Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and around the world:
Accor and IHG stocks up on mega-merger bid claims
Stocks rose in two of the world’s largest hotel companies on Thursday, after reports France’s Accor was weighing up a merger bid for UK rival Intercontinental Hotels Group (IHG).
It came after French newspaper Le Figaro reported Accor had “studied a merger project” with its rival, with both firms still reeling from the pandemic’s hammer-blow to global travel.
IHG has more than 5,900 hotels worldwide, and Accor has more than 5,000.
IHG declined to comment. An Accor spokesperson said: “The group does not comment on market speculations.”
A gloomy outlook from the US Federal Reserve knocked European and Asian stocks on Thursday, and Wall Street futures pointed to further declines in the US when markets open.
Minutes from the July meeting of central bank rate setters published on Wednesday show several policymakers highlighted increased uncertainty over the economic outlook for the US.
The Fed’s growth forecasts for real GDP and the pace of declines in the unemployment rate in the second half of the year were now expected to be “somewhat less robust than in the previous forecast.”
The comments from the world’s most important central bank derailed a Wall Street rally on Wednesday before hitting Asian stocks overnight.
European markets then followed Asia lower on Thursday morning. Britain’s FTSE 100 (^FTSE) was down 1% in early trading, Germany’s DAX (^GDAXI) lost 1.1% and France’s CAC 40 (^FCHI) lost 1.3%. Italy’s FTSE MIB (FTSEMIB.MI) lost 0.8%.
Profits at Frasers Group (FRAS.L), the company behind Sports Direct, fell 20% last year as the impact of the COVID-19 pandemic offset rising sales.
Billionaire Mike Ashley’s Frasers Group said on Thursday that pre-tax profit in the 12 months to 26 April 2020 fell 19.9% to £143.5m ($187.6m).
The slump in profits came even as sales rose 6.9% to £3.9bn, driven by the acquisition of brands like GAME. Excluding acquisitions and currency changes, revenue fell 12.6%.
The stock leapt higher on Thursday morning, climbing more than 17%. It follows an 8% rise on Wednesday.
Sophie Lund-Yates, an equity analyst at stockbroker Hargreaves Lansdown, said: “Store closures during lockdown inevitably knocked the top line, but the overall picture is better than might have been feared.”