Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad:
Bayer falls on profit warning
Shares in Bayer AG (BAYN.DE) have fallen as much as 13% in Frankfurt after the agriculture and pharma giant issued a profit warning.
Shares dropped to their lowest level in more than six months on Thursday after the group warned that the coronavirus pandemic would hit profits harder than expected.
“We expect the COVID-19 situation to particularly weigh on our crop science business in the second half of 2020 and then throughout fiscal 2021,” said chief executive Werner Baumann to investors.
He added that he expects Bayer will take a several billion euro write down of assets in its agricultural business, most of which was bought from Monsanto for $63bn (£48.33bn) in 2018.
The news will resume debates over the merits of the takeover of Monsanto as the business struggles to deliver profits and also resolve an $11bn settlement over claims that Monsanto’s Roundup weedkiller causes cancer.
Rolls-Royce wants cash for COVID
Struggling engine maker Rolls-Royce (RR.L) has announced plans to raise up to £5bn ($6.5bn) in debt and equity, as it looks to repair its balance sheet from the blow dealt by the COVID-19 pandemic.
Rolls-Royce announced the funding plans in a statement on Thursday, which include a highly discounted share issue.
Rolls-Royce is seeking to raise £2bn by selling new shares to investors in a 10-to-3 rights issue.
The issue, which comes at a 41% discount, is fully underwritten.
Separately, the company plans to raise up to £3bn in debt. Rolls-Royce is planning to issue a new £1bn bond, has negotiated a new £1bn term loan, and has support from the government’s Export Finance to extend an existing five year loan by a further £1bn.
Halfords jumps on stock upgrade
Halfords (HFD.L) has raised its profit guidance for the rest of the year following strong demand in bike sales during the pandemic.
The retailer said “unprecedented” demand for bikes and cycling products had continued following the “end of the peak cycling and summer staycation season” and pushed like-for-like sales up 46% in the five weeks to 20 September. Overall sales also grew by 22% during the period.
It now expects half-year profits to top £55m, compared with the £35m to £40m it had predicted last month. Shares jumped 18% after the trading update was published on Thursday morning.
While the company said it is prepared to capitalise on the tailwinds as they arise, it did warn that it was cautious over its outlook for H2 as the second wave of COVID-19 hits.
European equities are largely in positive territory despite negotiations between the UK and EU over Brexit intensifying.
The pound fell steeply against the euro and the dollar on Thursday after European Commission president Ursula von der Leyen said Europe would begin legal action against the UK over its threat to break part of the Brexit Withdrawal Agreement. According to the EY Brexit tracker, more than 7,500 finance jobs have already left Britain for Europe.
COVID-19 concerns are also still very much in focus. At a Number 10 briefing on Wednesday, the UK’s chief scientific officer said “there's no cause for complacency” given that hospitalisations and death rates are continuing to rise. The number of cases registered on Wednesday were the highest level reached thus far in the pandemic.