B&M warns on 2022 revenues, Chemring reports rise in revenue and profit

The FTSE 100 is expected to open seven points higher on Thursday, having closed up 0.39% on Wednesday at 7,108.00.

Stocks to watch

Retailer B&M Value warned 2022 UK revenues would be lower against tough comparatives as it reported better than expected annual profits. The company, which remained fully open during the pandemic, said adjusted core earnings rose 83% to £626.4m on the back of a 26% rise in revenue to £4.8bn. “Trading continues to be volatile at a weekly and product category level, in particular since the recent easing of lockdown restrictions. This is likely to remain the case for the whole of full-year 2022, as the business annualises against the very strong comparatives throughout last year,” the company said on Thursday.

Chemring posted a rise in interim profit and revenue on Thursday as it announced the acquisition of Cubica Group, a Surrey-based research and development company specialising in artificial intelligence, machine learning, data fusion and autonomy. In the six months to 30 April, underlying pre-tax profit increased 12% to £27.2m on revenue of £198.5m, up 4% on the same period a year ago. The company declared an interim dividend per share of 1.6p, up 23%. Chemring said the results were in line with its expectations, "reflecting continued strong performance in both segments, despite FX translation headwind caused by the weakening US dollar".

Newspaper round-up

The US securities watchdog told Tesla last year that CEO Elon Musk had twice violated a settlement requiring his tweets to be pre approved by company lawyers, the Wall Street Journal reported on Tuesday. Musk and the US Securities and Exchange Commission agreed in 2019 that the electric car maker would vet any material public communications Musk made regarding Tesla. - Guardian

President Joe Biden has ramped up pressure on Britain to back a global deal on taxes after announcing steep tariffs in retaliation for measures targeting US tech. The White House has said it will slap new trade duties on six countries including the UK, India, Spain and Italy, but is suspending them for six months as officials attempt to thrash out a deal on a global minimum corporate tax rate. Unless an agreement is reached, America will introduce a 25pc tariff on UK goods worth $887m (£626m), including types of clothing, footwear and furniture. - Telegraph

Amazon is poised to snatch Tesco’s crown as Britain's biggest retailer within four years in a watershed moment for the beleaguered high street. The US e-commerce powerhouse is expected to knock Tesco off the top spot for the first time in decades as the retail landscape is transformed by the internet, according to a new study from data firm Edge by Ascential. Amazon sales are predicted to hit £77bn in the next four years, Edge said - £1bn more than Tesco's. In 2020, the online company's total UK sales were £36.3bn while Tesco's total was almost double that at £64bn. - Telegraph

A social media-led rally in American shares popular with retail investors continued yesterday, with AMC Entertainment, the listed cinema chain, reaching a record high. So-called meme stocks, bought amid hype on social media and online forums such as Reddit’s WallStreetBets, are close to levels last achieved in their late-January rally. - The Times

Trafigura warned Credit Suisse last year that the bank’s supply chain finance funds appeared to contain a suspicious invoice from Sanjeev Gupta’s business empire. The independent, employee-owned commodities trading and logistics business raised the alarm with Credit Suisse in July 2020 over a so-called receivable listed in one of the supply chain finance fund’s annual accounts, according to the Financial Times. - The Times

US close

Wall Street stocks closed in the green on Wednesday, with the S&P 500 hovering near its record high following a somewhat muted session the day before.

At the close, the Dow Jones Industrial Average was up 0.07% at 34,600.38, as the S&P 500 and the Nasdaq Composite both added 0.14%, to 4,208.12 and 13,756.33, respectively.

The Dow closed 25.07 points higher on Wednesday, climbing down from some of its earlier gains but extending those recorded in the previous session, after traders returned from an extended break for the Memorial Day long weekend.

On the macro front, mortgage applications fell 4.0% across the US in the week ended 28 May, according to the Mortgage Bankers Association, following a 4.2% drop a week earlier.

The decline dropped the index to 665.9, the lowest print since February 2020.