31st Oct 2018 08:50
LONDON (Alliance News) - Stocks in London opened higher on Wednesday, tracking gains from US and Asian markets, with the FTSE 100 hitting a near three-week high, buoyed by gains from Standard Chartered and paper & packaging companies. The FTSE 100 was up 1.4%, or 100.47 points, at 7,136.32. The FTSE 250 was up 1.4%, or 264.21 points at 18,931.94, while the AIM All-Share was up 0.7%, at 967.05.The Cboe UK 100 was up 1.3% at 12,106.63, while the Cboe UK 250 was 1.1% lower at 17,127.62. The Cboe UK Small Companies was flat at 11,451.82."Building on Tuesday's gains, the FTSE shot up after the bell, allowing the index to cross 7,100 for the first time in 3 weeks. It benefited from the market-wide shift in sentiment," said Spreadex analyst Connor Campbell.In mainland Europe, the CAC 40 in Paris was up 1.6% while the DAX 30 in Frankfurt advanced 1.1%.On the London Stock Exchange, Standard Chartered was the best blue chip performer up 3.9%, after the emerging markets-focused lender reported a sharp rise in profit for the third quarter of 2018. It said growth fundamentals remained solid despite geopolitical uncertainties.For the three months to the end of September, StanChart reported a pretax profit of USD1.06 billion, up 37% from USD774 million the year before, on an operating income of USD3.72 billion, up 4.0% from USD3.59 billion. On an underlying basis, pretax profit was USD1.07 billion, up 31% from USD814 million.On a nine-month basis, pretax profit rose by 35% to USD3.41 billion from USD2.53 billion, while underlying pretax profit increased by 25% to USD3.43 billion from USD2.73 billion the prior year.Smurfit Kappa was up 5.5% after the Irish corrugated packaging company said it acquired a paper mill and a corrugated plant in Belgrade for EUR133 million.In addition, Smurfit Kappa said it has continued to deliver a very strong performance in the first nine months of the year. For the nine months to September-end, the company reported underlying revenue rose 7% and earnings before interest, taxes, depreciation and amortisation growth of 27% to EUR1.13 billion. Peers DS Smith and Mondi were up 2.5% and 1.8% respectively, benefiting from a positive read acrossAt the other end of the large cap index, Next was the worst performer, down 2.8% after the clothing and homewares retailer reported an increase in third-quarter full-price sales, despite struggles in its Retail sector, which encompasses its High Street shops. For the third quarter ended October 27, Next reported a 2% increase in total sales driven by sales in its Online unit, up 13%, and Finance business interest income, up 12%. In the year-to-date Online is up 15% and Finance 3.1%.Within the company's Retail unit however, sales dropped 8.0% in the quarter and are down 6.3% so far this year.Next maintained its guidance for the current financial year unchanged, as it expects total full price sales up 3% year-on-year and annual pretax profit up 0.1% to GBP727 million in financial 2019.Peer Marks & Spencer was also down 1.8%. Next's trading up coincided Wednesday with two reports on the health of the UK economy and retail sector.UK shop prices declined in October following two months of mild inflation, data from the British Retail Consortium showed.The BRC - Nielsen shop price index decreased 0.2% year-on-year versus a 0.2% rise in September. Non-food deflation deepened to 1.1% in October from 0.9% a month ago. At the same time, food inflation slowed to 1.3% from 1.9% in both September and August.Also, consumer confidence in the UK fell in October despite accelerating wage growth and pre-budget reports about the imminent end of government austerity. Confidence dropped one point to minus 10 in GFK's long-running Consumer Confidence Index amid conditions normally "sufficient to boost consumer sentiment".Confidence in the general UK economic situation during the last 12 months remained at minus 28 this month - one point higher than this time last year - but expectations for the coming year decreased one point to minus 28, two points lower than last October.In the FTSE 250, Inchcape was the best performer, up 7.1% after Barclays double upgraded the car dealer to Overweight from Underweight. At the other end of the midcap index, Computacenter was down 20% after the IT services company reported third quarter earnings.For the nine months to September-end, revenue at group level was down 3% to GBP900 million from GBP932 million last year. In the UK, revenue slipped 9% to GBP296 million from GBP326 million the same time last year."While the overall growth rates in the third quarter in isolation are subdued compared to recent quarters, as mentioned above, the third quarter presented a more challenging comparison. Our expectation for the fourth quarter is for improved growth before acquisitions but not to the levels seen in the first half of the year," the company said. In the US on Tuesday, Wall Street ended strongly higher, with the Dow Jones Industrial Average up 1.8%, S&P 500 and Nasdaq Composite up 1.6%.In corporate news, social network Facebook on Tuesday reported a 9% increase in profit for the third quarter, driven largely by growth in ad revenue. Facebook closed Tuesday's trading in New York at USD146.22, up USD4.13 or 2.9%, on the Nasdaq. The stock gained another USD2.16 or 1.5% in after-hours trading.In the US earnings calendar Wednesday car maker General Motors and KFC fast food chain owner Yum! Brands report earnings before the NY market open.The Japanese Nikkei 225 index closed up 2.2%. In China, the Shanghai Composite closed up 1.4%, while the Hang Seng index in Hong Kong ended up 1.1%.China's factory activity slowed in October to almost no growth, amid a trade war with the US, the National Bureau of Statistics said Wednesday. The manufacturing purchasing managers index came in at 50.2, compared to 50.8 in September. A figure above 50 indicates growth.The Bank of Japan downgraded its inflation outlook for the current financial year for the third straight quarter, while deciding to keep its ultra-easing monetary policy to prop up the world's third-largest economy. The central bank expects Japan's consumer price index to rise 0.9% for the year through March 2019, revised down from the 1.1% increase estimated three months ago, it said in a statement released after a two-day monetary policy meeting.Sterling was flat Wednesday, quoted at USD1.2727, against USD1.2727 at the London equities close on Tuesday.The economic events calendar has Italy unemployment at 0900 GMT and eurozone inflation and unemployment figures at 1000 GMT.Related Shares:
Smith (DS)Standard CharteredInchcapeMarks & SpencerComputacenterSKG.LNextMondi