Highlights of the Day
Asian Markets
Asian Shares were mixed in Asia after record highs on Wall Street overnight. Chinese markets lost ground on news of further tightening of market oversight by regulators.
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U.S. Markets
U.S. Shares were mixed, giving up earlier gains as oil prices took a beating and the US dollar gathered strength. |
Today's News
China’s inflation accelerated to a three-month high in April, while factory gate inflation eased on weakening commodity prices, data published by the National Bureau of Statistics showed. Inflation rose to 1.2% in April from 0.9% in March. Economists had forecast inflation to rise moderately to 1.1%. Inflation was well below the government’s target of around 3% for the whole year of 2017.
Barratt Developments expects full-year profit before tax to be at the top of the range of current analyst forecasts. It said total completions (including joint ventures) were expected to be around 17,350 for the year, the highest number of completions in nine years. And it said its commitment to build quality and customer service was reflected in the award of the Home Builder Federation’s maximum five star customer satisfaction rating for the eighth consecutive year.
ITV’s advertising revenue fell in the first quarter and is expected to remain down for the first half, though production sales from the company’s Studios arm and online growth were both strong. Despite an increase in television viewing figures thanks to hit shows like Broadchurch, total external revenue shrank 3% to £731m in the three months ended 31st March, with net advertising revenue down 9% and expected to be down 8-9% for the first half.
BAE Systems, the world’s third-largest defence contractor, has started its new financial year well, with trading consistent with expectations.The firm said its outlook remains unchanged with 2017 underlying earnings per share expected to be approximately 5% to 10% higher than the 40.3p made in 2016.”Our strategy is well defined, we have a large order backlog, long-term programme positions and a well balanced portfolio,” said Chief Executive Ian King.
Compass Group said its profit before tax for the first half of 2017 grew 7.2% to £831m from £666m the prior-year period. Earnings per share rose to 37.4p from 30.4p in the year-ago period.Underlying profit before tax for the period was £842m, up from £677m in the same period last year. Underlying earnings rose to 37.9p from 30.8p a year ago.
TalkTalk’s cut its dividend as founder Charles Dunstone, who became executive chairman earlier this month, said he would focus on returning the business to customer growth. The company, which competes with BT, Virgin Media and Sky, reported full-year earnings of £304m, up 17% but short of its own 320-360m guidance. The group cut its final dividend to 5p from 10.58p a year ago.”My focus for the company is growth, cash generation and profit – in that order,” Dunstone said.
Cape’s operating margins were in line with expectations with a robust performance in Asia Pacific offsetting lower margins in the Middle East where, as the group expected, the business experienced increased pricing pressure. UK margins were in line with forecasts. A trading update for the first quarter ahead of today’s annual general meeting said: “As expected, the Group delivered a strong trading performance in the first quarter, largely driven by increased project volumes and excellent operational performance in the Asia Pacific region.
National Express Group said in a trading update for the period 1st January to 30th April that it has maintained its strong momentum from 2016, and is on target to deliver its FY profit expectation. There was an overall revenue increase from continuing operations of 5.4% on a constant currency basis, up 15.8% on a reported basis, benefiting from organic growth and a number of bolt-on acquisitions made last year, together with significant foreign exchange tailwinds. “The group remains on target to deliver its profit expectation and free cash flow and leverage targets for the year,” said National Express.
Profits at Walt Disney jumped 11% in the first three months of 2017, bolstered by attendance at its theme parks and resorts. Profits in the first three months of the year were $2.4bn. But the media giant’s revenue gains more muted, up 3% year-on-year to at $13.3bn. The firm remains on track for modest growth, in spite of subscriber losses at its sports television network ESPN. “We’re extremely pleased with our results,” said Disney boss Robert Iger.
Oil Prices rose after it was reported Saudi Arabia would cut supplies to the region as OPEC battles against rising U.S. output that is threatening to derail its attempts to end a sustained global glut in crude.
Gold inched up as Asian stocks eased, but was sitting near a seven-week low hit in the previous session as Emmanuel Macron’s victory in French elections dampened the safe-haven appeal of the metal.
Companies Reporting this week
Day |
Companies |
Today: |
Compass Group * Bgeo Group * Vesuvius * ITV * Talktalk Telecom Group * National Express Group * Barratt Developments * Novae Group |
Tomorrow: |
Amec Foster Wheeler * BT Group * Arrow Global Group * Mondi * 3i Infrastructure * Galliford Try * Scottish Mortgage Investment Trust |
Friday: |
Provident Financial |
Early Market Movements
Market |
Index |
Change |
% Change |
UK 100 |
7,343.8 |
+1.6 |
+0.0% |
UK 250 |
19,844.7 |
+27.8 |
+0.1% |
GER 30 |
12,734.0 |
-15.2 |
-0.1% |
FRA 40 |
5,393.6 |
-4.4 |
-0.1% |
U.S. 30 |
20.975.78 |
-36.50 |
-0.2% |
U.S. 500 |
2,396.9 |
-2.5 |
-0.1% |
OIL (BRENT) |
48.96 |
+0.23 |
+0.5% |
GOLD |
1,221.59 |
+0.36 |
+0.0% |
UK Risers & Fallers (8:15am)
Company |
Price |
Change |
% Change |
Vesuvius |
567.25 |
+24.25 |
+4.5% |
Barratt Developments |
609.5 |
+13 |
+2.2% |
Compass Group |
1624 |
+29 |
+1.8% |
Card Factory |
310.45 |
-11.05 |
-3.4% |
Hikma |
1938 |
-41 |
-2.1% |
Provident Financial |
3190 |
-53 |
-1.6% |
Latest Broker Views
Company |
Broker |
Recommendation |
Price |
Target |
ASOS |
Citigroup |
Buy |
6,057.00 |
7,000.00 |
Burberry Group |
Credit Suisse |
Buy |
1,602.00 |
1,550.00 |
Marks & Spencer Group |
Citigroup |
Buy |
379.80 |
420.00 |
Shire |
Deutsche Bank |
Buy |
4,663.50 |
6,100.00 |
Forthcoming Economic Data
Time/Date |
Previous |
Forecast |
Outcome |
12:00pm: ECB President Draghi Speaks |
– |
– |
– |
12:30pm: U.S. Import Prices m/m |
-0.2% |
0.2% |
– |
2:30pm: U.S. Crude Oil Inventories |
-2.0M |
-0.9M |
– |
Sources:
http://www.londonstockexchange.com/exchange/news/alliance-news/detail/1494394881973130500.html
http://www.bbc.co.uk/news/business-39864568
https://www.ft.com/content/db03d929-2225-3d8f-b526-126afb6e50eb
http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11852720
https://www.digitallook.com/news/news-and-announcements/itv-ad-revenues-to-slump-for-whole-of-first-half–2663722.html
http://www.stockmarketwire.com/article/5546298/Barratt-expects-FY-to-be-at-top-end-of-forecasts.html
http://www.stockmarketwire.com/article/5546312/DiamondCorp-goes-into-administration.html
http://www.stockmarketwire.com/article/5546311/Cape-operating-margins-in-line-with-forecasts.html
http://www.stockmarketwire.com/article/5546308/Wood-Group-says-YTD-performance-weaker-than-expected.html
http://uk.reuters.com/article/uk-bae-systems-outlook-idUKKBN1860K7
http://www.nasdaq.com/article/compass-group-h1-pretax-profit-rises-proposes-special-dividend–quick-facts-20170510-00137
http://www.stockmarketwire.com/article/5546294/National-Express-maintains-strong-momentum-into-2017.html
http://uk.reuters.com/article/uk-talktalk-tlcm-gp-results-idUKKBN1860KJ
http://www.firstpost.com/fwire/gold-near-7-week-low-as-safe-haven-demand-fades-after-french-election-reuters-3432132.html
http://uk.reuters.com/article/uk-global-oil-idUKKBN186033?il=0