Grafton profits fall, Kainos still set to meet expectations

London open

The FTSE 100 is expected to open 14 points higher on Thursday, having closed up 0.12% on Wednesday at 7,473.67.

Stocks to watch

Building materials supplier Grafton on Thursday reported a 29% fall in half-year profits amid a challenging market, but still lifted its dividend and announced a new £50m share buyback. Pre-tax profits came in at £93.6m for the six months to June 30, compared with £132m a year earlier. The dividend was lifted 8.1% to 10p a share. Grafton said it expected full year adjusted operating profit of around £202.6m and a range of £194.6m - £209.4m, in line with its own compiled forecasts of analysts.

Belfast-based IT services group Kainos has announced that full-year results are still expected to meet consensus forecasts despite an "uncertain" trading environment. In a brief trading update for the first half ending 30 September, the company said customers have maintained their investments in digital projects and trading during the period has been "good". Current consensus forecasts are for full-year revenues to be between £418-434m, up from £375m the previous year, and adjusted pre-tax profit in the range of £73m-78m, up from £68m.

Newspaper round-up

Airlines have urged reform of compensation rules after the “staggering” revelation that a single wrongly input flight plan to UK air traffic control disrupted hundreds of thousands of passengers’ flights. Nats, which controls UK airspace, said “an unusual piece of data” had caused the unprecedented system failure on Monday, which led to more than 1,600 flights being axed and many more delayed. – Guardian

Embattled Chinese developer Country Garden reported a 48.9bn yuan ($6.7bn) loss for the first half of the year in a stock exchange filing on Wednesday, adding to worries of a potentially catastrophic default. Its tenuous state has sparked fears of a collapse that could have far-reaching consequences for the Chinese financial system two years after the fall of Evergrande. – Guardian

More electric vehicles are being made by manufacturers than drivers want, one of Britain’s biggest car dealerships has said. Vertu Motors, which trades under brands including Bristol Street Motors, said supply of new and used electric models is outstripping demand, forcing manufacturers to slash prices in an effort to shift stock. – Telegraph

The bucolic setting of Bletchley Park, the home of British codebreaking operations during the Second World War, is a fitting backdrop to Rishi Sunak’s ambitions to address a new threat: AI. In two months, the Buckinghamshire country estate will host the Prime Minister’s AI Safety Summit, a first of its kind international effort to ensure that the risks of rapidly improving artificial intelligence are addressed. - Telegraph

Car production increased by almost a third last month compared with a year ago, new figures show. The number of cars coming off British assembly lines in July rose 31 per cent, taking factory output in the first seven months of the year to 526,000, up 14 per cent year-on-year. – The Times

US close

Wall Street managed to close with modest gains on Wednesday, even as investors weighed the implications of less-than-stellar economic indicators.

Market participants were closely monitoring economic data to gauge its impact on the Federal Reserve's future monetary policy.

At the close, the Dow Jones Industrial Average was up 0.11% at 34,890.24, while the broader S&P 500 rose by 0.38% to end at 4,514.87 points.

The tech-heavy Nasdaq Composite increased 0.54% to close at 14,019.31 points.

On the currency front, the dollar was last up 0.03% on sterling at 78.63p, while it weakened 0.03% against the common currency to trade at 91.52 euro cents.