Yahoo Finance What to Watch: Greyhound for sale, Brexit slams car production, and 'naked economic terrorism'
Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad:
Greyhound buses up for sale
Transport giant FirstGroup (FGP.L) on Thursday announced plans to sell its Greyhound bus business and review “structural alternatives” to spin off its UK bus arm, after pressure from activist investors.
FirstGroup, which has owned Greyhound since 2007, follows pressure from US hedge fund Coast Capital for the company to split its UK and US assets. Coast Capital has built a 9.7% stake in FirstGroup and is the company’s largest shareholder.
FirstGroup, which also runs train lines including South Western Railway, said it will continue to manage its rail franchises but cautioned it had concerns over “risk and rewards” in the sector.
It added it was waiting for the outcome of the Government’s review into the rail industry and said “any future commitments to UK rail will need to have an appropriate balance of potential risks and rewards for our shareholders.”
Brexit slams car production
UK car production fell by an “extraordinary” 44.5% in April, according to new stats from the Society of Motor Manufacturers and Traders (SMMT).
Just 70,971 cars rolled off production lines in the month. The SMMT blamed delays to Brexit, as well as slowing demand from the EU, China, and the US.
Mike Hawes, the chief executive of SMMT, said: “Today’s figures are evidence of the vast cost and upheaval Brexit uncertainty has already wrought on UK automotive manufacturing businesses and workers.
“Prolonged instability has done untold damage, with the fear of ‘no deal’ holding back progress, causing investment to stall, jobs to be lost and undermining our global reputation.”
China attacks ‘naked economic terrorism’
China has continued to ramp up trade hostilities with the US, with a senior official making a thinly veiled jibe at the Trump administration.
Speaking to reporters in Beijing, Chinese Vice Foreign Minister Zhang Hanhui said: “We oppose a trade war but are not afraid of a trade war. This kind of deliberately provoking trade disputes is naked economic terrorism, economic chauvinism, economic bullying.”
While he did not mention the US or President Trump, the comments, reported by Reuters, appear clearly aimed at the United States.
The comments helped contribute to a dour atmosphere in Asian stock markets overnight.
Japan's Nikkei 225 (^N225) closed down by 0.2%, Hong Kong's Hang Seng index (^HSI) was down by 0.3%, and China's benchmark Shanghai Composite (000001.SS) was down by 0.3%.
... but European markets rebound
European stock markets were resilient on Thursday morning despite the war of words between the US and China.
Britain's FTSE 100 (^FTSE) was up by 0.3%, Germany's DAX (^GDAXI) was up by 0.5%, France's CAC 40 (^FCHI) was up by 0.4%, and the Euronext 100 (^N100) was up by 0.5%.
The mild rebound comes after steep losses on Wednesday that saw most major European indexes fall by at least 1.5%. Thursday’s performance appears to be value hunting by investors who think some stocks may have fallen too far.
“There’s still lots of nervousness out there and the downward pressure is rather powerful and looks hard to resist,” Neil Wilson, the senior market analyst at Markets.com, said. “Any gains look hard won and easy to give up at the moment.”
De La Rue boss quits
The chief executive of De La Rue (DLAR.L) has announced plans to step down, as the company revealed plunging profits and launched a review of the business.
Martin Sutherland will step down as CEO of the bank note and passport maker after five years.
At the same time, the FTSE 100 company announced that operating profits for the year to March 2019 plunged 74% to £31.5m, down from a £123m operating profit the previous year. De La Rue blamed “growing competitive pressure in the bank note print market” for a downturn in performance.
De La Rue said it has launched a three-year strategic review of its business following the loss of its contract to print British passports.
Revenue jumped 14% to £564.8m, significantly driven by growth in its currency division.
Stripe hires ex-Google exec
Stripe, the San Francisco-based payments platform owned by two Irish brothers, has hired Google veteran Matt Henderson to head its newly expanded Dublin engineering hub.
Henderson, who led the search giant’s strategy for scaling the Google Play app store, previously led Amazon’s marketplace strategy in Europe, and founded shopping platform Rangespan, which was acquired by Google in 2014.
Stripe, which was recently valued at $22.5bn (£17.8bn), provides the online payment infrastructure for companies like Spotify, Uber, Deliveroo, and Booking.com.
“One of the reasons we're very excited about Matt and bringing him on is that he has experience not only in leading functions within the largest and most successful technology companies like Amazon and Google, but also has started his own successful company in the past,” said John Collison, co-founder of Stripe, in an interview with Yahoo Finance UK.
Energy firms fined
Three energy companies have received combined fines of £870,000 by Ofgem after breaking competition law.
The industry regulator found that E (Gas and Electricity) Limited, Economy Energy, and Dyball Associates, an energy software and consultancy service, had an anti-competitive agreement to avoid targeting one another’s customers.
The energy suppliers, E (Gas and Electricity) Limited and Economy Energy, worked with energy software and consultancy service Dyball to ensure the two suppliers did not target one another’s customers through face-to-face sales.
As part of the agreement, the suppliers shared commercially sensitive information such as customer meter point detail, Ofgem said.
What to expect in the US
US stock futures were pointing to a higher open after Wednesday’s sell-off.
S&P 500 futures (ES=F) were up by 0.4%, Dow Jones Industrial Average futures (YM=F) were up by 0.3%, and Nasdaq futures (NQ=F) were up by 0.4%.
Companies reporting later in the US today include:
