13th Jun 2019 08:40
(Alliance News) - Despite opening in the red, the FTSE 100 managed to turn its fortunes around in early dealings thanks to gains for Ferguson, DS Smith and Wm Morrison Supermarkets. The FTSE 100 was up 6.41 points, or 0.1%, at 7,374.03 early Thursday. The FTSE 250 was down 3.63 points at 19,246.43 while the AIM All-Share was flat at 943.95.The Cboe UK 100 index was flat at 12,500.62. The Cboe UK 250 was unchanged at 17,274.72 with the Cboe UK Small Companies also flat at 11,682.32.London's headline index was outperforming European counterparts. The CAC 40 in Paris and DAX 30 in Frankfurt both were down 0.3%.Ferguson shares shot up 8.7% after funds managed by Trian Fund Management took a 5.98% stake in the plumbing and heating firm, in a transaction worth worth around GBP736 million."Trian has contacted members of Ferguson's management team and looks forward to working with them to explore and implement initiatives that it believes can create long-term shareholder value," said Trian Investors 1.DS Smith was up 1.9% as it reported strong annual growth and raised its medium-term targets. Revenue for the year to April 30 was up 12% to GBP6.17 billion, with pretax profit boosted 35% to GBP350 million. This lead to the firm raising its payout 13% to 16.2p. DS Smith recorded a return on sales margin of 10.2%, above its target of 8% to 10%. Following this strong performance, the company raised its medium-term return on sales target to between 10% to 12%.Explaining the reasoning for the target upgrade, DS Smith said: "We expect margin to continue to grow in the medium-term due to our value-adding customer proposition, the benefit of contribution from NAPP and Europac, and from a continuous focus on cost and efficiency."Looking ahead, DS Smith said it expects further good progress in the recently-commenced financial year."We saw some volume weakness in certain export-led markets in the second half of 2018/19, including Germany, but we expect this to improve during the current year," said Chief Executive Miles Roberts.Wm Morrison Supermarkets gained 1.3% as it expanded its relationship with online retail giant Amazon. The grocery delivery service is currently available in Leeds, Manchester, Birmingham and London, and will be rolled out to other cities - including Glasgow, Newcastle, Liverpool, Sheffield and Portsmouth in 2019, and then is expected to further expand in future years.This move will see Morrisons becoming a retailer on Amazon's Prime Now website and app, through 'Morrisons at Amazon', and selling directly to customers."Amazon has been a valued partner of Morrisons for over three years, and we are pleased to be expanding our relationship together. Continuing to partner with the best digital operators such as Amazon is a significant, capital light growth opportunity for Morrisons," said Morrisons Chief Executive David Potts.Tesco, meanwhile, dipped 1.5% as it reported slight sales growth in the first quarter. Total group sales excluding VAT and fuel were up 0.4% at constant exchange rates to GBP13.98 billion in the 13 weeks to May 25, rising 0.2% on a like-for-like basis. At actual exchange rates, sales were up 0.4%. Tesco's total sales in the UK and Ireland were up 1.3% at constant exchange rates to GBP11.17 billion, up 0.8% on a like-for-like basis, and 1.2% higher at actual currency rates.UK online grocery sales were up 7.0% year-on-year, while the closure of Tesco Direct in July last year hit sales growth by 0.8%. Tesco said it delivered a robust Easter performance across all formats, including the "biggest-ever" sales day for its small stores on Easter Sunday.In the FTSE 250, PZ Cussons was down 2.0%. The personal products firm announced the departure of its chief financial officer and said annual profit is expected in line with prior forecasts.CFO Brandon Leigh has stepped down from the board immediately, the company said, with Commercial Finance Director Alan Bergin to assume his responsibilities until a replacement is found.Separately, the Imperial Leather soap maker said it expects pretax profit before exceptional items for the year ended May 31 to be around GBP70 million."The expected outturn for the year reflects a resilient performance in Europe and Asia driven by product innovation and renovation as well as distribution expansion, and with the Group's beauty division performing particularly well," said PZ Cussons.This performance in Europe and Asia has been as operations in Africa continued to be "disappointing" due to the macro economic situation in Nigeria and challenging conditions at the port.In Asia on Thursday, the Japanese Nikkei 225 index ended down 0.5%. In China, the Shanghai Composite is flat, while the Hang Seng index in Hong Kong is down 0.8%.The economic events calendar on Thursday has eurozone industrial production at 1000 BST and US import and export prices at 1330 BST.
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