Meggitt to end year as expected, Segro collects 98pc of 2020 rents

London open

The FTSE 100 is expected to open 26 points lower on Friday, having closed up 0.84% on Thursday at 6,801.96.

Stocks to watch

Defence and aerospace engineers Meggitt said it expected full year results to be in line with expectations but cautioned that the expected recovery in air travel from the Covid pandemic would take longer than expected. The company reiterated guidance from November with underlying profit in the middle of a £180m – 200m range and revenue of £1.7bn. “Trading across our end markets in the final quarter was broadly in line with the trends experienced in October, with group performance lower than our September base case, which assumed a progressive improvement in civil aerospace in the fourth quarter,” Meggitt said on Friday. It said the rollout of coronavirus vaccines and pent-up demand for air travel, “provides a supportive backdrop for the recovery in civil aerospace in 2021”, but warned that logistical challenges in getting jabs administered meant “this positive development will take time to feed through into growth in flight and passenger numbers and aftermarket activity levels”.

Segro said on Friday that for the year ended 31 December, it had collected 98% of all rents to date. The FTSE 100 commercial landlord said that, looking at UK rents payable in advance for the first quarter of 2021, as at 14 January it had received 88% of the £63m of rent due. That represented a higher collection level than at the same time in each of the three prior quarters. It said it expected the substantial balance of outstanding rents to be paid by the end of the quarter, with the majority now due to be paid monthly.

Aveva said it was confident in its outlook for annual results after a "strong" third quarter improved revenue growth to about 1.5% in the first nine months of the year. Organic constant currency recurring revenue rose 10% over nine months taking it to 68% of group revenue. On the same basis revenue rose 26% in the third quarter, the industrial software group said. Revenue growth was driven by plenty of scheduled subscription renewals including a big three year contract in the food sector. A large engineering, procurement and construction contract was renewed early and two big marine contracts moved from annual fees to multiyear subscription.

Newspaper round-up

The business secretary, Kwasi Kwarteng, has said companies must redouble efforts to ensure employees work from home unless their work is critical and cannot be done offsite, as the TUC urged the government to step up enforcement. Calls are growing for the government to rethink allowing construction sites to continue as normal and to permit only those whose operations are vital, with several industry employees telling the Guardian that safe practice has become impossible on sites. - Guardian

The UK’s service sector suffered the biggest fall in growth in November, contracting by 3.4%. Unsurprisingly, the hospitality sector shrank the most - with pubs and restaurants forced to close during the November lockdown. - Guardian

The UK population may have fallen by as much as 1.3m - the biggest decline since the Second World War - in the wake of the Covid-19 pandemic, academics have said. A study by the Economic Statistics Centre of Excellence highlighted an “unprecedented exodus” of foreign-born workers following the outbreak of the virus as well as shortcomings in official surveys inflating the number of UK workers. - Telegraph

A group of 50 Tory MPs in the party's new Northern heartlands is calling on the Chancellor to extend the stamp duty cut in a major boost for The Telegraph’s campaign against the tax. The Northern Research Group (NRG) urged Rishi Sunak to continue a stamp duty holiday on properties worth less than £500,000 for a further 12 months. They also want him to extend a £20 increase to weekly Universal Credit payments until lockdown ends. - Telegraph

London-based start-ups raised more than $10 billion in funding last year, cementing the capital’s status as Europe’s leading technology hub. Investors continued to flock to London despite the shockwaves from Covid-19, as it received more venture capital funding than any European city, a new study has shown. - The Times

US close

Wall Street stocks closed lower on Thursday as market participants mulled over the details of president-elect Joe Biden's planned economic stimulus package and this week's jobless claims data.

At the close, the Dow Jones Industrial Average was down 0.22% at 20,991.52, while the S&P 500 was 0.38% weaker at 3,795.54 and the Nasdaq Composite saw out the session 0.12% softer at 13,112.64.

The Dow closed 68.95 points lower on Thursday, extending yesterday's minor losses that came after the House of Representatives voted to impeach Donald Trump for a second time.

Thursday's main focus was this week's worse-than-expected jobless claims report from the Labor Department, which revealed the number of Americans filing for unemployment surged at the start of 2021. In seasonally adjusted terms, initial unemployment claims soared by 181,000 over the week ending on 9 January to reach 965,000. Economists had been expecting a dip from 787,000 to 775,000

In addition to the jobless data, Biden unveiled his stimulus plan, one that will include $1,400 direct payments, an extension of increased unemployment insurance and support for state and local governments in a package set to be as big as $1.9trn.