Tate & Lyle inks insurance deal with Legal & General, JD Sports acquisition of Footasylum to be probed further
By Josh White
Date: Thursday 19 Sep 2019
(Sharecast News) - London open
The FTSE 100 is expected to open 16 points lower on Thursday, having closed down 0.09% at 7,314.05 on Wednesday.
Stocks to watch
Sugar and sweeteners group Tate & Lyle said it had agreed a £930m bulk annuity insurance 'buy-in' with Legal & General. The de-risking of the scheme means the company will save £20m in annual contributions, said Tate & Lyle chief financial officer Imran Nawaz on Thursday.
Diageo's chief executive said the company has begun its new financial year well as he doubled down on expectations for 4-6% organic net sales growth, with organic operating profit growth seen as beating net sales growth by a further 1%. However, he also warned that the company would not be immune to shifting global trade conditions, adding that the company is closely monitoring changes.
Footwear and sports apparel retailer JD Sports Fashion updated the market on its acquisition of Footasylum on Thursday, following the Competition and Markets Authority's (CMA) decision that it intends to refer its review to phase 2. The FTSE 100 company's executive chairman Peter Cowgill said the company continued to believe that Footasylum would be a "positive addition" to the group, bringing a "differentiated customer demographic" and fashion-led product range that was complementary to its existing business. "We also believe that there will be significant operational and strategic benefits from a combination of the two businesses," he added.
Newspaper round-up
Credit card spending has overtaken cash for the first time, according to data from UK retailers. This means notes and coins have been demoted to the third most popular method of payment. The figures from the British Retail Consortium (BRC) - whose members are responsible for £180bn of sales - come amid warnings that millions of adults would struggle to cope in a cashless society. - Guardian
The crown estate has opened the first leasing round for offshore wind farms in a decade to usher in a new generation of wind projects expected to eventually generate an investment of £20bn. The business intends to auction off new seabed rights in the waters around England and Wales to wind power developers. The leasing scheme allows up to 7GW of electricity generation capacity - enough to meet the needs of more than 6m homes. - Guardian
The outgoing boss of River Island said the family-owned fashion chain was committed to the high street despite a fall in sales and profits. Chief executive Ben Lewis, nephew of the retailer's founder, said: "We maintain our investment in stores. We believe in the future of the high street. We've opened stores, we've upgraded stores, we've enlarged stores." - Telegraph
The main trade union at Royal Mail has served notice for a strike ballot among 110,000 workers. The Communication Workers Union is in dispute with the postal delivery company over issues including threats to the universal service obligation, which means that post is delivered at uniform prices across Britain six days a week, and claims that the "four pillars agreement" reached between the union and Royal Mail last year has been breached. The agreement includes pay rises, new pension proposals and a pledge to reduce weekly working hours from 39 to 35 by 2022, dependent on productivity improvements. - The Times
EDF, the French electricity company, has insisted that its nuclear reactors are safe, despite admitting that six contained components that fail to meet industry standards. EDF, which is leading the project to build Britain's new nuclear plant at Hinkley Point in Somerset, also conceded that sub-standard parts had been found in a new-generation reactor under construction in Normandy. - The Times
US close
US stocks finished in a mixed state on Wednesday, as investors reacted to a rate cut decision from the US Federal Reserve late in the session.
The Dow Jones Industrial Average ended the day up 0.13% at 27,147.08 and the S&P 500 added 0.03% to 3,006.73, while the Nasdaq Composite shed 0.11% to settle at 8,177.39.
On Tuesday, the Dow had closed higher as crude oil futures skidded on news that Saudi oil output could be fully restored quicker than had originally been anticipated.
Focus for the entirety of the session was well and truly locked on the Federal Reserve, with recent comments from US president Donald Trump branding Fed policymakers "boneheads" when he demanded the bank set zero or negative rates.
The US central bank cut its main policy rate further in the end, with several of its top officials believing that it would need to be lowered again before the year was out.
According to the so-called 'dot-plot' graphs provided alongside its policy statement, seven of the Fed's 17 board members and regional Federal Reserve bank presidents now believed that the most appropriate course of action would be another 25 point cut before the end of 2019.
That was roughly in line with what Fed funds futures were pricing in at the time, according to the CME's FedWatch tool.
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