Shell turns in lower-than-expected earnings, Lloyds Bank hikes full-year guidance
The FTSE 100 is expected to open two points lower on Thursday, having closed down 0.33% at 7,253.27 on Monday.
Stocks to watch
Royal Dutch Shell reported lower-than-expected third-quarter adjusted earnings after taking a $400m hit from Hurricane Ida’s impact on operations. The company on Thursday said earnings fell by 25% quarter on quarter to $4.13bn, below analyst forecasts of $5.31bn and compared with $955m a year ago. Shell said the results were also hit by adverse one-off tax impacts, lower production volumes partly due to the impact of Hurricane Ida, and comparative lower contributions from trading and optimisation. This was partly offset by higher oil, LNG and gas prices.
Lloyds Banking Group improved its full-year guidance after bad-debt writebacks contributed to a near doubling of third-quarter profit. Pretax profit for the three months to the end of September rose to £2.03bn from £1.04bn a year earlier as net income increased 20% to £4.08bn. The bank released £84m of impaired loans compared with a charge of £301m a year earlier. In the first nine months of 2021 pretax profit surged to £5.93bn from £434m as net income rose 8% to £11.64bn. The FTSE 100 bank recorded a £740m impairment credit compared with a £4.12bn charge a year earlier.
Newspaper round-up
The impact of Brexit on the UK economy will be worse than that caused by the pandemic, according to the chairman of the UK fiscal watchdog. Richard Hughes said the Office for Budget Responsibility (OBR) had assumed leaving the EU would “reduce our long run GDP by around 4%”, adding in comments to the BBC: “We think that the effect of the pandemic will reduce that (GDP) output by a further 2%.” - Guardian
Advertisers are expected to spend almost £1bn more marketing their products this festive season than last year, marking the return of the annual big-budget Christmas marketing battle. UK companies are forecast to spend a record £7.9bn on advertising during the critical “golden quarter” to Christmas, retailers’ most lucrative three-month sales period. - Guardian
South Korean tech giant Samsung Electronics posted a 28pc jump in operating profit on Thursday despite global supply chain challenges caused by the pandemic. The world's top chipmaker saw its operating profit reach 15.8 trillion won (£9.8 billion) for the July-September period, it said in a regulatory filing. - Telegraph
The amount that savers can deposit in their Isas will be frozen until at least 2023, the Treasury said, in a blow for investors worried about higher tax bills and savers concerned about inflation. The Junior Isa allowance will be kept at £9,000 and the adult Isa allowance at £20,000, where it has been since 2017. - The Times
British car production has fallen to its lowest levels since the Thatcher recession and the industrial strife that met her economic reforms in the early 1980s. Just 67,000 cars came off the assembly lines in September, according to latest figures, a fall of 41.5 per cent year-on-year and the worst performance since 1982 when British Leyland phased out the Austin Allegro, Vauxhall was dropping the Chevette and Ford ditched its bestselling Cortina. - The Times
US close
Wall Street trading closed in a mixed state on Wednesday, as investors digested a slab of quarterly earnings reports.
At the close, the Dow Jones Industrial Average was down 0.74% at 35,490.69 and the S&P 500 lost 0.51% to 4,551.68, while the Nasdaq Composite eked out gains of just 0.12 points to 15,235.84.
The Dow closed 266.19 points lower on Wednesday, reversing modest gains in the previous session that saw the blue-chip index register a new record close.
Wednesday's primary focus was corporate earnings, with a number of big-name US firms reporting throughout the course of the day.
First off, Bristol-Myers Squibb posted a 10% increase in quarterly revenues as sales grew amid increased research and development spending, and Kraft Heinz beat on both earnings and sales expectations.