20th Aug 2018 11:57
LONDON (Alliance News) - Stocks in London started the week on firm footing, with blue-chip miners and commodity stocks boosting the FTSE 100 at midday on Monday.Housebuilders declined after Rightmove showed house asking prices fell month-on-month in August, while Mulberry continued to tumble after warning on its annual profit.The FTSE 100 index was up 0.4%, or 32.59 points, at 7,591.18. The mid-cap FTSE 250 was up 0.7%, or 141.82 points, at 20,586.18. The AIM All-Share index was up 0.2% at 1,080.01.The Cboe UK 100 was up 0.5% at 12,863.14 at midday, while the Cboe UK 250 climbed 0.7% to 18,683.25 and the Cboe UK Small Companies was up 0.1% at 12,199.78."European markets are following their Asian counterparts higher, as the fears of last week seem to have been washed away with a renewed optimism over the direction of US-China trade," commented IG market analyst Joshua Mahony.China and the US will hold lower-level trade talks this week, just before new US tariffs on USD16 billion of Chinese goods take effect.The IG analyst added: "While recent declines in global stocks has coincided with a move into the dollar and out of commodities, we are seeing that trend reverse today, given the shift out of perceived havens. The rebound in commodity prices is helping drive the FTSE 100 in particular, with miners such as Antofagasta, Anglo American, Glencore and Randgold all rebounding in early trade."Steelmaker Evraz was the biggest blue-chip gainer on Monday, up 5.9%, while BHP Billiton rose 3.0% and Glencore 2.6%.Copper was quoted at USD6,005.04 a tonne on Monday, up from USD5,934.00 late Friday.The second best performer on Monday was NMC Health, up 4.8% after reporting a strong set of interim results.The FTSE 100 constituent said pretax profit rose 20% year-on-year to USD118.7 million as earnings before interest, taxes, depreciation and amortisation jumped 32% to USD225.5 million over the first half of 2018. Revenue rose by 20% to USD932.0 million from USD775.2 million.The United Arab Emirates-focused private hospital operator said its core Healthcare division continued to drive growth, with revenue up 26% to USD706.0 million and Ebitda up 34% to USD226.8 million.Among those in the red on Monday were housebuilders, with Crest Nicholson down 1.8%, Persimmon down 1.4%, and Berkeley Group 1.0% lower.Rightmove on Monday said UK house prices dropped in August as more sellers entered the market during summer holiday season, with asking prices decreasing 2.3% month-on-month. This was particularly pronounced in London, with prices down 3.1%.Sellers who come to the market in the peak holiday season often have a pressing need to sell and price down accordingly, Miles Shipside, Rightmove Director said.On a yearly basis, house prices increased 1.1% to GBP301,973.Sage tumbled 5.3% to be the worst performing large-cap stock on Monday after Deutsche Bank downgraded the accounting software provider to Sell from Hold, highlighting "worsening" competition. Meanwhile, a broker upgrade helped to boost Hill & Smith to the top of the FTSE 250. Investec raised the galvanising services firm to a Buy rating from Add previously.TBC Bank gained 3.0% after the Georgia-based firm said interim pretax profit rose 25% to GEL239.5 million from GEL191.4 million for the same period the year before. At current exchanges rates, this is equivalent to GBP73.5 million and GBP58.7 million, respectively.First half net interest income rose to GEL363.6 million from GEL292.1 million in the prior year period.Elsewhere on the London Stock Exchange, Mulberry slumped 18% after it warned of a hit from troubles at department store House of Fraser.Mulberry, which operates in 21 House of Fraser's stores employing 88 workers, said it expects to incur GBP3 million in exceptional costs for the six months to September. House of Fraser earlier in August fell into administration, but was then bought out in a 'pre-pack' deal by Sports Direct International.Mulberry also highlighted challenging market conditions in the UK."If these sales trends in the UK continue into the key trading period of the second half of the financial year, the group's profit for the whole year will be materially reduced," the company said.Artjom Hatsaturjants, research analyst at Accendo Markets, said: "No investor likes to take losses, but the GBP3m exceptional charge to Mulberry's finances could have been seen as a one-off. It's the combination of the charge and the currently unquantified profit warning for the rest of the year that is really putting the hurt to the company's share price."Stocks in the US are pointed to a higher open on Monday, with the Dow Jones seen climbing 0.3%, the S&P 500 up 0.2% and the Nasdaq 0.4% higher.In US company news, PepsiCo has agreed to buy Israel's SodaStream, a producer of at-home carbonated water machines, for USD3.2 billion in cash."PepsiCo and SodaStream are an inspired match," said PepsiCo Chairman and CEO Indra Nooyi adding that SodaStream makes "great-tasting beverages while reducing the amount of waste generated." PepsiCo said it is buying all outstanding shares of SodaStream for USD144 per share, a 32% premium. The deal is expected to close by January 2019.In a thin economic calendar on Monday, Federal Open Market Committee member Raphael Bostic speaks at 1600 BST.The pace picks up as the week progresses, with minutes from the Federal Reserve and European Central Bank's latest meetings due on Wednesday and Thursday, respectively.Focus for this week, however, lies on the Jackson Hole gathering of central bankers in the US state of Wyoming. "Markets currently price the probability of the Fed raising its policy rates in September, for the third time this year, at around 90%, while a fourth increase in December is seen at about 60%. Fed Chair Powell's speech at Jackson Hole later this week will be watched for any sign that the Fed is wavering," said analysts at Lloyds Banking.Related Shares:
Crest NicholsonBHP Billiton PLCSage GroupNMC.LTBC Bank GroupEvrazPersimmonGlencoreMulberry Group