14th Oct 2015 07:44
LONDON (Alliance News) - UK shares opened lower Wednesday after weak Chinese inflation figures, while fund supermarket Hargreaves Lansdown was the best of a handful of FTSE 100 gainers after it reported a positive first quarter in the face of weak markets.
The company, whose shares traded up 5.2%, reported higher net new business inflows, client numbers and net revenue, though assets under administration were down 11% in a quarter hit by lower stock markets and weakness in investor confidence.
Net new business inflows amounted to GBP1.43 billion in the quarter ended September 30, compared with about GBP970 million the corresponding quarter the prior year.
Total active clients rose by 24,000 in the quarter against a 10,000 rise in the corresponding quarter the prior year. Total clients rose to 760,000 at the end of September from 736,000 at the end of June
"We are particularly pleased with the reported trading data for the first quarter of the financial year given lower stock markets and weakness in investor confidence during the period. During the quarter, the FTSE All Share index fell by 6.57% to 3335.92, driven primarily by concerns about the Chinese economy," Hargreaves Lansdown Chief Executive Ian Gorham said in a statement.
The FTSE 100 index traded down 1.1% at 6,270.45 points. The FTSE 250 was down 0.6% at 16,789.52, and the AIM All-Share index was down 0.2% at 733.24.
In Europe, the French CAC 40 index was down 1.2% and the German DAX 30 was down 1.1%.
Stocks in Asia were lower, with the Nikkei 225 index in Tokyo closing down 1.9%, while the Hang Seng was down 0.9% as was the Shanghai Composite.
China's National Bureau of Statistics showed inflation eased in September, reflecting a slowdown in food inflation, and producer prices extended their downward trend, adding to fears of deflationary pressure amid moderation in economic growth.
Consumer price inflation slowed to 1.6% in September from a 12-month high of 2% seen in August. It was forecast to fall to 1.8%, while the government aims to achieve around 3% inflation this year. Month-on-month, consumer prices gained 0.1%, slower than the 0.5% increase seen in August.
Mining stocks were again amongst the worst performers in the FTSE 100 following the further round of weak Chinese data. Glencore traded down 3.6%, Anglo American was down 2.6% and BHP Billiton was down 2.1%. Fashion retailer Burberry Group also was a heavy faller, down 2.1% due to its exposure to China.
Elsewhere, Intertek Group traded up 1.1% after it agreed to buy Professional Service Industries Inc for USD330 million in cash. US-based PSI provides testing and assurance services to commercial and civil construction markets.
Intertek Chief Executive André Lacroix said in a statement that the acquisition will expand the testing, inspection and certification services company's presence in adjacent US growth markets.
Intertek will finance the acquisition with debt facilities already in place. Net debt will rise to about 1.8 times earnings before interest, tax, depreciation and amortisation at the end of the 2015 fiscal year, it said.
In the FTSE 250, shares in Domino's Pizza shot up 14%, the best performer in the index, after it reported a rise in sales in the third quarter of 2015 and said it now expects its full-year results to be ahead of expectations following a solid start to the fourth quarter.
Al Noor Hospitals Group was up 11% at 1,108.00 pence after it reached an agreement on the terms of a possible reverse takeover by South Africa's Mediclinic International.
Al Noor said it will acquire Mediclinic pursuant to a South African scheme of arrangement under which Mediclinic shareholders will receive 0.62500 new Al Noor shares for each Mediclinic share held, as well as the Mediclinic interim dividend payable in December. Al Noor shareholders will receive a special dividend of GBP3.28 per Al Noor share and will also have the opportunity to tender their shares to Al Noor for cancellation for a cash payment of GBP8.32 per share.
The combination will result in Mediclinic shareholders owning 84% to 93% of the enlarged group.
Shares in fellow United Arab Emirates healthcare operator NMC Health were up 3.3%. Al Noor confirmed last Friday that it had received a competing approach from NMC regarding a possible takeover offer but made no reference to NMC on Wednesday.
N Brown Group shares were up 5.8% even though the company reported a drop in profit in the first half of its financial year, despite a rise in revenue, as it booked costs related to store closures made as part of its effort to become a digital-led retailer.
The online, catalogue and stores retailer said its pretax profit in the half year ended August 29 dropped by over half to GBP19.4 million from GBP42.7 million the year before, which it said was due to exceptional costs relating to the closure of 18 clearance stores.
It said it will significantly lower exceptional costs in the second half of the year to between GBP2 million and GBP3 million.
Revenue, however, grew 4.2% to GBP415.8 million from GBP399.2 million. Its said its turnaround of the JD Williams business is on track, with new customers up 21%, while it saw a strong performance in Simply Be and Jacomo.
Still ahead in the economic calendar are UK unemployment and wage data at 0930 BST and eurozone industrial production at 1000 BST. In the afternoon, US retail sales are at 1330 BST alongside producer price index.
By Neil Thakrar; [email protected]; @NeilThakrar1
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