Marks & Spencer Share News (MKS)

LONDON (Alliance News) - Shares in London are called to open lower on Wednesday, pulling back from Tuesday's peaks after US President Donald Trump expressed doubt over his June summit with North Korea's Kim Jong Un.In early UK company news, retailer Marks & Spencer reported a fall in profit as Food margins tumbled more than expected, waterworks Severn Trent also saw a dip in annual profit despite revenue rising, and miner Rio Tinto confirmed it is in talks to dispose of its interest in the Grasberg mine in Indonesia.The economic focus in the UK in the day ahead lies on April's inflation data, due at 0930 BST.IG says futures indicate the FTSE 100 index of large-caps to open 17.35 points lower at 7,860.10 on Wednesday. The FTSE 100 index closed up 0.2%, or 18.28 points, at 7,877.45 on Tuesday, a record closing high for the index.April's CPI reading is seen keeping steady at 2.5% year-on-year, while month-on-month it is expected to gain 0.5%, accelerating from last month's 0.1%."Should we see another undershoot by inflation this month, optimism of a late summer rate hike would be dented, pulling the pound lower towards USD1.33. Given the pound's inverse relationship with the FTSE, a weaker pound could help the FTSE on its way to fresh unchartered territory on target to 8000," says Jasper Lawler, head of research at London Capital Group."On the contrary, a surprise to the upside could be enough to boost the pound back towards USD1.36, which would bring the FTSE back from its current lofty levels and record highs," Lawler adds.Sterling was quoted at USD1.3395 early Wednesday, down compared to USD1.3437 at the London equities close on Tuesday.FTSE 100-listed Marks & Spencer said profit slumped in its recently ended financial year, as it works to rectify "a number of structural issues" at the company.Revenue rose 0.7% to GBP10.70 billion for the year to March 31, up from GBP10.62 billion last year, as pretax profit dropped 62% to GBP66.8 million from GBP176.4 million. Adjusted pretax profit fell 5.4% to GBP580.9 million, which the company said was largely due to a decrease in its Food gross margin, which fell "more than expected" by 140 basis points during the year."There are a number of structural issues to address and we are taking steps towards fixing these. The new organisation will largely be in place by July and the team is now tackling transforming our culture to make M&S a faster, lower cost, more commercial, more digital business," said Chief Executive Steve Rowe.The food, clothing and homewares retailed maintained its full-year dividend at 18.7 pence.M&S said that although online sales are growing, its online capability is "behind the best of our competitors and our website is too slow". The company continued: "Our fulfilment centre at Castle Donington has struggled to cope with peak demand and some of our systems are dated. In both businesses we need to revitalise our ranges and reassert our reputation for value for money."Looking ahead, M&S said it expects Clothing & Home gross margin to be flat to up to 50 basis points higher, "with the first half of the year adversely affected by currency and sale timing". Food gross margin is expected to decrease by as much as 50 basis points. UK costs are set to decrease by up to 1%, while capital expenditure is expected to total between GBP350 million to GBP400 million.Fellow FTSE 100 constituent Severn Trent said revenue rose for its recently-ended financial year though profit dipped.Revenue for the year to March 31 rose to GBP1.69 billion, from GBP1.64 billion, as pretax profit dipped to GBP528.4 million from GBP536.7 million. The water utility proposed a final dividend of 51.92p, taking its total payout for the year to 86.55p, up 6.2% on last year.For the year ahead, Severn Trent said it sees Regulated Water & Waste Water turnover between GBP1.62 billion to GBP1.65 billion, up from GBP1.57 billion for its recently ended year, with Business Services to be "higher year-on-year". Group capital expenditure is set to be between GBP650 million to GBP750 million, up from the GBP591 million recorded for 2018."We have delivered a good financial performance in 2017/18, absorbing the upward pressures from sector-wide changes in business rates and energy pass-through costs," the company said.Rio Tinto noted press reports of the potential purchase by PT Indonesia Asahan Aluminium of the FTSE 100-listed miner's entire interest in the Grasberg mine in Indonesia for USD3.5 billion.Rio Tinto confirmed that discussions between it, Inalum and Freeport are ongoing, including as to price. No agreement has been reached, and there is no certainty that binding agreements will be signed, the company said.St James's Place said Sarah Bates has decided to retire as chair of the company, having held the position since 2014. Iain Cornish, currently the senior independent director, will become chair, and Roger Yates will be appointed as senior independent director. "She has successfully navigated the board through a changing environment during which the company has experienced strong growth and has taken this decision after overseeing the successful transition of Andrew Croft to chief executive officer from David Bellamy in January 2018," the company said.FTSE 250-listed IG Group Holdings said it continued to perform well in the final quarter of its financial year, though said revenue for the year ending in 2019 will likely be below 2018 due to regulatory change in the UK and EU.Net trading revenue for the year to May 31, 2018, is expected to be around GBP565 million, up from GBP491 million last year. Looking ahead, the company reaffirmed that measures announced by ESMA earlier this year will see revenue for its 2019 year lower than 2018, though IG expects to return to growth after 2019.Defence outsourcer Babcock International said revenue for its year to the end of March rose 2.5% to GBP4.66 billion, as pretax profit climbed 8.0% to GBP391.1 million. The firm lifted its full-year dividend by 4.8% to 29.5p from 28.15p."The revenue visibility provided by around GBP31 billion of secured orders and near term opportunities offers continued prospects for growth in line with previous expectations for this year and over the medium term," Babcock said."The board is confident that the group will achieve low mid-single digit organic revenue growth with broadly stable margins in 2018/19, despite the scheduled step downs in the Aircraft Carrier and Magnox decommissioning programmes," the FTSE 250-listed firm added.In the US on Tuesday, Wall Street ended lower, with the Dow Jones Industrial Average ending down 0.7% at 24,834.41, the S&P 500 down 0.3% and Nasdaq Composite closing 0.2% lower.Despite some early gains - the Dow hitting a high of 25,064.99 during Tuesday's session - stocks pulled back after Trump said arrangements for the US-North Korea summit in Singapore are "moving along," but it could happen later than the proposed date."If it doesn't happen, maybe it will happen later," Trump told reporters at a photo opportunity with South Korean President Moon Jae In at the White House.He said a decision will be made soon on any changes to the date, but declined to mention specific demands he has made or whether he has spoken with Kim. He reiterated his demand that the peninsula be denuclearized.Secretary of State Mike Pompeo said later Tuesday that the State Department is moving forward with preparations for the summit."This could well be a case of expectations management on the part of the US president, but nonetheless US stocks quickly reversed course finishing the day in the red, and this looks set to translate into a lower open in Europe this morning," says CMC Markets chief market analyst Michael Hewson.Hewlett Packard Enterprise on Tuesday reported a swing to profit in the second quarter, as revenue grew nearly 10%. Palo Alto, California-based HPE reported a second-quarter profit of USD778 million or USD0.49 per share, compared to a loss of USD612 million or USD0.37 per share last year. Revenue for the quarter rose to USD7.47 billion from USD6.81 billion last year. Analysts had a consensus revenue estimate of USD7.38 billion for the quarter.In Asia on Wednesday, the Japanese Nikkei 225 index closed down 1.2%. In China, the Shanghai Composite is down 1.0%, while the Hang Seng index in Hong Kong is also down 1.0%.In the economic events calendar, there are manufacturing PMI readings from France, Germany, eurozone and US at 0800 BST, 0830 BST, 0900 BST and 1445 BST respectively. Later, minutes from the last Federal Open Market Committee are released at 1900 BST.