12th Apr 2016 07:16
LONDON (Alliance News) - Shares opened slightly lower in London Tuesday, ahead of UK inflation readings and after the US first-quarter earnings season opened on Monday.
Anglo American was the top blue-chip gainer, up 4.9%. It said rough diamond sales for its De Beers unit rose in the third sales cycle against the second. The miner said the value of rough diamond sales by De Beers in the third sales cycle hit USD660.0 million, up from USD617.0 million in the second sales cycle for 2016.
Anglo American said continued stability for polished diamond prices has supported a "reasonably positive environment" for rough diamond sales thus far in 2016.
Equipment rental firm Ashtead was the biggest FTSE 100 loser, down 2.9%, after HSBC cut the stock to Hold from Buy.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 0.1% at 6,192.36
FTSE 250: down 0.1% at 16,766.94
AIM ALL-SHARE: down 0.8% at 716.13
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Hang Seng: up 0.4% at 20,518.16
Nikkei 225: closed up 1.1% at 15,928.79
DJIA: closed down 0.1% at 17,556.41
S&P 500: closed down 0.3% at 2,041.99
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GBP: flat at USD1.4258 (USD1.4260)
EUR: flat at USD1.1419 (USD1.1428)
GOLD: flat at USD1,257.09 per ounce (USD1,257.40)
OIL (Brent): flat at USD42.88 a barrel (USD42.90)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Tuesday's Key Economic Events still to come
(all times in BST)
09:30 UK consumer, retail and producer price indices
09:30 UK DCLG house price index
11:00 US NFIB business optimism index
13:30 US export and import price indices
13:55 US Redbook index
19:00 US monthly budget statement
20:00 US FOMC member Williams speech
21:30 US API weekly crude oil stocks
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Like-for-like sales in the UK were down 0.7% on year in March, the British Retail Consortium said. That was well shy of forecasts for an increase of 1.4% following the 0.1% gain in February - and it marked the weakest showing since August. The BRC noted that the presence of Easter in the month may have had an effect on the numbers, as well as a spike in online shopping. Helen Dickinson, chief executive of the BRC said: "This slowdown can't be viewed in isolation; retail is an industry undergoing significant structural change as the investment in the digital offer continues apace while, from a consumer perspective, more disposable income is being spent on leisure and entertainment."
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UK Prime Minister David Cameron has set out new measures to make it harder for people to hide the proceeds of corruption offshore, as Jeremy Corbyn and George Osborne published details of their tax returns. The Chancellor's release showed he received a total taxable income of GBP198,738 in 2014/15, including GBP44,647 in the form of dividends and rental income of GBP33,562, and that he paid income tax of GBP72,210. The figures showed Osborne was earning enough to benefit from his cut in the top rate of income tax from 50p to 45p. Meanwhile, Labour leader Corbyn declared just GBP1,850 of taxable income in 2014/15 over and above his parliamentary salary. The Labour leader had to pay a GBP100 fine after filing the return late.
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The UK Business Secretary has raised the prospect of government involvement in the sale of Tata Steel's loss-making UK assets in a move which has surprised many in the industry. Sajid Javid told the Commons he had been in contact with potential buyers, making clear that the government stands ready to help. "This includes looking at the possibility of co-investing with a buyer on commercial terms," he said. He later said that the government had not ruled anything out, before repeating his belief that the best way forward was for a sale to a private buyer.
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Germany's consumer prices increased as estimated in March, final data from Destatis showed. Consumer prices rose 0.3% year-on-year in March after staying flat in February. The preliminary inflation figures were left unchanged.
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The bailout talks between Greece and its creditors could wrap up as soon as this week, one of the EU's top economy officials said, after weeks of tough negotiations between the two sides over reforms. The creditors are currently reviewing progress under Greece's third, EUR86 billion bailout. Negotiators from the European Commission, the European Central Bank, the International Monetary Fund and the eurozone's bailout fund are in Athens trying to find agreement with the Greek government on future reforms, notably on pensions. An agreement would allow bailout aid to continue flowing to the country and would pave the way for a highly anticipated discussion on Greek debt relief.
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Brazilian President Dilma Rousseff was one step closer to impeachment after a congressional committee voted in favour of advancing proceedings that could result in the embattled two-term leader being removed from office. A special committee of the lower house of congress, the Chamber of Deputies, voted 38 to 27 in favour of impeachment. The request will now be taken up by the full lower house on Sunday. If two-thirds of lawmakers in the 513-seat chamber vote for impeachment, Rousseff would be suspended from office for 180 days while the upper house Senate considers the matter. Rousseff is accused of manipulating budget accounts shortly before the 2014 election in order to conceal the true size of the budget deficit.
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Russia contradicted claims by Syria that an offensive to recapture rebel-held areas of the country's largest city, Aleppo, was imminent. On Sunday, Syrian Prime Minister Wael al-Halqi said a joint operation was being planned to take the city's rebel-held eastern sector. Activists based around the northern city said that Russian and Syrian aircraft have been increasingly active in the area. But the head of operations for the Russian General Staff, Sergey Rudskoy, said that activity was aimed at disrupting plans by jihadists to besiege government territory. "No onslaught on Aleppo is planned," Rudskoy said Sunday in remarks reported by the official TASS news agency.
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Calling what they've learned since focusing on the Zika virus "not reassuring", US health officials said the illness brings a "broader set of complications" for pregnant women than first thought. "Everything we look at with this virus seems to be a bit scarier than we initially thought," said Anne Schuchat of the Centers for Disease Control and Prevention. Speaking at the White House, Schuchat said authorities have learned that Aedes aegypti mosquito primarily responsible for spreading the illness could be present in 30 US states - not just the 12 initially believed.
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BROKER RATING CHANGES
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GOLDMAN CUTS ASTRAZENECA TO 'SELL' (NEUTRAL) - PRICE TARGET 3700 (4400) PENCE
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HSBC CUTS ASHTEAD GROUP TO 'HOLD' ('BUY') - TARGET 970 (1450) PENCE
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COMPANIES - FTSE 100
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Whitbread said Christopher Rogers, the managing director of the Costa coffee shop business, has stepped down from his post to be replaced by Dominic Paul. Rogers will step down from the board on April 20 but remain with the company until July 1 to ensure a smooth handover. Paul will take up his new role on June 6. Paul joins Whitbread from cruise company Royal Caribbean International, where he has been senior vice president of international since 2013. Prior to this, he worked at International Consolidated Airlines-owned British Airways and at easyJet.
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Grocer Tesco said it has agreed to sell a stake in e-commerce business Lazada Group to China's Alibaba Group Holding for USD129.0 million in cash. Tesco first invested in Lazada in November 2013 and had held a 19.6% stake in the business prior to the sale to Alibaba. Its remaining stake in Lazada will be 8.3%. Lazada is an e-commerce platform for local and international sellers and brands in South East Asia. Following the deal, Alibaba will be its controlling shareholder.
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The chief executive of Royal Dutch Shell said the oil major may sell some lower-grade assets in the North Sea in order to improve the overall quality of its portfolio, Reuters reported. Ben van Beurden, speaking at a conference, said: "The North Sea for us will be an area where we have to take a look." He said the assets Shell has acquired through its takeover of BG Group are newer, have more running room and are of higher quality, meaning Shell may look to sell some other North Sea assets.
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COMPANIES - FTSE 250
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Recruiter Michael Page International said gross profit grew in the first quarter despite tough conditions in some markets and a flat performance in the UK. The company said overall gross profit for the quarter to the end of March grew 4.9% year-on-year, or 3.6% in constant currencies. Gross profit rose 14% in Europe, the Middle East and Africa in the quarter, the only area to show robust growth. UK gross profit was flat in the quarter.
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Sports Direct International said it is buying a freehold property on Oxford Street and Poland Street in London for GBP108.0 million. The sporting goods and sportswear retailer said it will redevelop the property, following which it will use the retail part of the property as a new FLANNELS.com flagship store. It will also use the office space above as its new London office, replacing its offices at New Cavendish Street. FLANNELS is a fashion retailer, owned by Sports Direct, selling designer clothing for both men and women. It has eight stores across the UK, but so far has been absent from London.
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Galliford Try said it is completing remedial work to remedy defects in four schools in Edinburgh, after one of the schools lost part of an external wall during a storm earlier this year. This comes after seventeen schools in Edinburgh were unable to open after the Easter break due to fears for pupil safety.
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Moody's on Monday placed steel, mining and vanadium company Evraz's Ba3 rating on review for downgrade. The ratings agency said this reflected the "material deterioration in Evraz's financial performance in the second half of 2015, which led to Evraz's year-end 2015 financial metrics weakening substantially beyond Moody's expectations."
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Defence contractor Ultra Electronics Holdings said it has won a USD9.3 million deal with larger US peer Raytheon. Ultra said it has won a deal with Raytheon Integrated Defense Systems to supply its RiQ Ruggedized Networking Switch to be integrated into the Patriot air and missile defence system.
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COMPANIES - LONDON MAIN MARKET AND AIM
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Online fashion retailer ASOS reported growth in profit in the first half of its financial year, driven by good results in both the international and UK divisions, and said it is on track to deliver full-year results in line with guidance. ASOS said its pretax profit in the six months ended February 29 rose by 18% to GBP21.2 million from GBP18.0 million in the same period the year before, as revenue increased by 21% to GBP667.3 million from GBP550.5 million. "I'm pleased to confirm that we are on track to achieve our previously stated sales and margin guidance for the full year," Chief Executive Nick Beighton said in a statement. ASOS's full-year guidance is for 20% sales growth.
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Breedon Aggregates said the UK Competition & Markets Authority has concluded there is a realistic prospect of a substantial lessening of competition in the ready-mixed concrete markets if it is to acquire Hope Construction Materials. The proposed acquisition, which was first announced in November, now faces being referred for an in-depth investigation by the CMA, unless Breedon is able to address the competition concerns.
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Miner Lonmin said Chief Financial Officer Simon Scott is to step down from his role. Lonmin said Scott's departure date has not yet been determined but it expects he will will leave following the company's interim results in May. Lonmin said the search for Scott's successor is at an advanced stage and said Scott will remain involved with the company after the interims to ease the transition to his replacement.
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Oxford Instruments said it has promoted Chief Operating Officer Ian Barkshire to be chief executive, effective from May 11, as it reiterated its guidance for its recently ended financial year. Incumbent CEO Jonathan Flint will remain on the board until July to complete a smooth transition, the company said. Barkshire has been with the company since 1997, and has also previously held the role of group technical director.
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COMPANIES - INTERNATIONAL
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Alcoa reported a profit for first quarter 2016 that fell about 92% from last year, hurt by weak aluminium prices. The company cut its 2016 global aerospace sales growth outlook. Adjusted earnings per share for the quarter topped analysts' expectations, while quarterly revenues missed their estimates. Alcoa is in the process of spinning off its faster-growing business units, aerospace and automotive-focused business into a separate company, to be named Arconic. The company is on track to complete its separation in the second half of 2016.
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Unions representing employees of Verizon Communications have announced that they will go on strike on Wednesday if a new contract isn't reached. Nearly 40,000 Verizon workers from Massachusetts to Virginia will go on strike at 6 am on Wednesday, April 13 if an agreement is not reached by then.
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Tuesday's Scheduled AGMs/EGMs
Hellenic Carriers (re AIM delisting)
Lighthouse Group
Porvair
Law Debenture
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By Tom Waite; [email protected]; @thomaslwaite
Copyright 2016 Alliance News Limited. All Rights Reserved.
Related Shares:
AstrazenecaAnglo AmericanAshtead Group