Sainsbury's and Asda ask CMA for more time, Rolls-Royce implementing contingency plans
London open
The FTSE 100 is expected to open nine points higher on Wednesday, having closed up 1.27% at 6,806.94 on Tuesday.
Stocks to watch
Sainsbury's and Asda have asked the competition authorities for more time to argue the case for their proposed £12bn merger. After having received a "large amount of material" from the Competition & Markets Authority, likely referring to rival supermarkets' objections to the deal, the pair have lodged an appeal to be given 11 extra working days over the Christmas period to prepare their response.
Rolls-Royce on Wednesday said it was still implementing its contingency plans after the UK government pulled its vote on the Brexit withdrawal agreement. The aerospace company also confirmed its 2018 full year forecasts with both group and core profit and cash flow to be in the upper half of its full year guidance range.
British American Tobacco updated the market on its trading ahead of its close period on Wednesday, with the board saying it was expecting a full-year industry volume decline of around 3.5%. The FTSE 100 cigarette giant said it was anticipating it would exceed the 5.5% full-year price mix it achieved in 2017, and deliver “good” adjusted revenue and adjusted operating profit growth with a second half weighting. Full -year adjusted earnings per share growth was expected to be impacted by a currency translation headwind of around 6% for the year, at current exchange rates.
Newspaper round-up
Theresa May will be put under pressure at her cabinet meeting today to start planning for a no-deal Brexit, with ministers around the table expecting a vote on her future to be called within hours. Cabinet members are set to push the prime minister to step up preparations for a hard Brexit as some claim that she has repeatedly stalled spending decisions to prepare for such an outcome. - The Times
Plans to upgrade major parts of the London Underground will be put on hold after a decline in passenger numbers, government cuts and delays to the opening of Crossrail have left the capital’s transport authorities struggling to balance the books. Transport for London said its revenues would be £2.1bn lower for the next five years than forecast in 2016, compounded by the end of an average £700m annual government grant. - Guardian
More than a quarter of UK homes do not have fast enough broadband to cope with a typical family’s internet needs, such as downloading films and watching series on Netflix, according to a report. Just over 26% of the UK’s estimated 28 million households are getting by on speeds of less than 10Mbps, the level the media regulator, Ofcom, says is the bare minimum requirement for a modern household. - Guardian
US close
US stocks finished in a mixed state on Tuesday, after a positive start to the session and as a former Canadian diplomat was detained in China amid a political spat over Asian telecom giant Huawei.
The Dow Jones Industrial Average finished the day down 0.22% at 24,730.24 and the S&P 500 was 0.04% weaker at 2,636.78, while the Nasdaq 100 rose 0.32% to 6,704.24.
The mood was bright earlier in the day, after China's commerce ministry said that Chinese Vice Premier Liu He spoke to US Treasury Secretary Steven Mnuchin and US Trade Representative Robert Lighthizer on a call on Tuesday morning, launching formal talks.
Donald Trump tweeted: "Very productive conversations going on with China! Watch for some important announcements!"
Oanda analyst Craig Erlam said the markets were now seeing near-daily commentary on the progress of talks between the US and China.