FTSE 100 to Open Lower as Inflation Pressures Mount

FTSE 100 to Open Lower as UK Inflation Pressures Mount

0737 GMT - The FTSE 100 is expected to open lower after data showed U.K. inflation accelerated to a near 30-year-high in December, fuelling expectations that the Bank of England will raise interest rates further. Spreadbetting firm IG expects the London index to start trading down 49 points. U.K. consumer prices rose 5.4% on year in December--the highest since March 1992--after a 5.1% increase in November, and compared with the 5.2% increase forecast by economists in a WSJ survey and well above the BOE's 2% target. "The next few months are set to break record after record; inflation will continue to rise and we could see highs of 6% in April when the energy price cap increase sets in," Close Brothers Asset Management's Robert Alster says. (renae.dyer@wsj.com)

 
Companies News:

GlaxoSmithKline Names Tony Wood CSO Designate

GlaxoSmithKline PLC said Wednesday that it has appointed Tony Wood as chief scientific officer from August, replacing Hal Barron, who will become nonexecutive director.

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Smith & Nephew Buys Engage Surgical for Up to $135 Mln

Smith & Nephew PLC said Wednesday that it has acquired Engage Surgical for up to $135 million, contingent on sales performance.

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Burberry's 3Q Comparable Retail Sales Rose Ahead of Market Views

Burberry Group PLC said Wednesday that retail revenue and comparable store sales rose in the third quarter of fiscal 2022, with new customers driving double-digit full-price sales growth across all of its product categories.

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Antofagasta Expects Higher Costs in 2022; 2021 Output in Line With Guidance

Antofagasta PLC on Wednesday warned that its operational costs will jump this year, and reported that production for 2021 was in line with its guidance.

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Experian COO Kerry Williams to Retire; Craig Boundy Named

Experian PLC said Wednesday that Chief Operating Officer Kerry Williams plans to retire from his role after 19 years with the company, and will be replaced by Craig Boundy.

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Wise 3Q Revenue Rose 34%

Wise PLC said Wednesday that its revenue grew 34% in the third quarter of the fiscal year.

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Pearson Expects Increased 2021 Sales, Adj Operating Profit

Pearson PLC said Wednesday that it expects to report increased sales and adjusted operating profit for 2021.

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J.D. Wetherspoon to Report 1H Loss Due to Coronavirus-Related Restrictions

J.D. Wetherspoon PLC said Wednesday that sales for the second quarter of fiscal 2022 were hurt by coronavirus-related restrictions, and that it will be loss-making in the first half of the year.

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Christie Group Sees 2021 Operating Profit Significantly Ahead of Market Expectations

Christie Group PLC said Wednesday that it expects to report operating profit for 2021 significantly ahead of current market expectations.

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WH Smith Says Year-To-Date Revenue Is at 85% of Pre-Pandemic Levels

WH Smith PLC said Wednesday that revenue for the 20 weeks to Saturday was at 85% of 2019 revenue levels, with its high street--or brick-and-mortar retail--business being in a stronger position than its travel division due to the Covid-19 Omicron variant.

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Burberry's 3Q Comparable Retail Sales Rose Ahead of Market Views -- Update

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Liontrust 3Q Assets Under Management Rose

Liontrust Asset Management PLC said Wednesday that assets under management and advice for the third quarter of fiscal 2022 rose 20% from a year earlier.

 
Market Talk:

Antofagasta Costs Are Rising More Than Feared

0755 GMT - Antofagasta's unit costs increased 17% in the fourth quarter from the immediately-prior period to $1.35 per pound. This was 23% higher than expected by Citi, the U.S. bank says. "While the market has been expecting cost inflation to come through from 4Q'21, the magnitude is higher than market expectations, in our view." Moreover, the copper miner forecast that costs will average $1.55 in 2022, implying a on-year increase of around 30%, Citi notes. This is on the higher side of market expectations, and appears conservative given some of the assumptions used by the company, the bank says. (jaime.llinares@wsj.com)

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Sterling Stays Steady As High UK Inflation Confirms BOE Rate-Rise Expectations

0756 GMT - Sterling is little moved even after data showed U.K. inflation accelerated to its highest level in almost 30 years in December. The data bolsters the case for the Bank of England to raise interest rates further, Silicon Valley Bank's Sam Cooper says. "Sterling is largely unchanged post-release as today's data is only confirming current market expectations that inflation needs to be addressed in the coming months." U.K. consumer prices rose 5.4% year-on-year in December --the highest since March 1992--following a 5.1% increase in November, leaving it well above the BOE's 2% target. GBP/USD last trades at 1.3594 and EUR/GBP is at 0.8339. (renae.dyer@wsj.com)

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BHP Likely Looking at Buyback, Then Deals

0451 GMT - BHP is expected to announce a sizable circa $5 billion share buyback alongside its full-year earnings in August, although a buyback as early as its half-year result in February is possible, Jefferies says. "After the unification is complete, a buyback is announced, and petroleum is merged with Woodside, we would expect BHP to look for possible acquisitions to shift its commodity mix more to 'future facing commodities,'" namely copper, nickel and potash, it says. Although, the U.S. bank reckons the risk of an acquisition is likely to be a modest weight on BHP's shares. "The market would not react well to BHP paying a premium for an asset that offers no synergies," Jefferies says. BHP is down 0.3% in Sydney. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

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BHP's Iron-Ore Unit Shines; Copper, Coal Volumes Weak

2340 GMT - BHP's iron-ore output was better than expected, but its production of copper, metallurgical coal and thermal coal all missed expectations, RBC Capital Markets says. "BHP's result is likely to drive modest consensus downgrades although weaker copper production from SGO [Spence Growth Option] may help pricing in what remains a very tight underlying market," RBC says. The broker says that, with iron ore driving so much of BHP's cash flow, the impact from its 2Q operational report should be relatively muted. Focus will quickly shift to votes on unification of the miner's stock, due to be held Thursday. RBC expects the plan to pass, "but we also highlight there is a potential asymmetrical benefit from holding the Limited line versus the PLC line if the votes do not pass." BHP is down 0.6% in Sydney, in line with a fall in materials stocks. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

Contact: London NewsPlus, Dow Jones Newswires; Dow Jones Newswires; paul.larkins@wsj.com

(END) Dow Jones Newswires

January 19, 2022 03:13 ET (08:13 GMT)

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