Bellway warns of slowdown in demand, Rentokil cancels dividend
By Josh White
Date: Wednesday 25 Mar 2020
(Sharecast News) - London open
The FTSE 100 is expected to open 164 points higher on Wednesday, having closed up 9.05% at 5,446.01 on Tuesday.
Stocks to watch
House builder Bellway postponed its interim dividend and warned of a slowdown in demand due to the coronavirus and subsequent government-ordered lockdown. "We are ever mindful that the government imposed preventative measures to slow down the spread of the virus are likely to detrimentally affect both production and sales activity on our developments," said chief executive Jason Honeyman.
Rentokil International has cancelled its dividend and cut pay in an effort to conserve more than ?500m in cash to strengthen its finances against the Covid-19 crisis. The pest control and hygiene services company said it took the actions after the virus had a greater impact on its business in the past 10 days.
United Utilities said it had enacted its "robust" contingency plans in response to the Covid-19 coronavirus pandemic on Wednesday. The FTSE 100 water company said its revenues were fixed under the regulatory revenue control for the next five years, with shortfalls in any year being recoverable in later years. It also said it had a "robust" liquidity position extending out for 24 months, which was at the upper end of its policy range.
Newspaper round-up
The online shopping platforms eBay and Amazon Marketplace are failing to crackdown on a surge in profiteering by sellers due to the coronavirus, a consumer group has warned, after its investigation uncovered a wide range of products on sale at "extortionate" prices. Which? found "consistent overpricing" of household items, including cleaning products, hand sanitiser, thermometers, baby formula and tampons, which have all been in high demand since the coronavirus outbreak but in short supply in supermarkets and pharmacies. - Guardian
Private healthcare company Cera Care is creating 10,000 new jobs for home carers to support elderly or vulnerable people during the coronavirus outbreak, and to provide work for those who have lost their jobs. The firm said it will offer successful applicants training courses and assessments through its digital platform, allowing them to become formally certified as carers and able to start earning money after 10 days. - Guardian
The Chancellor is weighing up an unprecedented rescue package for Britain's five million self-employed workers that could follow measures introduced in Denmark and Norway. An option being considered by the Treasury is paying contractors a proportion of their income using earnings made in recent years, it is understood. Sources close to the discussions said there were still major sticking points over how to support the self-employed, including avoiding handing out money to wealthy contractors. - Telegraph
The Bank of England has launched an emergency liquidity scheme to ensure commercial lenders do not run out of cash as it warned that immediate disruption from the pandemic could be more severe than its banking stress tests. Underlining the risks to the financial system, the Bank has activated its contingent term repo facility (CTRF), an unlimited and cheap source of funding for commercial banks that desperately need cash. - The Times
US close
Wall Street's main market gauges snapped higher after the speaker of the House of Representatives, Nancy Pelosi, voiced "real optimism" that a deal on a coronavirus spending bill could be voted on Tuesday, or Wednesday at the latest.
By the end of trading, the S&P 500 was 9.38% higher at 2,447.33 and just below technical resistance at 2,450, alongside a more than 2,000 point jump on the Dow Jones Industrial Average to 20,704.91, while the Nasdaq Composite put on 8.12% to 7,417.86.
According to Bloomberg data, it was the biggest one day gain for the S&P 500 since October 2008, while the Dow Industrials saw its largest percentage point advance since 1933.
The next level of technical resistance for the S&P 500 lay at 2,550.
The VIX volatility index remained up by 0.13% at 61.67, but well off its recent highs of 85.47, having fallen to 36.24 earlier in the session.
West Texas Intermediate crude oil futures rose 3.91% to $24.31 a barrel on the ICE and the yield on the benchmark 10-year US Treasury note added six basis points to 0.85%.
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