The Times
US close
US stocks finished lower on Tuesday after inflation data missed forecasts and two Federal Reserve policymakers indicated an interest rate hike in September is a possibility.
The Dow Jones Industrial Average fell 0.45% to 18,552.02 points, the S&P 500 decreased 0.55% to 2,178.15 points and the Nasdaq shed 0.66% to 5,227.11 points.
In contrast, oil prices gained on a weaker dollar, with West Texas Intermediate crude up 1.7% to $46.57 a barrel and Brent 1.7% firmer at $49.20.
The US consumer price index (CPI) rose 0.8% year-on-year in July, down from 1.0% the previous month, according to the Labor Department. Economists had forecast a 0.9% increase. The easing in inflation was driven by a 1.6% drop in the energy index.
Core inflation, which excludes volatile energy and food prices, slowed to 2.2% year-on-year growth in July from 2.3% in June, surprising analysts who had expected no change.
The dollar dropped against major currencies following the report, down 1.24% against the pound, 0.84% versus the euro and 0.97% against the yen.
Barclays Research said: “Domestic price pressures remain strong as slack in the economy has diminished, and we expect core services CPI to continue driving inflation higher.