16th Oct 2018 07:36
LONDON (Alliance News) - Stock prices in London are set to open softer on Tuesday, with focus in the UK on the latest jobs data and any Brexit developments ahead of Wednesday's summit in Brussels.In early UK company news, Bellway boosted its dividend after annual revenue and profit grew, Merlin Entertainments said it has seen signs of recovery in its London market, and Meggitt upgraded its annual revenue guidance following a strong third quarter.Due at 0930 BST, the latest UK jobs report is expected to show the unemployment rate held steady at 4.0% in the three months to August and average earnings including bonus growth decelerated to 2.4% from 2.6%.Sterling was quoted at USD1.3159 early Tuesday ahead of the data, up from USD1.3145 earlier in the morning but flat compared to USD1.3159 at the London equities close on Monday.IG says futures indicate the FTSE 100 index of large-caps to open 3.62 points lower at 7,025.60 on Tuesday. The FTSE 100 index closed up 0.5%, or 33.31 points, at 7,029.22 on Monday."Shares in Asia edged higher overnight following a week of heavy losses, although geopolitical tensions with Saudi Arabia kept gains limited. Without a rebound in stocks in the US and whilst the focus of the market remains on the Middle East over the Saudi Arabia incident, the markets will struggle to put in a meaningful move higher," said Jasper Lawler, head of research at London Capital Group.In Asia on Tuesday, the Japanese Nikkei 225 index closed up 1.3%. In China, the Shanghai Composite is 1.2% lower, having traded in the green earlier in the session, while the Hang Seng index in Hong Kong is down 0.6%.Lawler added: "Investors will want to see US shares put in a convincing move higher following its recent higher Treasury yield-inspired sell-off before global equities are in the clear."In the US on Monday, Wall Street ended lower, with the Dow Jones Industrial Average off 0.4%, the S&P 500 down 0.6% and Nasdaq Composite shedding 0.9%.The economic events calendar on Tuesday, outside of UK jobs data, has Italy's inflation and eurozone trade figures at 1000 BST. At 0800 BST, the latest UK grocery share figures are due from Kantar Worldpanel, covering the 12 weeks ending October 7.Already out, China's consumer prices rose 2.5% year-on-year in September, in line with expectations and up from 2.3% in August.The National Bureau of Statistics also said that producer prices climbed an annual 3.6% - exceeding forecasts for 3.5% and down from 4.1% in the previous month.In the UK, focus will remain on Brexit ahead of Wednesday's summit in Brussels as hope of an agreement before the gathering fades.UK Prime Minister Theresa May has insisted an exit agreement is still "achievable" despite negotiations stalling just days ahead of a crunch summit."The shape of a deal across the vast majority of the withdrawal agreement, the terms of our exit, are now clear," May told lawmakers in the House of Commons on Monday."We have made real progress in recent weeks on both the withdrawal agreement and the political declaration on our future relationship," she said, adding that negotiations were now in the "final stages".European Council President Donald Tusk said that while there was goodwill on both sides, the negotiations have been more complicated than expected.EU leaders are due to decide late Wednesday how to take negotiations forward. Ahead of their discussions, May has been invited to give her assessment of the situation.In company news on Monday, British American Tobacco said its business is continuing to perform well and the company is "confident" in delivering good adjusted revenue growth on a constant currency basis.The tobacco major continues to expect industry volume to be down around 3.5% for the full-year, while Tobacco Heating Products is expected to grow revenue "substantially". BAT's global vapour business is expected to deliver double-digit volume and constant currency revenue growth in 2018.THP and vapour revenue have been showing "strong growth" and is expected to reach GBP900 million of reported revenue in 2018, led by THP. "The revision from the previously announced revenue target of GBP1 billion is largely driven by a reduction in planned year-end stocks in Japan as the THP category remains flat and the effect of the Vuse Vibe recall in the US," said BAT.AstraZeneca and Merck & Co said the US Food & Drug Administration has granted granted orphan drug designation to Lynparza for the treatment of pancreatic cancer.The use of Lynparza in pancreatic cancer is being assessed in the ongoing phase three Polo trial, which is testing the treatment as maintenance monotherapy versus placebo in patients with germline BRCA-mutated metastatic pancreatic cancer whose disease has not progressed following 1st-line platinum-based chemotherapy. Results from this trial are expected in the first half of 2019.Housebuilder Bellway said revenue and profit rose strongly over its recently-ended financial year, boosting its payout as a result.Revenue for the year to July 31 rose 16% to GBP2.96 billion, while pretax profit advanced 14% to GBP641.1 million. The homebuilder boosted its total dividend per share by 17% to 143.0p compared to 122.0p the year before.In the first nine weeks of the new financial year, trading has remained "solid", with Bellway achieving a 2.9% increase in reservations per week, standing at 176. As at September 30, the company had an order book value of GBP1.47 billion compared to GBP1.36 billion a year earlier, representing 5,380 homes compared to 5,034."The board are mindful that the forthcoming exit from the EU in March could pose a threat to consumer confidence during the busy spring selling season. Assuming that market conditions remain unchanged, however, this healthy position should enable Bellway to further increase output in the year ahead," the company said.Merlin Entertainments said it is beginning to see the headwinds to trading from last year's terror attacks in the UK slacken as it reported organic revenue growth.Over the 40 weeks to October 6, organic revenue grew 4.7%, up 2.6% at reported currency rates. Resort Theme Parks posted organic revenue growth of 9.0%, with strong like-for-like trading due to product investment and favourable weather. Legoland Parks reported organic revenue growth of 6.4%.Organic revenue growth was flat in Midway Attractions, with a 0.7% decline in like-for-like revenue offset by a stronger showing from New Business Development. "The impact of terror attacks which adversely affected performance from early 2017 has started to abate and we have seen early signs of recovery in the London tourism market over the summer," said Chief Executive Nick Varney.Merlin backed its annual guidance, with trading in the year-to-date in line with expectations ahead of "a number of important trading weeks" over Halloween and Christmas.Meggitt said trading in the third quarter has been stronger than previously expected, leading the engineering firm to upgrade its 2018 revenue guidance.Organic revenue growth for the third quarter of 2018 came in at 6%, driven by the Civil Aerospace and Defence segments. As a result of improving end market conditions, Meggitt now expects total organic revenue growth in 2018 between 7% to 8%, having previously been seen in a range of 4% to 6%. Guidance for operating margins remains unchanged and is expected to be towards the lower end of the 17.7% to 18.0% forecast range.Overnight, miner Rio Tinto reported third-quarter iron ore shipments were 5% lower than last year due to planned maintenance cycles and safety pauses.Pilbara iron ore shipments of 81.9 million tonnes in the third quarter were 5% lower than the third quarter of 2017, due to planned maintenance cycles and safety pauses across all operations following a fatality at the Paraburdoo Iron Ore mine.However, Rio Tinto said Pilbara shipments in 2018 are expected to be at the upper end of the existing guidance range of 330 million to 340 million tonnes on a 100% basis.Mined copper production of 159,700 tonnes was 32% higher than the corresponding quarter of 2017, reflecting increased production from Rio Tinto Kennecott due to higher grades.In Australia, the stock closed 1.6% higher.In other mining news, BHP Billiton said it will invest GBP45 million into London-listed gold miner SolGold. The FTSE 100 constituent will buy 100 million SolGold shares at a price of 45 pence each. This is a 32% premium to SolGold's 20-day volume-weighted average price to Monday.BHP, also dual-listed, closed 1.7% higher in Australia overnight.Related Shares:
AstrazenecaRio TintoBHP Billiton PLCBellwayBritish American TobaccoMerlin EntertainmentsMGGT.L