Highlights of the Day
Asian Markets
Asian shares advanced to new highs following Wall Street’s lead, while U.S. oil futures jumped to hover near a six-month peak as escalating tensions between the Iraqi government and Kurdish forces threatened supply. |
U.S. Markets
U.S. stocks reached record highs as investors bet on another strong earnings season. Bank of America jumped 1.5% on better-than-expected earnings. Netflix added 1.9%, crossing above $200 for the first time. |
Today's News
UK Prime Minister Theresa May will hold talks with EU bosses, in a bid to end a stand-off in negotiations over Brexit. May’s office said the meeting had “been in the diary for weeks,” though it took political correspondents by surprise and comes after a fifth round of negotiations ended last week in “deadlock”. May, who will be accompanied by Brexit Secretary David Davis, will meet European Commission President Jean-Claude Juncker and the EU’s chief negotiator Michel Barnier.
ConvaTec Group warned that revenues and profits for the full year will be lower than it had previously guided and that growth targets in 2018 may need to be adjusted. Although revenues in the third quarter grew 6.7% to $445.5m, the company said it now anticipated full year organic revenue growth of 1-2% after performance was severely affected by supply issues in both advanced wound care and ostomy care and a lower than anticipated revenue contribution from new products, which also damaged it profits margins. Guidance had been for an organic revenue growth rate greater than the 2016 rate on a constant currency basis, with group revenues last year growing 2.3% on a reported basis or 4% at constant exchange rates.
Ultra Electronics’ Cheltenham-based Precision Control Systems business has received contracts valued $16m from Boeing and Lockheed Martin. PCS will supply additional tranches of its “world-leading” high pressure pure air generators stores ejection systems for front line US and international strike aircraft. The company said no further information can be provided in relation to this award due to security considerations. Chief executive Rakesh Sharma said: “We are pleased to have extended our contracts with both prestigious Prime contractors. Our continued support of the US and international warfighters in their daily missions underscores the value of Ultra Electronics solutions which are fully accredited and proven effective.”
Sachem Head Capital Management is urging Shire to explore a sale or spin-off of several of its units. Sachem Head’s call for Shire to assess the merits of a separation of some of its divisions has not yet resulted in a formal letter to the company’s board. Shire is facing pressure from investors because of its weak share price performance since its $32bn deal last year to acquire US-based Baxalta.
B.P. Marsh & Partners has announced an investment in Mark Edward Partners, taking a 30% equity stake and providing a $2m loan facility available for future growth. Mark Edward Partners is a speciality insurance broker offering a wide range of risk management services to both commercial and private clients. MEP is a national US firm with licences to operate in all 50 states and has offices in New York, Palm Beach and Los Angeles.
Lenders to Interserve called in advisers as fears grow over the firm’s finances. A group of high street banks, including HSBC Holdings and Royal Bank of Scotland Group, hired Ernst & Young last week in the wake of a profit warning from Interserve in September. Interserve saw shares half, when it blamed economic uncertainty and weak government spending for downgraded profit expectations. Its chief executive and finance director have both left the company in the past year.
Oil prices jumped on concerns over potential renewed U.S. sanctions against Iran as well as conflict in Iraq, while an explosion at a U.S. oil rig and reduced exploration activity supported prices there.
Gold eased a touch, weighed down by a firm dollar and stronger Asian equities.
Companies Reporting this week
Day |
Companies |
Today: |
Central Rand Gold Ltd * Acal * Schroders (Non-Voting) |
Tomorrow: |
ASOS * Bellway * Bioventix * DotDigital Group * Genedrive * Orchard Funding Group * B.P. Marsh & Partners * Evraz * Mediclinic International * Merlin Entertainments * Moneysupermarket.com Group * Pearson * SEGRO * Virgin Money Holdings (UK) |
Wednesday: |
Softcat * U And I Group * Reckitt Benckiser Group |
Thursday: |
Tristel * Stobart Group Ltd. * Unilever * Travis Perkins |
Friday: |
Oncimmune Holdings * Record |
Early Market Movements
Market |
Index |
Change |
% Change |
UK 100 |
7,545.95 |
+10.51 |
+0.1% |
UK 250 |
20,260.87 |
+1.36 |
+0.0% |
GER 30 |
13,010.05 |
+18.18 |
+0.1% |
FRA 40 |
5,363.48 |
+11.75 |
+0.2% |
U.S. 30 |
22,871.72 |
+30.71 |
+0.1% |
U.S. 500 |
2,553.17 |
+2.24 |
+0.1% |
OIL (BRENT) |
57.82 |
+0.65 |
+1.1% |
GOLD |
1,304.84 |
+1.02 |
+0.1% |
UK Risers & Fallers (8:15am)
Company |
Price |
Change |
% Change |
Antofagasta |
1046 |
+31 |
+3.1% |
Kaz Minerals |
874.3 |
+25.25 |
+3.0% |
ITV |
176 |
+3.4 |
+2.0% |
Phoenix |
763 |
-10 |
-1.3% |
Reckitt Benckiser |
7121 |
-66 |
-0.9% |
GKN |
315.3 |
-2.7 |
-0.9% |
Latest Broker Views
Company |
Broker |
Recommendation |
Price |
Target |
ITV |
HSBC |
Buy |
176 |
210 |
GKN |
Barclays |
Overweight |
315.2 |
370 |
Pearson |
Barclays |
Equal Weight |
632.5 |
635 |
Astrazeneca |
Credit Suisse |
Outperform |
5181 |
5800 |
Forthcoming Economic Data
Time/Date |
Previous |
Forecast |
Outcome |
10:00am: European Trade Balance |
18.6b |
20.3b |
– |
Sources:
https://www.cnbc.com/2017/10/13/us-stocks-earnings-season-wall-street.html
http://uk.businessinsider.com/r-asian-shares-conquer-new-peaks-oil-up-on-iraq-tensions-2017-10?r=US&IR=T
https://www.digitallook.com/news/news-and-announcements/convatec-warns-on-full-year-and-2018-targets-after-supply-issues–2914235.html
https://www.digitallook.com/news/news-and-announcements/ultra-electronics-awarded-16m-fighter-jet-contracts–2914244.html
http://www.stockmarketwire.com/article/5704544/BP-Marsh-takes-stake-in-US-insurance-broker.html
http://www.londonstockexchange.com/exchange/news/alliance-news/detail/1508131190234468400.html
http://www.londonstockexchange.com/exchange/news/alliance-news/detail/1508133611864530100.html
http://www.londonstockexchange.com/exchange/news/alliance-news/detail/1508133445324521600.html
https://www.reuters.com/article/us-global-oil/oil-jumps-on-fears-of-new-iran-sanctions-iraq-conflict-idUSKBN1CL01M
https://uk.reuters.com/article/global-precious/precious-gold-eases-amid-firm-dollar-stronger-equities-idUKL4N1MR09P