1st Nov 2018 07:41
LONDON (Alliance News) - Stock prices in London are seen opening lower on Thursday with the FTSE 100 index hindered by a stronger pound, while Royal Dutch Shell enjoyed a strong third quarter as earnings rose on the back of higher oil prices.Both Shell and miner BHP Billiton are returning more cash to investors, but BT cut its interim dividend.IG futures indicate the FTSE 100 index will open 40.50 points lower at 7,087.60. The blue-chip index closed up 1.3%, or 92.25 points, at 7,128.10 on Wednesday.Sterling was higher, quoted at USD1.2866 against USD1.2757 at the London equities close on Wednesday, ahead of the Bank of England's interest rate decision at midday. The pound rose after Brexit Secretary Dominic Raab indicated he expected an EU withdrawal deal finalised by November 21 on Wednesday, only for his department to later insist there was no set date. Raab set off a flurry of speculation when he appeared to suggest a Brexit agreement could be done within three weeks.In a letter to the House of Commons Exiting the EU Committee, Raab wrote: "I would be happy to give evidence to the committee when a deal is finished and currently expect November 21 to be suitable."Meanwhile, the Bank of England will announce its latest monetary policy decision, alongside the release of the Monetary Policy Committee meeting minutes and quarterly Inflation Report, at midday on Thursday, on what has come to be known as 'Super Thursday'.This will be followed by a press conference with BoE Governor Mark Carney at 1230 GMT.With a Brexit withdrawal deal still not agreed, the Bank of England is expected to remain cautious, with the next UK interest rate hike still not seen until the second quarter of 2019.The economic events calendar on Thursday has UK manufacturing PMI at 0930 GMT and US manufacturing PMI at 1345 GMT. Already out, mortgage lender Nationwide said UK house prices were up 1.6% on a year before in October, compared to 2.0% in September.In early UK corporate news, Royal Dutch Shell reported one of its best ever quarters, with earnings soaring on higher oil prices.For the three months to September, Shell's current cost of supplies earnings excluding items rose 38% to USD5.79 billion.CCS earnings attributable to shareholders was up 51% to USD5.57 billion, and the figure excluding exceptional items climbed 37% to USD5.62 billion.Shell expects Integrated Gas output to fall in the fourth quarter due to divestments, though Upstream will rise due to lower maintenance and growth from new fields.Shell is paying a quarterly dividend of 47 US cents, in line quarter-on-quarter. It also is starting the second part of its share buyback programme, paying USD2.5 billion up to January next year.Cash flow from operating activities increased 59% year-on-year to USD12.09 billion, while free cash flow jumped to USD8.01 billion from USD3.67 billion. Telecommunications firm BT Group cautiously pushed full-year profit forecasts to the upper end of its range but cut its interim dividend Thursday, after profit rose on lower costs despite falling revenue.For the six months ended September, pretax profit rose 24% to GBP1.34 billion from GBP1.08 billion the year prior. Revenue fell 1.7% to GBP11.59 billion from GBP11.79 billion the year before.Profit performance was boosted by a reduction in operating costs. These fell to GBP9.90 billion from GBP10.33 billion the year before. Revenue performance, however, continued to be hurt by a further 7.1% decline in BT's global services business to GBP2.33 billion in the first six months from GBP2.51 billion the year prior. BT kept its forecasts for the full year ended March 2019 broadly unchanged. It did, however, add that its expected earnings before interest, taxes, depreciation and amortisation to be at the "upper half" of its GBP7.3 billion to GBP7.4 billion range. For the year ended March 2017, BT generated adjusted Ebitda of GBP7.65 billion. BT trimmed its interim dividend to 4.62 pence per share, down 4.7% from 4.85p the year prior. Online takeaway platform Just Eat said it saw a strong third-quarter performance and is on track to meet full year expectations.For the third quarter to the end of September, revenue surged 41% to GBP195.3 million driven by strong marketplace order growth and its HungryHouse acquisition. Total orders at group level were up 27% to 54.7 million with more than 57% of orders being made on its mobile app.Just Eat said it now expects annual revenue to be towards the top end of the GBP740 million to GBP770 million guided range. In addition, underlying EBITDA is expected to be towards the lower end of the GBP165 million to GBP185 million range, reflecting further investments in its Latin America markets."Our delivery expansion plans are on track, ensuring we give customers exactly what they want, and I'm very pleased with the progress we are making against our strategic objectives," said CEO Peter Plumb.BHP Billiton confirmed it will return its US shale proceeds via both a special dividend and a buyback.In July, London FTSE 100 and JSE Top 40 member BHP sold its US shale assets for USD10.8 billion to oil major BP and Merit Energy, with BP taking the vast majority. The deal completed on Wednesday.The miner will start straight away with a buyback worth USD5.2 billion, and, once this is done, will return an expected USD5.2 billion in a special dividend to be paid in January.FTSE 250-listed Provident Financial said Chris Sweeney, head of its Vanquis Bank arm, is to step down. CEO Malcolm Le May will be interim managing director of Vanquis as the company looks for a replacement. In the US on Wednesday, Wall Street ended higher, with the Dow Jones Industrial Average up 1.0%, S&P 500 up 1.1% and Nasdaq Composite up 2.0%.In the US earnings calendar broadcaster CBS, tomato ketchup maker Kraft Heinz, coffee house chain Starbucks and iPhone maker Apple will report earnings after the closing bell in New York on Thursday.The Japanese Nikkei 225 index closed down 1.1%. In China, the Shanghai Composite closed up 0.1%, while the Hang Seng index in Hong Kong is up 1.6%.China's manufacturing sector expanded only slightly in October as output remained broadly unchanged amid marginal increase in new business, survey data from IHS Markit showed Thursday.The Caixin Purchasing Managers' Index came in at 50.1 in October versus 50.0 in September. The reading was expected to remain unchanged at neutral level of 50.0. A score above 50 indicates expansion. Prior to September, the health of the sector had improved for 15 consecutive months.Related Shares:
PFG.LJust EatBT