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Pin to quick picksAvon Rubber Share News (AVON)

Share Price Information for Avon Rubber (AVON)

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Share Price: 2,656.00
Bid: 2,666.00
Ask: 2,678.00
Change: 0.00 (0.00%)
Spread: 12.00 (0.45%)
Open: 2,594.00
High: 2,674.00
Low: 2,556.00
Yest. Close: 2,564.00
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LONDON MARKET PRE-OPEN: Avon Rubber revenue to rise after good quarter

Fri, 9th Apr 2021 07:39

(Alliance News) - Stocks in London are seen opening marginally higher on Friday with the FTSE 100 edging closer to the 7,000 mark, tracking gains in US equity markets overnight.

In early company news, Anglo-Australian miner Rio Tinto signed a binding agreement with Turquoise Hill for Oyu Tolgoi financing. Mike Ashley's Frasers Group said it expects a hit to asset values as a result of the Covid-19 pandemic. Personal protection systems maker Avon Rubber expects a sharp rise in interim revenue.

IG futures indicate the FTSE 100 index is to open 5.98 points higher at 6,948.20. The blue-chip index closed up 56.90 points, or 0.8%, at 6,942.22 on Thursday.

Rio Tinto said it has entered into a binding heads of agreement with strategic partner Turquoise Hill Resources for an updated funding plan for the completion of the Oyu Tolgoi underground project in Mongolia.

Rio Tinto said the plan addresses the estimated remaining known funding requirement of around USD2.3 billion, building on and replacing the arrangements established in the memorandum of understanding that Rio Tinto and Turquoise previously entered into in September.

As part of the terms the companies will pursue a re-profiling of principal debt repayments up to USD1.4 billion with lenders under the existing project finance arrangements to better align with the revised mine plan, project timing and cash flows. They will also seek to raise up to USD500 million in senior supplemental debt under the existing project financing arrangements from selected international financial institutions.

Rio Tinto Copper Chief Executive Bold Baatar said: "This agreement and alignment with TRQ represents a major milestone in the continued development of Oyu Tolgoi, which is expected to become one of the world's largest copper mines and a significant contributor to the Mongolian economy for years to come.

"Commencing the re-profiling whilst concurrently listening, engaging and resolving the concerns of the government of Mongolia are critical steps to maintaining momentum on the timely delivery of the Oyu Tolgoi Underground Project."

Frasers Group, which owns department store House of Fraser and retailer Sports Direct, said it is continuing to assess the potential pandemic hit to asset values.

"In our ongoing assessment we note the continuing government and government advisor pronouncements regarding 'third waves' and normality being 'some way off', meaning further restrictions are in our view almost certain," the company said.

As such, Frasers Group said it anticipates making accounting non-cash impairments to freehold properties, other Property, Plant & Equipment, and IFRS 16 Right of Use Assets which could be in excess of GBP200 million.

Frasers Group said any such impairment would be in addition to impairments included in the half year results announced in December, and is expected to be included with the company's results for the financial year ending April 2021.

Avon Rubber said trading in the second quarter continued to be strong with ongoing positive momentum and continued strong order intake across its portfolio.

The company expects to report revenue of USD122 million for the first half ended March 31, up 40% from USD87 million at the same time last year. This includes a first-time contribution from Team Wendy of USD20 million during the first five months of ownership.

As a result and taking into account the current order book of USD155 million and expected order intake in the second half, Avon remains "confident of achieving its expectations for the current financial year".

Fast-fashion retailer boohoo Group said it has agreed a long-term lease for a new warehouse in Daventry, due to become operational in the second quarter of the financial year.

The company noted that the site will support its expansion and adds capacity in addition to its existing facilities in Burnley, Sheffield and Wellingborough. In aggregate, these sites will give net sales capacity in excess of GBP4 billion.

The new warehouse is scalable, with boohoo expecting to invest over GBP50 million in the coming years, increasing capacity and offering operational flexibility as it grows. The deal is expected to secure up to 500 jobs and in the future create up to a further 1,000 jobs as capacity increases at the site, boohoo added.

In the US on Thursday, Wall Street ended higher, with the Dow Jones Industrial Average up 0.2%, S&P 500 up 0.4% and Nasdaq Composite up 1.0%.

Stocks in New York provided another strong lead, with the S&P 500 chalking up a second successive record and the Nasdaq surging as tech shares regained their momentum, having suffered recent selling.

US Federal Reserve Chair Jerome Powell on Thursday again repeated his mantra that the central bank would stand fast in its pledge to keep borrowing costs at record lows for as long as needed to support recovery in the world's top economy.

While last week's blockbuster jobs report was welcome, Powell said the "recovery remains uneven and incomplete" and he wanted to see more of those in future before he was happy progress was being made.

CMC Markets analyst Michael Hewson said: "European markets look set to open in positive territory this morning, as they look to continue where they left off yesterday after US markets finished higher with another record close for the S&P 500, as it got to within a whisker of 4,100, led predominantly by the tech sector."

The Japanese Nikkei 225 index closed up 0.3%. In China, the Shanghai Composite is down 1.0%, while the Hang Seng index in Hong Kong is down 1.3%.

Official data showed China's consumer price index rose 0.4% on-year in March, with prices of some food items such as fresh fruit growing but that of pork dropping. A smaller annual rise in consumer prices of 0.3% was expected, according to consensus cited by FXStreet.

China's CPI, a key gauge of retail inflation, had in recent years been driven up by pork prices after an African swine fever outbreak ravaged stocks. This has since stabilised with officials working to boost supplies of the country's staple meat.

The pound was quoted at USD1.3706 early Friday, down from USD1.3739 at the close on Thursday, amid concerns over severe side effects with the AstraZeneca Covid-19 vaccine.

Europe's medicines regulator said this week the AstraZeneca vaccine could cause very rare blood clots in some recipients, prompting a cascade of countries to pull the plug on giving it to people under a certain age.

Hewson explained: "The pound has continued to have a rotten week sliding back for the third day in a row, with some putting the declines down to the concerns over the AstraZeneca jab slowing down the vaccine rollout. While this may suit the narrative it's probably wide of the mark and more to do with the fact that bets on the pound have gone a little bit too one way.

"The fact remains that whatever problems the UK is having the current problems appear perfectly navigable, with the rollout of the first instances of the Moderna jab."

The euro was priced at USD1.1900, flat from USD1.1903. Against the yen, the dollar was trading at JPY109.37, up from JPY109.25.

Brent oil was quoted at USD63.07 a barrel Friday morning, up from USD62.89 late Thursday. Gold was trading at USD1,748.14 an ounce, lower against USD1,754.40.

The international economic calendar on Friday has UK Halifax house prices at 0830 BST and US producer prices at 1330 BST.

By Arvind Bhunjun; arvindbhunjun@alliancenews.com

Copyright 2021 Alliance News Limited. All Rights Reserved.

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