Below are the key morning headlines from today’s papers, featuring the Financial Times, The Times, The Telegraph, The Daily Mail & more - see the full Press section here.
Wall Street rallies, as UK wage growth accelerates. Shares have opened higher on Wall Street, as investors try to put last week’s turmoil behind them. The Dow has jumped by 233 points, or 0.9%, with the Nasdaq streaking 1.2% higher. Today’s decent results from Morgan Stanley and Goldman Sachs seem to be shoring up confidence in New York. US industrial production rose by 0.3% in September, boosted by gains in manufacturing and mining, beating forecasts of 0.2% growth. That’s down on August’s 0.4%. The Federal Reserve also said manufacturing output increased 0.2% in September after rising 0.3% in August. Sterling has jumped by half a cent this morning, following today’s unexpectedly strong wage growth. This has pushed the pound up to $1.321, recovering last week’s Brexit-induced losses.
Ed Sheeran has given Gear4Music a boost. The AIM-listed firm has seen loop pedals - as used by Sheeran - fly off the shelves. These pedals allow artists to record and replay sounds live. “Sales have gone through the roof,” said chief executive Andrew Wass. Sales rose 36% to £42.5 million from £31.2 million for the half year to August 31. But underlying profits were down at £652,000 from £717,000 the year before, dragged down by selling other brands rather than its own instruments, which usually makes it more money. Wass said it was a blip rather than a trend.
Kape Technologies announced it has bought ZenMate, a security software business for €4.8 million (£4.2 million). ZenMate encrypts and secures internet connections and protects individuals’ privacy and digital data. Kape Technologies shares rose 2.2p to 114.7p
Big Four supermarkets ailing as Christmas food battle hots up. Big Four supermarkets ailing as Christmas food battle hots up. The UK’s biggest supermarkets are struggling to keep up with rivals as they enter the key Christmas trading period, it emerged on Tuesday. Three of the Big Four grocers — Tesco (TSCO) , Sainsbury (J) (SBRY) and Asda — lost shoppers to rivals in the 12 weeks to October 7, according to the latest industry data from Kantar. Tesco’s market share fell from 28% to 27.4%, Sainsbury’s was down from 15.8% to 15.4% and Asda’s decreased from 15.5% to 15.3% compared with this time last year. Morrison (Wm) Supermarkets (MRW) was flat at 10.3%. Discounter Aldi continued to snap at their heels. Its growing number of stores helped it increase its market share by 0.8% to 7.6% and sales rose by 15.1% — the fastest growth since January for the German chain.
Drax in £700m Scottish power deal to boost earnings in shift away from coal. Drax Group (DRX) has bought a clutch of power plants from Scottish Power owner Iberdrola for £702 million in a further shift away from coal. The portfolio, which includes the famous Cruachan plant in Scotland known as “hollow mountain” and featured in James Bond films, will boost Drax’s low carbon push. The earnings from the portfolio are expected to be between £90 million and £110 million in 2019. Chief executive Will Gardiner said: “This acquisition makes great financial and strategic sense, delivering material value to our shareholders through long-term earnings and attractive returns.”
McAlpine gets £350m boost as it wins contract to build Deutsche’s new home. Sir Robert McAlpine has landed London’s biggest building deal of the year, overseeing the construction of Deutsche Bank’s new headquarters above Moorgate Tube station. McAlpine — behind iconic projects in the capital such as the 2012 Olympic stadium — has landed the 21 Moorfields project from developer Land Securities Group (LAND) . The construction deal, worth an estimated £350 million, is a boost for the privately owned contractor, which made losses of more than £20 million last year. Deutsche Bank, which employs around 8000 staff in London, committed itself to the scheme last year in a morale-booster for the City after Brexit.
WPP in talks to buy FT’s London HQ in £90m-plus deal. One Southwark Bridge could become ad group’s head office in break from Sorrell era. WPP (WPP) is in advanced talks to buy the Financial Times’s London headquarters for more than £90m in another significant break from the Sir Martin Sorrell era. The media and advertising group is understood to be close to striking a deal for the building, as new its chief executive, Mark Read, continues to ring the changes after the company founder’s abrupt resignation in April. The FT is due to vacate the building next year, to return to its previous offices at Bracken House near St Paul’s Cathedral.
Merlin Entertainment dented as Legoland parks’ growth falters. Attractions operator Merlin Entertainments (MERL) had less than awesome news for investors on Tuesday as sales growth at its Legoland parks slipped into reverse. The update for the first 40 weeks of the year, including the crucial July and August summer months, saw like-for-like revenues slip 0.3%. The lack of a Lego movie this year meant no tailwind for visitor numbers, although a film will be released early next year. Chief executive Nick Varney said he had been braced for a weaker performance after several years of very strong growth, driven by investment in the parks and popular films. Problems at one park in Shanghai, which was closed, meant profits were short of previous expectations.
Footasylum trips up as it swings to £4 million loss. Sportswear seller Footasylum (FOOT) punishing start to life as a listed company took another tough turn on Tuesday as it slumped into the red. The retailer, which floated on London’s junior AIM market in November, posted a loss of £4 million for the six months to August 25, compared with pre-tax profits of £2.3 million the year before. Footasylum was forced to slash prices to shift its wares and continued to invest in the business, it said. It will now open two shops a year, down from four, in the next few years “to conserve cash” and focus on refurbishing and expanding some of its existing 66 stores.
