Unilever announces share buyback, Compass makes strong start to year

London open

The FTSE 100 is expected to open nine points higher on Thursday, having closed down 0.68% on Wednesday at 7,628.75.

Stocks to watch

Consumer goods giant Unilever announced a €1.5bn share buyback as it reported lower annual profit and sales and said it expected a “modest improvement” in operating margin in 2024. Pre-tax profit at the maker of Dove soap and Cornetto ice-cream fell to €9.3bn last year from €10.3bn. Turnover came in at €9.7bn from €10.75bn. “We expect underlying sales growth for 2024 to be within our multi-year range of 3% to 5%, with more balance between volume and price,” the company said on Thursday.

Catering giant Compass said it delivered a strong start to its financial year with organic revenue growth currently running ahead of full-year guidance. The company, which is targeting a high single-digit increase in organic revenues for the 12 months to 30 September 2024, said first-quarter organic sales were up 11.7%. Compass said like-for-like volumes were better than anticipated, especially in its Business & Industry division, which accounts for a third of group revenues.

SSE reaffirmed its 2024 adjusted earnings per share guidance on Thursday of more than 150p, despite reporting operational challenges including lower-than-planned renewables output amid adverse weather conditions and operational disruptions. The FTSE 100 firm said in a trading update that its strategic focus remained on its ‘Net Zero Acceleration Programme Plus’, with progress reported on investments in transmission, renewables, and flexibility projects. SSE Renewables output over the first three quarters was around 15% below plan, or 10% below plan relative to the full year, with January seeing continued mixed weather conditions for the renewables fleet.

Newspaper round-up

Thames Water has been ordered to update its service commitment plan by the regulator Ofwat after a minister said the company’s performance in regards to sewage dumping and serving customers was “completely unacceptable”. Robbie Moore, the floods minister, said Britain’s biggest water supplier was “under no illusions over the scale of the challenge” as MPs heard that Thames had allowed waterways to become polluted and homes to be flooded with sewage. – Guardian

Andy Burnham, the Labour mayor of Greater Manchester, and Andy Street, the Tory mayor of the West Midlands, have joined forces on alternative and cheaper plans for the scrapped section of HS2, warning that “to do nothing is not an option”. Burnham and Street shared a stage on Wednesday to put forward three options after the government abandoned the long-promised northern section of the high-speed rail line. – Guardian

The struggling parcel courier Yodel is preparing to call in administrators as hopes of a rescue deal fade, threatening disruption to online shopping. Insolvency experts at Teneo have been lined up after efforts to find a buyer for a company which provides delivery services for some of the high street’s biggest names began to flounder. Yodel’s customers include John Lewis, Argos, Zara and AO World, according to its website. – Telegraph

Deloitte has put a further 100 roles at risk of redundancy in the UK as part of its attempt to cut costs. The Big Four accountant has said the proposed job cuts will be made across the firm’s employee ranks, affecting roughly 5pc of Deloitte’s financial advisory business. It comes as Deloitte battles a slump in dealmaking amid high interest rates. – Telegraph

Government staff have been sacked for allegedly sharing details of potential jobs with private sector insolvency practitioners. The government’s Insolvency Service said three people had been dismissed “following an investigation into case data being improperly shared with two insolvency practitioners”. – The Times

US close

Both the Dow and S&P 500 finished at all-time closing highs on Wednesday on the back of a batch of strong corporate earnings.

The Dow finished 0.4% higher at a new closing record of 38,677.36, while the S&P 500 jumped 0.8% to a new peak of 4,995.06.

The Nasdaq meanwhile rose nearly 1% to 15,756.44 as it continues to inch closer to its all-time closing high of 16,057.44 reached in November 2021.

So far this year, Wall Street's three main equity indices have risen 2.55%, 5.32% and 6.71%, respectively, as earnings season has been broadly well-received by the market.

Investors continued to digest incoming comments from members of the Federal Reserve on Wednesday as the central bank grappled with questions surrounding the outlook for monetary policy – specifically around the timing of the first interest-rate cut.