10th Jun 2016 07:21
LONDON (Alliance News) - Recruitment company shares were under selling pressure early Friday, following broker downgrades of the newly renamed PageGroup, together with FTSE 250 peer Hays. Deutsche Bank lowered the pair to Sell from Hold.
Smaller rival SThree was down 12%, after it said the uncertainty created by the upcoming European Union referendum has led to a slowdown in its UK business.
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 6,203.23
FTSE 250: down 0.4% at 17,049.57
AIM ALL-SHARE: down 0.1% at 743.22
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Hang Seng: down 0.9% at 21,102.79
Nikkei 225: closed down 0.4% at 16,601.36
DJIA: closed down 0.1% at 17,985.19
S&P 500: closed down 0.2% at 2,115.48
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GBP: down at USD1.4418 (USD1.4479)
EUR: down at USD1.1307 (USD1.1332)
GOLD: flat at USD1,266.94 per ounce (USD1,269.52)
OIL (Brent): down at USD51.39 a barrel (USD52.01)
(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 BST)
09:00 Italy industrial output
13:30 Canada unemployment rate
15:00 US Reuters/Michigan consumer sentiment index preliminary
19:00 US monthly budget statement
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The new deadline for registering to vote in the UK's EU referendum on June 23 has passed without further reported incident. Earlier emergency legislation allowing registration to continue until midnight on Thursday was passed by both the Commons and the Lords without a vote. The order to extend was rushed through both Houses after the government registration website crashed close to the original deadline of midnight on Tuesday, resulting in potentially thousands of people being unable to submit their applications.
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US President Barack Obama endorsed Hillary Clinton to be his successor in a video posted to her campaign's website after she secured the Democratic Party's nomination this week. "I know how hard this job can be, that's why I know Hillary will be so good at it," he said. "In fact, I don't think there's ever been someone so qualified to hold this office." Obama had met earlier in the day with Democratic candidate Bernie Sanders and praised him for bringing passion and supporters to the Democratic Party.
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Germany's inflation remained low as estimated in May, final figures from Destatis showed. Consumer prices gained 0.1% on a yearly basis, reversing a 0.1% fall in April. Month-on-month, consumer prices climbed 0.3%, in contrast to a 0.4% decrease in April. The statistical office confirmed the preliminary estimate published on May 30. At the same time, harmonized inflation remained flat in May as estimated after easing 0.3% in April. Compared to April, the harmonized index of consumer prices moved up 0.4% in May.
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Germany's wholesale prices declined at a slower pace in May, data from Destatis showed. Wholesale prices decreased 2.3% in May from last year, slower than the 2.7% fall in April. This was the weakest fall in four months. The index has been falling since July 2013. On a monthly basis, wholesale prices climbed 0.9%, but faster than the 0.3% rise in April.
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Japan's tertiary activity index increased at a faster-than-expected pace in April after falling in the previous month, figures from the Ministry of Economy, Trade and Industry showed. The tertiary activity index rose a seasonally adjusted 1.4% month-over-month in April, exceeding economists' expectations for a 0.6% climb. In March, the index had fallen 0.5%, which was revised from a 0.7% fall reported earlier.
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Producer prices in Japan were up 0.2% on month in May, the Bank of Japan said. That exceeded expectations for a flat reading following the downwardly revised 0.4% contraction in April. On a yearly basis, prices fell 4.2% - matching forecasts and unchanged from the previous month.
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BROKER RATING CHANGES
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TRADERS: MS INITIATES TULLOW OIL WITH 'EQUAL-WEIGHT' - TARGET 322 PENCE
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TRADERS: DEUTSCHE BANK CUTS HAYS TO 'SELL' ('HOLD')
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TRADERS: DEUTSCHE BANK CUTS PAGEGROUP TO 'SELL' ('HOLD')
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TRADERS: INVESTEC RAISES DEE VALLEY GROUP TO 'BUY' ('HOLD')
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COMPANIES - FTSE 100
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BP said it has teamed up with Det Norske oljeselskap to form the largest independent oil and gas producer in Norway, to be called Aker BP. The pair plan to merge the BP Norge and Det Norske businesses to form the new entity, which will be independently operated and listed in Oslo. BP will take a 30% stake in the new company, Det Norske shareholders will also take a 30% stake and Aker, an existing shareholder of Det Norske, will hold a 40% stake. BP said it will be paid USD140.0 million in cash, plus positive working capital adjustments, as part of the transaction, which should be completed before the end of this year. BP said all 850 employees of BP Norge will transfer over to the new business.
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Tesco said it sold its 95.5% stake in Turkish supermarket chain Kipa as well as its UK restaurant chain Giraffe. The disposal of Kipa will result in Tesco receiving cash proceeds of around GBP30 million, which the grocer said will contribute to Tesco's goal of reducing debt by around GBP110 million. It is being sold to Swiss retail company Migros. Meanwhile, Giraffe is being sold to Boparan Restaurant Holdings for an undisclosed amount. The sale includes 54 standalone restaurants, of which 12 are franchise sites and three restaurants within Tesco stores.
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J Sainsbury said it will promote Chief Financial Officer John Rogers to the role of chief executive of Home Retail Group once the two companies have merged, while Home Retail said its current CEO, John Walden, will step down from the business. Rogers will be responsible for combining Sainsbury's non-food business with Home Retail's Argos retail chain. He will be replaced on an interim basis as CFO by Finance Director Ed Barker.
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Moody's Investor Service has upgraded its credit ratings for BT Group and its newly acquired mobile network EE, saying this reflected BT's "strengthened business risk profile" following the integration of its fixed and mobile activities. Moody's has upgraded its Prime-2 short term ratings for BT and British Telecom Finance BV to Baa1 from Baa2, and upgraded BT's senior unsecured debt ratings, its MTN programme rating, and senior unsecured shelf rating to Baa1 from Baa2 also. Similarly, it increased the issue rating of EE Ltd and senior debt ratings of EE Finance PLC to Baa1 from Baa2.
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COMPANIES - FTSE 250
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Private equity firm Apax Partners has sold its remaining stake in Auto Trader Group for a total of GBP76.4 million following a placing of shares that was originally announced on Thursday. Apax, through two entities named Crystal A Holdco and Crystal B Holdco, has sold 18.4 million shares in Auto Trader Group, equal to a 1.8% stake in the online car marketplace, for 415.0 pence per share. Apax will no longer hold any stake in Auto Trader following the sale, which was conducted by bookrunners Deutsche Bank and Bank of America Merrill Lynch.
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The all-share merger between Vectura Group and Skyepharma was set to be completed Friday, as the scheme of arrangement regarding the terms of the merger has become effective. Skyepharma's shares will be cancelled from Friday, and shares in the merged entity will be admitted to trading on the London Stock Exchange's Main Market on Friday morning.
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Recruiter Michael Page International will begin trading under new name PageGroup on Friday. The name change was approved by shareholders on Thursday, and the company said Friday that the formalities to effect the change of name have now been completed.
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COMPANIES - LONDON MAIN MARKET AND AIM
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Fuller, Smith & Turner reported a rise in profit in its recently-ended financial year on good revenue growth, although the first part of the current year has demonstrated a mixed performance so far. The pub company said its pretax profit in the year ended March 28 grew to GBP39.2 million from GBP36.1 million the year before, as revenue rose to GBP350.5 million from GBP321.5 million. Fuller will pay a total dividend of 17.9 pence for the year, up 8% on the 16.6p paid the year before.
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Bonmarche Holdings reported a fall in profit in its recently-ended financial year as it booked higher costs than in the prior year, but revenue rose despite the retailer reporting tough trading conditions resulting from poor weather conditions. The women's value retailer said its pretax profit in the year ended March 26 fell to GBP9.6 million from GBP12.4 million the year before, despite revenue rising to GBP188 million from GBP178.6 million.
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Recruitment company SThree said the uncertainty created by the upcoming European Union referendum has led to a slowdown in its UK business, as it saw "mixed trading conditions" in its first half. In a trading update, SThree said group gross profit rose 6% at constant currency in the half year to end-May from a year before, as it saw continued strong growth across its ICT business, and a continued strong performance from Continental Europe. However, this was offset by falls in Banking and Finance, which Sthree attributed to the EU referendum, and in Energy. Excluding Energy, gross profit rose 11% year-on-year.
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COMPANIES - INTERNATIONAL
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German airline Lufthansa Group announced Chief Financial Officer Simone Menne will step down with effect from 31 August, in a surprise announcement. Menne will step down from the executive board by mutual agreement on 31 August. A decision on her successor will be taken shortly, the airline stated.
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Airbus Group, which owns 23.6% of Dassault Aviation, announced that it has planned to sell approximately 0.83 million shares, representing around 9.05% of the share capital. Dassault Aviation intends to buyback 502,282 shares from Airbus, representing around 5.5% of Dassault Aviation's share capital, concurrently with the equity placement.
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Elon Musk's electric car company Tesla Motors has launched a more affordable version of Model S, which now sports a less powerful 60-kilowatt-hour battery pack but an attractive price tag of USD66,000, before tax incentives. The new version, which will be called the 60, will have a range of 210 miles per charge, while the all-wheel-drive version, the 60D, will be priced at USD71,000 and have a range of 218 miles. The Model S 60 will go from 0-60 mph in 5.5 seconds with a top speed of 130 mph.
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Friday's Scheduled AGMs/EGMs
Volga Gas
Baker Steel Resources Trust
Bioquell
Symphony Environmental Technologies
TF & JH Braime Holdings
MP Evans
Bisichi Mining
Steppe Cement
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By Tom Waite; [email protected]; @thomaslwaite
Copyright 2016 Alliance News Limited. All Rights Reserved.
Related Shares:
Tullow OilSTHR.LHaysPageGroup