US watchdog ramps up pressure on Glencore
MINING titan Glencore has found itself at the centre of another corruption probe, this time with American regulators.
The Commodity Futures Trading Commission is investigating Glencore, which mines and trades commodities from coal to agricultural grain.
This new probe adds to the firm’s headache in the US, where the Department of Justice is already scrutinising its oil deals in Nigeria and Venezuela.
Glencore said it believes the CFTC’s investigation is similar in scope to the DoJ’s, which has already demanded records going back as far as 2007.
Canadian regulators have also been needling the group.
They fined the former head of Glencore’s copper business £1.3m in December over misleading financial statements on operations in the Democratic Republic of Congo.
The Canadians also found that Katanga Mining – which is majority-owned by Glencore – failed to disclose its relationship with blacklisted Israeli businessman Dan Gertler. Investors backed away from Glencore, causing its shares to dip by 3.3pc, or 10.6p, to close at 310.85p.
The heavyweight acted as drag on the FTSE 100, which slid 0.1pc, or 5.94 points, to 7428.19 points.
Advertising group WPP wasn’t quite able to pull the Footsie back into the black, even as its shares jumped by 5.4pc, or 49p, to 955p.
WPP’s trading update seemed alarming at first glance. Revenues slipped 2.8pc in the first quarter.
It looked as though the firm was struggling to regain its footing after losing boss Sir Martin Sorrell last year, amid claims he used company cash to pay for a prostitute. Sorrell denies the allegations. WPP has since lost business from the likes of Ford, Glaxosmithkline and American Express, but has assured investors that its turnaround under boss Mark Read is on track.
Russ Mould, AJ Bell’s investment director, said although the results looked bad they were definitely no worse than feared.
He said: ‘Read may get the grace of the next 12 months to lay the foundations for recovery, but is likely to face pressure to get on with building WPP back up again as 2020 looms.’
Textbook-maker Pearson, which is trying to move into the 21st century by becoming an online education firm, finally seems to be making progress.
Revenues for the first quarter of the year climbed by 2pc, and the company is set to make £330m of savings per year by the end of 2019. Annual profit forecasts were steady at £590m to £640m, but investors showed little enthusiasm as shares ended the day down 0.7pc or 6.4p at 858.6p. George Salmon, an analyst at Hargreaves Lansdown, said: ‘The worry for investors is that, for all the recent progress, the risks remain unchanged.
‘Pearson’s strategy makes sense – but only if the educational market ends up looking very much like it does now, but with tablets rather than books. The challenge will be retaining market share in a world where freely available online resources provide a new type of competition,’ he said. On the FTSE 250 IT provider
Computacenter rocketed as it said trading in the first three months of the year had been ‘pleasing’.
Both revenue and profits at the firm, which works with bodies from the NHS to the Royal Mail, were ahead of expectations.
Shares in the firm shot up 18.3pc, or 197p, to 1275p.
But insurer Hastings Group countered the gains, tumbling by 12.8pc, or 28p, to 191p. Though live customer policies were up 3pc to 2.75m, Hastings warned that the cost of paying claims is rising rapidly across the industry.