13th Nov 2015 08:21
LONDON (Alliance News) - Auto Trader Group pleased an otherwise uninspired market Friday with a sharp jump in profit and its first dividend since listing in London in March. The stock was up 4.5%, the top of the FTSE 250.
The other end of the mid-cap index was occupied by engineering firm IMI, down 4.1% after being cut to Hold from Buy by SocGen.
Among blue-chips, Roll-Royce continued to slide after its profit warning on Thursday, off 3.1% in early deals.
With a raft of economic data from Europe and the US still to come, here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 0.5% at 6,149.14
FTSE 250: down 0.2% at 16,830.54
AIM ALL-SHARE: flat at 737.18
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Hang Seng: closed down 2.2% at 22,396.14
Nikkei 225: closed down 0.5% at 19,596.91
DJIA: closed down 1.4% at 17,448.07
S&P 500: closed down 1.4% at 2,045.97
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GBP: firm at USD1.5217 (USD1.5206)
EUR: firm at USD1.0770 (USD1.0759)
GOLD: up at USD1,082.81 per ounce (USD1,078.18)
OIL (Brent): up at USD45.45 a barrel (USD44.42)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Friday's Key Economic Events still to come
(all times in GMT)
09:00 Italy - Gross Domestic Product
10:00 Italy - Consumer Price Index
10:00 EU Trade Balance
10:00 EU Gross Domestic Product
13:30 US Retail Sales
13:30 US Producer Price Index
14:30 UK Conference Board Leading Economic Index
15:00 US Reuters/Michigan Consumer Sentiment Index Preliminary
15:00 US Business Inventories
15:30 US EIA Natural Gas Storage
17:30 US FOMC member Mester speech
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Germany's economic growth slowed marginally in the third quarter, data from Destatis showed. Gross domestic product climbed 0.3% from the second quarter, when it grew 0.4%. The third quarter growth came in line with expectations. The calendar-adjusted GDP advanced 1.7% year-on-year, slightly faster than the 1.6% rise seen in the prior quarter. Nonetheless, it was slightly weaker than the 1.8% growth forecast by economists.
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The French economy expanded as expected in the third quarter largely due to higher domestic demand, data published by the statistical office INSEE showed. Gross domestic product grew 0.3% sequentially after stagnating in the second quarter. The economy had expanded 0.7% in the first quarter.
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Japan's industrial production grew slightly more than estimated in September, final data from the Ministry of Economy, Trade and Industry showed. Industrial output grew 1.1% month-on-month in September, slightly faster than the 1% increase estimated initially.
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Prime Minister David Cameron urged Britain and India to "forge a more ambitious, modern partnership" as he held talks with his Indian counterpart, Narendra Modi. Cameron said they wanted to create "a stronger economic partnership, a stronger defence partnership and a stronger global partnership," adding that the two sides planned to sign agreements worth more than GBP9 billion during Modi's three-day visit Agreements signed Thursday covered financing for Indian infrastructure, plans to issue rupee bonds in London, cooperation in nuclear energy, joint research in new technology and a five-year plan to develop three "smart cities" in India, Modi and Cameron said.
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Exactly five years after she was last released from house arrest, Aung San Suu Kyi's opposition party learned Friday that it had won a majority of seats in Myanmar's historic election. The National League for Democracy won 238 out of 298 declared seats in the lower house and 110 out of 133 declared seats in the upper house in Sunday's poll, according to the Union Election Commission. The total of 348 means that the NLD will be able to ensure that their nominee for president becomes the next holder of the country's top executive post. Suu Kyi is barred from holding the presidency due to the terms of the constitution, but has said she will run the government from "above the president" after the country's first openly contested elections in a quarter of a century.
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US forces have conducted an airstrike in Syria Thursday night targeting the dreaded Islamic State terrorist Mohamed Emwazi, also known as "Jihadi John". A statement from Pentagon Press Secretary Peter Cook did not confirm if Jihadi John was killed in the airstrike in Raqqa, but said "We are assessing the results of tonight's operation and will provide additional information as and where appropriate."
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Ahead of the G20 summit in Turkey, US President Barack Obama has called for more cooperation among the most powerful economies. In an opinion piece published in the Financial Times on Friday, Obama said while the US is ready to lead global efforts to increase the number of jobs and bring about stronger growth and sustained prosperity, it cannot be the sole engine of global growth. "Other countries have to step up," he writes. "If the world relies excessively on the American consumer, it will jeopardise the sustainability of the global recovery."
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Democratic presidential candidate Hillary Clinton unveiled a USD30 billion plan aimed at helping coal miners, who have been impacted by the declining demand for coal as the country shifts to alternative energy sources. The plan aims at helping workers in Appalachia and other coal-producing areas that have been adversely affected by the fall in coal production and the closure of coal-fired power plants, by investing in economic diversification and job creation. The plan is part of Clinton's strong push for clean energy.
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Thousands of people marched through the Greek capital on Thursday, as unions launched nationwide industrial action to protest against the cash-strapped country's long-running austerity programme. Police estimates put the number of protesters in Athens at 25,000. The march was marred when a group of about 300 masked people threw rocks and incendiary devices at police, who responded with tear gas and flash grenades, ending the confrontation, witnesses said.
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BROKER RATING CHANGES
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DAVY INITIATES LLOYDS WITH 'OUTPERFORM' - TARGET 86.6 PENCE
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CITIGROUP RAISES SMITHS GROUP TO 'BUY'
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JPMORGAN RAISES BAE SYSTEMS TO 'NEUTRAL' ('UNDERWEIGHT') - TARGET 465 (435) P.
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TRADERS: LIBERUM RAISES ICAP TO 'HOLD' ('SELL')
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BERENBERG CUTS SABMILLER TO 'HOLD' ('BUY') - TARGET 4400 (3920) PENCE
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SOCGEN CUTS IMI TO 'HOLD' ('BUY') - TARGET 975 (1350) PENCE
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COMPANIES - FTSE 100
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BHP Billiton provided a further update on the tailings dam breach at its Samarco Mineração SA joint venture with Brazilian miner Vale, saying nine fatalities have been confirmed so far and the operating licence for the site has been suspended. Operations at the Samarco site will remain suspended as authorities open investigations into the incident and rectification plans are developed. BHP said Samarco is continuing to monitor the tailings facilities impacted by the dam breach at the project and is working up plans to reinforce the dam structures and stabilise the local area. Brazil President Dilma Rousseff informed BHP Chief Executive Andrew Mackenzie and Vale Chief Executive Murilo Ferreira that the company will face fines for the accident, according to the Financial Times. She also upped the rhetoric surrounding the incident, comparing it to the 2010 Deepwater Horizon oil spill in the Gulf of Mexico.
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HSBC Holdings said Deputy Chairman Simon Robertson will retire from his role after the group's 2016 annual general meeting. Robertson is one of the group's longest-serving non-executive directors, having been with the company for 10 years.
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International Consolidated Airlines Group on Thursday said it is launching an offer of two tranches of senior unsecured bonds, convertible into ordinary shares, of an aggregate EUR1.00 billion. The first tranche of bonds, due 2020, will have a principal amount of EUR500 million. The second tranche, due 2022, will have the same principal amount. The bonds will carry a fixed rate of interest of 0.25%, and of 0.625% per year, payable semi-annually in arrear for the 2020 and 2022 bonds respectively.
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COMPANIES - FTSE 250
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Auto Trader Group proposed a maiden interim dividend and reiterated confidence in meeting its expectations for its full financial year, as it reported a sharp jump in pretax profit in the first half due to a significant reduction in finance costs. The digital automotive marketplace operator proposed a maiden interim dividend of 0.5 pence following its listing on the London Stock Exchange in March. For the half year to end-September, Auto Trader reported a pretax profit of GBP74.7 million, multiplying from GBP13.1 million a year before, as revenue rose to GBP138.2 million from GBP127.5 million. The leap in profit was primarily the result of a GBP46.2 million reduction in finance costs as Auto Trader benefited from a lower level of debt than under its previous private ownership, and with that debt less expensive.
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Actuators manufacturer Rotork said trading conditions remained tough in the third quarter but said its guidance for 2015 remains unchanged. The company said quotation activity in the third quarter to the end of September was broadly flat year-on-year, but order intake fell 17%. Revenue in the quarter fell 18% in the quarter and Rotork's order book at October 25 was GBP185.0 million, down 13% year-on-year.
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Support services and construction company Interserve said trading had been mixed in its key markets in the second half, but it remains on track to meet its expectations for the full year as it appointed a chairman-designate. Interserve said its outlook for 2015 remains unchanged despite mixed trading conditions in its markets in the second half of the year so far.
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Russian gold miner Polymetal International said it has increased its stake in the Lichkvaz property in Armenia to 100% via the issue of shares worth USD9.7 million. Polymetal said the decision to increase its stake in the project was made following successful exploration drilling at the project. Polymetal is increasing its stake from its current 25% and will cover the USD9.7 million price tag via the issue of 1.1 million new Polymetal shares to the sellers.
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Housebuilding and construction company Galliford Try said market conditions remain strong for all of its business, and it remains confident on its outlook for the current financial year. Galliford Executive Chairman Greg Fitzgerald, in a statement to be given to the company's annual general meeting, said trading in the current financial year to the end of June 2016 has been good, and it remains confident on meeting its expectations for this year and on delivering its strategy out to 2018.
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HellermannTyton Group said it remains confident on meeting its targets for 2015 following a sharp rise in revenue in the first half, helped by translation effects from the weak euro. The company, which makes wires and cables and which recently agreed to be acquired by UK-based automotive parts manufacturer Delphi Automotive for GBP1.07 billion, said its revenue in the first nine months of the year to the end of September was EUR519.9 million, 18% higher year-on-year and up 11% at constant currencies, as the weak euro benefited its numbers.
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Jimmy Choo said it has appointed Elisabeth Murdoch as an independent non-executive director. Murdoch is the daughter of media tycoon Rupert Murdoch.
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COMPANIES - LONDON MAIN MARKET AND AIM
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Japan Residential Investment said it has reached an agreement to be acquired by a unit of real estate and private equity investor Blackstone for GBP152.6 million. Blackstone, which will acquire the Japanese-focused residential property investor through Nikko II Pte Ltd, a newly-incorporated bidding vehicle, will pay 72.00 pence per share for the company. The offer price is a 32% premium to Japan Residential's closing price on Thursday. Japan Residential also said it has received another approach valuing the company at the same amount which may or may not lead to an offer. Discussions with this potential rival suitors are at an early stage and the possible bidder is carrying out due diligence.
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Business technology and services provider Xchanging said it has received an approach from Computer Sciences with an indicative proposal for the company which trumps a previous offer from London-listed outsourcer Capita. Computer Sciences is an Virginia head-quartered IT and professional services company. Xchanging said the indicative proposal from Computer Sciences is to acquire Xchanging for 170 pence per share in cash. This is above the 160 pence per share, or GBP412.0 million takeover it agreed with Capita in October.
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COMPANIES - INTERNATIONAL
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Syngenta rejected ChemChina's offer to buy the Swiss crop chemicals firm in a deal valued at about USD42 billion, citing regulatory risk, Bloomberg reported. China National Chemical Corp, known as ChemChina, made an offer of about CHF449 per share, which would value Syngenta at about CHF41.7 billion or USD42 billion, the report said quoting people familiar with the matter.
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Cisco Systems, the world's largest computer networking gear maker, Thursday reported a 33% surge in first-quarter profit, helped by higher revenues and absence of asset impairment charges. The company's quarterly earnings and revenue trumped Wall Street estimates, but its outlook for the current quarter is below expectations. San Jose, California-based Cisco's first-quarter profit rose to USD2.4 billion from USD1.8 billion last year. Cisco, which makes routers and switches, said revenue for the first quarter rose 3.6% to USD12.68 billion from USD12.25 billion last year. Analysts had a consensus revenue estimate of USD12.65 billion.
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Hulu is reportedly in talks with Time Warner to sell a stake in the company, in a deal that could value the online-video streaming service at about USD5 billion. According to a report from the Wall Street Journal, the deal would make Time Warner a major share holder in Hulu, along with Walt Disney Co, 21st Century Fox and Comcast Corp. Each of the companies will hold 25% stake.
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Friday's Scheduled AGMs/EGMs
Galliford Try
Sefton Resources
Macau Property Opportunities Fund
Base Resources
Trinity Mirror (re Local World acquisition)
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By Tom Waite; [email protected]; @thomaslwaite
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