LONDON (Alliance News) - Stock prices in London are called for a higher open on Friday, with markets in Europe set to follow peers in the US and Asia in making gains. In UK company news, pub chain
JD Wetherspoon cautioned on various headwinds going forward as it reported a solid increase in annual profit and sales, while
Close Brothers has sold its Retail Finance business for an undisclosed sum. IG futures indicate the FTSE 100 index is to open 31.5 points higher at 7,308.70 on Friday. The blue chip index closed down 0.4%, or 31.79 points, at 7,281.57 on Thursday."European bourses are set to take the lead from positive a session on Wall Street and Asia overnight," said London Capital Group's Head of Research Jasper Lawler. "A drive higher from tech stocks on Wall Street helped lift Asian equities after their recent battering, pulling them off two-year lows.""Asian markets were ending the week on a positive note after sinking for 10 straight sessions, ending Wednesday, on rumours of trade talks between the US and China," Lawler continued."The chances of these trade talks making any real progress looks doubtful, especially given they have failed so many times before; it is difficult to see why they might find more common ground on this attempt. In however, in a display of optimism, the markets were willing to look beyond these concerns and realities."In the US on Thursday, Wall Street ended higher, with the Dow Jones Industrial Average ending up 0.6%, the S&P 500 up 0.5%, and the Nasdaq Composite up 0.8%. In China on Friday, the Shanghai Composite is 0.1% lower, while the Hang Seng index in Hong Kong is up 1.0%. The Nikkei 225 index in Tokyo closed 1.2% higher.Retail sales in China spiked 9.0% on year in August, the National Bureau of Statistics said on Friday. That topped forecasts for an increase of 8.8%, which would have been unchanged from the July reading. The bureau also said industrial production advanced an annual 6.1% - matching forecasts and up from 6.0% in the previous month. Fixed asset investment in China was up 5.3% on year, shy of expectations for 5.6% and down from 5.5% a month earlier. Finally, the surveyed jobless rate came in at 5.0%, down from 5.1% in July.In the FTSE 100 index, pharmaceutical giant
AstraZeneca said the US Food & Drug Administration has approved Lumoxiti, a treatment for adults with relapsed or refractory hairy cell leukaemia.
JD Wetherspoon, a member of the mid-cap FTSE 250, said sales for the 52 weeks to July 29 rose 5.0% year-on-year on a like-for-like basis.Pretax profit, before exceptional items, increased 4.3% to GBP107.2 million, though the increase was 6.2% excluding an extra week in the pub chain's prior financial year. After exceptional items, pretax profit climbed 17% to GBP89.0 million, and this was a 19% rise excluding the comparable's extra week.Revenue for the year came in at GBP1.69 billion, 2.0% higher year-on-year. Like-for-like bar sales rose 5.1%, accelerating from the year prior's 3.1% growth, while food sales were also up 5.1%, slightly slower than the prior year's growth of 5.7%. Wetherspoon's final dividend is 8.0 pence per share, giving a total payout of 12.0p, flat year-on-year.The company said it was "a year of progress", and said in the six weeks to September 9 like-for-like sales have risen 5.5%, a "reasonable" start to its new financial year. Wetherspoons did say, however, that tax as well as labour and interest costs will be higher going forward, and the firm will need like-for-like sales growth of around 4.0% in its new financial year to meet the profit figure reported on Friday. Also in the FTSE 250, merchant banker
Close Brothers has sold its Retail Finance arm to Swedish payment services firm Klarna Bank for an undisclosed sum.The sale, Close Brothers said, is part of its plan to exit the unsecured retail point of sale finance market. The business sold has a loan book of GBP66 million.
Sirius Minerals, which is developing the Woodsmith polyhalite mine in Yorkshire, said it has amended its minerals royalty agreement with Hancock British Holdings.Under the new terms, Hancock has agreed to a drawdown relating to the USD250 million royalty component of the royalty agreement, with the proceeds provided no later than next Wednesday.The USD50 million equity component, Sirius said, will come once stage two financing commitments are obtained. Sirius said the royalty drawdown provides sufficient liquidity to fund the project into the second quarter of 2019, when it will then need stage two financing. Elsewhere, the Co-operative Group reported a 10% increase in sales for the 26 weeks to July 7, with the figure reaching GBP4.99 billion. Pretax profit was GBP26 million, almost double the GBP14 million recorded a year prior. Co-op said food retail like-for-like sales were 4.4% higher, and the company said it has done well during the period against a backdrop of "increasing national uncertainty". Despite this tough environment, Co-op is confident on future growth. Distribution firm
Connect Group warned results for its year ended August 31 will be below expectations due to "challenging trends" during the period. Parcel freight conditions are difficult, Connect said, while it expects to make an unspecified provision in its recently ended year related to its current restructuring.
Avon Rubber said second half trading in its year ending September 30 has been strong, with adjusted pretax profit set to meet expectations. Avon also said it has a "strong" order book, giving good visibility going into its next financial year, with the company "well positioned" for further progress. Both the Bank of England and the European Central Bank held their interest rates on Thursday, as expected by economists, with the former's update described as "uneventful" by CMC Markets UK's David Madden.The Monetary Policy Committee, led by Governor Mark Carney, voted nine to zero to keep the key rate unchanged at 0.75%.The governor of the Bank of England has, however, warned ministers house prices could crash by more than a third in the event of a disorderly, no-deal Brexit.Mark Carney briefed Theresa May and senior ministers on the Bank's planning for a "cliff-edge" break with the EU at a special Cabinet meeting on Thursday to review the government's no-deal preparations.It is understood he warned house prices could fall by up to 35% over three years in a worst-case scenario, as sterling plummeted and the Bank was forced to push up interest rates.According to reports, he compared the fall-out from such a chaotic departure to the 2008 global financial crash.Sterling was quoted at USD1.3115 early Friday, compared to USD1.3101 at the London equities close on Thursday.Brent oil was lower quoted at USD78.14 a barrel early Friday from USD78.16 at the close Thursday."In stark contrast to the move on Wednesday, oil endured a major sell-off last night," said Madden."Hurricane Florence was downgraded to a category two storm from a category four, and that prompted dealers to unwind previous long positions."He continued: "The International Energy Agency revealed the global oil supply reached a record of 100 million barrels per day. The organisation predicts non-OPEC production will expand in 2018 and 2019, largely because of 'relentless' growth from the US. WTI and Brent crude oil may be off their recent highs, but they remain in their recent upward trends." The economic events calendar on Friday has eurozone trade balance figures at 1000 BST and US retail sales at 1330 BST. In addition, Carney will give the annual Whitaker lecture at the Irish central bank at 1100 BST in Dublin.
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