First quarter sales jump at Tesco, Aston Martin announces placing

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Supermarket giant Tesco reported a 9.2% rise in UK and Ireland total first quarter sales, driven by a sharp increase in online shopping as customers had their groceries delivered during the coronavirus lockdown. Sales came in at £12.2bn, and were up 8.2% on a like-for-like basis. Tesco added that it expected a £175m - £200m loss at its banking unit after increasing its potential bad debt provisions based on higher post-pandemic unemployment assumptions. “Whilst any forecast is inherently uncertain, based on an assumption of a continued easing of lockdown restrictions in the UK, our current expectation is that retail operating profit in the current year is likely to be at a similar level to 2019/20 on a continuing operations basis,” Tesco said on Friday.

Aston Martin Lagonda said it would sell new shares representing almost 20% of its existing share capital to get through the Covid-19 crisis and destocking by dealers. The luxury carmaker said it would place the shares with investors through an accelerated bookbuild and also offer shares to retail investors. It has irrevocable undertakings from investors to take up 32.8% of the new shares.

Gambling operator 888 Holdings said it had traded well since its last update in March on Friday, reporting that despite some moderation to revenue growth in recent weeks, average daily revenue in the year-to-date had been 34% higher than the prior year. The FTSE 250 company said that performance reflected its increased levels of customer acquisition during the second half of 2019 across a number of regulated markets, as well as a “structural shift” towards online services that had accelerated across several consumer-facing industries during recent months. As a result of its trading in the year thus far, its board said it now expected the firm to achieve an adjusted EBITDA outcome for 2020 “significantly ahead” of its prior expectations.

Newspaper round-up

Consumers are being warned about a sharp rise in coronavirus-related holiday scams, including a spate of fake caravan and motorhome listings targeting those planning a summer staycation. The warning from UK Finance, the banking industry body, comes three days after the government announced an easing of the lockdown rules in England aimed at helping to get the tourism sector back up and running. - Guardian

UK retailers stumped up just 14% of the £2.5bn quarterly rent bill due this week, as the high street crisis triggered by the lockdown reverberated through the property industry. The collapse in the rental take to a record low adds to the woes of Intu Properties, one of Britain’s largest shopping centre owners, which on Friday faces a deadline to convince lenders to grant a debt repayment holiday. If talks break down, the owner of the Trafford Centre in Manchester says it could go into administration. – Guardian

British Airways has vowed not to cut the salaries of its 14,000 cabin crew by more than 20pc in an offer presented to unions as the airline seeks to slash costs after flights were grounded worldwide. The flag carrier is already planning to axe up to 12,000 staff - more than a quarter of its workforce - and change the terms and conditions for those who keep their jobs, prompting MPs on the Transport Select Committee to label it a “national disgrace”. – Telegraph

Up to 500,000 furloughed employees have returned to work in the past two weeks as the UK economy stutters back into life, official figures suggest. A survey of more than 5,000 companies by the Office for National Statistics (ONS) found that 86pc are currently able to trade. Firms in this group had brought 7pc of their workforce back from the taxpayer-backed job retention scheme in the first half of June, up from 5pc in the previous fortnight. – Telegraph

The elderly could be in line for a state pension increase five times larger than the average pay rises given to people of working age over the next two years, an analysis has found. While average earnings may grow by only 1.5 per cent between this year and 2022, the state pension could be boosted by 7.6 per cent, the Resolution Foundation think tank has estimated. – The Times

US close

Wall Street indices finished in positive territory on Thursday, amid news that regulators were set to ease some rules on banks, although ongoing worries about the risk of a second pandemic wave lingered.

The Dow Jones Industrial Average ended the session up 1.18% at 25,745.60, the S&P 500 added 1.1% to 3,083.76, and the Nasdaq Composite was 1.09% firmer at 10,017.00.

A mixed batch of economic data did little to lift sentiment earlier in the session, with analysts pointing out the future near-term direction of the economy remained very much dependent on whether lockdowns could be lifted and how quickly.

According to the Department of Labor, over the week ending on 20 June, initial unemployment claims dropped by 60,000 to 1.48 million.

Economists had forecast a larger drop to 1.25 million.

Initial unemployment claims in Arizona soared by 31.8% while in Pennsylvania they rose by 7.6%.

Meanwhile, orders for goods made to last more than three years jumped in May, nearly reversing the previous month's sharp fall.

US durable goods orders grew at a month-on-month pace of 15.8% to reach $187.59bn, against consensus forecasts for a rise of 12%.

Elsewhere, the US trade deficit in goods widened at a 5.1% month-on-month pace in May to reach $74.3bn, instead of narrowing to $68.3bn as anticipated.