10th Dec 2025 07:51
(Alliance News) - Stocks were called lower on Wednesday, as investors prepare for the US Federal Reserve's interest rate decision and subsequent press conference.
"The FOMC are set to deliver a third straight 25bp cut," Pepperstone's Michael Brown commented, "lowering the target range for the fed funds rate to 3.50% - 3.75%, as policymakers continue to remove policy restriction in an effort to support the stalling US labour market, and as tariff-induced price pressures appear less intense than had been feared.
"Such a decision, though, is unlikely to be a unanimous one; as many as five policymakers may dissent in favour of holding rates steady (the record number of dissents at a meeting is four, in 1983), while Governor Miran may again vote for a larger 50bp reduction, albeit only if his vote isn't the marginal one."
Here is what you need to know before the London market open:
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MARKETS
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FTSE 100: called 35.3 points lower, 0.4% at 9,606.71
GBP: lower at USD1.3314 (USD1.3331 at previous London equities close)
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ECONOMICS
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US President Donald Trump on Tuesday renewed his criticism of Europe over migration and energy policy. Trump urged the UK to boost oil production in the North Sea, saying he had advised Prime Minister Keir Starmer to use this "great energy source" or risk, in Trump's view, not remaining in office for long. He also criticised the expansion of wind power in Scotland, saying "it's costing them a fortune." Speaking to supporters in the US state of Pennsylvania, Trump said of Europeans: "They better be careful because immigration and energy are gonna destroy Europe." Immigration policy was so poor, he claimed, that it was destroying "our beautiful Europe." He then added: "I love Europe."
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BROKER RATINGS
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UBS cuts Unilever price target to 4,440 (4,635) pence - 'sell'
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Goldman Sachs raises Watches of Switzerland price target to 575 (570) pence - 'buy'
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Berenberg initiates Rosebank Industries with 'buy' - target 440 pence
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COMPANIES - FTSE 100
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Berkeley Group, for the six months ended October 31, reported pretax profit of GBP254.0 million, down on-year from GBP275.1 million. Revenue decreased to GBP1.18 billion from GBP1.28 billion. The operating margin expanded to 20.8% from 20.2%. Berkeley has undertaken GBP132.0 million in shares buybacks during the period, up from GBP23.3 million. The firm said it is on track to deliver on its pretax profit guidance for financial 2026 and 2027, and noted the UK government's focus on housing supply. It declined to declare a dividend for the period, down from 207 pence. Also, the company announced that Barbara Richmond, who was chief financial officer at fellow housebuilder Redrow for 14 years before it became Barratt Redrow, is joing its board as a non-executive with effect from January 1.
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COMPANIES - FTSE 250
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Volution released a trading update for the four months ended November 30 ahead of its annual general meeting. It said the financial year has started well, with organic revenue growth at constant currency of about 5%, and that all three regions delivered organic growth in the period, against what continues to be a varied, but generally challenging backdrop. Total revenue growth was just over 30%, it said, when including inorganic growth of 25% from the prior year acquisition of Fantech and a small benefit from foreign exchange. Operating margins have remained strong. "With good organic revenue growth, the inorganic benefit from the Fantech acquisition in December 2024 and strong operating margin performance in the period, we expect to deliver another year of good growth in revenue, operating profit and cash generation," Volution said. Also, the indoor air quality solutions provider has agreed to acquire AC Industries, a Sydney-based designer, maker and supplier of specialist ventilation ducting solutions for secondary ventilation in underground mines. Consideration is AUD150 million, around GBP75 million, on completion. This will be followed by up to AUD28.9 million in further consideration based on Ebitda performance.
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FirstGroup says it has been named as the preferred operator for the London overground suburban rail network contract by Transport for London, acting through its subsidiary Rail for London. The Aberdeen, Scotland-based public transport provider said Rail for London will become the new operator from May 3 next year, with an initial eight-year term contract and an option to extend for up to two additional years at TfL's discretion. The contract is estimated to have a value of around GBP3 billion. First Rail London will also be responsible for operational performance, customer service and ticketless travel. There are a number of key improvements set out in the contract, such as an increase in services on the Mildmay and Windrush lines.
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OTHER COMPANIES
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Elon Musk's SpaceX is pursuing an initial public offering which would seek to raise "significantly" over USD30 billion, Bloomberg reported, citing "people familiar with the matter". The rocket company is targeting a valuation of about USD1.5 trillion for the entire company, and the planned IPO would make it the biggest listing of all time. Anonymous sources told Bloomberg that SpaceX's management and advisers are pursuing a listing as soon as mid-to-late 2026, although it could be 2027, depending on market conditions and other factors.
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Cohort reported results for the six months ended October 31, with revenue increasing 8.9% to GBP128.8 million from GBP118.2 million on-year. But pretax profit decreased 17% to GBP7.1 million from GBP8.5 million. The cost of sales increased 8.7% to GBP86.9 million from GBP80.0 million. The company increased its interim dividend by 10% to 5.80p from 5.25p. Cohort said its order book came to GBP604.5 million as of October 31, and that demand is "healthy" in the core defence markets. It says it still sees a positive outlook for organic growth in the coming years, and that the outlook for the full year remains unchanged.
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By Emma Curzon, Alliance News reporter
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