13th Jan 2016 11:15
LONDON (Alliance News) - The following is a summary of top news stories Wednesday.
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COMPANIES
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J Sainsbury reported growth in total retail sales excluding fuel in its third quarter as the number of customer transactions rose, although like-for-like sales fell. The supermarket chain said total retail sales in the 15 weeks ended January 9 grew 0.8% excluding fuel, although they fell 0.7% including fuel. Like-for-like retail sales, meanwhile, declined 0.4% excluding fuel and 1.8% including fuel. Sainsbury's added that over 30 million customer transactions were made in the week before Christmas, which was up 2.6% year-on-year.
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A major shareholder in HSBC Holdings has predicted the lender will decide to keep its headquarters in the UK and not relocate it to Asia, the Financial Times reported. Martin Gilbert, the chief executive of Aberdeen Asset Management, which is HSBC's fifth-largest shareholder, said the logistics involved in the bank moving its headquarters would be "so vast" that the bank is more likely, on balance, to remain in the UK. HSBC is due to make a decision on whether it will re-domicile later this month.
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Housebuilder Barratt Developments continued the positive news flow from the housebuilding sector as it said it sold more homes at higher prices in the first half and was confident on its outlook for the rest of its financial year. The group said it sold a total of 7,626 homes in the six months to the end of December, up from 6,971 a year earlier, at an average selling price of GBP254,000, up 11% from the GBP229,200 average price in the first half of the prior financial year.
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Specialist lender Provident Financial said its results for 2015 should meet its expectations, with solid trading across the business. The company, which ascended to the FTSE 100 index earlier this year following a year of very strong growth, said its Vanquis Bank business has continued to deliver good growth and strong margins in the fourth quarter of 2015. UK customer numbers ended the year up 9.9% year-on-year, the group said.
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Sports Direct International said it holds an indirect interest representing 11.5% of the issued share capital of Iconix Brand Group and 2.3% of the issued share capital of Dick's Sporting Goods. The sporting goods retailer said the indirect interests are through contracts for difference. It holds CFDs for 5.6 million shares in Iconix and 2.1 million shares in Dick's. Iconix is a brand management company which owns a portfolio of consumer brands across fashion, sports, entertainment and home. Dick's is a sporting goods and sports clothing retailer.
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Budget airlines easyJet and Ryanair Holdings could soon be handling part of the journey for long-haul passengers in Europe amid a strategic shift by the two groups, the Financial Times reported. Ireland's Ryanair has signalled plans to target tie-ups with flag carriers under which it would provide them with passengers for their long-haul flights. easyJet is understood to be considering a similar move, the FT said.
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Dunelm Group reported growth in sales in the first half of its financial year as it benefited from an extra six days in its winter sale, but warned the positive like-for-like trend would reverse in the current quarter. The homewares retailer said total sales in the 26 weeks ended January 2 grew 10% to GBP448.1 million year-on-year, growing 8.8% to GBP245.7 million in the 13 weeks to the same date. Like-for-like sales rose 4.6% to GBP404.9 million in the 26 weeks and 3.9% to GBP221.5 million in the 13-week period.
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Ted Baker reported a rise in retail sales in its eight-week Christmas period and said it expects full-year results to be in line with its expectations. The high-end fashion retailer said retail sales in the eight weeks to January 9 grew 10% year-on-year. Gross margins were in line with expectations, and there was no significant promotional activity before Christmas, Ted Baker said, adding that it expects to end the year with a clean stock position.
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Tullow Oil said revenue and gross profit in 2015 is set to come in considerably lower than a year earlier as lower oil prices and lower production from Europe offset a small rise in production from its main asset in West Africa. The West African oil producer said revenue for 2015 is set to total USD1.60 billion, yielding a USD600.0 million gross profit and generating USD1.00 billion of pre-tax operating cashflow before working capital.
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Recruiter Hays said its net fee income grew in the second quarter, despite some weakness emerging in Asia Pacific as a result of the slowdown in the mining industry in Australia. Hays said its total net fee income for the quarter to the end of December grew 3.0%, with like-for-like constant currency growth of 7.0%. The strongest performance came in its Continental Europe and Rest of the World division, helped by a recovery in Germany and broad-based positive trading elsewhere in the region. Asia Pacific net fee income fell 8.0%, though, hit by the slowdown in the mining sector in Australia and general weakness across the region, caused by a weakening economy in China. UK & Ireland net fee income rose 1.0%, with growth slowing against tough comparators.
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Housebuilding and construction company Galliford Try said trading was solid across its businesses in the first half of its financial year, with good sales in its Linden Homes unit and improving conditions for its construction arm. FTSE 250-listed Galliford said its Linden Homes unit made progress on its operating margin in the half to the end of December, as it sold more homes, up to 1,357 units from 1,171 a year earlier, at an average selling price of GBP295,000, compared to GBP259,000 a year previously.
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Online financial trading provider CMC Markets confirmed its plan to float on the London Stock Exchange's Main Market, an announcement which had been much anticipated in recent weeks. The Financial Times on Monday said CMC's board was due to meet on Tuesday to discuss the plans and that a confirmation its intention to float would likely come soon after. CMC on Wednesday said it intends to raise GBP17.0 million gross for the company through the share offering, which will be run by Goldman Sachs, Morgan Stanley and RBC Capital Markets. The primary proceeds will be used to meet listing and staff incentive plan costs, CMC said.
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Investment fund Woodford Patient Capital Trust said it has now deployed all the funds from its GBP800.0 million float in London in April last year. The fund, which focuses on investing in UK-based, early-stage technology companies and which is run by prominent fund manager Neil Woodford, said it may look at raising further capital and intends to consult with an gauge interest in such a move with its investors.
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MARKETS
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UK indices were trading higher with positive trade data from China boosting mining stocks. The Brent oil price recovered somewhat after hitting a fresh low USD30.36 a barrel on Tuesday. Wall Street was pointed to a higher open.
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FTSE 100: up 1.1% at 5,995.05
FTSE 250: up 0.6% at 16,791.25
AIM ALL-SHARE: up 0.1% at 721.84
GBP: up at USD1.4429 (USD1.4395)
EUR: flat at USD1.0813 (USD1.0837)
GOLD: down at USD1,081.95 per ounce (USD1,088.30)
OIL (Brent): up at USD31.58 a barrel (USD30.67)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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China's trade surplus increased in December, as exports dropped at a slower-than-expected pace, raising hopes that the depreciation in yuan is unlikely to continue on its previous trajectory. Exports fell 1.4% on a yearly basis in December, data published by the General Administration of Customs showed. It was slower than an 8% decline expected by economists and a 6.8% decrease posted in November. At the same time, imports slid 7.6%, also slower than the expected decrease of 11%. The Chinese trade surplus rose to around USD60 billion, taking the full year surplus to USD594.5 billion. The December figure was well above a USD51.3 billion surplus forecast by economists. In yuan terms, exports advanced 2.3%, reversing a 3.7% drop in November. Imports slid at a slower pace of 4% after falling 5.6% a month ago.
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Eurozone industrial production declined more than expected in November, figures from Eurostat revealed. Industrial production decreased 0.7% in November from October, when it grew by revised 0.8%. Economists had forecast output to drop 0.3%. On a yearly basis, growth in industrial output slowed to 1.1% from revised 2% in October. It was slower than the expected 1.3% increase.
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Belgian investigators have discovered three hideouts used by terrorists and suspects involved in the November attacks in Paris, prosecutors said. Belgium has been heavily involved in the investigations following the November 13 attacks that killed 130 people, as several of the perpetrators had links to the country.
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German Chancellor Angela Merkel described Tuesday's suicide attack in Istanbul in which 10 people died, eight of them Germans, as a "murderous act." "The terrorists are enemies of all free people, indeed they are enemies of humanity," she said Tuesday evening in Berlin. The Turkish government blamed Islamic State for the suicide bombing Tuesday in the tourist heart of Istanbul.
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US President Barack Obama attempted to paint an optimistic vision of the future of the US as he heads into his final year in office and works to cement the legacy of his eight years in office. "I believe in change because I believe in you," he said, echoing themes from his 2008 election campaign in his final State of the Union address to Congress. "That's why I stand here as confident as I have ever been that the state of our union is strong." The speech was short on concrete policy proposals. Obama instead said lawmakers must address big questions regardless of who the next president is, including: how to provide economic opportunity, how to make technology work for people, how to keep the US safe and how to improve the political climate.
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By Arvind Bhunjun; [email protected]; @ArvindBhunjun
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