5th Oct 2020 07:36
(Alliance News) - Stocks in London are set to open higher on Monday following news that US President Donald Trump has "continued to improve" after being admitted to hospital to be treated for Covid-19.
"Given the sell-off and uncertainty this news created Friday, it is no surprise to see the reaction today as the markets tentatively toggle risk after the President's better than expected Covid prognosis," said Axi's Stephen Innes.
In early UK company news, Weir announced the USD405 million sale of its Oil & Gas unit, Greencore reported an improvement in revenue trends in the fourth quarter, and Cineworld confirmed it will be suspending operations in the US and UK.
IG says futures indicate the FTSE 100 index of large-caps to open 42.58 points higher at 5,944.70 on Monday. The FTSE 100 closed 22.67 points, or 0.4%, at 5,902.12 on Friday.
In the US on Friday, Wall Street ended in the red, with the Dow Jones Industrial Average ending down 0.5%, the S&P 500 down 1.0% and Nasdaq Composite closing 2.8% lower.
US President Donald Trump has "continued to improve" as he is treated for Covid-19 at a military hospital near Washington, his doctors said Sunday, adding that he could be discharged as early as Monday.
In a briefing outside Walter Reed medical centre, they said Trump's oxygen levels had briefly dropped twice in recent days and that he is being treated with steroids, while continuing to provide an upbeat assessment of the 74-year-old's health and outlook.
"The president has continued to improve," said his White House physician, Sean Conley. "As with any illness, there are frequent ups and downs over the course."
Conley said the president was flown to Walter Reed on Friday after a "rapid progression" of his illness, with his oxygen levels dropping worryingly low.
Sterling was quoted at USD1.2933 early Monday, soft on USD1.2939 at the London equities close on Friday.
UK Prime Minister Boris Johnson said a UK-EU trade deal is "there to de done" but highlighted the UK could "prosper mightily" if no deal is reached, as the two sides agreed to intensify talks.
Johnson and European Commission President Ursula von der Leyen spoke via video conference on Saturday to take stock of progress in the negotiations following the final scheduled round of talks between Brussels and the UK this week.
Following their conversation on Saturday, the pair have tasked their chief negotiators with working "intensively" to resolve the remaining differences in the post-Brexit trade talks.
The euro traded at USD1.1727 early Monday, firm on USD1.1717 late Friday.
Against the yen, the dollar was quoted at JPY105.58 versus JPY105.34.
In Asia on Monday, the Japanese Nikkei 225 index ended up 1.2%. Financial markets in China are closed to commemorate 'Golden Week', though the market in Hong Kong re-opened on Monday after the National Day holiday, with the Hang Seng up 1.4%.
Gold was quoted at USD1,892.56 an ounce early Monday, lower than USD1,906.50 on Friday. Brent oil was trading at USD40.11 a barrel early Monday, up from USD39.48 late Friday.
In early UK company news, Weir said it has agreed to sell its Oil & Gas division to Caterpillar for an enterprise value of USD405 million.
The proceeds will be used to reduce the firm's leverage and the deal is expected to complete by the end of 2020.
"Alongside the previous sale of the Flow Control division and the acquisition of ESCO, it is a major milestone in transforming the Group into a focused, premium mining technology business," said Chief Executive Officer Jon Stanton.
Greencore said it saw an improvement in revenue and earnings in the fourth quarter of its financial year.
Group proforma revenue in the fourth quarter, which ended September 25, was down 19% - though this marked an improvement on the 36% fall registered in the third quarter.
For the full-year, Greencore expects to post revenue of GBP1.27 billion and adjusted earnings before interest, tax, depreciation, and amortisation of GBP85 million. For the year ended in 2019, revenue amounted to GBP1.45 billion and adjusted Ebitda GBP142.0 million.
"The fourth quarter of our financial year has seen an ongoing improvement in demand for our products...We are realistic but also confident in our plans for FY21, and remain excited by Greencore's longer term prospects," said Chief Executive Patrick Coveney.
Wizz Air reported a 59% drop in passenger numbers for September after a 41% fall in August. Capacity for September was down 40% and load factor reduced to 64.6% from 94.5%.
Cineworld on Monday confirmed that it will be suspending operations in the US and UK due to an "increasingly challenging theatrical landscape".
The closures involve all its 536 Regal theatres in the US and its 127 Cineworld and Picturehouse theatres in the UK. They will be shut from Thursday this week.
These closures will impact around 45,000 employees, Cineworld said. Chief Executive Mooky Greidinger said this was not a decision taken lightly.
"Cineworld will continue to monitor the situation closely and will communicate any future plans to resume operations in these markets at the appropriate time, when key markets have more concrete guidance on their reopening status and, in turn, studios are able to bring their pipeline of major releases back to the big screen," said Greidinger.
The decision comes after the release of the latest James Bond film was pushed back again.
Daniel Craig's final outing as spy James Bond will not hit big screens until next April, it was announced on Friday. No Time To Die was originally scheduled for release in April 2020, but was first pushed back to November as a result of the pandemic.
The economic calendar on Monday has services PMIs from Germany, the eurozone and the UK at 0855 BST, 0900 BST and 0930 BST respectively.
Eurozone retail sales are at 1000 BST and there is a Markit US services PMI at 1445 BST, followed by a report from the ISM at 1500 BST.
By Lucy Heming; [email protected]
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