30th Sep 2015 07:26
LONDON (Alliance News) - Shares in grocer J Sainsbury lead blue-chip gainers amid an overall positive open for shares in London Wednesday.
Sainsburys shares are up 11%, lifting rivals Tesco and Wm Morrison Supermarkets shares by 4.2% and 3.8%, respectively. Sainsburys said its full-year underlying pretax profit will be "moderately ahead" of consensus after it achieved growth in sales in the second quarter of its financial year.
In the FTSE 250, shares in Entertainment One are down 10% after it agreed to buy 70% of 'Peppa Pig' producer and creator Astley Baker Davies, which it will fund through a rights issue to raise GBP193.6 million.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 1.7% at 6,007.99
FTSE 250: up 1.3% at 16,647.39
AIM ALL-SHARE: up 0.2% at 721.51
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Hang Seng: up 1.7% at 20,906.57
Nikkei 225: closed up 2.7% at 17,388.15
DJIA: closed up 0.3% at 16,049.13
S&P 500: closed up 0.1% at 1,884.09
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GBP: down at USD1.5142
EUR: down at USD1.1215
GOLD: down at USD1,123.52 per ounce
OIL (Brent): down at USD47.78 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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Wednesday's Key Economic Events still to come
(all times in BST)
08:55 Germany Unemployment Rate
09:00 Italy Unemployment
09:30 UK Gross Domestic Product
09:30 UK Current Account
09:30 UK Business Investment
09:30 UK Index of Services
10:00 EU Unemployment Rate
10:00 EU Consumer Price Index
10:00 Italy Consumer Price Index
11:00 Italy Producer Price Index
12:00 US MBA Mortgage Applications
13:00 US Fed's William Dudley speech
13:15 US ADP Employment Change
13:30 Canada Gross Domestic Product
14:45 US Chicago Purchasing Managers Index
15:30 US EIA Crude Oil Stocks change
20:00 US Fed's Yellen Speech
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Consumer confidence in the UK was down in September, the latest survey from GfK showed on Wednesday with an index score of +3. That was shy of expectations for +5 and down from +7 in August. "Both the Chinese economic downturn and its negative impact on global markets and the ongoing migrant crisis, combined with other economic woes across the euro zone, has hit home," said Joe Staton, head of market dynamics at GfK.
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UK house prices grew at the fastest pace in four months in September, the Nationwide Building Society said. House prices increased 3.8% year-on-year in September, the fastest since May, when it grew 4.6%. The annual growth matched expectations and faster than August's 3.2% increase. On a monthly basis, house prices climbed 0.5% after rising 0.4% a month ago. Economists had forecast prices to rise by 0.4%.
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Industrial output in Japan fell a seasonally adjusted 0.5% on month in August, the Ministry of Economy, Trade and Industry said preliminary reading. That was well shy of forecasts for an increase of 1.0% following the 0.8% decline in July. On a yearly basis, industrial production added just 0.2% - also below expectations for a gain of 1.8% following the flat reading in the previous month.
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Afghan troops, supported by US airstrikes, launched an offensive to recapture the key northern city of Kunduz from Taliban insurgents, officials said. Afghan President Ashraf Ghani vowed that the government was intent on retaking Kunduz, which fell Monday to Islamist forces, and restoring security over the city. He urged Afghans to not give in to "fear and terror." The Taliban took Kunduz in a single day with a coordinated attack. It was the first provincial capital captured by the insurgents since their ouster from power 14 years ago in a US-led invasion.
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The US and Russian militaries will hold talks on their activities against the Islamic State terrorist group in Syria, the Pentagon said. US Secretary of Defence Ashton Carter has directed his staff to "open lines of communication with Russia on de-confliction", Pentagon spokesman Peter Cook said. Carter's order made it clear that the two nations have common ground when it comes to fighting Islamic State, and the goal should be to take the fight to Islamic State and not to defend the regime of Syrian President Bashar al-Assad.
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BROKER RATING CHANGES
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GOLDMAN RESUMES ROLLS-ROYCE WITH 'BUY' - TARGET 966 PENCE
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TRADERS: HSBC RAISES SHIRE TO 'HOLD' ('REDUCE')
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COMPANIES - FTSE 100
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Embattled multi-commodities miner and trading house Glencore moved to defend its financial position following recent concerns about its debt pile which have caused its shares to plunge, exacerbating declines it had faced due to the tough conditions in commodities markets. Glencore said it has "taken proactive steps to position our company to withstand current commodity market conditions", adding the company "remains operationally and financially robust" and has "positive cash flow, good liquidity and absolutely no solvency issues." The company said it is working to reduce its debt levels by up to USD10.2 billion and said it has no debt covenants and continues to retain strong lines of credit due to its good relationships with its banks.
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J Sainsbury said its full-year underlying pretax profit will be "moderately ahead" of consensus after it achieved growth in sales in the second quarter of its financial year. The supermarket chain said that total retail sales in the 16 weeks to September 26 grew 0.3% excluding fuel, but fell 1.8% including fuel. Like-for-like retail sales, however, declined for the seventh consecutive quarter, falling 1.1% excluding fuel and 3.3% including fuel. This was an improvement on the first quarter, though, when like-for-like revenue excluding fuel decreased 2.1% and total sales excluding fuel declined 0.6%.
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Energy company SSE said it remains on course to meet its financial expectations for the current financial year to the end of March. The company said it is on course to meet its main financial objectives for the year, which will mean it will be able to hike its full-year dividend at least in line with RPI inflation.
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Oil and gas giant Royal Dutch Shell is to cut 1,300 jobs from its Malaysian operations over the next two years, the company said. Shell Malaysia, which has a total workforce of 6,500 people, said in a statement that the move was aimed at removing complexity in order to become more competitive.
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Miner Rio Tinto said it has reached a binding agreement for the sale of its 40% interest in the Bengalla coal joint venture in Australia to New Hope Corp for USD606 million. Bengalla is the smallest of three coal mines in the Hunter Valley of New South Wales in which Rio Tinto holds an interest, producing 8.6 million tonnes.
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Pearson is set to acquire the company which is overseeing the UK's National Citizenship Test in the first deal it has sought to strike since selling the Financial Times and its stake in The Economist, Sky News reports. Pearson is set to announce a deal on Wednesday to acquire the e-assessments arm of Learndirect, which is currently owned by private equity firm LDC.
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COMPANIES - FTSE 250
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Entertainment One said it has agree to buy 70% of 'Peppa Pig' producer and creator Astley Baker Davies Ltd, which it will fund through a rights issue to raise GBP193.6 million. Astley Baker Davies jointly holds the ownership rights to the 'Peppa Pig' franchise, a big growth driver for Entertainment One. The company said that through this acquisition it will increase its interest in the related share of the earnings from 'Peppa Pig' to 85% from 50%.
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Defence services company QinetiQ Group affirmed its full-year financial targets. The group said the Strategic Defence and Security Review and a public consultation on calculating the baseline profit rate for single-source contracts are both underway in the UK. QinetiQ's EMEA Services division has continued to see some contract award deferrals due to uncertainty in the UK market, but revenue under contract for the financial year is in line. The company's Global Products arm also is trading in line.
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Saga said its pretax profit surged in the first half on lower costs, improved margins and better revenue, driven by strong performances for its motor insurance and travel arms. The company, which provides products and services for over-50s, said its pretax profit in the first half to the end of July was GBP101.3 million, more than double the GBP42.2 million it made a year earlier. The profit rise was driven by the group posting higher revenue, better gross margins and lower administrative and financing costs in the half.
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Plastic products company RPC Group said trading remains in line with its expectations in the year to the end of March, with half-year revenue to be significantly higher year-on-year. Overall trading for the group is set to meet its expectations, RPC said, and it said its financial position remains robust.
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Data centre provider Telecity Group noted that the number of shares Telecity shareholders will be entitled to receive under its takeover offer will be subject to an adjustment upwards, as a result of Equinix declaring a special USD627.0 million distribution to its shareholders. Equinix is making the special distribution as a result of its conversion to a real estate investment trust. Telecity agreed to a GBP2.35 billion cash and share takeover offer from Equinix in May.
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COMPANIES - LONDON MAIN MARKET AND AIM
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Electrical retailer Darty said it has received a GBP533 million all-share takeover proposal from Groupe Fnac on the basis of one Fnac share for every 39 Darty shares. The proposal values Darty at 101 pence per share based on Fnac's closing price of Tuesday, compared to Darty's closing price on Tuesday of 81p. Darty shares are up 15% at 93.00p at the open Wednesday. "The board has considered the proposal and concluded that it should further explore the benefits of a potential combination with Fnac. Initially, this engagement will focus on reviewing deal execution risks in order to determine whether an offer is likely to be deliverable on a basis which could be capable of being recommended to Darty shareholders," Darty said in a statement.
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COMPANIES - INTERNATIONAL
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Volkswagen's board is to hold a crisis meeting on Wednesday to consider a comprehensive revamp of the group in the wake of the crisis triggered by revelations that the German carmaker cheated on global exhaust emissions tests. New VW Chief Executive Matthias Mueller is expected to lay out at Wednesday's meeting of VW's powerful presidium of the supervisory board - representing key shareholders, unions and executives - plans for rebuilding the company's battered image, officials told dpa. German Transport Minister Alexander Dobrindt briefed Chancellor Angela Merkel's cabinet on details of the scandal on Tuesday, German government spokesman Steffen Seibert said.
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Google unveiled two new Nexus smartphones-- the Huawei-made Nexus 6P and the LG-made Nexus 5X. The tech giant also unveiled a new Pixel C tablet and an updated Chromecast. The flagship Nexus 6P, manufactured in partnership with Chinese smartphone maker Huawei, is the first all-metal body Nexus phone.
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Electric car maker Tesla Motors launched its first sport-utility vehicle, the Model X, with a ceremony at its factory in Fremont, California, near San Francisco. The Model X will be the first fully-electric SUV on the general car market, and the first time the Silicon Valley carmaker and energy-storage pioneer has had two car models available at the same time.
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Danish shipping giant AP Moller-Maersk said it is using AT&T Internet of Things technology to connect its refrigerated containers. The agreement between Maersk and AT&T is one of the largest Industrial IoT deployments of its kind, the firm added. Maersk is working with AT&T to track and monitor the condition of refrigerated containers with perishable goods.
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Vodafone Hutchison Australia and TPG Telecom announced two commercial agreements with a combined value of more than AUD1 billion: a major Dark Fibre transmission network expansion and the migration of TPG's mobile customer base to the Vodafone network. TPG will provide Dark Fibre and network services to more than 3,000 Vodafone Australia sites over a 15 year term. The two companies also announced one of the industry's largest-ever Mobile Virtual Network Operator arrangements, with TPG to migrate its mobile wholesale customer base to the Vodafone network.
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The US Department of Justice and the Environmental Protection Agency announced that Wyeth Holdings, a subsidiary of the Pfizer Corp, will perform nearly USD194 million worth of cleanup work at the American Cyanamid Superfund Site in Bridgewater Township, New Jersey. The cleanup work that the company has agreed to perform includes work to address six disposal areas at the site, where chemicals were manufactured for nearly 100 years. In addition, the company will pay USD1 million for EPA's past costs of overseeing cleanup work at the site.
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General Electric announced new products and partnerships, with its total portfolio of software and solutions set to deliver more than USD5 billion in revenue this year with USD6 billion in orders. By 2020, it expects more than USD15 billion in software and solutions revenue driven by Predix scale and internal productivity.
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Wednesday's Scheduled AGMs/EGMs
Provexis
Angle
Adept Telecom
Ilika
Vast Resources
Fastnet
Fulcrum Utility Services
Tricor
Galileo Resources
Tesco
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By Tom Waite; [email protected]; @thomaslwaite
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