Wetherspoon swings to profit, Shell expecting stable third quarter for marketing

Stocks to watch

UK pub chain JD Wetherspoon swung to a full-year profit after sales rose by over a tenth, though underlying growth has eased somewhat in the first quarter of the new financial year. Revenues rose 10.6% in the 12 months ended 30 July to £1.93bn, up from £1.74bn the previous year, while like-for-like sales jumped 12.7%. However, in the nine weeks to 2 October, that LFL growth had eased to 9.9% from 11.5% reported in the fourth quarter.

Shell updated the market on its third-quarter outlook on Friday, with the integrated gas sector expecting production of between 880,000 and 920,000 barrels of oil equivalent per day, and LNG liquefaction volumes between 6.6 million and seven million tonnes, while the upstream sector projected production of 1,700,000 to 1,800,000 equivalent daily barrels and exploration well-write offs of approximately $0.2bn. The marketing sector expected sales volumes between 2,450,000 and 2,850,000 barrels daily, with similar results to the third quarter of 2022, and the chemicals and products sector anticipated a refining margin of $16 per barrel and a chemicals margin of $116 per tonne, with refinery and chemicals utilisation of 82% to 86% and 69% to 72%, respectively.

Newspaper round-up

Elon Musk is under investigation by the US Securities and Exchange Commission over his $44bn takeover of social media giant Twitter, it was revealed on Thursday. The investigation concerns whether Musk broke federal securities laws in 2022 when he bought stock in Twitter, which he later renamed X, as well as statements and SEC filings he made about the deal. – Guardian

Sam Bankman-Fried’s crypto fraud trial gained steam on Thursday when the co-founder of his fallen exchange, Gary Wang, took the stand as a government witness in Manhattan federal court. His testimony came as the highly anticipated trial entered its third day. Bankman-Fried faces seven counts on fraud and conspiracy charges in relation to the implosion of his crypto exchange FTX and its related hedge fund, Alameda Research. – Guardian

Jeremy Hunt must not let Britain’s spending watchdog dictate tax policy, a leading think tank has warned. The Institute for Fiscal Studies (IFS) said the Chancellor should not be bound by the Office for Budget Responsibility’s (OBR) “short-run” forecasts about the cost of the Government’s flagship business investment tax break. – Telegraph

The Bank of England is closely monitoring depositors’ behaviour at Metro Bank for any sign of panic after reports that the lender is trying to raise up to £600 million to shore up a potentially shaky balance sheet. Robert Sharpe, Metro’s chairman, was due to meet senior officials at the Bank’s Prudential Regulation Authority yesterday for a previously scheduled meeting. Analysts said the Bank would be asking for daily, if not hourly, reports on flows, especially as Metro suffered sharp outflows in 2019 after an earlier spell of jitters about its financial strength. – The Times

Mike Lynch, the technology entrepreneur once regarded as a British Bill Gates, is trying to have criminal charges against him dropped in the United States. In May, after a long-running battle, Lynch was extradited to face fraud allegations over Hewlett-Packard’s $11 billion acquisition in 2011 of Autonomy, the software company he founded. – The Times

US close

US stocks finished flat to slightly lower on Thursday as investors chose to tread cautiously ahead of the much-anticipated non-farm payrolls report.

The Dow Jones Industrial Average finished down 0.03% at 33,120, the S&P 500 fell 0.13% to 4,258 while the Nasdaq slipped 0.12% to 13,220.

The yield on a 10-year US Treasury was down 2.2 basis points at 4.714%, as it continued to retreat after reaching a new 16-year high of 4.887% earlier in the week after Tuesday's JOLTS survey pointed to a strengthening jobs market.

Stocks gained on Wednesday after the ADP Employment Report showed that just 89,000 jobs were created in September, down from an upwardly revised 180,000 the previous month and well below the 160,000 expected by analysts.

However, the 'official' non-farm payrolls report, due out on Friday, can often contrast with the ADP figures and is expected to show that job creation eased to 170,000 last month, from 187,000 previously.