3rd Feb 2020 07:50
(Alliance News) - Stock prices in London are set to open higher on Monday, rebounding from sharp losses on Friday, despite fears over the spread of coronavirus sending Asian markets lower.
In early company news, Irish carrier Ryanair Holdings swung to a third-quarter net profit on a strong Christmas period, but said delivery of the Boeing 737 MAX was unlikely until the autumn, setting back its growth plans. Tobacco firm Imperial Brands poached car dealer Inchcape's chief executive.
IG says futures indicate the FTSE 100 index of large-caps to open 15.49 points higher at 7,301.50. The FTSE 100 index closed down 95.95 points, or 1.3%, at 7,286.01 Friday.
Ryanair said it swung to a third quarter net profit of EUR88 million from a EUR66 million loss a year before. Revenue for the quarter ended December 31 came in at EUR1.91 billion, up 21% from EUR1.58 billion a year ago, in what is a seasonally weak period for airlines.
Ryanair reported passenger growth of 6% to 35.9 million from 33.8 million, while its passenger load factor was 96%, up from 95% a year previous.
Ryanair said the first Boeing 737 MAX delivery is unlikely before September or October.
The company said that due to the delay in receiving delivery of the Boeing 737 MAX, it will not see any of the expected cost savings from the fuel-efficient jet until late 2021 and as a result plans to extend its 200 million passenger per annum target by at "least one or two years" to financial 2025 or 2026.
Ryanair expects annual earnings in financial 2020 to be at the mid-point of its latest profit after tax guidance. Earlier this month, Ryanair upped its annual profit after tax guidance range to between EUR950 million and EUR1.1 billion.
Imperial Brands said Stefan Bomhard is to join the board as chief executive officer, effective at a start date to be announced. He will join the tobacco company from car dealer Inchcape where he has been CEO for the past five years.
Inchcape said a search to find a new CEO is underway.
Imperial added that Alison Cooper has stepped down as chief executive and as a board director with immediate effect now that a replacement has been found for her.
Elsewhere, Just Eat Takeaway.com shares are to start trading on the London Stock Exchange on Monday following the merger of online takeaway platforms Just Eat and Dutch rival Takeaway.com becoming wholly unconditional.
The deal is being investigated by the UK Competition & Markets Authority, but the company is confident the deal will be given the green light by the regulator.
Just Eat Takeaway CEO Jitse Groen said: "Today's listing on the London Stock Exchange marks the beginning of a new era for our company. The Just Eat Takeaway.com merger provides the scale that is a necessary condition to remain competitive in a globalised environment. Our ambitions, however, reach much further. It is our intent to lead the sector, which not only means delivering the absolute best product for both consumers and restaurants, but also a dedication to our social responsibility.
"Following the CMA's discretionary decision to conduct an investigation into the merger, we will work quickly to respond to their questions. As said, we are confident merger clearance will be obtained."
China's death toll from a new coronavirus jumped above 360 on Monday to surpass the number of fatalities of its SARS crisis two decades ago, with dozens of people dying in the epicentre's quarantined ground-zero.
The 57 confirmed new deaths was the single-biggest increase since the virus was detected late last year in the central city of Wuhan, where it is believed to have jumped from animals at a market into humans. The virus has since spread to more than 24 countries, despite many governments imposing unprecedented travel bans on people coming from China.
In Asia on Monday, the Japanese Nikkei 225 index closed down 1.0%. In China, the Shanghai Composite is down 8.0%, while the Hang Seng index in Hong Kong is up 0.3%. Shanghai reopened on Monday after being closed all last week for a extended Lunar New Year holiday.
Gold was quoted at USD1,579.60 an ounce early Monday, lower than USD1,586.60 late Friday.
Brent oil was at USD56.28 a barrel early Monday, down from USD56.86 late Friday.
China's manufacturing sector started the new year with the slowest rate of growth in five months, IHS Markit reported.
The Caixin purchasing managers' index was 51.1 in January, down from 51.5 in December. January's figure marks the slowest rate of improvement since August, which stood at 50.4. A figure over 50 reflects expansion, while below means contraction.
However, optimism for the year ahead rose to a 22-month high, due to an easing of US-China trade tensions following the signing of a phase one trade deal, as well as new product launches and expectations for improving global demand conditions.
Japan's manufacturing weakness continued in January, figures showed on Monday, with output reduced for the 13th successive month. The Jibun Bank Japan manufacturing purchasing managers' index came in at 48.8 in January, a slight improvement from 48.4 in December but still below the neutral 50.0 mark.
Sterling was quoted at USD1.3158 early Monday, lower than USD1.3186 at the London equities close on Friday, as the UK looks ahead to life outside the European Union.
The euro was trading at USD1.1081 early Monday, flat against USD1.1083 late Friday. Against the yen, the dollar was quoted at JPY108.51 firm versus JPY108.40 late Friday.
In the US on Friday, Wall Street ended sharply lower, with the Dow Jones Industrial Average ending down 2.1%, the S&P 500 down 1.8% and Nasdaq Composite closing down 1.6%.
The economic calendar on Monday has a swathe of manufacturing PMIs, from the eurozone, Germany, France, Italy, the UK, and the US.
By Arvind Bhunjun; [email protected]
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