Pound Could Fall Further as BOE's Bond-Market Intervention Ends Soon
0946 GMT - Sterling could extend its declines as the Bank of England is set to withdraw its emergency support for the bond market on Friday, ActivTrades says. The BOE's temporary bond-purchase program stopped the bond market rout and helped sterling recover from the record low of $1.0349 reached on September 26 after the government unveiled a debt-funded package of tax cuts. "However, the GBP65 billion purchase package will soon come to an end, and the market is once again on the move against British bonds," ActivTrades analyst Ricardo Evangelista writes. "The selloff in gilts is driving the U.K.'s borrowing costs up and weighing heavily on the pound." GBP/USD falls 0.1% to 1.1043 and EUR/GBP rises 0.2% to 0.8793. (renae.dyer@wsj.com)
Companies News:
PureTech Mutually Agrees to End Takeover Talks With Nektar Therapeutics
PureTech Health PLC said Tuesday that it has mutually agreed to terminate takeover talks with potential buyer Nektar Therapeutics.
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Reach CFO Simon Fuller to Step Down; 3Q Revenue Hit by Death of Queen
Reach PLC said Tuesday that Chief Financial Officer Simon Fuller will step down from his role on Dec. 31, and that revenue in the third quarter was hurt by the death of Queen Elizabeth II in September.
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Plus500 Sees 2022 Revenue and Ebitda Ahead of Views Thanks to Robust Customer Income
Plus500 Ltd. said Tuesday that it expects its fiscal 2022 performance to be ahead of market expectations, driven by robust levels of customer income and a flexible cost base.
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WSP Global Says RPS Group Offer Final; Won't Be Increasing Financial Terms
WSP Global Inc. said Tuesday that its offer for RPS Group PLC was now final as it wouldn't be increasing the financial terms of the offer.
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YouGov FY 2022 Pretax Profit, Revenue Rose; CEO to Take Chairman Role
YouGov PLC said Tuesday that its fiscal 2022 pretax profit and revenue both significantly rose on strong demand, and it named Chief Executive Officer Stephan Shakespeare as its next chairman.
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XP Power 3Q Orders, Revenue Rose; Sees Full Year in Line
XP Power Ltd. said Tuesday that orders and revenue rose in the third quarter of 2022 as supply chain issues eased, and that it expects to meet full-year market expectations.
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Sureserve's FY 2022 Results in Line With Views; Order Book Gives Good Earnings Visibility
Sureserve Group PLC said Tuesday that it expects financial results for the year ended Sept. 30 to be in line with management's expectations, and that its order book provided good visibility of future earnings.
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Foresight Group 1H Assets Under Management Rose on Robust Acquisition Activity
Foresight Group Holdings Ltd. said Tuesday that assets under management for the first half of fiscal 2023 rose sharply amid robust acquisition activity.
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Greencore Expects Higher FY 2022 Revenue But Sees Adjusted Profit at Low End of Guidance
Greencore Group PLC said Tuesday that it expects revenue for the year ended Sept. 30 to rise but that it forecasts adjusted operating profit and adjusted earnings per share to be at the lower end of its guidance range.
Market Talk:
Drax Shares Reflect Risks; Biomass Is Transitional
1007 GMT - Drax Group shares are pricing in risks, Citigroup says, upgrading the U.K. biomass-fueled power-station operator to neutral from sell. The shares now fairly reflect political risk around the potential capping of U.K. power prices and recent interest-rate moves, Citi says. "Our FY 2022 earnings per share remains broadly unchanged, while longer-term it's circa-50% lower, given the price cap and operational gearing to power-price assumptions," Citi analyst Jenny Ping says in a note. "We continue to see biomass as a transitional fuel, rather than a green source of generation." Still, Citi cuts its price target on the stock to 537 pence from 616p. Shares fall 0.6% to 530p. (philip.waller@wsj.com)
Centrica Prospects Look Better Than The Market Thinks
1009 GMT - Centrica shares offer attractive risk-reward, Citigroup says, upgrading the owner of British Gas to buy from neutral. Recent share-price weakness suggests the market is being overly pessimistic about the possible impact on Centrica of potential government caps and taxes on energy prices and revenue, Citi says. "Furthermore, in a rising rate environment, we prefer companies with little debt and robust balance sheets, qualities which Centrica possesses and should [be reflected] in its shares," Citi analyst Jenny Ping says in a note. "With potential value-creating opportunities at [gas storage site] Rough and an attractive risk-reward profile, we upgrade to buy." Still, Citi cuts its price target on the stock to 81 pence from 97p. Shares rise 1.5% to 70p. (philip.waller@wsj.com)
Inflation Expected to Remain Main Concern of BOE Amid Resilient Labor Market
1001 GMT - U.K. headline wage growth overshot expectations and the unemployment rate fell further to a new record low of 3.5% in the three months to August, Citi says in a note. While weakness does likely lie ahead, concerns surrounding inflationary feedback effects are likely to remain front and center for the Monetary Policy Committee of the Bank of England, economists at Citi say. "That means an aggressive response, especially to any near term fiscal loosening," Citi says. The American bank continues to expect a 100 basis-point move in November. (maria.martinez@wsj.com)
Contact: London NewsPlus; paul.larkins@wsj.com
(END) Dow Jones Newswires
10-11-22 0627ET
