City sources predict FTSE 100 will open up 58 points from previous close of 5015. Stocks to Watch
AB Foods is on course to deliver “very good progress” on earnings for the year after its Silver Spoon sugar business and discount clothes chain Primark put in a solid performance during the third quarter. Revenue in the 16 weeks to 19 June is up 13%, aided by a 44% surge in sugar revenues and 15% increase at the retail business. It’s up 14% for the first 40 weeks of the financial year.
Global recruitment firm Hays has returned to year on year growth for the first time in two years after making progress in most of its markets. In the quarter ended 30 June, Hays increased net fees by 14% (8% on a like-for-like basis) versus the same period last year,
Under pressure social housing firm Connaught is looking for a new chief executive after current boss Mark Tincknell stood down to recover from recent health issues. Finance director Stephen Hill has also decided his time is up at the company and will be leaving at the end of October this year.
In the Press
Leading shareholders in the Prudential were considering last night whether to back Sir Richard Lapthorne, the controversial Cable & Wireless boss, as the insurer’s next chairman. Sir Richard, who has held discussions with investors over the past three weeks, wants the job if he gets sufficient support, says the Times.
The City watchdog is considering whether Britain can claim exemption from European laws that will introduce the toughest pay restrictions in the world. Lawyers at the FSA are exploring the possibility of claiming that the UK financial services sector is already adequately regulated by its own Code, writes the Telegraph.
Europe's bank regulators have revealed a list of 91 banks facing stress tests but declined to offer any details on the weightings given to potential losses on sovereign debt, reducing the chance that the exercise will restore confidence in the region's battered banking system, reports the Telegraph.
Newspaper Tips
Carillion has been working to shed its traditional image as a construction company and accelerated the shift towards support services. The strategy appears to be paying dividends, at least according to yesterday's trading update. While economic uncertainties remain a worry for almost any business you care to consider, on valuation grounds alone Carillion appears to be worth an investment, so buy, according to the Independent.
Xstrata is building its own copper-mining franchise in southern Peru. Yesterday it announced that it planned to spend $1.47 billion (Ł967 million) developing its Antapaccay copper project. Xstrata shares were up 3.6p last night at 909.5p. Worth picking up on further weakness, says the Times.
Big Yellow posted a healthy 10 per cent rise in first-quarter revenues from its 51 wholly owned stores yesterday. Forward visibility in the self storage trade is fairly limited, but as far as Big Yellow can tell, trading is likely to remain reasonable until the seasonal slowdown in September, when students move into halls and home movers have usually sorted out plans. Moreover, management has done a good job of managing the balance sheet, and the company seems strong enough to deal with any short-term pullback in the economy. US close
US markets powered forward as banks rallied on a bullish update from State Street.
The bank forecast earnings of 87c per share for the second quarter, beating analysts' expectations of around 72c per share. Rival custody banks Bank of New York Mellon and Northern Trust rose in sympathy.
Dow Jones jumped 274 points to 10,018 with the Nasdaq rising 65 points to 2,159. The S&P 500 is up 32 points to 1,060.
On the economic front, a report from the American Bankers Association showed that fewer consumers are behind on their debt payments than a year ago.
It is not all good news for the US economy. US shopping centre vacancy rates are continuing to rise. The vacancy rate is 10.9%, just below the 11% figure hit in 1991.
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