Highlights of the Day
Asian Markets
Investors sought out havens, boosting assets such as the Japanese yen, gold and U.S. Treasurys, after North Korea fired a ballistic missile over Japan for the first time since 2009. |
U.S. Markets
Stocks finished little changed as investors focused on the effects of Tropical Storm Harvey. Insurance companies and oil drillers stumbled, while refineries rose along with oil prices. |
Today's News
North Korea fired a ballistic missile this morning which flew over the Japanese island of Hokkaido before landing in the Pacific Ocean, prompting residents to seek shelter and calls for additional actions against the reclusive state. South Korea’s Joint Chiefs of Staff said the missile was launched near the North Korean capital Pyongyang and travelled more than 2,700 kilometres, reaching a maximum altitude of around 550 kilometres. The missile, which was the first to pass over Japan since 2009, posed an “unprecedented, serious and grave threat” Japanese Prime Minister Shinzo Abe told reporters, adding that Tokyo had lodged a “stern protest” with North Korea.
Many refineries have shut and almost a fifth of oil and gas production in the Gulf of Mexico has been suspended amid the largest storm to hit in the US in more than a decade. Hurricane Harvey has produced high winds and extensive flooding forcing thousands of people from their homes. The closures are expected to cause a temporary spike in US gas prices. Analysts expect the economic impact of the storm to pass $40bn (£31bn), with direct losses of over $20bn. The storm’s path through southeast Texas and the Gulf of Mexico has hit the heart of the US energy industry, an area home to almost half of US refining capacity and a fifth of its oil production. Houston, where water has overwhelmed the streets, is also the base of one of America’s largest ports.
AstraZeneca announced that the US Food and Drug Administration has approved Faslodex 500mg as monotherapy for expanded use in women with advanced breast cancer, who have gone through menopause and have not received previous endocrine therapy. The drugmaker said the FDA approval was based on data from the Phase III FALCON trial, which were published in the November 2016 issue of The Lancet.
WPP’s wholly-owned operating company, AKQA, the global brand experience studio, has acquired a majority stake in digital agency DIS/PLAY in Denmark for an undisclosed sum. DIS/PLAY provides strategy, user experience, design, and technical development solutions to clients. Employing more than 100 people in Copenhagen and Aarhus, its clients include Amnesty International, ECCO and Vestas.
Bunzl, the international distribution and outsourcing group, saw good increases at constant exchange rates in revenue, adjusted operating profit and adjusted earnings per share in the six months to the end of June. Group revenue increased 20% to £4,119.2 million and adjusted operating profit before customer relationships amortisation and acquisition related items was up 16% to £272.6 million. Adjusted earnings per share were 55.1p, an increase of 19%.
Grainger has conditionally agreed, subject to planning, to acquire a private rented sector, build-to-rent development at Gore Street in Salford, near Spinningfields, Manchester, for around £80m from Euro Car Parks and the English Cities Fund. Grainger will forward fund the project, UKLP Gore Street Limited will develop the site, and Sir Robert McAlpine will also be the contractor. The site is anticipated to complete in 2020. It will deliver 375 private rental homes through a mix of apartments and townhouses, and provide a range of amenities for residents. It is anticipated to generate a gross yield of c.7% once fully let. Once this transaction completes, it will become part of Grainger’s secured pipeline, which currently stands at c.£500m.
Hunting has appointed John Glick as non-executive chairman with effect from 1 September. Glick will succeed Richard Hunting who on the same date will step down as chairman after 26 years, but will remain on the board as a non-independent, non-executive director. Hunting said the succession process had been led by senior independent director John Hofmeister. Glick was appointed as a non-executive director on 2 February 2015 and has served on the company’s audit, nomination and remuneration committees.
Mitie has said it is under investigation by the Financial Conduct Authority (FCA) over the timing and content of a profit warning. Mitie said it was told by the FCA last Friday and was “fully co-operating” with the financial regulator. The profit warning sent shares in Mitie tumbling by a quarter when it was released in September last year. The firm said at the time that Brexit uncertainty and other “economic pressures” would lead to lower profits. Mitie is one the UK’s largest outsourcing groups, offering facilities management services to clients such as the NHS, London City Airport and Linkedin.
Oil prices were mixed, with traders expecting refinery shutdowns in the Gulf of Mexico region due to storm system Harvey to cause an excess in crude supplies.
Gold prices rose for a third day to its highest since November as mounting geopolitical tensions over a new North Korean missile launch stoked demand for safe-haven assets.
Companies Reporting this week
Day |
Companies |
Today: |
Bunzl |
Tomorrow: |
Petrofac * WH Smith |
Thursday: |
Jimmy Choo * Ladbrokes Coral Group * Restaurant Group * Hays |
Early Market Movements
Market |
Index |
Change |
% Change |
UK 100 |
7,336.8 |
-64.7 |
-0.9% |
UK 250 |
19,593.9 |
-77.5 |
-0.4% |
GER 30 |
12,021.12 |
-102.35 |
-0.8% |
FRA 40 |
5,035.1 |
-44.6 |
-0.9% |
U.S. 30 |
21,808.40 |
-5.27 |
-0.0% |
U.S. 500 |
2,444.2 |
+1.2 |
+0.1% |
OIL (BRENT) |
52.10 |
+0.21 |
+0.4% |
GOLD |
1,321.11 |
+10.98 |
+0.8% |
UK Risers & Fallers (8:15am)
Company |
Price |
Change |
% Change |
Provident Financial |
970 |
+54 |
+5.9% |
Hochschild |
280.5 |
+13.2 |
+4.9% |
Randgold Resources |
7850 |
+280 |
+3.7% |
Restaurant Group |
311.95 |
-10.95 |
-3.4% |
Standard Chartered |
759.6 |
-17.5 |
-2.3% |
Smiths Group |
1535 |
-30 |
-1.9% |
Latest Broker Views
Company |
Broker |
Recommendation |
Price |
Target |
Polymetal |
RBC Capital |
Sector Perform |
961 |
840 |
Forthcoming Economic Data
Time/Date |
Previous |
Forecast |
Outcome |
3:00pm: U.S. CB Consumer Confidence |
121.1 |
120.9 |
– |
Sources
http://www.denverpost.com/2017/08/28/u-s-stocks-mixed-amid-fallout-from-tropical-storm-harvey/
http://www.marketwatch.com/story/asian-markets-jolted-by-north-korean-missile-test-over-japan-2017-08-28
http://www.londonstockexchange.com/exchange/news/alliance-news/detail/1503981305598563500.html
https://www.digitallook.com/news/news-and-announcements/wpp-buys-minority-stake-in-denmarks-display–2832381.html
http://www.stockmarketwire.com/article/5642719/Bunzl-hikes-divi-after-strong-first-half.html
http://www.stockmarketwire.com/article/5642712/Grainger-to-acquire-pound80m-build-to-rent-scheme.html
http://www.stockmarketwire.com/article/5642742/Hunting-appoints-chairman.html
http://www.bbc.co.uk/news/business-41080177
http://www.bbc.co.uk/news/business-41075704
https://www.cnbc.com/2017/08/28/gold-climbs-to-9-12-month-high-on-rising-north-korea-tensions.html
http://www.marketwatch.com/story/why-oil-prices-are-sinking-as-gasoline-soars-after-harvey-2017-08-28
https://www.reuters.com/article/us-global-oil-idUSKCN1B802D