15th Jan 2019 07:45
LONDON (Alliance News) - Stocks in London are seen opening higher on Tuesday tracking strong gains in Asia, as UK housebuilder Persimmon reported a strong trading performance and now expects profit ahead of market consensus. IG futures indicate the FTSE 100 index to open up 44.38 points at 6,899.40. The blue chip index closed down 63.16 points, or 0.9%, at 6,855.02 on Monday.The Japanese Nikkei 225 index closed up 1.0%, resuming trading after being closed on Monday. In China, the Shanghai Composite ended up 1.4%, while the Hang Seng index in Hong Kong is up 1.8%.Markets in Asia were higher after Beijing said it would cut taxes "on a larger scale" to stabilize a slowing economy amid ongoing US-China trade war."Equities are rebounding on Tuesday after recovering from Monday's China inspired sell off. Soft data from China sent stocks reeling in the previous session, as traders were unable to shake off slowing growth fears. Today's bounce comes following a pledge of more supportive measures from Beijing to stabilise the slowing Chinese economy," said London Capital Group's Jasper Lawler. Persimmon said it delivered another strong trading performance, with disciplined growth in 2018 in line with its strategy.The housebuilder said annual revenue was 4% higher at GBP3.74 billion from GBP3.60 billion last year and new housing revenue rose 4% to GBP3.55 billion from GBP3.42 billion the year before. The company said legal completion volumes increased 3% to 16,449 from 16,043 last year and the average selling price of GBP215,560 was 1% higher than GBP13,321 last year.Persimmon said the UK housing market has continued to benefit from robust employment levels, low interest rates and a competitive mortgage market, which in turn supported confidence and customer demand across all its regions. The company expects pretax profit for 2018 to be modestly ahead of current market consensus, benefitting from new developments opened through the year."Whilst the future performance of the UK economy is currently subject to increased levels of uncertainty the group is well positioned with its strong outlet network together with the availability of a range of attractive house types at affordable prices across the regions of the UK, supported by a high quality land bank and conservative financial structure," the company said. Subprime lender Provident Financial said it has made further progress during the final quarter against its operational aims for 2018 and its funding and capital positions remain strong.Provident sells high-cost credit via its Vanquis Bank, Moneybarn and consumer credit business. The company said Moneybarn has continued to perform well and the consumer credit division has performed in line with internal plans during the last quarter of the year. Vanquis Bank delivered further customer and receivables growth, however impairments have been modestly higher than expected.Provident said it expects to report exceptional costs of approximately GBP55m in 2018, representing costs associated with the implementation of the home credit recovery plan, intangible and tangible asset write offs alongside redundancy and consultancy costs.The company said it expects to report profit for 2018 towards the lower end of the range of market expectations of GBP151 million to GBP166 million. "We have been progressively tightening our underwriting standards throughout the group in anticipation of the current uncertain UK economic environment we are facing. We will continue to monitor underwriting standards in light of any changes in customer behaviour," said Chief Executive Malcolm Le May. Online fashion retailer Boohoo Group said it saw strong growth across all brands in all of its regions. For the four months to December-end revenue increased 44% to GBP328.2 million from GBP228.2 million last year. Year-to-date revenue increased 47% to GBP723.5 million from GBP491.1 million. "We remain firmly focused on continuing to provide our customers with great fashion at unbeatable value. The global growth opportunity is significant and we will be addressing it in a controlled way - investing in our proposition, operations and infrastructure to capitalise on the opportunity," the company said. The company now expects revenue to be between 43% to 45% higher, ahead of its previous guidance of 38% to 43%. The pound was marginally higher, quoted at USD1.2900 against USD1.2890 at the London equities close Monday, ahead of the key vote in the House of Commons.UK Prime Minister Theresa May will make her final efforts Tuesday to persuade lawmakers to back the deal she has agreed for Britain to withdraw from the EU, as she faces widespread dissent from her own Conservatives and opposition parties.May has promised parliament a "meaningful vote" on the agreement, but she postponed it at the last minute in mid-December after admitting she faced a heavy defeat.Speculation has mounted over what could happen to the deal, to the Brexit process and to May's political career if, as seems likely, she loses the vote.May conceded that the deal "is not perfect" and reflects compromise.Addressing lawmakers in Monday's debate, she rejected calls to delay the date of the UK leaving the EU, scheduled for March 29, to allow more time to build consensus or allow a second referendum.In the US on Monday, Wall Street ended lower, with the Dow Jones Industrial Average down 0.4%, S&P 500 down 0.5% and Nasdaq Composite down 0.9%.Ahead in the US earnings calendar on Tuesday, banks JPMorgan Chase and Wells Fargo report earnings before the market open in New York.
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