9th Feb 2016 08:30
LONDON (Alliance News) - UK shares opened flat to slightly lower Tuesday, as oil and gold prices weakened.
Antofagasta led FTSE 100 fallers, down 4.4% after the stock was cut to Sell from Neutral by Goldman Sachs. Fellow miners Anglo American, BHP Billiton, Glencore and Rio Tinto also topped the blue-chip loser list.
Meanwhile, J Sainsbury continued its trend of being the only one of the UK big four supermarkets to achieve sales growth in the latest figures released by Kantar Worldpanel, as its sales increased for the sixth period in a row. The stock was up 1.1% at the open.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: flat at 5,691.49
FTSE 250: down 0.2% at 15,474.38
AIM ALL-SHARE: down 0.1% at 680.18
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Hang Seng: market closed for holiday
Nikkei 225: closed down 5.4% at 16,085.44
DJIA: closed down 1.1% at 16,027.05
S&P 500: closed down 1.4% at 1,853.44
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GBP: firm at USD1.4439 (USD1.4429)
EUR: soft at USD1.1180 (USD1.1192)
GOLD: down at USD1,186.99 per ounce (USD1,194.07)
OIL (Brent): down at USD33.37 a barrel (USD33.73)
(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 GMT)
holiday China Chinese New Year
09:30 UK Trade Balance
11:00 US NFIB Business Optimism Index
13:55 US Redbook index
15:00 US JOLTS Job Openings
15:00 US Wholesale Inventories
21:30 US API Weekly Crude Oil Stocks
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Like-for-like sales in the UK spiked 2.6% on year in January, the British Retail Consortium said. That shattered forecasts for an increase of 0.3% following the 0.1% gain in December. A spike in the sale of large ticket items was the primary cause for the jump in January, the BRC said.
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UK Chancellor George Osborne's "inflexible" budget surplus target may mean sudden tax rises or spending cuts, the BBC reported, citing The Institute for Fiscal Studies. The IFS said Osborne's promise to run a budget surplus "in normal times" from 2019-20 was simple but would require a "precarious balancing act". That means there could be "big tax rises or spending cuts with very little notice", the IFS said.
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UK Transport Minister Patrick McLoughlin has said a decision on where to build a new airport runway should be made this summer, Reuters reported. The minister dismissed concerns the decision could be further delayed by the UK's in-out referendum on European Union membership, which could take place as soon as June. The decision is whether to expand either Heathrow or Gatwick.
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German exports and imports set new highs in 2015, leading to the biggest ever trade surplus, preliminary data from Destatis showed. Exports rose 6.4% to EUR1,195.8 billion and imports increased 4.2% to EUR948.0 billion. The trade surplus grew to a record EUR247.8 billion from the previous peak of EUR213.6 billion.
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Germany's industrial production dropped unexpectedly in December, figures published by Destatis revealed. Industrial production fell 1.2% from November, confounding expectations for an increase of 0.5%. This was the second consecutive fall in production. Output had decreased 0.1% in November. Excluding energy and construction, industrial output was down by 1.1% in December.
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The US Centres for Disease Control and Prevention put its emergency operations centre on the highest level alert on Monday in response to the Zika virus. The CDC decision came the same day the White House said it would ask Congress for USD1.8 billion in emergency funding to combat the mosquito-borne virus. The CDC said its move was in response to the need for "accelerated preparedness" by experts in anticipation of Zika virus transmissions by mosquitoes in the continental US.
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Blood samples from soldiers involved in an alleged chemical weapons attack in Syria last year show a "high degree of probability" that they have been exposed to sarin at some point, the Organization for the Prohibition of Chemical Weapons said in a report published Monday. In a report to the UN Security Council, the chemical weapons watchdog said that its investigation into a possible attack on Darayya, a suburb of Damascus, on February 15, 2015, found that at least four people had been exposed to sarin gas at some point.
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The South Korean military fired warning shots at a military vessel from the North that crossed their maritime border Monday, a news report said. The boat crossed the disputed boundary around 6:55 am (2155 Sunday GMT) in the Yellow Sea, to the west of the peninsula, before retreating 20 minutes later after the South's navy fired five warning rounds, an unnamed Seoul military official was quoted as saying by the Yonhap News Agency. North Korean vessels frequently cross the Northern Limit Line, which Pyongyang argues should be further south.
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Former New York mayor and billionaire businessman Michael Bloomberg has confirmed for the first time that he is looking at a possible bid for the US presidency. When asked about entering the race to become president in 2016, the media mogul told the Financial Times newspaper that he is "looking at all the options". Bloomberg, a former Democrat, ran for New York mayor as a Republican and has been without a political party since 2007.
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BROKER RATING CHANGES
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Deutsche Bank Downgrades Randgold Resources To Hold From Buy, Raises Price Target To 5,000p From 4,400p
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TRADERS: HSBC CUTS RANDGOLD RESOURCES TO 'HOLD' ('BUY')
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TRADERS: UBS CUTS RANDGOLD RESOURCES TO 'NEUTRAL' ('BUY')
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TRADERS: RBC CAPITAL INITIATES BHP BILLITON WITH 'SECTOR PERFORM'
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GOLDMAN CUTS ANTOFAGASTA TO 'SELL' ('NEUTRAL') - TARGET 250 (440) PENCE
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COMPANIES - FTSE 100
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TUI Group reported a narrower first-quarter underlying loss before interest, tax and amortisation, though the tourism company reported a sharp decline in demand for summer bookings to Turkey. Bookings to Turkey are currently down by about 40%, the company said. TUI underlying EBITA loss was EUR101.7 million in the quarter ended December 31, versus EUR104.8 million the corresponding period the prior year. Revenue for the quarter rose 5.4% to EUR3.72 billion from EUR3.53 billion in the prior-year period.
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Anglo American said it will report underlying earnings from South Africa's Kumba Iron Ore of USD238 million for 2015, a significant drop from the USD693.0 million contributed in 2014. Kumba Iron Ore reported headline earnings of USD304 million for 2015, versus USD1.01 billion the prior year. Anglo American will report group results for 2015 on Tuesday next week.
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Legal & General Group published details of its annuity bond portfolio ahead of its earnings for 2015, following inquiries from sell-side analysts and investors. The life insurer and investment manager said the bond portfolio backing its annuity business amounted to GBP39.0 billion at the end of 2015, versus GBP40.7 billion at the end of 2014. Within its retirement arm, 4.4% of the bond portfolio was rated AAA, the top rating. About 28% of the portfolio was rated AA, around 33% at A and 31% at BBB. Bonds rated BB or below made up 3.2% of the portfolio.
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Hedge fund managers have been taking short positions against Berkeley Group Holdings, The Financial Times reported. The stock is seen as a "proxy" for new high-end London property, the report said, amid signs Asian and Russian buyers are deserting the market. Odey Asset Management, BlueMountain Capital Management and Anchorage Capital took short positions against the FTSE 100 builder in January, the newspaper said, worth 2.2% of its share capital. The report cited data disclosed to the UK Financial Conduct Authority.
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COMPANIES - FTSE 250
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Housebuilder Redrow declared a doubled interim dividend as it reported a 14% increase in first-half pretax profit, bolstered by the completion of almost 2,200 new homes in the period, 18% higher than last year. The company raised its interim dividend to 4.0 pence per share from 2.0p and said it intends to lift its final dividend to 6.0p from 4.0p, making 10.0p for the full year, up from 6p. First-half pretax profit rose to GBP104.0 million in the six months ended December 31, from GBP91.0 million the corresponding half the prior year, as revenue rose to GBP603.0 million from GBP560.0 million.
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ICAP said the deal to sell its voice broking and information business to rival Tullett Prebon is on track. Both companies are in the process of obtaining regulatory and competition approval from various authorities. The markets operator said revenue from continuing businesses for its third quarter ended December 31 was 5% lower than the corresponding period the prior year.
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Sophos Group reported a rise in billings in the third quarter of its financial year as revenue also rose. The security software and hardware developer said like-for-like billings in the three months to December 31 grew 17% year-on-year to USD141.3 million from USD127.7 million. On a reported basis, the increase was 11%.
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Vehicle distributor and retailer Inchcape said on Monday it has appointed Richard Howes as its new chief financial officer, following the announcement in October that John McConnell is leaving the company. Howes will become Inchcape's CFO on April 11, leaving his current position as CFO of textile company Coats Group. Coats Group said it had initiated the search to appoint a replacement CFO.
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COMPANIES - INTERNATIONAL
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Twenty-First Century Fox reported a second-quarter profit that dropped from last year, hurt largely by lower revenue, as strong cable and television advertising revenues were offset by lower filmed entertainment division. Earnings for the quarter trumped Wall Street estimates by a penny, but revenues fell short of expectations. Fox reported second-quarter profit of USD672 million or USD0.34 per share, down from USD6.21 billion or USD2.88 per share last year. Revenue for the quarter fell to USD7.38 billion from USD8.06 billion last year.
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Alphabet Inc disclosed in a regulatory filing that it awarded Google Chief Executive Officer Sundar Pichai restricted stock worth about USD199 million. Sundar Pichai becomes one of the highest-paid executives of a publicly traded company this year after the stock award. Pichai received 273,328 Class C shares on February 3 that will vest in quarterly increments through 2019 if he remains on the job.
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Sanofi revealed earnings for the fourth quarter that dropped from last year. The company said its earnings declined to EUR553 million, or EUR0.41 per share. This was down from EUR1.39 billion, or EUR1.03 per share, in last year's fourth quarter. The company said revenue for the quarter rose 1.8% to EUR8.72 billion. This was up from EUR8.57 billion the year before.
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Tuesday's Scheduled AGMs/EGMs
TUI AG
RWS Holdings
F&C Capital & Income Inv Tst
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By Tom Waite; [email protected]; @thomaslwaite
Copyright 2016 Alliance News Limited. All Rights Reserved.
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