(Alliance News) - The following is a summary of top news stories Wednesday.
----------
COMPANIES
----------
Restaurant food ordering platform Just Eat Takeaway.com will employ 1,500 people in a new UK customer service site as it brings jobs back from India and Bulgaria. Just Eat said it will invest GBP100 million in the region over the next five years, with staff working partly from home and partly from its new Sunderland-based office in the north east of England. UK Managing Director Andrew Kenny said that the company would shoulder the extra cost of bringing the staff in-house because it allowed Just Eat to provide better service. Much of its customer service had been run from Bulgaria and India, but bosses have already seen an increase in customer satisfaction among those who dealt with the 300 people already hired in Sunderland.
----------
Even as Just Eat is bringing jobs home to the UK, it is being ejected from the FTSE 100 index for being too Dutch. FTSE Russell, after the market close Tuesday, said shares of the Anglo-Dutch company would be removed from the UK flagship index, having reassigned the company's nationality from the UK to the Netherlands and making the company ineligible for the FTSE UK Index Series. As a result, Dechra Pharmaceuticals, with a market capitalisation of GBP5.85 billion, will take Just Eat's place in the FTSE 100. In addition, FTSE Russell indicated that aerospace parts maker Meggitt and grocer Wm Morrison Supermarkets, with market values of GBP6.53 billion and GBP7.04 billion respectively, will be added to the FTSE 100. Morrisons shares have risen 70% over the last six months as the Bradford-based grocer found itself the object of a protracted bidding war between private equity firms. Meggitt and Morrisons will replace engineer Weir Group and broadcaster ITV in the FTSE 100, which have market capitalisations of GBP4.35 billion and GBP4.64 billion respectively.
----------
A German regulator has rejected suspicions of insider trading in Aston Martin Lagonda Global Holdings and Daimler shares, the Financial Times reported. Germany's Federal Financial Supervisory Authority, or BaFin, and the UK Financial Conduct Authority found no evidence of wrongdoing, the newspaper added. The regulators have been looking into suspected insider trading, including the purchase of a stake in Aston Martin by Mercedes's Formula One boss Toto Wolff. BaFin said it would not proceed with an investigation due to insufficient evidence, the newspaper reported, while the FCA declined to comment. A person familiar with the matter told the FT that the FCA had not pursued an investigation.
----------
Grafton Group reported a record first half performance, buoyed by upbeat trading from its Woodie's DIY, home and garden retail business in Ireland. For the six months to June 30, revenue was GBP1.03 billion, up 46% from GBP703.7 million last year. Pretax profit was GBP142.9 million, almost five times higher than GBP29.5 million a year ago. Grafton also posted record adjusted operating profit of GBP142.4 for the period, up from GBP46.9 million. Grafton declared an interim dividend of 8.5 pence per share, which the company said reflects its strong profitability and cashflow from operations. The company paid no interim dividend for 2020, though it paid a 14.5p final dividend for the year. Looking ahead, Grafton said the overall outlook is positive following the successful rollout of vaccines in the four countries where it operates. In addition, Dublin-based Grafton maintained its full-year guidance and expects operating profit of GBP240 million in 2021. It posted operating profit of GBP159.7 million in 2020.
----------
The effectiveness against infection of the Pfizer and Moderna Covid-19 vaccines dropped from 91% before the Delta variant became dominant to 66% afterwards, according to a large study of US health workers published Tuesday. The Centers for Disease Control & Prevention has been examining the real-world performance of the two vaccines since they were first authorized among healthcare personnel, first responders and other frontline workers. Thousands of workers across six states were tested weekly and upon onset of Covid-19 symptoms, allowing researchers to estimate efficacy against symptomatic and asymptomatic infection. By looking at the rate of infections among vaccinated and unvaccinated people and the amount of time they were tracked, vaccine effectiveness was estimated at 91% in the initial study period of December 14, 2020 to April 10, 2021. But during weeks in the run-up to August 14, when the ultra-contagious Delta variant became dominant, effectiveness fell to 66%.
----------
Intuit on Tuesday posted a drop in fourth quarter profit but nonetheless called its 2021 financial year "outstanding". Revenue for the fourth quarter that ended July 31 jumped 41% year-on-year to USD2.56 billion, helped by the addition of credit score monitoring Credit Karma, which Intuit closed the acquisition of in December 2020. Credit Karma notched revenue of USD405 million, a quarterly record for the business. Small Business & Self-Employed Group revenue grew 19% to USD1.3 billion, with QuickBooks Online accounting revenue up 28%. However, the California-based financial software company's net income tumbled 15% to USD380 million from USD445 million, dented as total costs jumped 62% to USD2.16 billion from USD1.33 billion. Selling and marketing costs nearly doubled to USD845 million from USD424 million.
----------
MARKETS
----------
Stocks and currencies were hardly changed on Wednesday, amid indecision ahead of a key speech by US Federal Reserve Chair Jerome Powell on Friday. Gold lost ground, however, slipping back below USD1,800 an ounce. "It remains a somewhat fraught exercise to ascribe some thematic value to current market movements given the twin complications of looming event risk (Jackson Hole) and holiday thinned liquidity," commented Rabobank.
----------
CAC 40: up 0.1% at 6,672.55
DAX 30: marginally lower, down 5.45 points at 15,900.40
FTSE 100: up 0.2% at 7,137.66
----------
Hang Seng: closed down 0.1% at 25,693.95
Nikkei 225: closed marginally lower, down 7.30 points at 27,724.80
S&P/ASX 200: closed up 0.4% at 7,531.90
----------
DJIA: called marginally higher, up 10.00 points
S&P 500: called up 0.1%
Nasdaq Composite: called up 0.2%
----------
EUR: up at USD1.1755 (USD1.1747)
GBP: up at USD1.3731 (USD1.3721)
USD: up at JPY109.75 (JPY109.67)
Gold: down at USD1,793.25 per ounce (USD1,806.44)
Oil (Brent): flat at USD70.70 a barrel (USD70.73)
(currency and commodities changes since previous London equities close)
----------
ECONOMICS AND GENERAL
----------
Afghans faced an increasingly desperate race to escape life under the Taliban after President Joe Biden confirmed US-led evacuations will end next week. More than 70,000 people have already been evacuated, but huge crowds remain outside Kabul airport hoping to flee the threat of reprisals and repression in Taliban-ruled Afghanistan. Biden said Tuesday the US would stick to his August 31 deadline to completely withdraw its troops despite warnings from European allies that not all vulnerable Afghans would able to leave by then. "The sooner we can finish, the better...each day of operations brings added risk to our troops," Biden said Tuesday. "We are currently on the pace to finish by August 31."
----------
Biden's plans to spend nearly USD5 trillion to change the world's largest economy advanced in the House of Representatives on Tuesday, after Democratic leaders reached an agreement with centrist lawmakers to end a dispute that threatened the bills. Biden and his Democratic allies controlling the chamber are pushing for passage of both a USD1.2 trillion overhaul to the country's infrastructure and a bill costing USD3.5 trillion over 10 years that would pay for improvements to education, health care and climate change resiliency. While the infrastructure bill has already won passage in the Senate with some votes from Republicans, Democrats have found no opposition support for the second, larger bill, and were planning to approve it with their votes alone – a tough task given their narrow majorities in both chambers of Congress.
----------
Japan moved to expand a virus state of emergency to eight more regions, a day after the Paralympic opening ceremony, as rising infections put hospitals under pressure. The step comes with summer school holidays ending and top infection experts suggesting delaying the start of classes to reduce infection risks. The country has been recording more than 20,000 new infections a day in recent weeks, and in urban areas like Tokyo patients in serious condition have been left waiting for hours or travelling long distances in ambulances to find available hospital beds.
----------
The slow rollout of coronavirus vaccines will cost the global economy USD2.3 trillion in lost output. The Economist Intelligence Unit's study found that emerging and developing economies, whose vaccine rollouts are far behind those of wealthier countries, will bear the brunt of those losses. The report comes as advanced nations move towards providing booster shots to their populations while the international effort to provide vaccines for poorer nations remains inadequate. The study calculated that countries which fail to vaccinate 60% of their populations by mid-2022 will suffer the losses over the 2022-2025 period.
----------
The economic mood in Germany has darkened again in August, after losing some cheer in July, the Munich-based ifo Institute for Economic Research reported. In August, the ifo business climate index fell to 99.4 points, after recording a revised 100.7 in July. This decline was due mainly to significantly less optimism in companies' expectations and followed a fall from 101.7 points in June. The ifo Business Climate is based on 9,000 monthly responses from businesses in manufacturing, the service sector, trade, and construction.
----------
The value of the private rented sector in Britain rose 5.8% in the past year to GBP1.4 trillion. House prices have soared 9.9% between the start of the pandemic and March this year, helped by the stamp duty holiday, according to a report by Shawbrook Bank. This included a 5.6% rise in the value of the average buy-to let property across the UK to December 2020, sitting at approximately GBP258,900 for each home. But despite the rise in value, the size of the private rented sector shrank over the past year with some landlords choosing to leave the market. It also found that many tenants made a change, opting to return to their family homes during the pandemic, to leave cities in search of more space, or to make the most of the stamp duty holiday and become homeowners themselves. The report comes after new figures on Tuesday showed house sales in the UK slumped by nearly two thirds last month as activity cooled after the end of the full stamp duty holiday. HM Revenue & Customs said an estimated 82,110 residential property sales took place in July, down 62% on June's record levels.
----------
By Tom Waite; thomaslwaite@alliancenews.com
Copyright 2021 Alliance News Limited. All Rights Reserved.