Highlights of the Day
Asian Markets
Asian shares were mostly lower after the U.S. 30 closed above the 22,000 level and as the dollar recovered slightly from a two-and-a-half year low touched overnight against the euro. |
U.S. Markets
U.S. shares breached the 22,000 mark, powered by Apple’s stellar results, before stocks retreated sharply across sectors as investors locked in gains. |
Today's News
Next continued to fall in the second quarter of the year despite the fine summer weather that boosted other high street names, with expectations for the second half to remain in negative territory. A strong online and catalogue performance, however, allowed the company to modestly narrow sales guidance for the full year, though its profit and dividend expectations remain the same. Retail sales fell 7.4% in the three months to 29th July, which was an improvement on the 8.1% collapse in the first quarter.
ConvaTec saw group reported revenue rise 0.3% in its first half to $831.3m, it reported, with constant exchange rate growth sitting at 2.1% and organic growth of 1.5%. The firm said its margin improvement programme brought a 40 basis point performance benefit in the six months to 30th June, with a 150 basis point increase in adjusted gross margin to 60.3% including favourable foreign exchange movements. EBITDA fell by 4.3% on a reported basis, however, to $216.4m, while that drop was 8.5% on an organic basis.
Inmarsat’s revenues rose to $688.2m inthe six months to the end of June – 9.4% up on last time despite still challenging markets. EBITDA increased by 2% to $376.5m and the group has declared an interim dividend of 21.62 cents per share – up 5%. Chief executive Rupert Pearce said: “With our on-going focus on operational execution, Inmarsat has continued to move forward in 2017, building on a strong performance towards the end of last year, despite on-going challenging markets.
Esure Group has reported ‘an excellent first half with growth in premiums, policies and profits’. Gross written premiums rose by 22.8% to £393.3m while the number of in-force policies increased by 8.8% to 2.258m. Profit before tax from continuing operations was up 44.6% at £45.1m and the combined operating ratio improved 2.6ppts to 96.6% (1H 2016: 99.2%).
Cobham has reported first half results in line with expectations and maintain its full year outlook – although it said there remained a wide range of potential outcomes for 2017. Group order intake was lower at £915.8m (2016: £1,170.4m), with order intake in 2016 benefiting from an initial net AUS$719m order booked relating to the significant multi-year contract extension from Qantas. Excluding this from the comparator, order intake was up 4% at constant exchange rates.
Aviva’s first half operating profit rose by 11% to £1,465m while the IFRS profit after tax increased to £716m from £201m. Operating EPS rose by 15% to 25.8p and the group declared an interim dividend of 8.4p per share up 13%. Group chief executive Mark Wilson said: “Aviva is delivering. For the fourth year in a row we have grown operating profit, up 11%, reflecting positive performances across Aviva’s businesses world-wide. As a result, we are increasing the interim dividend per share by 13% to 8.4p.
Randgold Resources sustained its strong performance record with second-quarter results that have positioned it well to achieve its guidance for 2017. Results for the quarter and the half-year to June showed continuing growth in production and profit and a further reduction in total cash cost per ounce. The company’s cash pile rose over the first six months to $572.8 million despite the payment of the 2016 dividend of $94 million.
Oil prices dipped on Thursday as a rally that has pushed up prices by almost 10 percent since early last week lost momentum despite renewed signs of a gradually tightening U.S. market.
Gold prices prices dipped with the dollar in focus ahead of US nonfarm payrolls at the end of the week.
Companies Reporting this week
| Day |
Companies |
| Today: |
Serco Group * Randgold Resources * Shire * Cobham * Inmarsat * Centamin * London Stock Exchange Group * Aviva * Ferrexpo * Convatec * Next |
| Tomorrow: |
Merlin Entertainments * RBS * Pearson * Millennium & Copthorne Hotels |
Early Market Movements
| Market |
Index |
Change |
% Change |
| UK 100 |
7403.9 |
-7.5 |
-0.1% |
| UK 250 |
19,844.3 |
+42.8 |
+0.2% |
| GER 30 |
12,136.8 |
-44.7 |
-0.4% |
| FRA 40 |
5,094.0 |
-13.3 |
-0.3% |
| U.S. 30 |
22,016.24 |
+52.32 |
+0.2% |
| U.S. 500 |
2,477.6 |
+1.2 |
+0.1% |
| OIL (BRENT) |
52.11 |
-0.25 |
-0.5% |
| GOLD |
1,262.02 |
-4.63 |
-0.4% |
UK Risers & Fallers (8:15am)
| Company |
Price |
Change |
% Change |
| Next |
4435 |
+422 |
+10.5% |
| Cobham |
145.35 |
+11.35 |
+8.5% |
| Randgold Resources |
7235 |
+240 |
+3.4% |
| Convatec |
287 |
-22 |
-7.1% |
| Mondi |
1947 |
-55 |
-2.7% |
| Ferrerexpo |
230.5 |
-9.1 |
-3.8% |
Latest Broker Views
| Company |
Broker |
Recommendation |
Price |
Target |
| Aggreko |
JP Morgan |
Neutral |
841 |
867 |
| DS Smith |
Berenberg |
Buy |
489.3 |
550 |
| Standard Chartered |
Deutsche Bank |
Sell |
787.7 |
668 |
| William Hill |
Barclays |
Equal Weight |
269.65 |
315 |