Persimmon warns on profits, Rathbones reports fall in earnings

London open

The FTSE 100 is expected to open 39 points higher on Wednesday, having closed down 0.74% on Tuesday at 7,876.28.

Stocks to watch

Persimmon warned on profits on Wednesday, after the housebuilder was knocked by the spike in mortgage rates. The FTSE 250 firm said it had delivered a “very strong performance” in 2022, with 14,868 new home completions, compared to 14,551 a year previously. The new home average selling price rose to £248,616, from £237,078, while total group revenues rose 6% to £3.82bn. Underlying operating profits improved 4% to £1.01bn.

Rathbones reported a big drop in full-year profits and a reduction in funds under management and administration, although net inflows held up. Commenting on the results, chief executive officer, Paul Stockton, said that the UK wealth and asset management sector remained "fundamentally attractive" thanks to the underlying long-term trends.

Engineering group Weir on Wednesday posted a rise in annual profits on the back of a booming mining industry. The company said pre-tax profits for 2022 rose by 24% to £260m. Revenue was up 28% to £2.47bn as orders surged 14% to £2.64bn. Shareholders were rewarded with a 38% rise in the annual dividend to 32.8p a share.

Newspaper round-up

Ministers have warned energy firms that they must pass on the benefits of lower wholesale prices to consumers, amid concern that bills could rise this spring. In a speech on Wednesday, Grant Shapps will tell energy suppliers that reduced wholesale prices must be seen in consumer prices, “no ifs, buts or maybes”. In an apparent sign of government concern about the impact of reduced direct support for domestic energy bills, the energy secretary will spell out his message in a speech at the Chatham House think tank in London. – Guardian

Tube workers in the RMT union will strike on 15 March, joining Aslef in a 24-hour stoppage that will bring the London Underground to a halt. The strike, on the day of the budget, will be the first this year in London by the RMT, in a long-running dispute over pensions and reducing the number of staff. Most services were already unlikely to run on 15 March because of the strike announced by Tube train drivers in the Aslef union last week. – Guardian

A British electric van champion once valued at $13bn has been forced to fight off legal action by a creditor as it grapples with a collapsing share price. Arrival, which is listed on the US stock market, was hit with a winding up petition by a supplier over an alleged unpaid debt. – Telegraph

The Thai and Austrian owners of Selfridges have laden the upmarket department store with more than £1.7bn of debt in a higher-risk strategy that could significantly increase investment returns. Loans were booked through a number of new trading and property entities by Tiang Chirathivat and René Benko as they took control of the 114-year Oxford Street stalwart last autum+-n, according to company filings. – Telegraph

The pharmaceuticals industry has urged the government to slash a contentious sales levy back to “historical norms” as part of a wider overhaul to attract investment. In a submission to the Department of Health and Social Care, the Association of the British Pharmaceutical Industry has called for the rebate rate on sales of NHS branded medicines to be fixed at 6.88 per cent, down from an estimated 26.5 per cent this year. – The Times

Nishad Singh, the former director of engineering at FTX, pleaded guilty to criminal charges in the United States last night and agreed to cooperate with prosecutors’ investigation into Sam Bankman-Fried, founder of the now-bankrupt cryptocurrency exchange. “I am unbelievably sorry for my role in all of this,” Singh said, adding that he had known by mid-2022 that Alameda Research, Bankman-Fried’s hedge fund, was borrowing FTX customer funds and that customers were not aware. Singh said that he would forfeit proceeds from the scheme. – The Times

US close

Wall Street trading closed below the waterline on Tuesday, as investors digested a number of data points.

At the close, the Dow Jones Industrial Average was down 0.71% at 32,656.70, as the S&P 500 lost 0.3% to 3,970.15 and the Nasdaq Composite was 0.1% weaker at 11,455.54.

The Dow closed 232.39 points lower on Tuesday, easily reversing gains recorded in the previous session as Treasury yields eased back from recent highs.

Despite what had been a generally strong start to the year, major indices looked to have registered their second negative month out of the last three on the final day of February trading, with the Dow down more than 3% on the month and negative for the year as a whole.

On the macro front, America's shortfall on trade in goods with the rest of the world increased at the start of 2023.