Sainsbury's reports full-year statutory loss of £72m
London open
City sources predict the FTSE 100 will open four points higher than Tuesday's close of 6,927.58.
Stocks to watch
Supermaket group Sainsbury's has swung to its first annual loss in a decade and slashed its dividend by nearly a fifth following a hefty property impairment charge and a continued slump in sales. Statutory results showed a loss before tax of £72m in the year ended 14 March, compared with a profit of £898m the year before, mainly as a result of a £628m impairment taken in the first half.
Insurer Direct Line saw gross written premiums slip by 0.9% over the first quarter ended 31 March. Total costs were 10.1% lower at £220.7m and on track to fall in absolute terms over 2015. The firm reiterated guidance for a full-year combined operating ratio of between 94% to 96% after normalising for claims from major weather events. Company chief Paul Geddes said the firm is well positioned “to meet its 2015 financial objectives.”
In the press
UK GDP growth is expected to slow this year to 2.5%, according to the NIESR, down from 2.8% last year and the previous forecast of 2.9%, according to The Guardian.
HP is suing Autonomy's founder Mike Lynch and former finance director Sushovan Hussain for $5bn in damages, writes The Times. The two have been accused of firing a key US employee who had raised concerns about Autonomy's accounts prior to the HP takeover.
Greece's government has said "serious disagreements and contradictions" between the IMF and its European partners are to blame for the three-month bailout impasse, according to The Telegraph.
US close
US stocks closed lower on Tuesday, led by weaker technology and biotechnology stocks, as investors grappled with disappointing trade data.
At close, the Dow Jones Industrial Average was down 142.33 points, while the S&P 500 was down 25.02 points and the Nasdaq 77.60 points.
Jeff Clark, trading analyst at Stansberry Research, said the selling action in recent times indicated investor skittishness ahead of the June Federal Open Market Committee meeting, where Fed officials will assess the implementation of interest rate hikes.
“Over the past several years, ‘buy the dip’ strategy worked very well, but it seems investors now turned to ‘sell the strength’ mentality. We can see that from the market’s inability to follow though on the rallies,” Clark said.
America’s trade deficit with the rest of the world widened unexpectedly in March, according to a preliminary estimate from the US Department of Commerce.