4th Jun 2015 10:02
LONDON (Alliance News) - The following is a summary of top news stories Thursday.
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COMPANIES
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Johnson Matthey reported a large rise in pretax profit and its dividend that both comfortably beat market expectations after most of its divisions reported strong sales growth, partially offset by a weaker performance from the precious metals business. However, the FTSE 100-listed speciality chemicals and metals company gave a mixed outlook for its businesses in the current year, but did say it expects its overall performance in the current year should be "slightly ahead" after it sold two businesses. Johnson Matthey also raised its dividend by more than expected to 68.0 pence per share for the year, representing a 9% rise and ahead of analysts' expectations of 67.5 pence.
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Low cost airlines easyJet and Wizz Air Holdings reported a strong rise in passenger numbers in May, and their planes were more full as the growth in numbers outpaced increased capacity. EasyJet said it flew nearly 6.5 million passengers in May, up 7.2% from nearly 6.1 million a year earlier, while its load factor, a measure of how full its planes are, rose to 91.6% from 89.4%. Wizz Air, which operates in Central and Eastern Europe and is set to join the FTSE 250 index, said it flew 1.6 million passengers in may, up 20% from 1.3 million a year earlier. That outpaced an 18% increase in capacity meaning its load factor rose to 89.0% from 87.5% a year earlier.
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Smith & Nephew said it has voluntarily removed smaller-size components for its Birmingham Hip Resurfacing system from the market, as recent performance data has shown patients may be "at a greater risk of revision surgery that previously believed". Revision surgery refers to when a hip replacement needs to be replaced. The products account for around 1% of Smith & Nephew's hit implant revenue in 2014 and 0.1% of group revenues, it said, and will have no impact in its guidance for the full year.
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Sports Direct International said it has made Financial Controller Matt Pearson its acting chief financial officer and he will take his place on the board with immediate effect. Pearson joined the sports goods retailer as group financial accountant from EY in June 2007, and subsequently became financial controller.
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FTSE confirmed late Wednesday that satellite firm Inmarsat will replace temporary-power provider Aggreko in the FTSE 100 from the market open on Monday, June 22, following the completion of its quarterly review.
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Pets at Home Group posted a substantial rise in pretax profit for its 2015 financial year, flattered in part by costs it booked last year not recurring, but also by revenue growth in its merchandise and services businesses as it paid its maiden dividend. The FTSE 250-listed pet retailer said its pretax profit for the 52 weeks to March 27 was GBP87 million, nearly quadruple the GBP22.5 million it posted a year earlier. The figure for the 2014 financial year was pulled lower by the company booking GBP29.7 million in exceptional costs related to its listing on the London Stock Exchange, but even stripping out those costs, pretax profit was up in the recent financial year from GBP52.2 million previously.
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Odey Asset Management LLP said it does not intend to vote in favour of the 400 pence per share bid made for contracts-for-difference trading platform Plus500 by FTSE 250-listed gaming technology company Playtech, saying the bid "materially undervalues" Plus500. London-based hedge fund Odey, which on Tuesday increased its stake in Plus500 to 25.49%, having been steadily building up its stake in recent weeks, said Playtech's offer is "an opportunistic bid exploiting current regulatory issues and risks" and said it intends to vote against it.
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Ladbrokes may be forced to provide a rival bookmaker in Ireland more information to allow the company to launch a bid for its Irish arm, The Daily Telegraph reports. Boylesports, the largest independent bookmaker in Ireland, has said it is interested in acquiring Ladbrokes' Irish business, but claims the assets were placed under court protection to prevent them being sold. The 'examinership' process gave Ladbrokes' business in Ireland protection from creditors while the FTSE 250-listed company formulated a rescue plan to turnaround the unit.
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MARKETS
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London shares are lower mid-morning, as volatility in debt markets is weighing on investor sentiment, while easyJet is amongst a handful of gainers in the FTSE 100 after it reported a strong rise in passenger numbers in May.
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FTSE 100: down 1.5% at 6,847.29
FTSE 250: down 1.1% at 18,061.57
AIM ALL-SHARE: down 0.2% at 776.57
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The pound is up against the dollar ahead of the Bank of England's monetary policy decision due at 1200 BST.
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GBP: up at USD1.5427
EUR: up at USD1.1345
GOLD: down at USD1182.72 per ounce
OIL (Brent): down at USD63.64 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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UK house prices dropped for the first time in three months in May, data from Lloyds Banking Group's Halifax division showed. House prices edged down unexpectedly by 0.1% month-on-month in May, reversing April's 1.6% increase. This was the first fall since February. Prices were forecast to grow 0.2% from April. In three months to May, house prices were 2% higher than in the preceding three months. This measure of the underlying rate of house price growth eased for the second consecutive month, falling to its lowest since January, said Martin Ellis housing economist at Halifax.
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Critical bailout talks between Greek Prime Minister Alexis Tsipras and European officials were to continue Thursday, after a late-night meeting in Brussels left officials upbeat but reached no firm conclusion. "The discussions are going to continue in the coming days," Tsipras said after the meeting with European Commission President Jean-Claude Juncker. "The more we talk sincerely, the closer we will get to a mutually acceptable solution," he said after what many consider to be a final push for a deal allowing Athens to access urgently needed bailout aid in return for reforms. Jeroen Dijsselbloem, head of the Eurogroup of eurozone finance ministers, said the talks were "very good," a sentiment echoed by the European Commission, which described it as a "good, constructive" meeting.
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French unemployment rate decreased unexpectedly in the first quarter, though slightly, data from the statistical office Insee showed. The jobless rate, measured according to International Labour Organisation, or ILO, standards, edged down to 10.3% in the three months ended March from 10.4% in the fourth quarter. Economists had expected the rate to remain stable at 10.4%.
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Ireland's service sector expanded at the fastest pace in three months in May, driven by greater levels of new business on improving economic conditions, survey figures from Markit Economics showed. The Investec services purchasing managers' index rose to 61.4 in May from 60.6 in the previous month. A reading a above 50 indicates expansion in the sector.
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At least 17 people were reportedly killed Wednesday in eastern Ukraine in the bloodiest fighting since the February ceasefire. The Ukrainian government and pro-Russian separatists traded blame for the escalation, which was predominantly within the partially rebel-held Donetsk region.
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Brazil's central bank lifted its key interest rate by 50 basis points despite seeing signs of recession in the economy. The Selic rate was raised by 50 basis points to 13.75% from 13.25%. Policymakers unanimously voted for a rate hike. The bank said policymakers took decision after evaluating the macroeconomic scenario and the outlook for inflation. The central bank intends to bring inflation to 2.5% to 6.5% range. The inflation measured by the 12-month accumulated broad national consumer price index reached 7.7% in February. In the first quarter, the economy contracted 0.2%, which was the first fall in three quarters. The central bank earlier projected the economy to shrink 0.5% this year.
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The US economy continued to plod along after another rough winter, according to the latest Federal Reserve Beige Book released. Seven districts reported "moderate" or "modest" growth in May, while others described growth as "slight," "mixed," or "steady." A number of economists were expecting the US to snap back in the second quarter after a brutal start to the year, but it appears for now that the recovery has stalled. Stronger growth is seen later in the year, but the strong dollar has been hurting manufacturers of late.
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Ailing former FIFA official Chuck Blazer admits that he and others accepted bribes before the votes that gave the 1998 World Cup to France and the 2010 World Cup to South Africa, according to newly unsealed US court documents. A former FIFA executive committee member, Blazer confessed to taking bribes in connection with the votes on the two World Cup hosts, according to a transcript released Wednesday of his November 2013 plea hearing in a closed Brooklyn federal courtroom.
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By Arvind Bhunjun; [email protected]; @ArvindBhunjun
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