1st Apr 2021 11:22
(Alliance News) - The following is a summary of top news stories Thursday.
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COMPANIES
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Next raised its forecast, said it met annual profit guidance and "optimistically" ruled out any more store closures as the UK's vaccine rollout continues. The clothing and homewares chain also took note of the "battle" its bricks and mortar arm faces as the retail sector's shift to online was accelerated by the Covid-19 pandemic. It also decided against making a final payout but did say it will review its dividend once visibility improves. In the financial year ended January 30, total revenue fell 17% to GBP3.53 billion from GBP4.27 billion. Full price sales were down 15%. Pretax profit dropped 54% to GBP342.4 million from GBP748.5 million, though it did meet the latest guidance. Online sales rose 10% to GBP2.37 billion, while retail sales dropped 48% to GBP954.5 million. "We expect the shift in consumer behaviour towards online sales to continue for some time and one of our priorities during the year has been to continue the development of our online platform," Next said, adding: "There remains a big question mark over the level of sales our stores will achieve when they reopen. The pandemic has served to accelerate a pre-existing social trend - the move to more online shopping. History has been given a shove and, having moved forward, seems unlikely to reverse."
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Wealth manager Quilter said it has agreed to sell Quilter International to Utmost for GBP483 million following a strategic review. The sale will simplify Quilter and focus the company on its higher-growth UK wealth management business, it said. Net cash proceeds of around GBP450 million are expected from the sale. The board said that it is currently minded to undertake a capital distribution to shareholders of the majority of the proceeds.
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Microsoft won a massive Pentagon contract for augmented reality headgear for soldiers, the company and the US military announced, in a deal reported to be worth more than USD20 billion. The headsets, based on commercially available HoloLens, will make soldiers safer and more effective, according to Microsoft technical fellow Alex Kipman. The contract could be worth some USD22 billion over the next ten years, according to reports by CNBC and the Washington Post.
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Boeing said it was awarded a contract to supply the US Navy with 11 submarine hunters. The aerospace and defence firm said the pact is worth USD1.6 billion. Nine of P-8A Poseidon aircraft will go to the US Navy, while another two will be sent to the Royal Australian Air Force, as part of a partnership. "The P-8A is a long-range anti-submarine and anti-surface warfare aircraft used by the US Navy. It's vital for intelligence gathering, surveillance reconnaissance and search and rescue," Boeing explained. "Deployed around the world, with 103 aircraft in service and more than 300,000 flight-hours, the P-8's performance and reliability delivers confidence to customers operating in an uncertain world."
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Panasonic's new chief executive officially took up the role on Thursday and backed the company's improvement plan. Kusumi was named as the replacement for Kazuhiro Tsuga back in November. "Last year we announced our decision to transition to a holding company system with the aim of bolstering our competitiveness by 'specializing and sharpening' our business operations. Through this reorganization, I expect all of our businesses to become strong enough to survive even the toughest competition," Kusumi said. Kusumi outlined Panasonic's "autonomous management" plan, which the CEO said will empower the company's individual units. Osaka, Japan-based is an electronics firm whose vast range includes televisions, home appliances, beauty products and cameras.
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MARKETS
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Stock prices were rising around the world ahead of the long Easter weekend. "It seems investors are very much of the mind that it is still worth backing companies that will benefit from the reopening of the global economy, despite the negative backdrop of France closing schools in its third lockdown and Brazil still struggling to get Covid under control," commented Russ Mould, investment director at AJ Bell. An upgrade in guidance by leading UK retailer Next helped support the positive mood in London. Next shares were up 2.2%.
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CAC 40: up 0.3% at 6,085.97
DAX 30: up 0.4% at 15,063.13
FTSE 100: up 0.8% at 6,764.68
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Hang Seng: closed up 2.0% at 28,938.74
Nikkei 225: closed up 0.7% at 29,388.87
S&P/ASX 200: closed up 0.6% at 6,828.70
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DJIA: called up 0.1%
S&P 500: called up 0.4%
Nasdaq Composite: called up 1.0%
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EUR: unchanged at USD1.1742
GBP: steady at USD1.3780 (USD1.3785)
USD: up at JPY110.72 (JPY110.50)
GOLD: up at USD1,715.12 per ounce (USD1,704.21)
OIL (Brent): soft at USD63.80 a barrel (USD64.00)
(currency and commodities changes since previous London equities close)
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ECONOMICS AND GENERAL
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The eurozone's manufacturing economy posted a strong end to the first quarter of the year, with numbers showing growth in the sector was slightly higher than initially expected in March. The final IHS Markit eurozone manufacturing purchasing managers' index came in at 62.5 points, beating the earlier flash estimate of 62.4. The March figure was up from February's tally of 57.9 points. It was the ninth month in-a-row that the PMI has registered above 50 points, meaning growth. Markit noted a "record" increase in output, new orders, exports and buying activity. "The eurozone's manufacturing economy performed extremely strongly during March, with operating conditions improving to the greatest degree in nearly 24 years of data collection," Markit explained. PMI figures for Germany and Netherlands came in at record highs. Italy and France posted their best tallies in more than 20 years.
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UK manufacturing activity hit its best level in over a decade in March, figures showed, surpassing both the flash estimate and the previous month's reading. The IHS Markit/Chartered Institute of Procurement & Supply purchasing managers' index shot up to 58.9 in March - the best reading since February 2011 - from 55.1 in February. The figure beat the flash estimate of 57.9. The PMI was supported by improved growth of output, new orders and employment, along with increased supplier lead times, said IHS Markit. Manufacturing output increased for the tenth successive month and at the quickest pace since last November.
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The Irish manufacturing sector performed strongly in March, IHS Markit said, as output, new orders and exports all rose solidly and for the first time since the end of 2020. The headline AIB Ireland manufacturing purchasing managers' index surged to 57.1 in March, from 52.0 in February, signalling a marked overall improvement in Irish manufacturing business conditions at the end of the first quarter. Any figure greater than 50.0 indicates overall improvement of the sector, so the latest figures suggest the sector at a faster pace in March. "It also sees Ireland join a global rebound in manufacturing, with the March flash PMI readings for the UK, Eurozone and US all at historically high levels," noted Oliver Mangan, AIB chief economist.
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China's manufacturing sector grew "modestly" in March, according to the latest Caixin purchasing managers' index. The PMI ticked down to 50.6 points, from February's 50.9 points. The reading remained above the 50.0 no-change mark but IHS Markit noted it was the "softest" growth seen over the past 11 months. "Looking ahead, manufacturers were highly confident that output would
continue to rise over the next year, with the level of positive sentiment among the highest seen over the past seven years," Markit said.
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Japan's manufacturing economy expanded at a faster pace in March, numbers from the latest au Jibun Bank reading showed. The headline au Jibun Bank manufacturing PMI climbed to 52.7 points in March from 51.4 points in February. "This signalled the strongest improvement in the health of the sector since October 2018, reflecting a sustained recovery from the impact of the coronavirus disease 2019 (Covid-19) pandemic," Markit said. "The improvement in operating conditions was partly due to a second successive rise in production volumes in March."
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Australia's manufacturers reported further strong output and order book growth in March as production and demand continued to recover from pandemic-related losses, IHS Markit said. The seasonally adjusted IHS Markit manufacturing purchasing managers' index recorded 56.8 in March, down from 56.9 in February and slipping further below January's recent peak. IHS Markit said production and new orders both continued to rise at solid rates in March, both increasing for the ninth consecutive month.
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US President Joe Biden vowed to make companies like Amazon pay their fair share in taxes to fund his ambitious USD2 trillion infrastructure plan. He said it was not about "retribution" against the wealthy and successful, but the fact that Amazon pays zero in federal taxes is "just wrong." Biden on Wednesday unveiled the far-reaching plan to shore up the nation's highways, bridges and ports, as well as fund telecommunications upgrades plus research and development to boost competitiveness, especially compared to China. A key source of the financing would come from increasing the corporate tax rate from 21% to 28%, and cracking down on the use of tax havens to avoid paying US taxes.
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French President Emmanuel Macron announced that French schools would close next week and a limited lockdown in place in Paris and other regions would be extended to the whole country to battle soaring Covid-19 cases. Macron said in an address to the nation that the current efforts to limit the virus "were too limited at a time when the epidemic is accelerating". The spread of the so-called British variant meant "we risk losing control". He said that schools would close from Monday for the next three weeks, but this would include two weeks of spring holiday.
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Coronavirus restrictions in most of Italy that closed restaurants, shops and museums through Easter will be extended through April, the government said. But "an easing of measures" could be decided if the trend of the epidemic and the vaccination rollout warrant it, according to the decree approved late Wednesday by the government of Prime Minister Mario Draghi. Under the new decree, schools for lower grades will remain open, and it makes vaccines for healthcare workers compulsory. Anyone refusing to be vaccinating can be reassigned, where possible, in roles away from the public. If not, their pay will be suspended.
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Stay-at-home orders for more than two million people in Australia's third-biggest city Brisbane were lifted Thursday, ending a snap coronavirus lockdown just ahead of the traditionally busy Easter holidays. The three-day lockdown ordered Monday saw schools, restaurants and bars forced to close after an outbreak in Brisbane, with health officials saying it was necessary to stop the virus spreading and bolster contact tracing. It was the latest in a series of mini lockdowns in Australian cities this year, which authorities say have quickly brought virus outbreaks under control and avoided more onerous measures.
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By Tom Waite; [email protected]
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