12th Nov 2026 07:58
(Alliance News) - The UK economy grew at its fastest pace in two years in the third quarter of 2026. Burberry returns to profit in the first half, while Rolls-Royce announces an additional GBP1.5 billion share buyback following strong trading.
Here is what you need to know before the London market open:
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MARKETS
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FTSE 100: called up 0.7% at 10,909.47
GBP: lower at USD1.3268 (USD1.3284 at previous London equities close)
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ECONOMICS
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UK gross domestic product grows 0.7% in the third quarter of 2026, the fastest quarterly rate since the start of 2024, and accelerating from 0.5% in the second quarter and matching FXStreet-cited market expectations, according to the Office for National Statistics. On an annual basis, growth accelerates to 1.9% from 1.4%, also in line with forecasts. The services sector expands by 0.9%, while production grows 0.1% and construction contracts 0.7%. GDP per head rises 0.7% quarter-on-quarter. Meanwhile, monthly GDP increases 0.2% in September, beating expectations of no growth, following a flat reading in August. Separately, the UK's goods trade deficit widens to GBP22.29 billion in September from GBP19.61 billion in August, exceeding expectations of GBP19.2 billion.
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BROKER RATINGS
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Deutsche Bank Research raises Spirax price target to 8,250 (7,500) pence - 'hold'
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Berenberg raises Keller Group price target to 3,600 (3,450) pence - 'buy'
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COMPANIES - FTSE 100
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Burberry Group reports a return to profit in the first half of its financial year, as revenue rises and its turnaround strategy continues to deliver growth. For the 26 weeks to September 26, revenue increases 6% to GBP1.10 billion from GBP1.03 billion a year earlier, while pretax profit reaches GBP19 million, swinging from a GBP48 million loss. Adjusted operating profit rises to GBP62 million from GBP19 million, with the adjusted operating margin improving to 5.7% from 1.9%. Comparable retail sales grow 4.0%, marking five consecutive quarters of growth, while wholesale revenue rises 17%. By region, comparable sales increase 12% in the Americas and 7.0% in Greater China, but fall 2.0% in Europe, the Middle East, India and Africa. Burberry expects further revenue growth and margin expansion in financial 2027, while remaining mindful of the uncertain external environment. Chief Executive Officer Joshua Schulman says: "Two years ago, we launched Burberry Forward. Today, our brand and our business are stronger. Five consecutive quarters of growth and improved quality of sales demonstrate that our strategy is working...Having laid the foundations for growth, I am more confident than ever that we will realise the full potential of this extraordinary British luxury brand."
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BAE Systems raises its 2026 free cash flow guidance to around GBP3.0 billion from more than GBP2.0 billion previously, following strong trading and order intake. The defence contractor says it has secured GBP33 billion in orders so far this year, with further agreements expected before year-end. It maintains its full-year guidance for sales growth of 8.0% to 10%, underlying earnings before interest and tax growth of 10% to 12%, and underlying earnings per share growth of 11% to 13%. BAE says strong second-half trading in Electronic Systems, Air and Platforms & Services has more than offset subdued growth and margins in Maritime. It expects to return around GBP1.6 billion to shareholders through dividends and share buybacks in 2026. CEO Charles Woodburn says: Our substantial backlog provides good visibility and, with our portfolio aligned to evolving threats and customer priorities, we remain well positioned to deliver sustainable growth over the years ahead."
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Rolls-Royce Holdings announces an additional GBP1.5 billion share buyback, as it reiterates its full-year guidance following strong trading in the second half of 2026. The buyback, to be completed by its annual results on February 25, follows the substantial completion of its previously announced GBP2.5 billion programme for 2026 and forms part of its existing GBP7 billion to GBP9 billion buyback plan for 2026 to 2028. The engineering group remains confident of delivering underlying operating profit of GBP4.7 billion to GBP4.9 billion and free cash flow of GBP3.8 billion to GBP4.0 billion this year. Large engine flying hours rise 4.0% year-on-year in the first 10 months of 2026, reaching 114% of 2019 levels, while its large engine order backlog grows to around 2,500 engines. In Power Systems, orders increase 62% in the first nine months, with the backlog reaching a record GBP8.6 billion. Rolls-Royce says it will revisit its medium-term targets at its annual results in February.
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COMPANIES - FTSE 250
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Metro Bank Holdings announces a strategic review, including the launch of a formal sale process, as it explores options to accelerate growth and maximise shareholder value. The UK lender says it is inviting expressions of interest for a potential takeover of the entire company, although it is not currently in discussions with any potential bidder and has received no approaches. Morgan Stanley has been appointed lead financial adviser for the process. Metro Bank says it remains confident in its standalone growth prospects and reiterates its guidance for return on tangible equity of more than 13% in the fourth quarter of 2026, above 15% in 2027 and above 18% in 2028. The bank says there is no certainty that an offer will be made or a sale completed. The firm has shifted its strategy away from mainstream lending to focus on a more "underserved market" as part of a major turnaround since 2023.
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Serco Group agrees to acquire the US business of Qinetiq Group for USD292 million in cash, expanding its defence capabilities in North America. The consideration comprises USD237 million for the operating business and a USD55 million acquired tax benefit. Serco expects the business to generate revenue of around USD370 million and underlying operating profit of USD21 million in 2027, with the acquisition expected to boost underlying earnings per share in 2028. The deal is expected to complete in the first quarter of 2027, subject to regulatory approvals, and does not change Serco's 2026 guidance. QinetiQ says the sale completes its strategic review and will allow it to focus on UK, European Nato and allied defence markets. It plans to return GBP200 million of the proceeds to shareholders through additional buybacks and has recognised a non-cash impairment charge of around GBP175 million in its interim results.
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Dr Martens reports a narrowed pretax loss of GBP8.5 million in the first half of its financial year 2027, from GBP11.0 million a year earlier, although its adjusted pretax loss widens to GBP13.7 million from GBP9.4 million. The footwear retailer swings to an adjusted earnings before interest and tax loss of GBP2.8 million from a GBP3.1 million profit. It maintains its interim dividend at 0.85 pence per share. Dr Martens says direct-to-consumer trading remains challenging, with October revenue showing signs of improvement from a very weak September, although sales continue to decline due to weakness in boots. Resilient demand for shoes and sandals is insufficient to offset the decline. Looking ahead, the company warns that a "wide range of outcomes" remains possible for revenue and profit in financial 2027.
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Wizz Air Holdings reports a 67% fall in net profit to EUR108.1 million for the six months to September 30 from EUR323.5 million a year earlier, as higher fuel costs and disruption in the Middle East weigh on profitability. Revenue rises 14% to EUR3.80 billion from EUR3.34 billion, supported by a 26% increase in passenger numbers to 46.1 million. Operating profit falls 40% to EUR264.5 million from EUR439.2 million, although second-quarter operating profit rises 8.8% to EUR447.8 million. The airline says trading momentum has continued into the second half, with unit revenue rising around 5.0% year-on-year in October. It expects third-quarter seat capacity to grow around 19%, with revenue per available seat kilometre increasing by a low-single-digit percentage. Wizz Air forecasts mid-single-digit growth in non-fuel unit costs for financial 2027 and says 22 aircraft remain grounded due to engine inspections, down from 35 a year earlier.
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Young & Co's Brewery reports a 9.2% rise in pretax profit to GBP33.4 million for the 26 weeks to September 28 from GBP30.6 million a year earlier, as revenue grows 10% to GBP291.1 million from GBP263.6 million. The pub operator says like-for-like sales increase 6.4%, supported by favourable summer weather and the football World Cup. Adjusted pretax profit rises 19% to GBP37.1 million from GBP31.1 million, while the adjusted operating margin improves to 16.0% from 15.4%. Young's maintains its interim dividend at 12.22 pence per share. The company says integration of the nine Cubitt House pubs acquired in April is complete. Trading momentum continues after the period end, with revenue up 10% and like-for-like sales rising 5.1% in the subsequent six weeks. CEO Simon Dodd says: "Boosted by excellent trading across the summer months, supported by record weather and the FIFA World Cup, Young's has delivered another period of outstanding performance." Notably, Christmas bookings are up 11% on-year, with the firm highlighting that "the lucrative walk-in trade over the Christmas and New Year period remains a huge focus for our teams."
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OTHER COMPANIES
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Atomic Metals begins trading on the Access segment of the Aquis Stock Exchange Growth Market under the ticker ATO, following a fundraising of approximately GBP2.34 million. The fundraising comprises GBP698,250 raised at 2.25 pence per share ahead of its initial public offering and a further GBP1.64 million raised at 3.0p per share through a placing and subscription. The company, classified as an enterprise company on Aquis, is seeking to acquire, explore and develop critical and precious metals projects, including uranium, copper, silver and gold, primarily in the US, Canada and Australia. Atomic Metals is chaired by Paul Johnson, who also serves as interim chief executive officer.
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By Eva Castanedo, Alliance News senior economics reporter
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Related Shares:
Young & Co's BreweryRolls-RoyceBAE SystemsBurberryMetro BankSercoQinetiqWizz AirKellerSpirax-Sarco