11th Jun 2018 08:45
LONDON (Alliance News) - Stocks in London opened broadly higher, as NMC Health led the way with an agreement to form a new healthcare joint venture in Saudi Arabia, in spite of uncertainty surrounding a shaky G7 summit at the weekend and upcoming Brexit votes in Parliament.The FTSE 100 index was up 0.4%, or 29.44 points, at 7,710.81 early Monday. The mid-cap FTSE 250 index was up 0.5% at 21,274.37. The AIM All-Share index was flat at 1,096.67.The Cboe UK 100 was up 0.4% at 13,082.56, the Cboe UK 250 was up 0.6% at 19,425.14, and the Cboe UK Small Companies was flat at 12,860.45.On the London Stock Exchange, NMC Health opened in the lead of the FTSE 100 index, up 2.3% as the United Arab Emirates-focus healthcare operator signed an agreement with Hassana Investment company to set up a joint venture healthcare platform in Saudi Arabia.Hassana is the investment arm of the Saudi Arabian pension fund General Organization for Social Insurance. The joint venture will be formed with the contribution of existing Saudi Arabian assets by NMC and Hassana's 39% stake in Tadawul-listed National Medical Care Co, and will have a bed capacity of 1,489.The joint venture is subject to regulatory approvals and due diligence.Pest control firm Rentokil Initial came out of the blocks second best among blue chips, up 1.8% as HSBC raises its recommendation to Buy from Hold, also increasing its price target to 440 pence from 290p.At the bottom of the index was Experian, down 1.2% as Deutsche Bank cut the credit reporting agency's rating to Hold from Buy, while increasing its target price to 1,800 pence from 1,750p.Jet engine maker Rolls-Royce was the second worst large-cap stock, down 1.0% following the identification durability issues on a number of Trent 1000 jet engines, dubbed Package B engines.Back in April, the aerospace and engineering firm had identified similar issues for the intermediate pressure compressor within another range of Trent 1000 engines, known as Package C.Rolls-Royce said it has agreed with Boeing and the relevant regulatory authorities to conduct a one-off inspection of the group's Trent 1000 Package B fleet, which consists of 166 engines.The inspection requirements are expected to incur additional costs for 2018, however Rolls-Royce said it remains confident that its free cash flow guidance of around GBP450 million, plus or minus GBP100.0 million remains unchanged.Monday's announcement follows a report by the Sunday Times that Rolls-Royce is set to cut 4,000 jobs in a bid to slash costs and increase profit.In the FTSE 250, satellite operator Inmarsat sat comfortably at the top of the midcap index, up 12% to 530.80 pence after RBC raised its price target to 850p from 725p, while retaining its Outperform rating.On Friday, Inmarsat confirmed it had received a preliminary merger proposal from US peer Echostar Corp, which was rejected by the company's board.The company was responding to movement in its share price and a takeover speculation on the Financial Times' Alphaville blog. Shares in Inmarsat closed up 13% on Friday."After carefully considering the proposal with its advisers the board rejected the proposal on the basis that it very significantly undervalued Inmarsat and its standalone prospects. The board remains highly confident in the independent strategy and prospects of Inmarsat," the company said, adding that there was no certainty over a formal offer from Echostar.Echostar, which is based in the US state of Colorado and provides satellite communication solutions through its Hughes Network Systems and EchoStar Satellite Services business segments, has until July 6 to make a formal offer for Inmarsat, or walk away, under UK takeover rules. Sterling was quoted at USD1.3424 early Monday, higher than USD1.3394 at the London equities close on Friday, ahead of UK industrial and manufacturing data at 0930 BST."Sterling is off Friday lows (normally a hindrance to FTSE names) as FX markets start to price in tomorrow's Brexit amendment votes in the House of Commons. Whipping is expected to result in the shooting down of most of the 15 House of Lord's 'soft Brexit' proposals, but with PM May lacking a parliamentary majority (DUP prop-up partners not happy about NI border and abortion) rebel Tories could side with Labour to make things difficult,"said Michael van Dulken, head of research at Accendo Markets.In political news, the EU (Withdrawal) Bill returns to the Commons on Tuesday with ministers seeking to overturn a raft of amendments by the House of Lords intended to keep Britain close to the EU after Brexit.UK Prime Minister Theresa May will appeal for a show of unity from her warring MPs as she seeks to avoid a series of damaging Commons defeats on the government's centrepiece Brexit legislation.However, they face a revolt by pro-EU Tory MPs determined to retain as many of the changes as possible in the legislation.The euro was quoted at USD1.1809 early Monday, slightly lower from USD1.1825 at the European equities close Friday.In mainland Europe, the CAC 40 in Paris was flat while the DAX 30 in Frankfurt was down 0.4% early Monday."Over the weekend, the G7 meeting ended in acrimony with US President Trump refusing to endorse the joint communication after taking umbrage with comments made by Canada's Prime Minister Trudeau. As a result, trade frictions between the US and some of its major trading partners are likely to remain for some time," said Nikesh Sawjani, economist at Lloyds Banking Group."With three key central bank meetings due, US President Trump's meeting with North Korea's leader Kim and the EU Withdrawal Bill returning to the House of Commons, there is plenty for markets to focus on this week. However, it is also a busy week for domestic data releases, a number of which should help shape expectations for near-term trends in UK GDP," Sawjani added.US President Trump withdrew his endorsement of the joint communique at the end of the G7 summit - after calling Canadian Prime Minister Justin Trudeau "dishonest and weak".The summit in Canada was marked by the US president's controversial trade policy which has put him at odds with the rest of the G7 leaders.In Asia on Monday, the Japanese Nikkei 225 index closed up 0.5%. In China, the Shanghai Composite closed down 0.7%, while the Hang Seng index in Hong Kong is up 0.4%.Also this week, there are interest-rate decisions from major central banks. The US Federal Reserve decides on Wednesday, while the European Central Bank follows on Thursday and the Bank of Japan on Friday.Related Shares:
InmarsatNMC.LExperianRentokil InitialRolls-Royce