4th Jun 2024 07:52
(Alliance News) - Stocks in London are set to open lower on Tuesday, ahead of data from the US, and after UK retail sales only grew slightly overall in May.
In economic news, total UK retail sales increased by 0.7% from a year before last month, according to the BRC-KPMG retail sales monitor, swinging from an annual decline of 4.0% in April.
Meanwhile, in corporate news, British American Tobacco said that it is on track to deliver guidance for financial 2024 of low-single digit revenue and adjusted profit from operations growth.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: called down 0.3% at 8,245.30
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Hang Seng: up 0.5% at 18,492.03
Nikkei 225: closed down 0.3% at 38,793.82
S&P/ASX 200: closed down 0.3% at 7,737.10
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DJIA: closed down 115.29 points, 0.3%, at 38,571.03
S&P 500: closed up 5.89 points, 0.1%, to 5,283.40
Nasdaq Composite: closed up 93.65 points, 0.6%, at 16,828.67
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EUR: up at USD1.0905 (USD1.0883)
GBP: up at USD1.2802 (USD1.2788)
USD: down at JPY156.12 (JPY156.16)
Gold: up at USD2,348.70 per ounce (USD2,341.60)
(Brent): down at USD77.50 a barrel (USD78.22)
(changes since previous London equities close)
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ECONOMICS
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Tuesday's key economic events still to come:
09:20 CEST eurozone European Central Bank member of the supervisory board Edouard Fernandez-Bollo speaks
11:00 CEST eurozone European Central Bank supervisory board chair Claudia Buch speaks
09:55 CEST Germany unemployment
01:01 IST Ireland AIB manufacturing PMI
11:30 SAST South Africa GDP
09:00 CEST Spain unemployment
08:30 CEST Switzerland CPI
00:01 BST UK British Retail Consortium retail sales monitor
08:55 EDT US Redbook index
10:00 EDT US job openings and labour turnover survey
10:00 EDT US total vehicle sales
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The Conservative party announced plans on Monday for new annual caps on work and family visas to cut immigration after the opposition laid out its plans for the key election issue. The plan laid out by Prime Minister Rishi Sunak, who is predicted to lose to Labour's Keir Starmer in the July election, would involve a new cap on the number of visas that would be set by parliament each year. Over the weekend, Starmer set out Labour's plans to cut regular migration by banning "bad bosses" who violate labour laws from bringing foreign workers to the country, and by requiring employers to prioritise training Britons first. The annual cap, which will progressively be lowered each year to cut migration numbers, will not affect foreign students and seasonal workers. More than 300,000 work visas were given in the year ending March 2024, which is more than double the number granted in 2019, according to official statistics.
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UK retail sales grew slightly overall in May, but this was entirely due to food sales as non-food sales remained in decline, figures from an industry group showed on Tuesday. Total UK retail sales increased by 0.7% from a year before last month, according to the BRC-KPMG retail sales monitor, swinging from an annual decline of 4.0% in April. The May increase was above the three-month annual growth average of 0.3% but below the 12-month average of 2.0%. In May 2023, sales had grown by 3.9% annually. Food sales increased by 3.6% in the three months to May from a year before, below their 12-month average annual growth of 6.4%. Non-food sales declined by 2.4% in the same period, worsening from their 1.7% average annual decline over the past 12 months. The decline in non-food sales last month was due to weakness on the high street, while online sales rose.
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Prime Minister Narendra Modi's ruling Bharatiya Janata Party was in first place on 39.3%, with a quarter of votes counted in India's election, national election commission data showed Tuesday. The BJP and its coalition allies were leading in at least 281 seats, the commission's figures showed, above the 272 needed for a lower house parliamentary majority.
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The US is slapping new sanctions on four Iranian entities and one Iranian individual over their association with Iranian-made drones supplied to Russia, the US State Department announced on Monday. Washington said the sanctioned entities were connected to "the development, manufacture, and proliferation of unmanned aerial vehicles (UAVs), which the Iranian regime provides to Russia and militant proxies and partners to prolong conflict and destabilize the region." The sanctions have been issued "concurrently with the European Union's imposing of sanctions against individuals and entities involved in Iran's UAV industry," State Department spokesman Matthew Miller said.
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BROKER RATING CHANGES
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Berenberg raises Future to 'buy' (hold) - price target 1,310 (850) pence
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Berenberg starts Gamma Communications with 'buy' - price target 1,980 pence
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COMPANIES - FTSE 100
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British American Tobacco said that it is on track to deliver guidance for financial 2024 of low-single digit revenue and adjusted profit from operations growth, with first half delivery in line with expectations. The firm continues to believe that its annual performance will be second half-weighted, with acceleration driven by the phasing of innovation in New Categories, and the benefits of first half investment in US commercial actions and related wholesaler inventory movements. It also noted "ongoing macro-economic pressures", particularly in the US market and the "continued lack of effective enforcement against the growing illicit vapour segment". Thus, BAT expects first half revenue and adjusted profit from operations to be down by low-single digits on an organic, constant currency basis.
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COMPANIES - FTSE 250
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Vistry Group agreed terms with Blackstone Real Estate and Regis Group for the acquisition of a portfolio of new build homes totalling a gross development value of around GBP580 million. The portfolio would be managed by Leaf Living, a provider of private rented sector housing, which is backed by funds managed by Blackstone and Regis. The portfolio, which is concentrated in the South-East of England, has around 1,750 homes across 36 Vistry developments.
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LondonMetric swung to pretax profit of GBP120.0 million for the financial year ended March 31, from a pretax loss of GBP507.5 million a year prior. Rental income was GBP175.3 million, up 22% from GBP144.1 million. It declared a fourth quarter dividend of 3.00 pence per share, up 15% from 2.60p. Chief Executive Andrew Jones says: "Our financial performance again reflects our sectorial focus, strength of our portfolio and the efficiency with which it is run. Our material earnings growth allowed us to again increase our covered dividend by 7.4% and gives us confidence to increase our Q1 dividend for FY 2025 by 19%. This will be our tenth year of dividend progression; a performance that allows us to be called a dividend achiever."
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OTHER COMPANIES
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SigmaRoc entered into a share purchase agreement to acquire the Polish lime operations of CRH for a deferred consideration of EUR100 million. The purchase of the Deal 3 Target is conditional on Polish competition office clearance. The Polish Target, CRH's Ovetill Investments, includes CRH's lime and limestone flour production, associated distribution network and assets in Poland.
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Mission Group is considering a revised potential takeover offer from digital advertising and technology service provider Brave Bison Group valuing Mission at about 35.2 pence per share, up from a previous offer ascribing the company's shares a value of around 29.04p, which Mission had rejected. The revised offer by Brave was announced in late May. Mission, an owner of a group of digital marketing and communications agencies, says there can be no certainty that an offer will be made.
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By Holly Beveridge, Alliance News reporter
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