WSJ City: Tesco Resumes Dividend, City's Lord Mayor Urges Quick Transition Deal

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MUST READS FROM WSJ CITY

Tesco reported an eight-fold rise in first-half pretax profit and returned to the dividend list after a three-year hiatus. The UK’s biggest grocer by market share made a pretax profit of £562 million for the 26 weeks ended Aug. 26, compared with a pretax profit of £71 million a year earlier.

The Lord Mayor of the City of London is set to warn that the UK government’s overtures for a transitional Brexit deal with the EU must be turned into a binding legal agreement by the end of the year to prevent further damage to the Square Mile.

British government ministers presented an upbeat picture of the UK’s prospects outside the European Union at the Tory party’s annual conference in Manchester as Prime Minister Theresa May prepares to deliver a closing speech on Wednesday.

The King of Spain accused leaders in the region of Catalonia of pushing the country toward a constitutional crisis on a day when hundreds of thousands of Catalans mobilised to protest against the actions of Spanish police.

A massive data breach at Yahoo in 2013 was far more extensive than previously disclosed, affecting all of its three billion user accounts, new parent company Verizon Communications said on Tuesday.

The amount of money flowing into emerging markets is set to top $1 trillion in 2017, the biggest flow of funds in three years, as economic growth in these countries and low returns in the developed world bump up demand for assets in many developing nations.

Up until the hurricanes hit, the third-quarter was shaping up to be pretty good for US companies. And now? It is hard to know as there’s an even higher uncertainty around earnings than usual, writes Justin Lahart for Heard on the Street.

The economies of Vietnam and Japan are the most vulnerable to a drawn-out conflict on the Korean peninsula besides the two Koreas themselves, according to a report from Moody’s Investors Service.

IN THE PAPERS

Tory tensions over Brexit have resurfaced after senior ministers said a transition period may last until the end of 2021, defying Boris Johnson’s 'red line' by nine months. FT (£)

Royal Mail workers have voted to strike over pensions with the first national action since the company’s privatisation likely to disrupt Christmas deliveries. FT (£)

The British Retail Consortium has revealed that inflation is making its way back into supermarkets and the high street after four years of falling shop prices. The Times (£)

Uber and TfL have described their first face-to-face meeting as ‘constructive’ after the ride-hailing app’s new boss made an emergency trip to London to try to get the operating licence restored. FT (£)

MARKETS TODAY

Europe’s main stock markets opened with minor gains on Wednesday, while the FTSE 100 inched lower as the pound strengthened against the dollar.

The Stoxx Europe 600 index was up 0.1% in early trading while the UK benchmark was fractionally lower. Tesco was up more than 1% after beating analysts' profit estimates.

The buck drifted lower against the yen, euro and sterling in Asia with the WSJ Dollar Index down 0.2% at 86.53. The index snapped a two-day winning streak in New York on Tuesday, although trading was thin ahead of Friday’s jobs data.

Stocks in Asia were mainly higher, building on fresh records for US indexes, while Hong Kong flirted with 10-year highs.

COMING UP

Services sector PMI; keynote speech by Theresa May at the Tory conference.