30th Aug 2023 07:49
(Alliance News) - Stocks in London are called up on Wednesday, in hopes markets will extend Tuesday's rally.
Sentiment has been lifted by weak US data which is driving up hopes that interest rates have peaked.
Data from the US Bureau of Labor Statistics showed there were 8.827 million job vacancies in July, down from 9.165 million in June, and below a FXStreet-cited consensus of 9.465 million. It is the smallest number of openings since March 2021.
In early UK company news, Direct Line appointed Aviva's Adam Winslow as its new chief executive officer. Prudential reported a swing to interim profit.
Here is what you need to know at the London market open:
FTSE 100: called up 0.3% at 7,490.3
Hang Seng: up 0.4% at 18,550.89
Nikkei 225: closed up 0.3% at 32,333.46
S&P/ASX 200: closed up 1.2% at 7,297.70
DJIA: closed up 292.69 points, or 0.9%, at 34,852.67
S&P 500: closed up 64.32 points, 1.5%, at 4,497.63
Nasdaq Composite: closed up 238.63 points, or 1.7%, at 13,943.76
EUR: up at USD1.0864 (USD1.0845)
GBP: up at USD1.2623 (USD1.2616)
USD: up at JPY146.23 (146.04)
Gold: flat at USD1,936.12 per ounce (USD1,936.07)
(Brent): up at USD85.13 a barrel (USD84.24)
(changes since previous London equities close)
Wednesday's key economic events still to come:
11:00 CEST EU economic sentiment indicator
14:00 CEST Germany CPI
09:30 BST UK effective interest rates -July 2023
07:00 EDT US MBA weekly mortgage applications survey
08:15 EDT US ADP national employment report
08:30 EDT US GDP
10:00 EDT US home sales index
The number of home sales taking place across the UK this year is on track to be around a fifth, 21%, lower than in 2022, according to a property website. About one million sales could be completed in 2023, which would be the lowest total since 2012 and equate to the average household moving just once every 23 years, Zoopla said. The website made its predictions based on house sales in the first half of this year. With mortgage costs having increased sharply, the number of house sales with a mortgage is expected to plunge by nearly a third, 28%, this year, compared with 2022. Cash sales where buyers are not relying on a mortgage are expected to hold up relatively well, edging down by 1% compared with 2022.
BROKER RATING CHANGES
Barclays raises Beazley price target to 740 (700) pence - 'overweight'
JPMorgan cuts Kingfisher price target to 220 (230) pence - 'underweight'
COMPANIES - FTSE 100
Prudential reported insurance revenue of USD4.59 billion in the first half of 2023, up from USD4.16 billion year-on-year. The London-based, Asia-focused insurer swung to a pretax profit of USD1.18 billion, swung from a loss of USD1.35 billion a year ago. Prudential declared an interim dividend of 6.26 cents per share, up 9%. Alongside interim results, CEO Anil Wadhwani announced a new purpose and strategy following the completion of his strategic and operational review. Prudential's new purpose statement is "For Every Life, For Every Future." Looking ahead, Prudential expects to grow new business profit at 15% to 20% compound annual growth between 2022 and 2027. Commenting on his first interim results and strategic update, Wadhwani said: "The interim results demonstrate the power of our multi-engine, multi-channel business model across Asia and Africa."
COMPANIES - FTSE 250
Direct Line appointed Adam Winslow as its new chief executive officer. It is expected that he will take up the role of Direct Line CEO in the first quarter of 2024 succeeding Jon Greenwood who has been acting CEO since January. The Bromley, England-based motor and home insurer said Greenwood will work with Winslow when he picks up the role, to ensure a smooth handover and transition. Since May 2021, Winslow has led Aviva's UK & Ireland general insurance business developing a "clear strategy for both personal and commercial lines which has delivered market share expansion and improved profitability". Chair Danuta Gray says: "The board conducted an extensive search and Adam Winslow stood out for his strategic understanding of the sector, outstanding track record of leading high performing businesses and his focus on driving operational excellence to consistently meet customer needs."
UK Commercial Property REIT said it has fully let Sussex Junction, its brand new 107,000 square foot industrial development in Bolney, West Sussex. Birch Sussex, an asset storage and concierge business, has let the 47,000 square foot unit one, on a 15-year lease without break, which increased the rental rate of the property to GBP14.50 per square foot, delivering annual rental income of about GBP677,000. Will Fulton, fund manager of UKCM at abrdn, said: "The logistics occupier market continues to perform well with demand outstripping supply for well-located, high quality assets, as demonstrated by the speed with which we have been able to let our newly completed units at Sussex Junction, while at the same time improving the rents."
Australia's Woodside Energy Group Ltd on Wednesday announced it has received regulatory approval in Mexico for the Trion deepwater oil project. The Perth-based oil and gas producer said the Comision Nacional de Hidrocarburos gave the nod to its field development plan. Trion is located around 180 kilometres off the Mexican coastline, around 30 kilometres south of the Mexican/US maritime border. BHP Petroleum acquired an interest back in 2017, and this became part of Woodside's portfolio following their asset merger in 2022. It was first discovered by Pemex, the Mexican state-owned petroleum company, in 2012. "This milestone allows us to fully progress into execution phase activities with our contractors," said Woodside Chief Executive Officer Meg O'Neill. "We look forward to working with Pemex and our other stakeholders in Mexico to deliver this important project."
TheWorks.co.uk reported that in the year to April 30 rose to GBP280.1 million up from GBP264.6 million a year earlier. Pretax profit fell to GBP5.0 million from GBP14.2 million. The Birmingham-based retailer of arts, crafts, toys, books and stationery said the result includes a GBP5.1 million impairment charge. "We expect FY23 to be the low point in The Works' profitability post-Covid given that cost headwinds have now eased, the financial performance improved throughout the second half of the year and we have started to make more meaningful strategic progress, the benefits of which are expected to be realised in FY24 and beyond," added CEO Gavin Peck. Looking ahead, TheWorks said that the macroeconomic environment remains uncertain. The company declared a dividend of 1.6p, down from 2.4p. TheWorks also said that Chief Financial Officer Steve Alldridge plans to step down by the end of 2023. Rosie Fordham, currently head of Finance at TheWorks, will be appointed as his successor. Alldridge joined the company in June 2020 as interim CFO, a position that was made permanent in May 2021.
By Sophie Rose, Alliance News reporter
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