Barclays Share News (BARC)

LONDON (Alliance News) - Shares are lower across the board in London Wednesday, with the mid-cap FTSE 250 index underperforming on bad news for FirstGroup.

The rail and bus operator confirmed it has not been awarded the new ScotRail Franchise by the UK government, although it stressed that this does not alter its medium-term targets. Shares are down 5.7%.

Automotive and aerospace firm GKN is the second biggest loser in the FTSE 250, down 4.6%, after being cut to Underperform from Buy by Merrill Lynch, according to traders.

On AIM, London Mining, down 80%, is by far the biggest loser, after telling shareholders there will be little or no value left in its shares under current financing proposals.

Rangers International Football Club is up 2.3% after it revealed that Sports Direct founder and owner of Newcastle United football club Mike Ashley bought a 5% stake and is demanding that two directors are removed from the board.

Here is what you need to know at the UK market open:
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MARKETS
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FTSE 100: down 0.4% at 6,470.70
FTSE 250: down 0.8% at 14,982.76
AIM ALL-SHARE: down 0.4% at 733.19
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Hang Seng: down 0.7% at 23,270.54
Nikkei 225: closed down 1.2% at 15,595.98
DJIA: closed down 1.6% at 16,719.39
S&P 500: closed down 1.5% at 1,935.10
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GBP-USD: down at USD1.6067
EUR-USD: down at USD1.2642

GOLD: up at USD1,217.18 per ounce
OIL (Brent): down at USD91.20 a barrel

(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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Wednesday's Key Economic Events still to come
(all times British Summer Time)

12:00 US MBA Mortgage Applications
13:15 Canada Housing Starts
15:30 US EIA Crude Oil Stocks
19:00 US FOMC Minutes
21:30 US Former Fed's Bernanke speech
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UK shop prices experienced deflation for the seventeenth consecutive month in September, a survey from the British Retail Consortium revealed. According to the Report on Jobs published jointly by the Recruitment and Employment Confederation and KPMG, growth in permanent staff salaries slowed to a four-month low. Meanwhile, hourly pay rates for temporary workers increased at the fastest pace since November 2007. The BRC-Nielsen shop price index fell 1.8% year-on-year in September, faster than the 1.6% drop seen in August.
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China's services sector continued to expand in September, albeit at a slower pace, the latest survey from HSBC Bank showed on Wednesday with a PMI score of 53.5. That's down from 54.1 in August, although it remains above the boom-or-bust line of 50 that separates expansion from contraction. The composite index, which covers both manufacturing and services sectors, came in at 52.3 - expanding for the fifth straight month but down from the 17-month high of 52.8 in August.
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Japan posted a current account surplus of JPY287.1 billion in August, the Ministry of Finance said - up 83% on year. The headline figure beat forecasts for a surplus of JPY200 billion following the JPY416.7 billion surplus in July. The trade deficit came in at JPY831.8 billion, missing expectations for a shortfall of JPY770.7 billion following the JPY282.1 billion deficit in the previous month.
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The International Monetary Fund trimmed its global growth forecast by 0.1 percentage points to 3.3% for 2014 and 0.2 points to 3.8% next year, according to Tuesday's quarterly update of its World Economic Outlook. "World growth is mediocre and a bit worse than forecast in July," IMF chief economist Olivier Blanchard said. Fizzling economic recoveries in Japan and the eurozone accounted for much of the 2014 reduction.
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Hong Kong was calm Wednesday morning, with only a few hundred pro-democracy protesters blocking major roads, after students and the government agreed to start talks this week. Government employees went to work unobstructed as only scattered dozens of demonstrators remained in the protest sites. Kindergartens remained closed in some districts on Hong Kong Island because of transport delays caused by some street blockades. Middle and primary schools were open. Students said they wanted to keep pressure on authorities, despite agreement Tuesday to start talks wih government officials Friday.
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The European Commission said Tuesday it would look into the first incidence of transmission of ebola on European soil, as US and EU officials stepped up efforts in West Africa to halt the spread of the virus. Europe's first transmitted case involved a 44-year-old Spanish nurse who helped care for a missionary transported to Madrid after contracting the Ebola virus in Liberia. The missionary died on September 25.
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Turkish President Recep Tayyip Erdogan Tuesday warned that the Syrian Kurdish city of Kobane was about to fall and criticized the US-led bombing campaign against Islamic State militants as an insufficient response. "You cannot bring this terror to an end only through airstrikes," said Erdogan in comments carried by the Anadolou news agency as he spoke to refugees in the south-eastern Turkish city of Gaziantep. He renewed calls for the formation of a zone of protection and a no-fly zone over Syria, saying that moderate fighters in the Syrian opposition had to be strengthened. The Turkish leader's comments came as Kurdish fighters battled the jihadists in the streets of Kobane and a US-led coalition pounded Islamic State positions on the outskirts.
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BROKER RATING CHANGES
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TRADERS: HSBC RAISES TESCO TO 'NEUTRAL' ('UNDERWEIGHT')
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TRADERS: MERRILL LYNCH CUTS GKN TO 'UNDERPERFORM' ('BUY')
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CREDIT SUISSE ADDS ITV TO 'EUROPE FOCUS LIST' - 'OUTPERFORM'
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COMPANIES - FTSE 100
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Swisscom is considering a possible sale of its Fastweb Italian broadband unit, Reuters reported on Tuesday, citing sources familiar with the situation. Vodafone Group has been running the rule over the Fastweb business, which could fetch up to EUR5 billion, having made several takeover approaches for the business which have been rebuffed by Swisscom, Reuters said. Swisscom is now understood to have hired UBS AG, a long-term adviser to Vodafone, in order to facilitate a deal, the sources said.
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EE Ltd is expected to launch a set-top box on Wednesday in a bid to keep pace with rivals BT Group PLC and TalkTalk Telecom Group PLC, both of which have gained customers by moving into television, The Daily Telegraph reported Tuesday. The newspaper said it is understood the device will offer a service comparable to YouView, the technology used by BT and TalkTalk. EE is believed to have held talks with the consortium behind the YouView box earlier this year but instead decided to go its own way.
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FTSE 100-listed Irish cement company CRH has teamed with Mexican cement maker Cemex in order to bid for all the assets that Lafarge SA and Holcim Ltd will have to sell in order to secure the approval of European competition authorities for their proposed merger, Reuters reported on Tuesday. HeidelbergCement AG of Germany and Brazil's Votorantim Cimentos SA also are understood to be considering a joint bid for the assets, according to sources familiar with the matter cited by Reuters.
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Barclays urged a New York court on Tuesday to throw out the fraud case levelled against the bank by the state attorney general regarding its 'dark pool' trading venue, claiming the case oversteps state securities laws and offers no proof that investors were harmed, Reuters reported.  Eric Schneiderman, the New York attorney general, filed a lawsuit in June against the bank, accusing it of giving an unfair edge to high-frequency traders and lying to other customers.
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COMPANIES - FTSE 250
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Transport operator FirstGroup confirmed it has not been awarded the new ScotRail Franchise by the UK government, although it stressed that this does not alter its medium-term targets. FirstGroup will continue to operate First ScotRail until the new franchise begins on April 1, 2015. Separately FirstGroup said its trading in the first half to end-September had been in line with its expectations, and expressed confidence in seeing an improved performance in its second half.
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British brewer and pub owner Marston's said it expects to report an underlying operating profit "broadly" in line with expectations for its financial year just ended, buoyed by higher food sales and investment in new pub-restaurants. The owner of Pitcher & Piano bars, said like-for-like sales in its Destination and Premium division, its pub-restaurant unit, grew by 3.1% in the financial year ended October 4, driven by a 3.3% increase in food like-for-like sales, and 2% growth in drink sales.
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Student accommodation manager The Unite Group said the net asset value of its Unite UK Student Accommodation Fund was GBP903.8 million at the end of the third quarter, up 2.1% over the quarter and 5.1% over the first nine months of the year and including the GBP17.8 million of new equity it has issued. The fund's property portfolio comprised 24,955 beds in 69 properties across 22 UK towns and cities, and was independently valued at GBP1.6 billion. The movement during the quarter represents a like-for-like increase of 1.7%.
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COMPANIES - LONDON MAIN MARKET AND AIM
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London Mining warned its investors that it thinks there will be little or no value left in its shares and other securities under the proposals currently being discussed for its refinancing. The iron ore miner had warned in late September that it had entered talks with a potential strategic investor for a dilutive financing package, after it ran out of money to continue trading. In a statement Wednesday, it said detailed talks with potential strategic investors and its bank lender group are continuing.
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Mike Ashley, founder and director of Sports Direct International PLC and owner of Newcastle United football club, Wednesday bought a 5% stake in Scotland's Rangers International Football Club PLC and demanded that two directors are removed from its board. In a statement, Rangers said Ashley's investment vehicle MASH Holdings Ltd has bought nearly 4.3 million Rangers shares, equating to 5% of the voting rights. MASH has demanded that Rangers call a shareholder meeting for a vote on the removal of Graham Wallace and Philip Nash as directors.
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Building services company T Clarke said it expects to report a significant drop in profits for the full year on the back of a big loss taken on a contract dispute in its Mission Critical arm and a smaller writedown on an insurance claim made against one of its subsidiaries. The company said the loss from the Mission Critical project, which was not specified but which the group said would be "sizeable", will result a "significant" fall in profits for the full year, with underlying pretax profit now expected to be GBP0.5-1 million.
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Liontrust Asset Management reported an increase in assets under management over the course of the first half, and also said its macro-thematic team has bean granted a GBP320 million institutional mandate that will be funded in the third quarter and take the assets managed by the group past the GBP4.1 billion mark. In a statement, the AIM-listed fund management said its assets under management rose to GBP3.81 billion at the close of business on September 30, up from GBP3.61 billion on March 31, helped by GBP284 million of net inflows but hindered by a negative market and investment performance, which was down GBP79 million.
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EasyHotel, one of the portfolio of companies launched by billionaire entrepreneur Stelios Haji-Ioannou, said it traded in line with its own expectations in both its owned and franchised hotels in the financial year just ended. The hotel operator, which listed on London's AIM market earlier this year, said it is working on a new multi-lingual website to improve international bookings, which it said will make it easier for overseas visitors to book and simplify the booking process on mobile devices.
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COMPANIES - INTERNATIONAL
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Symantec Corp is exploring a breakup into Security and Storage companies, Bloomberg has reported, citing people with knowledge of the matter. Late last month, Symantec appointed Michael Brown as chief executive. Brown has been serving as interim president and CEO of the company since March 2014, when the then CEO Steve Bennett was terminated.
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French aerospace company Airbus Group is preparing to reduce its stake in French aircraft maker Dassault Aviation by almost half, by selling shares in a transaction valued at about EUR2 billion, Bloomberg reported Tuesday. The planned stake sale comes as Airbus is seeking to benefit from a pick up in demand for business jets. Dassault Aviation makes aircraft including Rafale combat jets and Falcon business jets.
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Software giant Microsoft has signed a letter of intent to buy Israel-based text analysis startup Equivio Ltd, a deal that could be worth around USD200 million, the Wall Street Journal reported Tuesday, citing a person familiar with the matter. The deal could still fall through, the Journal said.
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Restaurant operator Yum! Brands Inc said Tuesday after the markets closed that its third quarter profit more than doubled from last year, when results were weighed down by a hefty impairment charge related to Little Sheep. However, the company's quarterly earnings per share, excluding items, came in below analysts' expectations as did its quarterly revenue. At the same time, the company lowered its full year earnings per share growth forecast, citing soft sales in China due to a recent supplier incident.
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Twitter is suing the US government over its right to make public Washington's requests for user-information, according to court documents filed Tuesday in San Francisco. Twitter claims that the government restrictions on what the company can say publicly about national security requests for user data violate the company's First Amendment rights of free speech.
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Wednesday's Scheduled AGMs/EGMs

Goodwin
Macromac
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By Tom Waite; thomaslwaite@alliancenews.com; @thomaslwaite

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