12th Jul 2016 10:18
LONDON (Alliance News) - The following is a summary of top news stories Tuesday.
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COMPANIES
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Irish pharmaceuticals company Shire said its key dry eye disease treatment lifitegrast received approval from the US Food & Drug Administration. The eye drop treatment, branded Xiidra, is expected to be launched in the US in the third quarter of 2016. Dry eye disease is a chronic disease of the tears and ocular surface which can cause inflammation that could eventually result in damage to the surface of the eye. An estimated 16 million adults in the US are diagnosed with the disease, according to Shire. Shire said Xiidra is the only prescription eye drop indicated for the treatment of both signs and symptoms of dry eye disease. The approval marks a positive step in Shire's plan to reach product sales of USD20 billion by 2020, along with its recently completed acquisition of Baxalta, as it looks to replace some of its maturing portfolio with new drugs in an effort to avoid a "patent cliff".
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Recruitment firm PageGroup said gross profit growth in the second quarter was in line with the first and said it is too early to predict what impact the UK's vote to leave the European Union will have on the recruiting sector. The company, which changed its name from Michael Page International in June, said total gross profit growth in the second quarter to the end of June was 8.0% year-on-year. It was 3.7% in constant currencies, broadly in line with the constant currency growth seen in the first quarter. Gross profit in the UK, however, declined 2.3%, hit by the uncertainty prior to the UK's Brexit referendum.
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Builders merchanting and DIY group Grafton Group said the UK's vote to leave the European Union is likely to weigh on demand in the new housing and repair, maintenance and improvement markets over the remainder of the year, after posting a rise in revenue in its first half. Grafton said its revenue for the six months ended June 30 came in at GBP1.23 billion, up 13% from the GBP1.08 billion recorded a year earlier, with the largest gain made in its merchanting businesses, which make up 92% of total revenue.
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Construction and housebuilding company Galliford Try said it expects to post full-year results in line with management's expectations, after it sold more houses at higher prices and saw revenue growth in its construction arm. Within its Linden Homes housebuilding arm, the company said it made 3,078 completions during the year, compared to the 2,769 recorded a year earlier, and noted its average private sales price rose to GBP335,000 from GBP327,000. Its forward sales position grew 27% at the year-end to GBP380.0 million.
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Veterinary pharmaceuticals company Dechra Pharmaceuticals said trading in the year to the end of June was strong, with robust revenue growth boosted by acquisition contributions. Dechra said revenue growth including acquisitions in the year to June 30 was 21% at both constant and actual currencies. Excluding acquisitions, revenue grew 11%, the company said.
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Online fashion retailer ASOS reported growth in revenue in the third quarter of its financial year and said it expects full-year sales to be at the top end of its guidance. However, retail gross margin shrank slightly. Revenue in the four months ended June 30 grew by 30% to GBP514.6 million from GBP396.7 million the year before, as total retail sales also rose by 30% to GBP500.5 million from GBP386.0 million. Revenue includes retail sales, plus delivery receipts and third-party revenue.
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MARKETS
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London shares were higher, with financial stocks among the gainers as UK political uncertainty eased following the confirmation that Theresa May will become the nation's second female prime minister on Wednesday. The pound reacted positively to the news, reaching its highest level in a week. Wall Street was pointed to a higher open.
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FTSE 100: up 0.1% at 6,692.00
FTSE 250: up 1.0% at 16,888.26
AIM ALL-SHARE: up 0.7% at 720.43
GBP: up at USD1.3185 (USD1.2985)
EUR: flat at USD1.1109 (USD1.1043)
GOLD: down at USD1,352.26 per ounce (USD1,358.46)
OIL (Brent): up at USD47.19 a barrel (USD46.58)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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David Cameron is preparing for his final Cabinet meeting as UK prime minister as his successor Theresa May mulls over who to appoint to her top team. May will take up office as Britain's second woman PM on Wednesday, after Cameron answers MPs' questions in the House of Commons for the last time and goes to Buckingham Palace to offer his resignation to the Queen. Cameron will chair a farewell meeting of Cabinet ministers on Tuesday. After being confirmed as new Tory leader, May was left with around 48 hours to put together a new team to lead the government, with Chancellor George Osborne's position thought to be under threat.
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A union has been accused by UK Transport Secretary Patrick McLoughlin of having an "absurd" attitude over its dispute with train operator Southern Railway. McLoughlin claimed he shared the "fury" of passengers and insisted that the government is "playing its part" by investing in the rail network.The bitter dispute between the Rail, Maritime and Transport union and Southern broke out over plans to transfer responsibility for closing train doors from conductors to drivers.
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The UK economic growth was uninspiring in the run-up to the EU Referendum, the British Chambers of Commerce said. According to Quarterly Economic Survey, several key indicators remained static, or at a low ebb just before the referendum. In the service sector, the main driver of economic growth, posted declines in domestic and overseas sales and manufacturing sales remained at a historically low ebb. The business lobby does not expect official data to show an improvement in the second quarter GDP.
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Like-for-like sales in the UK were down 0.5% on year in June, the British Retail Consortium said. That follows the 0.5% increase in May. Overall sales were up just 0.2%. For the second quarter of 2016, overall sales were up 0.5% on quarter and 1.2% on year.
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Ireland's gross domestic product increased by 2.3% year-on-year in the first quarter, rising by 2.1% from the prior quarter.
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Britain's decision to leave the EU could reduce gross domestic product in the bloc by 0.2% to 0.5% next year, said EU Economy Commissioner Pierre Moscovici. The figure is a preliminary assessment and "can be changed if we are capable of limiting uncertainty and delivering the proper policy response," he noted. The commission expects the Brexit vote to reduce British GDP by between 1.0% and 2.5% in the same period, he added.
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Germany's consumer prices increased for the second straight month in June as initially estimated, latest figures from Destatis showed. The consumer price index climbed 0.3% year-over-year in June, following a 0.1% rise in May. The statistical office confirmed the preliminary estimate published on June 29. Meanwhile, German wholesale prices continued to drop in June but the pace of decline slowed further, Destatis said. Wholesale prices decreased 1.5% year-on-year in June, slower than the 2.3% fall seen in May and a 2.7% decline posted in April. The index has been falling since July 2013.
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The International Monetary Fund called on Italy to press on with reforms to head off the threat of a banking crisis and ensure the nation's economic growth continues to gain momentum. The eurozone's third biggest economy should expand this year by 1.1% before accelerating to a 1.3% growth rate in 2017 as unemployment falls and public debt levels edge lower, the Washington-based IMF said in its annual report on Italy. The Italian economy grew by 0.8% in 2015 after it emerged from its longest recession since the end of the Second World War.
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Jeroen Dijsselbloem, the head of the Eurogroup of eurozone finance ministers, spoke out against spending more public money on struggling banks, with Italian lenders particularly in the spotlight. Stock market values for Italian banks have tumbled following the Brexit referendum on June 23. The worst hit by the crash has been Monte dei Paschi di Siena, whose stock value has fallen by 50% to a record low. Rome has been in talks with the European Commission on ways to carry out public bank rescues - a move that could run counter to EU rules aimed at putting the onus of bailouts on shareholders and creditors, rather than taxpayers.
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By Arvind Bhunjun; [email protected]; @ArvindBhunjun
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