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What to Watch: Metro Bank CEO quits, AJ Bell's strong year, and Daily Mail profits slips

Oscar Williams-Grut
Senior City Correspondent, Yahoo Finance UK
A Metro Bank branch is seen in London. Photo: Dinendra Haria/SOPA Images/LightRocket via Getty Images

Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad:

Metro Bank CEO quits

Shares in beleaguered lender Metro Bank (MTRO.L) rose on Thursday after the resignation of its chief executive late the prior evening.

Craig Donaldson announced he was stepping down from Metro Bank after markets closed on Wednesday. Donaldson spent a decade in charge of the challenger bank but has overseen a 90% decline in the bank’s share price this year after loans were misclassified and the bank found itself short on regulatory capital.

“While this has undoubtedly been a challenging year, it has been a privilege to serve,” Donaldson said. “I committed to work with the Board until we felt that the Bank was sufficiently strong for me to step away. 

“This has been achieved and as Metro Bank looks to the future, we have reached that point where I am confident that the Board and the many dedicated teams within Metro Bank will enable this Bank to prosper again.”

Dan Frumkin, who joined Metro Bank in September as chief transformation officer, will serve as interim CEO while the board seeks out a permanent replacement.

“We are working hard to evaluate the Bank's future plans and we will be in a position to update the market in February,” Frumkin said.

Shares in Metro rose almost 1.5% at the open on Thursday in response to the news.

AJ Bell’s strong year

Stockbroking platform AJ Bell (AJB.L) toasted rising profits and revenues in its first annual report since going public last December.

The company said Wednesday that revenue rose 17% to £104.9m in the 12 months to the end of September. Pre-tax profit rose 33% to £37.7m.

Assets under administration rose by 13% to £52.3bn and customer numbers climbed by 17% to 232,066.

“These results are a strong endorsement of the business model and growth strategy that we outlined in the run up to our IPO a year ago,” chief executive Andy Bell said. “Our focus on the needs of our customers and helping them to invest has enabled us to continue to add new customers to the platform and retain existing ones.

“The structural growth drivers for investment platforms in the UK remain strong and if we continue to meet the needs of customers we are well placed to benefit from these over the coming years.”

AJ Bell declared a final dividend of 3.33p per share.

Daily Mail profits slip

Sales and profits fell at the Daily Mail’s parent company despite its online operations helping to weather the continued downturn in newspaper sales.

Pre-tax profits at DMGT (DMGT.L) fell by 21% to £145m for the year to September 30. Revenues dropped 1% to £1.4bn, driven by sliding sales of the Daily Mail and Mail on Sunday newspapers.

Paul Zwillenberg, chief executive of DMGT, said: “We have continued to deliver successfully against our three strategic priorities of increasing portfolio focus, improving operational execution and maintaining financial flexibility.

“We will continue with our active portfolio management approach, focusing on those assets that have the potential to drive good returns through strong cashflow generation and growth in capital value.

“We are now in the next phase of the group’s transformation, optimising our business through targeted and disciplined investment whilst maintaining significant financial flexibility to enhance shareholder value.”

DMGT recently announced a deal to buy The i newspaper for £49.6m.

Dunelm upgrade

Dunelm’s (DNLM.L) stock price rocketed after the homeware and furnishings retailer told investors to upgrade profit expectations for the year.

The retailer said the move to a new website did not impact sales, allowing it to maintain strong online momentum. Margins have also been better than predicted on the back of “sourcing gains and better sell-through”.

Shares rose 18.6%.

Pound hits 31-month high

The pound renewed its surge on Thursday, as traders continue to price in the increasing likelihood that prime minister Boris Johnson’s Conservative party will gain a majority in next week’s general election.

After passing the $1.30 milestone and reaching its highest level since May on Wednesday, sterling on Thursday climbed nearly 0.3% against the dollar to above $1.31 (GBPUSD=X).

The currency was also up 0.1% against the euro (GBPEUR=X), reaching €1.18 — its highest level since May 2017.

Electric car demand surges

Demand for fully electric battery cars surged by almost 230% in November, even as the overall UK car market continued to be dragged down by uncertainty related to Brexit and the looming general election.

The UK new car market fell by 1.3% in November, with 156,621 models registered, according to figures released on Thursday by the Society of Motor Manufacturers and Traders (SMMT).

The SMMT cited weak business and consumer confidence, Brexit-related economic uncertainty, and confusion over newly introduced diesel and clean air zones as reasons for the continued decline.

Stocks mixed

European markets were mixed, with little momentum about due to a lack of trade war news.

The FTSE 100 (^FTSE) was flat, with any gains capped by the rally sterling which makes dollar-earning stocks more expensive.

Germany’s DAX (^GDAXI) was down 0.1%, while France’s CAC 40 (^FCHI) was 0.4%, rebounding from losses earlier in the week. The Euronext 100 (^N100) was up 0.3%.

OPEC members are meeting in Vienna later today, which could move oil prices (CL=F) and stocks.

Overnight in Asia, Japan’s Nikkei (^N225) closed up 0.7%, the Hong Kong Hang Seng Index (^HSI) was up 0.5%, and China’s Shanghai Composite (000001.SS) was up 0.7%.

What to expect in the US

US stocks futures point to a higher open. S&P500 futures (ES=F) were up 0.2%, Dow Jones futures (YM=F) were up 0.2%, and Nasdaq futures (NQ=F) were up 0.2%.

62 companies are reporting in the US later today, including: