Weekly review

Equity view

RBS was pushed deep into the red as a result of provisions to cover possible litigation costs linked to its 2008 rights issue just prior to its emergency rescue by taxpayers.

Home builder Bellway said it expected full year housing revenue to increase by around 27% to £2. 2bn with a 12. 5% increase in the number of housing completions to 8,721.

Better than expected returns from the Euro 2016 football championships scored a financial goal for bookmaker William Hill after what it called an “extremely challenging” start to 2016 including a disastrous Cheltenham horse racing festival and poor results from Australia.

Traffic at low-cost carrier EasyJet was up 6. 7% in July to 7. 5m passengers, while the load factor – which gauges how full the flights were – nudged up to 95. 8% from 94. 3%.

Insurance giant Aviva posted its interim results for the six months to 30 June on Thursday, with operating profit rising 13% to £1. 325bn and operating earnings per share improving 1% to 22. 4p.

RSA Insurance reported a drop in pre-tax profit but a rise in operating profit for the first half, as it lifted its dividend.

FTSE 250 outsourcing group Serco said it swung to a profit in the first half as it lifted its guidance for the year.

Shares in Cobham tumbled on Thursday after the FTSE 250 aerospace and defence group said it swung to a loss in the first half and cut its interim dividend.

Specialist retailer of pet products and services Pets at Home Group announced a first quarter trading up for the 16 week period from 1 April to 21 July on Thursday, with group like-for-like revenue growth of 2. 7%.

London Stock Exchange Group said on Thursday that profit slipped in the first half of the year, although revenue and operating profit were higher and the company lifted its interim dividend.

Bookmaker Ladbrokes first-half profits beat management and City forecasts by a length as favourable results from the sporting gods put an extra sheen on the progress being made after last year's strategic rejig.

Amid continuing turbulent economic conditions, HSBC Holdings' profits plunged in the second quarter to push interim result south of market expectations, though the bank sweetened the pill with news of a $2. 5bn (£1. 8bn) share buyback thanks to the sale of its Brazilian business.

Price comparison website Moneysupermarket. com reported a jump in pre-tax profit and revenue for the first half as it announced the resignation of its chief executive officer Peter Plumb.

First half profits at Rio Tinto fell to their lowest since 2004 as crumbling commodity prices hit home, but though the numbers were in bang in-line with analyst forecasts the mining behemoth said caution was still required for the medium-term.

Aggreko tumbled on Wednesday after the FTSE 250 temporary power provider posted a drop in first-half profit and revenue as weak oil prices took their toll on the company.

Low-cost airline Ryanair said on Wednesday that traffic grew 12% in July and the load factor nudged higher.

First-half profits at Standard Chartered slumped to $893m from $2. 1bn as income fell on the back of weaker growth in key markets and a group restructuring.

Fashion retailer Next impressed investors with a slight improvement in the sales in the second quarter and increased its profit and earnings guidance for the full year. a trading update for the 26 weeks to 30 July on Wednesday, with full price sales in the second quarter up just 0. 3% on a year ago.

Insurance company Direct Line Group posted its half year report for the six months to 30 June on Tuesday, with gross written premiums for ongoing operations 3. 9% higher, driven by strong growth in motor in-force policies - up 2.5% - and a 9.5% increase in premium rates.

Defence and aerospace engineer Meggitt reported a drop in first-half pre-tax profit but lifted its interim dividend and confirmed its guidance for 2016.

Challenging conditions in the soft drinks market have taken some of the fizz out of AG Barr, with first-half revenues down on the previous year and management only expecting to hit full year profit forecasts if the market improves and 'robust' second half plans come to fruition.

Burberry has taken full control of its retail business in China, snapping up the final 15% it did not own for £54m.

Barclays said its Tier 1 capital ratio fell to 7. 3% from a 2015 year-end position of 11. 4% under a stress test conducted by the European Banking Authority under the European Union's Capital Requirements Directive.

Lloyds Bank said its core equity Tier 1 (CET1) capital ratio fell to 10. 1% under an EU-wide stress test of 51 banks, compared with a 2015 year-end position of 13%.

Royal Bank of Scotland said its capital ratio fell by 7. 5 percentage points to 8. 1% under an EU stress test of 51 lenders in the eurozone and the rest of the EU.

Economic news

UK construction output continued to fall in July as activity dropped by the fastest rate in seven years, further raising the risk of a recession and possibly increasing the likelihood of a Bank of England rate cut this week.

UK house prices fell by 1% in July from a month ago, suggesting that growth is “slowing" in the market, according to Halifax.

The Bank of England on Thursday cut interest rates by 25 basis points to 0. 25%, in a move widely expected by economists. The Bank also boosted its asset purchases by £60bn.

Britain’s automobile market cooled as car registrations were flat and demand from private consumers fell in July, suggesting a decline in consumer confidence, according to SMMT.

Competition continued to drive prices down in July, according to a report by the British Retail Consortium (BRC), albeit by less than in the month before.

The UK services industry contracted sharply in July following the vote to leave the European Union. The final Markit/CIPS services purchasing managers’ index fell to 47.4 from 52.3 in June, in line with the flash estimate.

World economic growth has been revised down in 2017 in a large part due to Brexit, as the UK is expected to experience a marked economic slowdown beginning in the third quarter of this year, according to the NIESR.

UK construction output continued to fall in July as activity dropped by the fastest rate in seven years, further raising the risk of a recession and possibly increasing the likelihood of a Bank of England rate cut this week. The Markit/CIPS construction industry Purchasing Mangers Index (PMI) slid to 45.9 in July from 46.0 the month before, which was not as bad as the consensus 44.0 feared by economists but still was the second successive sharp fall and the biggest decline since June 2009.

The Financial Conduct Authority said on Tuesday that is looking to set a June 2019 deadline for payment protection insurance complaints as it attempts to draw a line under the scandal.

The UK manufacturing sector contracted more than expected in July on the back of pre- and post-EU referendum uncertainty, according to data released on Monday.The Markit/CIPS UK manufacturing purchasing managers’ index fell to 48.2 from 52.4 in June and came in weaker than the flash estimate of 49.1, marking the lowest level since February 2013.

International events

The US created far more jobs than expected in July, with the latest monthly tally for non-farm payrolls clocking in at 255,000.

Factory orders in the US fell slightly less than expected in June as durable goods orders were revised slightly higher by the Commerce Department on Thursday.

Economic uncertainty has increased globally since the UK voted to leave the European Union, according to the European Central Bank (ECB) on Thursday.

Private sector employment in the US rose more than expected in July, driven by an increase in mid-sized-business jobs, according to data released by ADP on Wednesday.

Retail sales in the 19 countries that share the euro were stable in June compared with May, in line with economists’ expectations, according to the latest figures from Eurostat.

Australia acted to forestall an undue slowing in the economy which might see inflation running below target by cutting its benchmark policy rates. Australia acted to forestall an undue slowing in the economy which might see inflation running below target by cutting its benchmark policy rates.

Activity in China´s manufacturing sector grew again in July for the first time in a year, pointing to continued economic momentum in the third quarter of 2016 according to some economists. Caixin´s manufacturing sector purchasing managers´ index rose from a reading of 48.6 in June to 50.6 in July, crossing the 50.0-point threshold which denotes an expansion for the first time since February 2015.

An official manufacturing sector PMI also published on Monday morning by the National Bureau of Statistics slipped from 50.0 to 49.0.

Growth in the US economy’s manufacturing sector slipped more than expected in July, according to the US Institute for Supply Management (ISM). The ISM index of national factory activity fell to 52.6 from a 16-month high of 53.2 the month before, missing economists’ expectations for a smaller drop down to 53.0.

Markit’s final US manufacturing purchasing managers’ index rose to 52. 9 in July from 51. 3 the month before, in line with the flash reading.