14th Oct 2025 07:59
(Alliance News) - BP expects to post higher Upstream output for the third quarter, Close Brothers lifted its car finance provision and Bellway said a tough consumer backdrop in the housebuilding sector has persisted.
Here is what you need to know before the London market open:
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MARKETS
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FTSE 100: called down 0.3% at 9,411.47
GBP: lower at USD1.3281 (USD1.3331 at previous London equities close)
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ECONOMICS
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The UK unemployment rate unexpectedly rose in the three months to August, numbers on Tuesday showed, though total earnings growth was higher than predicted. According to the Office for National Statistics, the jobless rate was 4.8% in the three months to August, rising from 4.7% in the three months to July. The last time the jobless rate was higher was in March 2021, the ONS said. It had been expected to stay at 4.7%, according to consensus cited by FXStreet. The ONS said payrolled employees in the UK fell by 93,000 on-year in August alone but did rise by 10,000 on-month. The early estimate for September, which the ONS warns is likely to be revised, payrolled employees fell by 100,000 on-year and by 10,000 on-month to 30.3 million. "The estimated number of vacancies in the UK fell by 9,000 (1.3%) on the quarter, to 717,000, in July to September 2025. This is the 39th consecutive period where vacancy numbers have dropped compared with the previous three months," the ONS said. Annual growth in regular earnings, so excluding bonuses, was 4.7% in the three months to August, easing from 4.8% in the three months to July. The figure landed in line with consensus. Total pay growth, however, surprisingly accelerated to 5.0% from 4.8%. It had been expected to cool to 4.7%.
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BROKER RATINGS
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RBC cuts IMI to 'sector perform' (outperform) - price target 2,500 (2,475) pence
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Jefferies raises Fevertree to 'buy' (hold) - price target 1,100 (900) pence
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COMPANIES - FTSE 100
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BP says it expects higher Upstream output for the third quarter of the year, but it warns of a "weak" oil trading result. On Upstream operations, BP says it expects to report production was higher "in both oil production & operations, primarily higher gas production in bpx energy, and in gas & low carbon energy". In Gas & Low Carbon Energy, it expects to report a USD100 million hit from changes in non-Henry Hub natural gas prices. "The gas marketing and trading result is expected to be average," BP adds. BP says: "In the oil production & operations segment, realisations, compared to the prior quarter, are expected to be broadly flat, including the impact of the price lags on BP's production in the Gulf of America and the UAE." Oil Production & Operations exploration write-offs are expected to be around USD100 million higher than the prior quarter. BP also updates on its Customers & Products segment. In Customers, it notes "seasonally higher volumes with broadly flat fuels margins". For Products, it notes "stronger realised refining margins" in the range of USD300 million to USD400 million. This will be "partly offset by seasonal effects of environmental compliance costs and the impact of unplanned Whiting outage due to exceptional weather conditions", however, BP warns of a "weak" oil trading result. BP notes the Brent price averaged USD69.13 a barrel in the third quarter, rising from USD67.88 in the second. BP expects to report asset impairments in the range of USD200 million to USD500 million.
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Miner Rio Tinto reports it has left the bulk of its output guidance unchanged, but has lifted its production forecast for bauxite. Rio Tinto says third quarter Pilbara iron ore shipments and production were flat on-year, while bauxite production was 9% higher. Alumina output rise 7% and aluminium production was 6% higher, it adds. Copper was up 10%. "We continue to strengthen performance from our assets, setting back-to-back quarterly production records in our bauxite business and at Oyu Tolgoi [Mongolia] - where the underground ramp-up remains on track to boost copper output by more than 50% this year," Chief Executive Simon Trott says. "We are focused on delivering a strong finish to the year from the Pilbara [Western Australia]. Our growth projects are also progressing at pace - at Simandou [Guinea], we started loading first ore at the mine for movement down the rail and to the port in October." Simandou is an iron ore project. Rio Tinto says it has upped its bauxite output guide to 59 to 61 million tonnes, from the 57 to 59 million range previously. The rest of its forecast was unchanged, though it does not it now expects Pilbara shipments at the lower end of its 323 to 338 million tonnes range after "cyclone impacts" in the first quarter.
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COMPANIES - FTSE 250
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Close Brothers says it has lifted its motor finance compensation provision to GBP300 million, from GBP165 million, as the merchant bank hits out at a Financial Conduct Authority redress plans which it does not deem "proportionate". The total GBP300 million provision includes redress and some operational costs and is the firm's best estimate "at this stage". The provision has been lifted from GBP165 million. "The ultimate cost to the group could be materially higher or lower than the estimated provision depending on the outcome of the consultation and any further legal, regulatory or industry developments," Close Brothers adds. On Thursday, it warned of a material increase in its existing provision. Last week, the Financial Conduct Authority said car finance mis-selling will cost providers around GBP8.2 billion, with an additional GBP2.8 billion of administrative costs, taking the total to GBP11 billion. Close Brothers believes the FCA plan will see a "greater likelihood that more historical cases". "The group is committed to achieving a fair outcome for customers and providing redress where loss has occurred. However, it does not believe the redress methodology proposed by the FCA appropriately reflects actual customer loss or achieves a proportionate outcome. In addition, the FCA's proposed approach to assessing unfairness does not align with the legal clarity provided by the Supreme Court judgement in respect of the 'Johnson' case, which confirmed that the test for unfairness is highly fact specific and must take into account a broad range of factors. The group will continue to engage with the FCA in respect of these points," Close Brothers says.
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Housebuilder Bellway reports an increase in annual earnings, but cautions that "weak consumer sentiment" has persisted. For the year to July 31, pretax profit rises 21% to GBP221.9 million from GBP183.7 million, as revenue climbs 17% to GBP2.78 billion from GBP2.38 billion. Bellway lifts its final dividend by 29% to 49.0 pence per share from 38.0p, meaning a total dividend of 70.0p, up 30% from 54.0p. Bellway announces the start of an initial tranche of GBP75 million of a GBP150 million share buyback programme. Housing completions rise 14% to 8,749. "Bellway has delivered a good performance in FY25 with double-digit growth in volume output and profits, and our sharper focus on balance sheet efficiency is reflected by the GBP150 million share buyback programme announced today," CEO Jason Honeyman says. "While we face some near-term market challenges, we have a high-quality land bank, strong balance sheet and the operational capacity to capitalise on the positive long-term fundamentals of our industry. Combined with our refreshed and disciplined approach to capital allocation, I am confident that we can drive increased volume output, cash generation and shareholder returns in FY26 and beyond." Since the start of the new financial year, "there has been a continuation of weak consumer sentiment which has carried from late spring", Bellway cautions. "Customer demand has been affected by ongoing affordability constraints and uncertainties about potential taxation changes in the government's budget in November 2025," it adds.
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E-commerce firm THG says it saw its best organic growth since 2021, as its Nutrition arm impresses. In the third quarter of the year, revenue rises 2.4% on-year to GBP405.2 million. The constant currency rise from continuing operations is 6.3%, representing its "highest organic quarterly growth since" the final quarter of 2021. Organic growth in THG Beauty is 4.2% for the third quarter, while for Nutrition, it is 10%. THG says its third quarter result sets it up "favourably" to meet guidance. It expects second half revenue growth between 3.9% and 5.9%.
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OTHER COMPANIES
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Recruiter Robert Walters says market conditions "remain fragile" and it continues to expect that a recovery will only "develop very gradually". Net fee income in the third quarter of the year declines 13% annually to GBP69.6 million, it says. Year-to-date, it is down 15% to GBP209.6 million. "Our year-on-year fee income performance during the third quarter improved slightly compared to the second, albeit with some divergence across our geographic portfolio. Encouragingly, Asia Pacific, our largest segment by net fee income, saw broad-based improvement and UK specialist recruitment grew year-on-year. Europe, however, continued to be challenging. Whilst we are seeing signs of sustained improvement in a select number of hiring markets, overall conditions globally remain fragile. As such, our planning assumption continues to be that recovery in hiring markets will develop very gradually," CEO Toby Fowlston says.
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By Eric Cunha, Alliance News news editor
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Related Shares:
IMIFevertreeRio TintoBPClose BrosBellwayThgRobert Walters