What to watch: Robert Walters' shares up on dividend news, TalkTalk gets takeover bid and easyJet CEO demands more support
Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and around the world:
Robert Walters' shares gain on dividend news
British recruiting firm Robert Walters (RWA.L) has reinstated its interim dividend on Thursday, following encouraging signs of a turnaround in its Asia-Pacific and technology-driven operations.
The news sent shares higher by as much as 6% in early trading.
The recruiter had cut its dividend earlier this year as a contingency measure for the hiring downturn due to the COVID-19 pandemic, it said in a statement on Thursday. An interim dividend will now be paid to shareholders on 6 November.
“With some key forward-looking indicators either stabilising or showing signs of improvement, we believe now is the right time to end the voluntary reduced working hours scheme for all employees globally and to reinstate the interim dividend,” CEO Robert Walters said in the statement.
Recruiters around the world have been hit hard by hiring freezes at the start of the health crisis, forcing many to come up with cost-cutting measures to weather market turbulence.
TalkTalk gets takeover bid
Telecoms group TalkTalk (TALK.L) has received a £1.1bn ($1.4bn) takeover approach from a London hedge fund, which hopes to take the business private.
TalkTalk said in a statement on Thursday it had received a preliminary offer from Toscafund Asset Management to buy the business for 97p per share.
The offer values TalkTalk at around £1.1bn and represents a 16% premium on Wednesday’s closing price.
Shares in TalkTalk jumped 13% to 94p at the open in London on Thursday.
A spokesperson for TalkTalk confirmed the board had recently received the approach and had decided to progress talks after considering the offer and input from advisors. Barclays and Deutsche Bank are advising TalkTalk.
The telecoms company warned investors that a firm bid was not certain. Toscafund’s approach is contingent on a number of preconditions, including the support of TalkTalk’s executive chairman Sir Charles Dunstone.
EasyJet CEO calls for support
The chief executive of EasyJet (EZJ.L) has renewed calls for government support for the airline industry, warning the sector faces “the most severe threat in its history.”
EasyJet chief executive Johan Lundgren said the company would make the first loss in its 25-year history this year as a result of the COVID-19 pandemic.
“EasyJet came into this crisis in a very strong position thanks to its strong balance sheet and consistent profitability,” he said. “This year will be the first time in its history that easyJet has ever made a full year loss.”
In a trading update on Thursday, easyJet said it expects to lose up to £845m ($1bn) this year. The airline has been forced to cancel scores of flights and lay off thousands of staff, after the pandemic led to collapsing demand for air travel. Passenger numbers have fallen by 50% over the last 12 months.
Conditions are set to remain tough, with easyJet forecasting it will fly just 25% of its usual capacity over the next few months.
Market pressure eases as US fiscal policy and a Democratic win appear in focus
Investor confidence grew overnight following renewed hopes for a US stimulus deal and markets now pricing in a Democratic victory during the elections in November.
On the Brexit front, the pound slid on Wednesday after reports emerged that the UK government was threatening to walk out of talks next week if a deal wasn’t clearly in focus by 15 October.
However, as analysts pointed out in a note from Deutsche Bank on Thursday, “this simply echoed what UK prime minister Johnson had said back in early September,” explaining why sterling swiftly clawed back most of its losses. With European Council president Charles Michael tweeting that “the EU prefers a deal but not at any cost” Deutsche analysts added that they still hold out hope that progress can be made to extend talks.
European markets opened in positive territory. The pan-European STOXX 600 (^STOXX) was up 0.7%. Germany’s DAX (^GDAXI) was up by 0.8%, and France’s CAC 40 (^FCHI) also tilted up by 0.6%. The FTSE 100 (^FTSE) was up by 0.3% in London.
