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(Alliance News) - Stocks are expected to edge higher at Wednesday's market open in London, as investors look ahead to the latest fiscal announcements from the UK government.
The main focus on the local front will be Chancellor Jeremy Hunt's statement at around 12.30 GMT.
Hunt's Commons statement is expected to contain 110 different growth measures as he seeks to revive the UK's economy and the Tories' election chances.
Hunt will reportedly use his autumn statement to reduce headline rates of national insurance and make permanent a GBP10 billion-a-year tax break for companies that invest in new machinery and equipment. He will promise to cut business taxes, remove planning red tape and speed up access to the national grid.
Meanwhile, the dollar was slightly stronger against major currencies, following hawkish minutes from the Federal Reserve.
Fed officials indicated interest rates would need to remain high for "some time" judging it as "critical" to return "unacceptably high" inflation to its 2% target.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: called up 10.5 points, 0.1%, at 7492.49
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Hang Seng: down 0.3% at 17,679.64
Nikkei 225: closed up 0.3% at 33,451.83
S&P/ASX 200: closed down 0.1% at 7,073.40
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DJIA: closed down 62.75 points, 0.2%, at 35,088.29
S&P 500: closed down 0.2% at 4,538.19
Nasdaq Composite: closed down 0.6% at 14,199.98
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EUR: down at USD1.0901 (USD1.0926)
GBP: down at USD1.2520 (USD1.2531)
USD: up at JPY148.92 (JPY147.91)
Gold: up slightly at USD2,000.91 per ounce (USD1,999.42)
Oil (Brent): up at USD82.20 a barrel (USD81.74)
(changes since previous London equities close)
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ECONOMICS
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Wednesday's key economic events still to come:
UK Chancellor Jeremy Hunt's Autumn Statement
UK economic forecast
10:00 CET EU ECB financial stability review
16:00 CET EU consumer confidence indicator
11:00 GMT Ireland WPI
07:00 EST US MBA weekly mortgage applications survey
08:30 EST US advance report on durable goods
08:30 EST US unemployment insurance weekly claims report
10:00 EST US University of Michigan survey of consumers
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BROKER RATING CHANGES
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RBC cuts HSBC to 'sector perform' (outperform) - price target 775 (825) pence
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Jefferies starts Howden Joinery Group with 'buy' - price target 835 pence
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Berenberg reinitiates Devolver Digital with 'buy' - price target 31 pence
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COMPANIES - FTSE 100
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Enterprise software company Sage Group announced double-digit annual revenue growth, and began a share buyback of GBP350 million. In the year to September 30, revenue rose 12% year-on-year to GBP2.18 billion from GBP1.95 billion, and annualised recurring revenue rose 11% to GBP2.19 billion from GBP1.96 billion. Pretax profit dropped 16% to GBP282 million from GBP337 million, as the firm's operating profit margin shrunk to 14.4% from 18.9%. The final dividend proposed is 12.75p, bringing the annual total to 19.3p, up from 18.4p a year before. The firm said it entered financial 2024 "with good momentum" and expects organic revenue growth to be broadly in line with the prior year. It expects operating martin to improve in the current year and beyond, as it focuses on "efficiently scaling the group".
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Rio Tinto said it has reached a court-approved settlement with the US Securities & Exchange Commission over a 2017 lawsuit. The matter concerned was the disclosure of the impairment of Rio Tinto Coal Mozambique reflected in its 2012 year-end accounts. "Without admitting to or denying the SEC's allegations related to its books, records and reporting requirements, Rio Tinto will pay a USD28 million penalty and retain an independent consultant to advise on its current policies, procedures, and controls related to impairment, disclosures and project risk," the miner said. Its former chief executive, Tom Albanese, also reached a settlement with the SEC and will pay USD50,000 as a penalty, without admitting or denying the allegations. "With this settlement, all investigations of Rio Tinto regarding this matter have been finalised," it confirmed.
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COMPANIES - FTSE 250
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Speciality chemical firm Johnson Matthey reported a weaker half-year as lower precious metal market prices declined. In the six months to September 30, revenue dropped 11% year-on-year to GBP6.53 billion from GBP7.33 billion, while pretax profit dropped 56% to GBP82 million from GBP188 million. It maintained its interim dividend at 22.0 pence per share. It now expects underlying growth in at least high single digits in operating performance at constant precious metal prices and constant currency, compared to mid-single digits before. However, it warns that it is uncertain how precious metal prices will develop. If they remain at their current level, it expects an adverse impact of around GBP80 million on its full-year operating performance.
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OTHER COMPANIES
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CRH said it has agreed to divest its European lime operations to SigmaRoc for around USD1.1 billion. The Dublin-based building materials on Tuesday announced a USD2.1 billion deal to acquire cement and ready-mixed concrete assets in Texas. CRH said: "The transaction is structured in three phases, the first of which is expected to complete in early 2024 comprising the group's lime operations in Germany, Czech Republic and Ireland. The remaining phases, consisting of operations in the UK and Poland, are expected to complete in 2024." Due to the size of the deal, it would constitute a reverse takeover of SigmaRoc, a buy-and-build group targeting construction materials assets. The firm will suspend trading of its shares this morning. The deal is an opportunity to become "Northern Europe's leader in lime". SigmaRoc will pay EUR745 million for the first set of assets and draw upon a new bank facility. It will also raise GBP200 million from the issue of 421.1 million shares at 47.5p.
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ChatGPT creator OpenAI announced Tuesday that Sam Altman would return as its CEO, days after his shock dismissal plunged the pioneering artificial intelligence firm into crisis. Altman's dramatic exit on Friday sparked intense lobbying from OpenAI's biggest investors, including tech titan Microsoft, for his return. Hundreds of OpenAI staff had threatened to quit in a letter released to the media, demanding the resignation of the board as speculation swirled about the future of the company. Microsoft CEO Satya Nadella had announced this week that he would hire Altman to lead an AI research team. Altman said on Tuesday that his return had Nadella's backing. Microsoft has invested billions of dollars into OpenAI, incorporating its tech into various products including its search engine Bing. "We are encouraged by the changes to the OpenAI board," the Microsoft CEO said on X Tuesday. "We believe this is a first essential step on a path to more stable, well-informed, and effective governance."
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By Elizabeth Winter, Alliance News deputy news editor
Comments and questions to newsroom@alliancenews.com
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