18th Nov 2019 11:10
(Alliance News) - The following is a summary of top news stories Monday.
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COMPANIES
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Aviva said it has decided to retain its Singapore businesses. The FTSE 100-listed insurance company said the move follows a "thorough" review of options for the Singapore business, including seeking offers for the business. Earlier on Monday, Bloomberg reported that Japan's MS&AD Insurance Group Holdings and Canada's Manulife Financial Corp were vying to buy Aviva's assets in Singapore and Vietnam, with the sale process entering its final stage. Also on Monday, Aviva confirmed that its joint venture in China will be retained, given the scale of the market, "excellent" relationship with its partner China Oil & Food Corp and the high growth prospects.
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Sage Group said it has entered an agreement for the sale of its Pay business to payments firm Elavon, a subsidiary of US Bancorp, for GBP232 million. Sage expects to report a statutory profit on disposal of GBP180 million on completion, it said, which is expected in the second quarter of its financial 2020. Back in September, the FTSE 100-listed accounting software firm had confirmed press reports that it was evaluating strategic options for its Pay division, including a sale. For the year to the end of September 2018, Sage Pay had revenue of GBP41 million and operating profit of GBP15 million.
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Consort Medical, a contract development and manufacturing pharmaceutical company, said it has agreed to a GBP505 million acquisition offer from Swedish peer Recipharm. Under the offer, a unit of Recipharm will pay 1,010 pence in cash for each Consort share, representing a premium of 39% to Consort's closing stock price of 726p on Friday. The proposed deal implies an enterprise value of GBP627 million for Consort. Recipharm may reduce its acquisition consideration if any dividend or other distribution is made by the Hemel Hempstead-based company, Consort said.
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Diploma upped its final payout for financial 2019 after reporting a "strong double-digit growth in revenues and earnings". The company, which supplies seals, filters, specialised wiring and fastners, also said its remains confident of making further progress in the current financial 2020 as moderately lower underlying growth will be offset by a strong contribution from acquisitions. The London-headquartered company posted a 15% rise in pretax profit for the year ended September 30 to GBP83.5 million from GBP72.7 million a year ago. FTSE 250-listed Diploma recommended a 15% increase in its final dividend to 20.5 pence per share, with the total annual payout up 14% to 29.0p from 25.5p last year.
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MARKETS
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London shares were higher on US-China trade optimism. However, Aviva was the worst blue chip performer, down 4.3%. In the FTSE 250, Diploma was the best performer, up 3.8%. Wall Street was called to open higher, with major stock indices pointed up 0.3%.
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FTSE 100: up 0.1% at 7,308.45
FTSE 250: up 0.4% at 20,485.84
AIM ALL-SHARE: up 0.4% at 895.05
GBP: up at USD1.2963 (USD1.2901)
EUR: firm at USD1.1062 (USD1.1050)
GOLD: down at USD1,458.31 per ounce (USD1,466.80)
OIL (Brent): up at USD63.31 a barrel (USD62.80)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Top Chinese and US trade negotiators held "constructive" discussions over the phone on a preliminary trade deal between the two countries, China's commerce ministry announced in a statement on Sunday. The long-running trade war between Washington and Beijing has weighed on the global economy and spooked markets, with the two sides imposing punitive tariffs on hundreds of billions of dollars in two-way trade. US President Trump announced a "phase one" trade deal last month which has yet to be signed. Vice Premier Liu He spoke with US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin on Saturday, and had "constructive discussion on each side's core concerns regarding the phase-one agreement", the Chinese commerce ministry said. The two sides will "continue to maintain close communication", it added, without providing further details.
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Pro-democracy demonstrators holed up in a Hong Kong university campus set the main entrance ablaze Monday after police warned they may use live rounds, deepening fears over how nearly six months of unrest across the city will end. The violence extended a dangerous new phase of the crisis, which over the past week has seen schools shut down, roads barricaded and Chinese soldiers briefly leave their local barracks to clean up streets. China has refused to budge on any of the protesters' key demands, which include free elections for the city of 7.5 million people and an end to the perceived erosion of liberties under China's tightening grip. Beijing has instead repeatedly warned it will not tolerate any dissent, and concerns are growing it could intervene militarily to quell the unrest.
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Political uncertainty in the UK drove the largest year-on-year slump in would be sellers of houses in over ten years in November, Rightmove said, though buyers were tempted by cheaper house prices. The Rightmove Monthly House Price index showed November average house prices fell by 1.3% from October, but edged 0.3% higher year-on-year. Rightmove said: "Would-be sellers are not only faced with the usual lower asking prices in the run-up to Christmas, but also a unique autumn combination of a Brexit deadline followed by a looming general election." The number of new-sellers dropped by just shy of 15% year-on-year, the largest annual fall since August 2009.
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The number of UK manufacturing companies entering insolvency has hit a five-year high, new research suggests. There was a 7% increase in the last year, to 1,466, said chartered accountants and business advisers Moore. The rise is being driven partly by Brexit-related uncertainty and a broader slowdown across Europe, said the report.
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Boris Johnson will cut employers' National Insurance as part of a range of tax cuts as he seeks to get the business community back on side. The UK prime minister will tell business leaders on Monday that the Tories will put an end to Brexit "uncertainty and confusion" if they are returned to power on December 12. In a major general election pledge, the Conservative Party said a Tory government would cut business rates, launching a fundamental review at their first budget. The party said they will increase the employment allowance from GBP3,000 to GBP4,000, providing a cut in National Insurance of up to GBP1,000 for more than half a million businesses.
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The incoming president of the European Council said the EU stands ready to negotiate a trade deal with the UK once Brexit happens. On a visit to Dublin on Friday, Charles Michel would not be drawn on whether it was realistic to anticipate an agreement being struck in the 11 months between the current exit date in January and the end of the transition period in December 2020. "We will see, it is not my intention to predict," he said. The former Belgian prime minister expressed hope a deal could be achieved in matter of "months", but suggested a lot depended on the outcome of the UK election.
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