2nd Oct 2019 11:27
(Alliance News) - The following is a summary of top news stories Wednesday.
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COMPANIES
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Tesco Chief Executive Dave Lewis will step down and the UK's biggest supermarket chain said it has delivered its turnaround goals during the first half of its current financial year. Lewis will leave next summer and will be replaced by Ken Murphy, the former commercial chief of retail pharmacy Walgreens Boots Alliance. For the six months to August 31, Tesco reported 0.6% year-on-year growth in revenue to GBP31.91 billion from GBP31.73 billion. Pretax profit was up by 6.7% to GBP494 million from GBP463 million. Group sales, excluding fuel, rose slightly to GBP28.30 billion from GBP28.29 billion. "Despite challenging external conditions we have delivered a very good start to the year. I'm very pleased to say that we have now delivered every element of the turnaround plan and from this position of strength, the transformation of our business continues at pace," Lewis said. "With the turnaround complete and as we begin to implement the next steps of our sustainable growth strategy, now is the right time to plan a smooth and orderly succession."
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Flutter Entertainment has agreed an all-share acquisition of Canadian online gambling firm The Stars Group. Flutter - which was formerly known as Paddy Power Betfair - said the combined firm's annual revenue would have been GBP3.8 billion in 2018, making it the largest online betting and gaming operator globally. Under the deal, Stars Group shareholders will receive 0.2253 of a new Flutter share in exchange for each Stars Group share. Upon completion of the merger, Flutter shareholders will own 55% and Star Group shareholders 45% of the combined firm. The more-than GBP10 billion merged company will be based in Dublin, with a premium listing on the London Stock Exchange and a secondary listing on Euronext Dublin.
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Standard Life Aberdeen said former co-boss and current Vice Chair Martin Gilbert will retire from the insurer and asset manager in September 2020. Gilbert co-founded Aberdeen Asset Management in 1983. In 2017, Aberdeen Asset Management merged with Standard Life to become Standard Life Aberdeen, with Gilbert assuming the role of co-chief executive officer of the combined group. Gilbert stood down as co-boss of Standard Life Aberdeen in March, becoming vice chair. On Wednesday, Standard Life Aberdeen said Gilbert will not seek re-election at its annual general meeting in May 2020. He will then retire from the firm at the end of September 2020. In July, the Financial Times had reported that Gilbert would be stepping down from his role at Standard Life to become chair of digital bank Revolut.
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Metro Bank said its founder, Vernon Hill, will step down as chair before the end of December. The UK challenger bank, know for its high street branches, added that the search for a new chair is "progressing well" but explained that should a replacement not be found by the end of the year, an existing non-executive director will assume the role on an interim basis. The company said in July that Hill - who founded the firm in the UK in 2010, having found success with the Metro Bank formula in the US - believes it has now "reached a size and scale where it is appropriate to appoint an independent chair".
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Budget airlines Ryanair Holdings and Wizz Air Holdings both reported a rise in passenger traffic in September, compared to a year before. Ryanair said group traffic rose by 7.6% to 14.1 million from 13.1 million reported in September last year. The result includes 600,000 passengers carried by Laudamotion. Meanwhile, rival Wizz Air said it continued to grow its network and improve its customer offering. The Hungarian carrier increased capacity, measured in available seat kilometres, by 20% to 4.0 million from 3.4 million a year prior. Load factor advanced by 0.5 percentage point to 94.5%. Wizz Air carried a total number of 3.8 million passengers in September, which was up 20% year-on-year from 3.2 million. The group's traffic, measured in revenue passenger kilometres, rose by 23% to 6.3 million from 5.1 million reported in September last year.
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MARKETS
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London shares were lower at midday amid global economic fears following weak manufacturing data from the US on Tuesday. Tesco shares were up 0.6%. The pound was down against the dollar after disappointing UK construction PMI data. The UK Conservative Party conference in Manchester concludes on Wednesday with UK Prime Minister Boris Johnson set to deliver his keynote speech at around 1130 BST. Wall Street was pointed to a lower open.
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FTSE 100: down 1.6% at 7,240.45
FTSE 250: down 1.1% at 19,655.61
AIM ALL-SHARE: down 0.4% at 872.11
GBP: down at USD1.2235 (USD1.2251)
EUR: down at USD1.0914 (USD1.0930)
GOLD: flat at USD1,483.65 per ounce (USD1,483.01)
OIL (Brent): down at USD58.80 a barrel (USD59.28)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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UK construction remained in contraction in September, the latest IHS Markit/CIPS purchasing mangers' index showed. The headline PMI posted 43.3 in September, down from 45.0 in August. The reading, further below the neutral mark of 50, signals the building sector suffered even more severe downturn in September than was seen the previous month. Consensus was for the reading to remain unchanged at 45.0 in September. Building activity fell at the second-fastest rate since April 2009, "only narrowly outpaced by June's decline", IHS Markit said. A historically steep drop in new orders was also registered, while firms trimmed employment at the fastest rate since the end of 2010 due to unfavourable demand, client hesitancy and low confidence.
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UK shop prices continued to fall in September, according to the latest British Retail Consortium-Nielsen shop price index. Shop prices in September fell 0.6% year-on-year, following on from a 0.4% decrease in August. The latest figure marked the steepest rate of decline since May 2018. Non-food prices fell by 1.7% annually in September after a 1.5% fall in August, while food prices grew 1.1%, slower than 1.6% the previous month.
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UK Prime Minister Boris Johnson's plan for a Brexit deal will be delivered to Brussels on Wednesday with a message that there will be no delay beyond the October 31 deadline. Johnson will use his speech at the Conservative Party Conference to say "we can, we must and we will" get Brexit done because voters feel they are being "taken for fools" by Westminster's politicians. British officials have made clear to EU counterparts that the legal texts which will be presented to the EU are a final offer and unless Brussels is prepared to engage there will be no more talks until after Brexit.
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North Korea fired a presumed submarine-launched ballistic missile from waters off its east coast, South Korea's Yonhap news agency reported, citing the Joint Chiefs of Staff. The projectile, one of two launches reported on the day, was fired from the waters off the port city of Wonsan at 7:11 am local time and flew around 450 kilometres in an easterly direction, according to the JCS. Yonhap reported the body as saying that the projectile reached a maximum altitude of about 910 kilometres, saying that the missile could have travelled much further had it been fired at a lower angle. The Japanese government said one of the two "ballistic missiles" fell into the country's territorial waters, off the western prefecture of Shimane.
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Donald Trump denounced the impeachment inquiry threatening his US presidency as a "coup," as his administration pushed back hard against the investigation. Trump's comments came after Secretary of State Mike Pompeo vowed to prevent or delay five State Department officials from testifying in the investigation probing accusations that Trump abused his office by seeking dirt from Ukraine on a 2020 election rival. "As I learn more and more each day, I am coming to the conclusion that what is taking place is not an impeachment, it is a COUP," Trump tweeted.
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