Balfour Beatty to resume dividends, G4S accepts Allied offer

Stocks to watch

International infrastructure group Balfour Beatty said it planned to resume paying dividends and would start a £50m share buyback from January as it guided for a “significantly higher” year-end order book driven by the UK’s HS2 rail project. The company on Wednesday said the year-end order book was expected to be around £17bn, up from £14.3bn. Full year group revenue was expected to be in line with the prior year’s £8.4bn and profit from operations forecast to be in line with the expectations. It added that full-year average monthly net cash was now forecast to be around £500m, ahead of the previous guidance of £430m - £460m.

Security firm G4S on Wednesday rejected an increased offer from Canada’s GardaWorld, just hours after accepting a rival higher bid from US firm Allied Universal. GardaWorld last week increased its offer to 235p a share from 190p. G4S on Tuesday night said it agreed to recommend a 245p-a-share bid from Allied that values the company at around £3.8bn. The Allied price represents a premium of approximately 68% to the closing share price of G4S on September 11, which was the start of the offer period. G4S said its directors deemed the offer to be "fair and reasonable" and intend unanimously to recommend that shareholders accept it.

Victrex said on Wednesday that its full year sales volume was down 7% and its revenue fell 10%, impacted by end-market weakness in the second half, in which revenue fell 23%. The FTSE 250 company said medical revenue was off 14%, with the US remaining weak and Asia improving. Its underlying profit before tax was 29% lower at £75.5m, with the board reporting a continuing margin impact from the under-absorption of fixed costs.

Newspaper round-up

The government has been urged to launch a one-off wealth tax on millionaire households to raise up to £260bn in response to the coronavirus pandemic, as the crisis damages Britain’s public finances and exacerbates inequality. The Wealth Tax Commission – a group of leading tax experts and economists brought together by the London School of Economics and Warwick University to examine the case for a levy on assets – said targeting the richest in society would be the fairest and most efficient way to raise taxes in response to the pandemic. - Guardian

The government’s furlough scheme should cover workers infected with Covid-19 to prevent the spread of the disease by people who cannot afford to self-isolate, according to a leading thinktank. With Britain’s statutory sick pay the lowest of any advanced economy, the Resolution Foundation said a more generous and easier to administer system should be put in place or the multibillion-pound vaccination programme was at risk of being undermined. - Guardian

Factories are shutting, food could rot on the dockside and Christmas presents may go undelivered as a perfect storm of Covid chaos and Brexit stockpiling batters the UK’s port system. Honda warned on Tuesday that it could be forced to temporarily close its Swindon factory as soon as today after slow-burning problems at ports and the Channel Tunnel exploded into the open.- Telegraph

Britain is desperate for high streets to be saved and renewed government support through a VAT break, an extension of the business rates holiday and the relaxation of Sunday trading laws could start the recovery, according to research by Primark. A report by Public First, the policy and research company commissioned by the fashion retailer, has found that people are worried that their towns will fail to make it through the lockdowns. They remain nervous about going shopping and the pandemic has pushed many in-store shoppers online for the first time, although that could reverse. - The Times

Google and Facebook could face fines running into billions of pounds under a new regime to police the digital economy. The Competition and Markets Authority is demanding powers to stop large technology companies from crushing emerging rivals and harming consumers. Companies that deliberately breach a new statutory code of conduct should face fines of as much 10 percent of their global turnover, according to the watchdog. - The Times

US close

Wall Street stocks closed higher on Tuesday after drugmakers Pfizer and BioNTech began the rollout of their Covid-19 vaccine across the UK.

At the close, the Dow Jones Industrial Average was up 0.35% at 30,173.88, while the S&P 500 was 0.28% higher at 3,702.25 and the Nasdaq Composite saw out the session 0.50% firmer at 12,582.77.

The Dow closed 104.09 points higher on Tuesday, cutting into losses recorded in the previous session amid a seemingly ever-increasing number of new Covid-19 cases across the US.

In focus on Tuesday were comments from both Republican and Democratic leaders that indicated Congress was attempting to extend government funding for an additional week to try and strike a deal on new Covid-19 aid.

Demands for a new bill to be forced through before the end of the year had grown of late as employment growth continued to decelerate and the number of new coronavirus cases accelerated. They also come after a bipartisan group of senators unveiled a $908.0bn stimulus proposal last week, which was later shot down by Senate majority leader Mitch McConnel.