M&G beats analysts' forecasts, Next holds guidance

London open

The FTSE 100 is expected to open 68 points higher on Thursday, having closed down 0.01% on Wednesday at 7,737.38.

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Savings and investments firm M&G beat analysts' forecasts with its 2023 results, with net client flows, adjusted profits and operating capital generation all up materially on the previous year. Adjusted operating profit before tax totalled £797m, up from £625m in 2022, which the firm put down to a resilient performance in Asset Management, and improved contributions from Life, Wealth and Corporate Centre. This was well ahead of the consensus forecast of £750m, according to UBS.

UK fashion retailer Next held guidance for 2024 after posting a better-than-expected 5% rise in annual profits to £918m. The company said it still expected pre-tax earnings of £960m, based on a 2.5% increase in full price sales. Total sales for the year to January 2024 rose 6% to £5.8bn.

FirstGroup announced on Thursday that it has secured the contract from Transport for London (TfL) to operate the London Cable Car between Greenwich Peninsula and the Royal Docks area, starting on 28 June for an initial five-year term extendable up to eight years. The FTSE 250 passenger transport operator said its expected revenues were £60m over the contract's duration, with patronage risk assumed by TfL and minimal capital expenditure required. FirstGroup said it would enhance the cable car service, and planned to implement educational outreach and work placements for local school students in Greenwich and Newham boroughs during the contract period.

Newspaper round-up

The disgraced former owner of Norton Motorcycles should have served jail time for his role in the multi-million-pound pension fraud, the chair of the Pensions Ombudsman service has told a parliamentary inquiry into the scandal. The comments by Anthony Arter will be viewed by victims as a thinly veiled criticism of a prosecution run by the Pensions Regulator against former Norton boss, Stuart Garner, who was convicted of three pensions offences in 2022 but avoided prison because the regulator did not allege dishonesty. – Guardian

Reddit will enter a new era as a publicly traded company with a market value of $6.4bn after the social media platform’s initial public offering was priced at $34 per share. The price, announced late on Wednesday, came in at the top of the target range set by Reddit’s investment bankers as they spent the past few weeks gauging investor demand for the stock. It sets the stage for Reddit’s shares to begin trading Thursday on the New York stock exchange under the ticker symbol RDDT in the largest initial public offering by a social media company in years. – Guardian

Joe Biden has announced new rules that will see as many as half of all cars sold in America run on electricity by 2030. The US President on Wednesday moved to adopt strict European-style tailpipe emission rules. The finalised regulations will require manufacturers to drastically cut the amount of carbon dioxide (CO2) emitted from cars and trucks from 2027 through to 2032. – Telegraph

Journalists at the Daily Mail are braced for job cuts after bosses warned of changes to working patterns as the newspaper group races to adapt to the digital age. In a note to staff, Ted Verity, editor of Mail Newspapers, said the publisher was taking further steps to merge its titles to put digital “at the heart of everything we do”. He said: “Inevitably, this will mean changes to the way some reporters and news desk executives work. Some staff will see a change to their working pattern, job title, line manager or duties.” – Telegraph

A record 1.1 million Britons are working on zero-hour contracts, with most lacking regular pay and employee protection. Research from the Work Foundation think tank found that 136,000 extra zero-hour contracts were given out in 2023 compared with the previous year, with 88,000 for younger workers aged 16-24. – The Times

US close

Wall Street stocks finished Wednesday's trading session on a positive note following the Federal Reserve's decision to maintain interest rates, aligning with market expectations.

The Dow Jones Industrial Average rose 1.03% to 39,512.13 points, while the S&P 500 climbed 0.89% to 5,224.62, and the Nasdaq Composite saw gains of 1.25% to settle at 16,369.41.

In currency markets, the dollar was last down 0.06% on sterling to trade at 78.16p, while it decreased 0.13% against the euro to 91.44 euro cents.

Against the Japanese yen, the greenback depreciated 0.4% to change hands at JPY 150.66.

At the top of the economic agenda was the Federal Reserve, after it opted to maintain interest rates at current levels while slightly adjusting its forecasts for economic growth and interest rates in 2025 and 2026.