4th Oct 2018 07:40
LONDON (Alliance News) - Stocks in London are seen opening in the red on Thursday following Asian markets lower, with retailers Ted Baker and DFS Furniture reporting a drop in profit amid challenging trading conditions. The Japanese Nikkei 225 index closed down 0.7% while the Hang Seng index in Hong Kong is down 1.9%. Financial markets in China remain closed for a week long holiday. Asian stock markets were lower as upbeat US economic data drove 10-year US Treasury yields to their highest level since 2011 and also raised concerns about the outlook for interest rates."Good US economic data and dollar strength saw money being drawn out of emerging markets. Emerging market currencies and Asian markets traded lower across the board overnight. Asian markets are quickly losing their appeal as emerging market fears combined with trade tensions and better opportunities stateside mean investors are pulling their funds from the region," said London Capital Group's Jasper Lawler.IG futures indicate the FTSE 100 index is to open 15.28 points lower at 7,495.00. The blue chip index closed up 0.5%, or 35.73 points at 7,510.28 Wednesday.In early UK corporate news, BHP Billiton confirmed it reached an agreement with prosecutors in the Brazilian state of Minas Gerais related to the Samarco Mineracao dam failure disaster in 2015.BHP explained the deal with the State Prosecutor of Mariana "outlines the process and principles for the negotiation and implementation by the Renova Foundation of the formal compensation programme for impacted people in Mariana, Minas Gerais".Fundao - operated by Samarco - failed in early November 2015 and flooded the surrounding area, causing multiple deaths. Samarco is jointly owned by subsidiary BHP Billiton Brasil and Brazilian miner Vale. No financial details of the deal were provided in the statement.Budget airline easyJet reported passenger numbers increased to 8.8 million in September from 7.7 million last year. Although, the load factor was down to 92.8% in September from 93.6% at the same time last year.Fashion retailer Ted Baker said it continued to make progress amid challenging trading conditions.For the half year ended August 11, revenue rose 3.6% to GBP306.0 million from GBP295.7 million last year, while pretax profit fell 3.2% to GBP24.5 million from GBP25.2 million the year before. Ted Baker reported that UK & Europe sales rose 1.0% and North America sales were up 1.8%, while sales in the Rest Of World were down 1.8%.The company said the first half of the year saw challenging external trading conditions across its global markets and its performance was hurt by unseasonable weather across the UK and Europe and North America in the early part of the year and a very hot summer across the UK and Europe.Ted Baker lifted its interim dividend 7.8% to 17.9p from 16..6p. "Whilst we believe that the second half of the year will remain challenging due to external factors, we are well positioned to continue Ted Baker's long-term development. Our flexible business model ensures that our customer has multiple channels to engage with Ted Baker and our global e-commerce business continues to expand, supported by our digital marketing strategy and unique stores that showcase the brand," said Chief Executive Kelvin Ray. Sofa retailer DFS Furniture said it made "solid operational and strategic progress" as its trading performance was hurt by hot weather in the fourth quarter.For the financial year ended July 29, revenue rose 14% to GBP870.5 million from GBP762.7 million last year, as pretax profit halved to GBP25.8 million from GBP50.1 million the year before. The company declared a final dividend of 7.5p, maintaining its payout for the financial year at 11.2p.DFS said it sees like-for-like order growth over first nine weeks although it added that overall market conditions will remain subdued during 2019."We believe, we are benefiting from deferred purchases in the prior financial year and overall we expect the market to remain subdued into 2019, constrained by political risk and weak consumer sentiment. Notwithstanding this we believe we are well positioned to become stronger in this current environment, boosted by investment and acquisition benefits, and we have excellent prospects for profitable growth and attractive cash flow generation over the longer term," said CEO Ian Filby. US cable company Comcast said it entered into an agreement to acquire the 39.12% stake in pay-TV company Sky held by rival Twenty First Century Fox. Comcast is to acquire the Sky stake at GBP17.28 per share. The pound was marginally lower quoted at USD1.2935 compared to at USD1.2999 at the London equities close Wednesday.In domestic political news, a leading Tory Brexiteer has issued a new warning to Theresa May that she faces a Commons defeat if she presses ahead with her Chequers blueprint for Brexit.Just hours after the prime minister appealed to the party to unite behind her plan, former Brexit minister Steve Baker, who quit over Chequers, urged her to avoid a political "accident" and rethink her approach to negotiations with Brussels.Baker, a leading member of the pro-Brexit Tory European Research Group, said even if only half the 80 Conservative MPs who had indicated their opposition to the plan actually voted against it would be enough to defeat the government.In her closing address to the Conservative conference on Wednesday, May sought to rally her warring party with an appeal to back her proposed deal in the "national interest".She warned that if Tory MPs split in pursuing their "perfect Brexit" they risked ending up with "no Brexit at all".However Baker - who backed former foreign secretary Boris Johnson's conference call to "chuck Chequers" - said she would face a "substantial" revolt unless she changed course.The economic events calendar on Thursday has US initial jobless claims at 1330 BST and US factory orders at 1500 BST. On Wall Street, stocks closed modestly higher on Wednesday, with the Dow ending the session at a new record closing high. The Dow Jones Industrial Average closed up 0.2%, S&P 500 up 0.1% and Nasdaq Composite up 0.3%.A report from payroll processor ADP showing stronger than expected private-sector job growth in the month of September contributed to the strength on Wall Street.Related Shares:
SkyTED.LDfs FurneasyJet