Kingfisher profits fall on Brexit concerns, ConvaTec snaps up US catheter supplies firm
By Josh White
Date: Wednesday 18 Sep 2019
(Sharecast News) - London open
The FTSE 100 is expected to open 11 points lower on Wednesday, having closed down 0.01% t 7,320.40 on Tuesday.
Stocks to watch
Half year profits at DIY retailer Kingfisher fell on Brexit worries and the move to a low-price strategy at its French Castorama business as the company warned of a "mixed" full-year outlook. Like-for-like sales fell 1.8% to £5.9bn with growth in Screwfix, Poland and Romania offset by B&Q and France as pre-tax profits came in 12.5% lower at £245m.
AstraZeneca will fully manage the development, manufacture and commercialisation of irritable bowel syndrome treatment Linzess in China, Hong Kong and Macau after amending a 2012 agreement with Ironwood Pharmaceuticals. The pharmaceutical giant will pay Ironwood $35m over the next five years and up to $90m in milestone payments depending on the achievement of sales targets.
Medical products and technologies provider ConvaTec Group has signed an agreement to purchase the assets of Southlake Medical Supplies - a Texas-based provider of catheter-related supplies - for an undisclosed consideration, it announced on Wednesday morning. The FTSE 250 company said that for the year ended 31 December, Southlake delivered revenues of around $5m (£4m). It said the acquisition was expected to close on 30 September, subject to usual formalities.
Newspaper round-up
Britons are £128 a year worse off on average than they were in 2008, according to a report that reveals household incomes were hit harder in the wake of the financial crash than official figures have revealed. The New Economics Foundation said figures used to calculate GDP, which is adjusted to take account of rising prices, failed to include essential items that affected the cost of living over the last 10 years. - Guardian
Companies across Britain have begun stockpiling beer, wine and spirits to keep the alcohol flowing at Christmas as concerns grow that Brexit could disrupt supplies over the festive period. Rushing to bring forward their imports, firms warn that the Brexit deadline on 31 October stands to clash with the run-up to Christmas, when import volumes rise, temporary staff are employed and warehouse space is at a premium. - Guardian
Thousands of retail investors risk losing their money in Sirius Minerals after it admitted its plan to build a fertiliser mine in Yorkshire was on the brink of collapse and the Government appeared to rule out a rescue. The FTSE 250 company warned that it had been unable to sell a $500m (£400m) junk bond it needed to unlock $2.5bn in debt financing from JPMorgan, throwing the future of its ambitious scheme to mine under the North York Moors into doubt. Up to 1,200 jobs are at risk as Sirius has only enough cash to last six months. - Telegraph
The boss of the world's largest mining company has had his pay cut by almost a quarter after an unexplained death at its Queensland mine and a runaway iron ore train. Andrew Mackenzie, 62, chief executive of BHP since 2013, had his short-term bonus reduced by more than $1 million from 2018 to $1.3 million. His base salary was kept at $1.7 million, taking his total earnings, including other benefits, to $3.5 million, from $4.6 million the previous year. - The Times
MPs have attacked the government's £12 billion Help to Buy scheme, claiming that the policy has supported homebuyers who could already afford to buy a property and has failed to boost the provision of affordable housing or reduce homelessness. Three fifths of buyers who took part in Help to Buy did not need it to buy a home, according to a damning report by the Commons' public accounts committee. It said that the "large sums of money tied up could have been spent in different ways to address a wider set of housing priorities and focus more on those most in need". - The Times
US close
US stocks closed higher on Tuesday as crude oil futures skidded lower amid reports that Saudi oil output could be fully restored as quickly as had originally been anticipated.
At the close, the Dow Jones Industrial Average was up 0.13% at 27,110.80, while the S&P 500 was 0.26% stronger at 3,005.70 and the Nasdaq Composite was 0.40% firmer at 8,186.02.
The Dow Jones closed 33.98 points higher on Tuesday after Wall Street stocks closed weaker on Monday, snapping the Dow's eight-day winning streak as an attack on a Saudi Arabian oilfield and the country's key processing facility sparked fears that a surge in crude prices could add to the slowdown in the global economy.
West Texas Intermediate crude oil futures slid off earlier highs after Reuters, which cited two Saudi sources, said the kingdom's oil output could be fully-restored in two or three weeks' time and 70% of lost production was already close to being back online.
Saudi and US investigators also said there was believed to be a "very high probability" that the cruise missile attack against Saudi oil installations had been launched from inside Iran.
Elsewhere, investors were shifting some of their focus from Middle Eastern woes to the start of the Federal Reserve's two-day policy meeting.
Market participants and analysts alike have been divided on what the central bank will do at its meeting, with the recent increase in energy prices leading some investors to think the Fed may not quite be in such a rush to lower interest rates yet again.
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