Key occasions
UK authorities ‘intently monitoring’ Thames Water
The UK authorities is “intently monitoring” Thames Water and able to take motion if obligatory, in line with the atmosphere secretary, as Britain’s largest water firm is battling for its survival, blighted by sewage scandals, fines and large money owed.
Steve Reed instructed LBC Radio:
We’re intently monitoring the state of affairs with Thames… the corporate stays viable, but when we’ve got to take motion, we’re ready to try this.
The information got here after it emerged that water corporations in England may very well be banned from making a revenue underneath plans for a whole overhaul of the system.
The concept is without doubt one of the choices being thought of by a brand new fee arrange by the Division for Surroundings, Meals and Rural Affairs (Defra) amid public fury over the best way companies have prioritised revenue over the atmosphere.
Sources on the division mentioned they’d take into account forcing the sale of water corporations in England to companies that may run them as not-for-profits. In contrast to underneath nationalisation, the corporate wouldn’t be run by the federal government however by a personal firm, run for public profit.
The nonprofit mannequin, which is broadly utilized in different European nations, permits workers to be paid substantial salaries and bonuses however any earnings on prime of which can be returned to the corporate.
Deutsche Financial institution experiences revenue rise after smaller hit from lawsuits
Deutsche Financial institution, Germany’s largest financial institution, has reported larger earnings for the third quarter, after taking a smaller-than-expected monetary hit from shareholder lawsuits over its Postbank division. The financial institution mentioned it will resume share buybacks.
Deutsche paused plans for extra share buybacks in July, after reserving a €1.3bn litigation cost linked to its botched acquisition of the lender Postbank greater than a decade in the past. The group has since settled with 80 plaintiffs, about 60% of the lawsuits, and reduce provisions by €440m. Nevertheless, provisions for credit score losses doubled from a 12 months earlier.
The investor lawsuits going by the courts lately declare that the financial institution underpaid for Postbank. This has weighed on Deutsche’s share value.
Deutsche reported a revenue earlier than tax of €2.3bn between July and September, up 31% from a 12 months earlier, boosted by the litigation provision launch. Excluding this, earnings rose by 6% to €1.8bn.
Its funding financial institution beat expectations, with revenues up 11% from a 12 months earlier, mirroring positive factors at US rivals like JPMorgan and Goldman Sachs.
Deutsche’s chief government Christian Stitching mentioned:
In these three months, we made vital progress in placing legacy litigation issues behind us, whereas additionally producing a file third-quarter revenue in our working enterprise.
Nevertheless, revenues on the retail division, which incorporates Postbank, had been flat, whereas the company financial institution posted a 3% decline in income, worse than anticipated.
Lloyds shares rose by 0.7% after the outcomes, which got here in higher than anticipated.
Richard Hunter, head of markets at interactive investor, mentioned:
Lloyds has kicked off the quarterly reporting season in unspectacular style, though there are indicators of enhancing momentum because the 12 months progresses…
General, these outcomes don’t shoot the lights out, however they do present a big factor of consolation that Lloyds continues on its constructive course of journey in the direction of a extra streamlined and digital enterprise, underpinned by a wholesome monetary place. Strikes into different earnings streams resembling bank cards and insurance coverage might nicely bolster its main mortgage income, and the group’s affirmation of its year-end targets is proof that the financial institution stays on observe.
Introduction: Trump commerce drives greenback rally and gold hits file excessive; Lloyds beats revenue expectations
Good morning, and welcome to our rolling protection of enterprise, the monetary markets and the world economic system.
The greenback has rallied, boosted by robust financial information and buyers betting that Donald Trump can clinch subsequent month’s presidential election, whereas gold costs hit a brand new all-time excessive amid rising geopolitical tensions within the Center East.
The greenback is up once more at the moment, as markets shortened the chances of a second Trump administration. Sturdy US jobs figures earlier this month drove buyers to reduce their expectations for Federal Reserve fee cuts, additionally lifting the foreign money. The greenback index – which measures the US foreign money towards six different main currencies – rose to 104.17, the best since early August.
Gold costs have hit a recent file because the battle within the Center East together with uncertainty round US rates of interest and the US election fuelled demand for safe-haven property.
Spot gold climbed to $2,752 an oz, whereas silver costs additionally rose, by 3% to $34.78 an oz.
Over right here, Lloyds Banking Group, Britain’s largest mortgage lender, predicted larger home costs because it reported third-quarter earnings forward of expectations. Chief government Charlie Nunn credited earnings development, price self-discipline and robust asset high quality.
It made a statutory pre-tax revenue of £1.8bn between July and September, down from £1.9bn a 12 months in the past, however above Metropolis forecasts of £1.6bn.
The financial institution has raised its forecast for UK home costs to rise by 3.1% this 12 months, in contrast with an earlier prediction of 1.9%.
The Agenda
Midday BST: US MBA Mortgage purposes
2.45pm BST: Financial institution of Canada rate of interest resolution
3pm BST: European Central Financial institution president Christine Lagarde speech
3pm BST: Eurozone Shopper confidence flash estimate for October
3pm BST: US House gross sales for September
