11th Apr 2016 07:21
LONDON (Alliance News) - With little in the way of significant UK company or economic news to start the week, the fallout from the Panama Papers leak continues to dominate attention.
UK Prime Minister David Cameron will face questions in Parliament over his personal finances as the Commons returns from its Easter Break, while under planned new UK legislation, firms that aid tax evasion will be held criminally responsible for the actions of their staff.
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 6,174.08
FTSE 250: down 0.2% at 16,795.54
AIM ALL-SHARE: up 0.1% at 719.80
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Hang Seng: down 0.1% at 20,351.24
Nikkei 225: closed down 0.4% at 15,751.13
DJIA: closed up 0.2% at 17,576.96
S&P 500: closed up 0.3% at 2,047.60
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GBP: flat at USD1.4120 (USD1.4125)
EUR: flat at USD1.1407 (USD1.1414)
GOLD: firm at USD1,250.40 per ounce (USD1,240.44)
OIL (Brent): soft at USD41.52 a barrel (USD41.79)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Monday's Key Economic Events still to come
(all times in BST)
09:00 Italy Industrial Output
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UK economic growth lost momentum in the first three months of the year as manufacturing and services sectors faced weaker domestic demand, results of a quarterly survey by the British Chambers of Commerce showed. Most key survey indicators were either static or decreasing, according to the survey, which is based on over 8,500 responses from firms.
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David Cameron will face questions in Parliament over his personal finances as he faces MPs for the first time since it emerged he had profited from an offshore fund. The UK Prime Minister, who took the unprecedented step of publishing information from his tax returns dating back to 2009-10, still has "big questions" to answer, according to Jeremy Corbyn. As MPs return to Westminster following the Easter break, Cameron will make a statement on the measures the Government is taking to tackle tax dodging and corruption ahead of an international summit in London in May.
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Labour has stepped up demands for an independent inquiry into the Panama Papers leak, after it emerged the head of HM Revenue and Customs was previously a partner at a law firm which represented a number of offshore companies - including Blairmore Holdings, the fund set up by David Cameron's father. HMRC has been given in a lead role in the GBP10 million taskforce launched by Cameron to investigate allegations of wrongdoing linked to the Panama Papers leak of more than 11 million files from Panamanian law firm Mossack Fonseca. Edward Troup, the new executive chairman of HMRC, is a former partner at Simmons & Simmons, whose clients have included the Panama-registered fund created by the Prime Minister's father Ian, the Guardian reported.
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Firms that aid tax evasion will be held criminally responsible for the actions of their staff under UK legislation to be introduced in Parliament this year, David Cameron will announce as he attempts to draw a line under the Panama Papers row. The Prime Minister will give details of the plans as he faces his critics in the Commons for the first time since it emerged he had invested in an offshore trust set up by his father Ian. Legislation expected to be contained in the Queen's Speech in May will create the new offence, which will mean that firms will be held criminally liable if they fail to stop their employees from facilitating tax evasion.
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The sale of a huge Tata steelworks is expected to be completed Monday as efforts continue to find a buyer for the firm's other UK plants. Negotiations between the Indian conglomerate and investment firm Greybull Capital over the Scunthorpe plant started nine months ago. It is expected that the deal will be announced Monday, bringing some welcome good news to the crisis hit steel industry.
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Tata Steel said the UK Serious Fraud Office opened a criminal investigation after the company identified a lapse in procedures at its Speciality Steels business through an internal audit in 2015. The UK Serious Fraud Office confirmed it opened a criminal investigation in December 2015 into activity at Speciality Steels, a business unit of Tata Steel (UK). "Certain inappropriate testing and certification procedures at the South Yorkshire-based Speciality Steels business were identified" in the audit, the company said. Tata Steel said that it immediately stopped the practices after an internal investigation, and suspended a number of Speciality Steels personnel.
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Consumer prices in China were up 2.3% on year in March, the National Bureau of Statistics said. That was unchanged from the February reading, although it was shy of expectations for an increase of 2.4%. The bureau also said that producer prices were down 4.3% versus forecasts for -4.6% after falling 4.9% in the previous month.
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Core machine orders in Japan tumbled 9.2% on month in February, the Cabinet Office said on Monday - coming in at JPY848.7 billion. The headline figure beat forecasts for a decline of 12.0% following the 15.0% gain in January. On a yearly basis, core machine orders dipped 0.7% - also topped expectations for a decline of 2.4% following the 8.4% jump in the previous month.
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The top leader of North Korea Kim Jong Un has overseen a successful test of a heavy-lift engine of a new-type intercontinental ballistic rocket, Xinhua reported citing the official news agency KCNA. The ground test was conducted at the Sohae Space Center, which is located at the North Korea's North Pyangan Province, the KCNA said, without specifying when the test was carried out.
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The terrorists who struck Brussels last month had been plotting a fresh attack in France, but changed their plans as the police were closing in on them, according to reports citing Belgian prosecutors. The gang whose members allegedly included Mohamed Abrini, the "man in the hat" Brussels airport bombing suspect now in police custody, switched targets to hit Brussels four days after the arrest of one of its members. The death toll in the March 22 attacks at the airport and a downtown subway station was 32.
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Ukrainian Prime Minister Arseniy Yatsenyuk resigned after weeks of pressure, paving the way for a government revamp seeking to end the nation's worst political crisis in two years. Yatsenyuk said Sunday in his weekly address to the nation that he would submit his resignation to parliament on April 12, adding that his party will stay in the coalition allied with President Petro Poroshenko. Poroshenko's party nominated parliament Speaker Volodymyr Hroisman to take over as premier. His appointment requires approval by lawmakers.
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The US has sent B-52 bombers to Qatar to be used in the fight against the Islamic State terrorist group in Iraq and Syria, the Air Force Times reported citing US Central Command. The deployment marks the first time the Cold War-era aircraft have been used to combat the extremists.
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India may invest as much as USD20 billion in Iran's energy industry and ports and boost imports of crude from the the Persian Gulf nation if it gets favourable terms, reports quoted India's Oil Minister Dharmendra Pradhan as saying. Indian companies are evaluating opportunities to explore for oil and natural gas, build petrochemical plants and gas-processing facilities and expand ports including the new industrial hub of Chabahar, Pradhan reportedly said Saturday during a visit to Tehran.
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CIA Director John Brennan said the US intelligence agency would not use waterboarding as an interrogation technique even if a future president sought to reinstate the practice that many consider torture. US President Barack Obama forbade use of the simulated drowning technique when he took office in 2009 after it was used during the George W Bush administration on terrorist suspects.
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BROKER RATING CHANGES
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JEFFERIES RAISES SCHRODERS TO 'BUY' ('HOLD') - TARGET 3103 (3296) PENCE
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BARCLAYS CUTS DIRECT LINE TO 'EQUAL WEIGHT' ('OVERWEIGHT') - TARGET 369 (443) P
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TRADERS: RBC CAPITAL CUTS FRESNILLO TO 'UNDERPERFORM' ('SECTOR PERFORM')
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COMPANIES - FTSE 100
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DIY retailer Kingfisher said it has engaged Goldman Sachs International to manage part of its capital return programme. Goldman Sachs will buy a maximum of GBP52 million in Kingfisher shares for cancellation by no later than July 25. In January, Kingfisher announced a capital return programme of GBP600 million over the next three years via share buybacks.
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Royal Bank of Scotland Group is set to close its banking operations in India, The Financial Times reported. According to the report, the FTSE 100 bank has given up on finding a buyer amid concerns that regulation could make the process take too long to complete and lead to higher costs. RBS began seeking buyers for the business in 2015.
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Standard Chartered is looking to sell at least USD4.4 billion of assets in Asia, Bloomberg reported, citing people with knowledge of the matter. The London-based bank is in talks with potential buyers for about USD1.4 billion of stressed loans extended to Indian companies, the report said, with a sale underway of around USD3 billion of assets in the rest of Asia.
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COMPANIES - FTSE 250
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Pork and poultry producer Cranswick said it has bought CCL Holdings and its wholly-owned subsidiary Crown Chicken from the Thacker family and management for GBP40 million. Crown is a poultry producer based in East Anglia in England. In 2015, it made revenue of GBP83.8 million and adjusted earnings before interest, tax, depreciation and amortisation of GBP6.6 million.
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Cairn Energy said the latest well to be drilled offshore Senegal has confirmed that the high-quality reservoirs that have been found elsewhere on the field extend to the northern part of the licence area, adding the next well will be drilled on the field shortly. The oil and gas company said the BEL-1 well was targeting the Bellatrix exploration prospect and appraising the northern extent of the SNE field discovered in 2014.
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Vedanta Resources said the majority of its commodity portfolio experienced a rise in production in the recently ended financial year, with its zinc operations outside of India and its oil and gas division the only units to experience falls in the year. From its Zinc India operations, production of refined zinc rose 3% in the year to 759,000 tonnes from 734,000 tonnes, refined lead production rose 14% to 145,000 tonnes from 127,000 tonnes and silver production was up a hefty 30% to 13.7 million ounces from 10.5 million ounces. Vedanta's zinc operations outside of India, however, produced 27% less zinc in the year, totalling 226,000 tonnes from 312,000 tonnes a year ago.
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Mark Newton-Jones, the chief executive officer of Mothercare, has emerged as a contender to run Debenhams, The Sunday Times reported. Newton-Jones is understood by the newspaper to be among the final candidates to replace Michael Sharp, who has been chief executive of Debenhams since September 2011.
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COMPANIES - LONDON MAIN MARKET AND AIM
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Daily Mail & General Trust, the parent company of the Daily Mail, the UK newspaper and global tabloid website, is in talks with several private-equity firms about a possible bid for Yahoo, the Wall Street Journal reported citing people familiar with the matter. Yahoo has set an April 18 deadline for bids. While as many as 40 firms have expressed some interest in Yahoo's businesses, the pool of serious bidders is expected to narrow considerably.
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De La Rue made secret payments and lavished huge commissions on a middle-man to secure lucrative contracts in India, The Sunday Times reported, citing to documents uncovered in the Panama papers data leak. The banknote printer sought to distance itself from the revelations of its eight-year relationship with a Panamanian company called Aphra Consultants, whose beneficial owner was Somendra Khosla, an Indian businessman, the report said. "This arrangement would never be acceptable today," De La Rue told the Sunday Times. "This was a long time ago, and those mentioned no longer work with the company."
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COMPANIES - INTERNATIONAL
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The US Department of Justice announced that the US has settled civil mortgage fraud claims against Wells Fargo Bank, NA and Wells Fargo executive Kurt Lofrano, stemming from Wells Fargo's participation in the Federal Housing Administration Direct Endorsement Lender Program. In the settlement, Wells Fargo agreed to pay USD1.2 billion.
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Monday's Scheduled AGMs/EGMs
No Events Scheduled
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By Tom Waite; [email protected]; @thomaslwaite
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