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RBS, IAG Drag On FTSE100

Published 23/02/2018, 09:46
Updated 03/08/2021, 16:15

It’s been a lacklustre start to the European session after yesterday’s losses as once again what looked set to be a positive start, saw any early gains evaporate quickly on the open.

On the corporate front Royal Bank of Scotland (LON:RBS) was able to finally post an annual profit for the first time in a decade, but this was largely based on the fact that the ongoing issue with the US Department of Justice remains unresolved. The announcement of a further £2.5bn of restructuring costs over the next two years appears to have not been particularly well received by investors.

British Airways owner IAG (LON:ICAG) also hit an air pocket after the company announced Q4 revenues of €5.47bn which fell short of market expectations of €5.6bn, with annual revenues also falling short by almost €3bn. Annual profits came in at €2.02bn, while the announcement of a share buyback of €500m did little to support the share price.

On the plus side education publisher Pearson (LON:PSON) announced a better than expected full year profit of £576m, which while down from the previous year was better than expected. The company also announced it would be looking to sell its US K12 school business.

BT Group (LON:BT) is also higher after Ofcom moderated its approach on the price controls on the company’s Openreach division for access to the fibre broadband network. The original proposal mooted a charge of £11.23, but this has changed to £11.92 a potential net improvement of £80m over four years.

After yesterday’s late slide in the US saw markets there close a little mixed today’s US open looks set to be a positive one as the bi-polar nature of market sentiment continues to drive price moves in an erratic fashion.

US 10 year bond yields have continued to slip back from this week’s peaks, and this slide looks set to help US markets when they re-open later today.

With little in the way of data on the ticket today US markets are still in the red for the week and it will take something fairly substantive to push them above last weeks peaks.

Dow Jones is expected to open 56 points higher at 25,118

S&P500 is expected to open 13 points higher at 2,717

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No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.

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