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LONDON (Alliance News) - UK defence giant BAE Systems Wednesday said the UK and Saudi Arabian governments have come to a long-awaited agreement on the price the Middle Eastern kingdom will pay for the Typhoon jets it ordered back in 2005.
Sports Direct has put out another strong trading update, with gross profits and revenues up by double digits.
Pets At Home has become the third retailer to confirm it intends to float in London this year, just a day after Poundland formally announced its intention to launch an initial public offering.
Here is what you need to know at the UK market open:
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MARKETS
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FTSE 100: Flat at 6,797.37
FTSE 250: Down 0.2% at 16,305.21
AIM ALL-SHARE: Up 0.1% at 880.57
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DJIA: closed down at 16,130.40
S&P 500: closed up at 1,840.76
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GBP-USD: Up at USD1.6731
EUR-USD: Flat at USD1.3760
GOLD: Down at USD1,317.80 per ounce
OIL (Brent): Down at USD110.18 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
09:30 UK Bank of England Minutes
09:30 UK Average Earnings
09:30 UK ILO Unemployment Rate
10:00 EU Construction Output
13:30 US Housing Starts
13:30 US Producer Price Index
17:15 US Fed's Lockhart speech
18:00 US Fed's Bullard speech
19:00 US FOMC Minutes
23:50 Japan Exports/Imports
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The UK has scope to expand further before the Bank of England would need to raise interest rates, Monetary Policy Committee member Ian McCafferty told LBC radio. He said the risk of deflation is "pretty minimal." The BoE will lift interest rates only gradually when it does eventually hike it from the current 0.50%.
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The US central bank has now adopted new regulations on international financial groups that could force some to set aside billions of dollars in capital. The Federal Reserve's rules will affect large European banking firms such as Deutsche Bank AG, Credit Suisse Group AG, UBS AG, Barclays PLC and others with operations in the US. Foreign banking organizations with US non-branch assets of more than 50 billion dollars will be required to establish an US intermediate holding company over their subsidiaries. The holding companies will be subject to the same risk-based and leverage capital standards applicable to US bank holding companies, including regular capital plans and stress tests.
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Australia will urge G20 finance ministers and central bankers meeting in Sydney this weekend to put economic growth ahead of deficit reduction and set ambitious national targets for output and jobs. Treasurer Joe Hockey, who is hosting the gathering in his hometown, admitted to reporters that some of the finance chiefs would not be enthused about his call to "shift the dial" and strive to beat this year's global growth forecast of 3.7%.
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The Japanese economy will continue to recover at a moderate pace in the near term, supported by a further improvement in industrial production and external demand, a report from the Bank of Japan revealed. The bank, however, cautioned that growth will be affected by the front-loaded increase and the subsequent decline in demand before and after the consumption tax hike. Adverse developments in the emerging markets, the European debt crisis and the pace of the U.S recovery also pose risks to growth.
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Ukrainian opposition leaders blamed the government for failing to respond to deadly violence in the capital Kiev, following talks with President Viktor Yanukovych aimed at resolving the country's political crisis, news reports said. "Yanukovych is reacting inadequately to the situation," opposition leader Vitaly Klitschko was quoted as saying by Russian news agency Itar-Tass and the Kyiv Post, after a late-night meeting with Yanukovych.
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Anti-government protesters in Bangkok surrounded the temporary office of caretaker Prime Minister Yingluck Shinawatra, the day after a police crackdown left five dead in the capital's centre. Suthep Thaugsuban, secretary general of the People's Democratic Reform Committee (PDRC), led a convoy of 200 cars to the Permanent Secretary of Defence office in northern Bangkok, which Yingluck and the cabinet have been using as a temporary office since protesters closed down Government House in December. Yingluck and her caretaker cabinet were not there, and the building was heavily guarded by soldiers behind barbed wire.
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BROKER RATING CHANGES
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JPMORGAN INITIATES MERLIN ENTERTAINMENTS WITH 'OVERWEIGHT' - TARGET 415 PENCE
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Jefferies Raises Marks & Spencer To Buy From Hold, PT 600p (480p)
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COMPANIES - FTSE 100
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Verizon Communications said it expects to issue approximately 1.274 billion shares of Verizon common stock to shareholders of Vodafone Group in connection with Verizon's acquisition of Vodafone's indirect 45% interest in Verizon Wireless. The transaction and issue of shares are expected to close on February 21.
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Sports Direct International said gross profit grew by 14.6% in its fiscal third quarter, buoyed by double-digit revenue growth which was fueled by strong growth in retail and online sales, and it is confident it will meet its expectations for full-year underlying earnings. The UK's biggest sports goods retailer by revenue said that group sales for the 13 weeks to January 26 rose to GBP655.4 million, and its gross profit increased 14.6% to GBP280.7 million.
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BAE Systems says the governments of the UK and Saudi Arabia have now reached a deal on higher prices for the Typhoon jets that Saudi Arabia ordered back in 2005. The defence giant didn't provide any details of the agreement, but said it is in line with what it has expected when it gave a trading outlook for 2013. It expects cash settlement for the higher price to start being paid in early 2014.
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Packaging and paper company Mondi Group has confirmed that its 2013 underlying operating profit will be above the prior year level of EUR574 million.
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COMPANIES - FTSE 250
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Ultra Electronics Holdings PLC said Wednesday that it had acquired US-based specialist sonar provider 3 Phoenix Inc for USD70 million in cash, a deal that it expects to boost its earnings and enhance its relationship with the US Navy.
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Housebuilding and construction group Galliford Try has reported a record half year, as profit and revenue both jumped 18% driven by improved housing market conditions, even though its construction unit is continuing to struggle.
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COMPANIES - ALL-SHARE AND AIM
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Gaming Realms Says 50% Of Gambling Revenue From Mobile In Q1. Has Launched US Marketing Trials. Acquired QuickThink Media Ltd For GBP2.2 Million In Q1.
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24/7 Gaming Group Raises About GBP502,000 Through Subscription Offer. Also Gets Deals To Convert Some Debts Into Equity
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Motive Television Raises GBP775,000 Through A Placing Of 3.9 Million New Shares. Says Placing Proceeds To Develop, Patent Additional Technology, Products.
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Feedback H1 Pretax Loss GBP122,000 Vs Pretax Loss GBP319,000. Confident Of Moving Forward With Potential Project In Technology Sector In Near Future.
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Gasol Will Not Proceed With Acquisition Of 12% Interest in Energie de Cote D'Ivoire SA After GDF Suez Got Exercising Notices From Existing Block Partners.
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Avanti Comms Signs 3 Year Deal With Vodafone European Unit. Says It Will Supply 3G IP BackHaul Services To Vodafone Company.
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A&J Mucklow H1 Revenue GBP11.0M Vs GBP10.6M. Pretax Profit GBP14.2M Vs GBP8.1M. Declares Dividend Of 9.04 Pence Vs 8.78 Pence. Agrees Terms To Build 115,000 Sq Ft Distribution Warehouse For Worecester Bosch.
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Bluefield Solar Income In Conditional Deal To Buy Ninth Solar Plant For An Investment Of About GBP21 million. To Raise GBP13 Million In Placing To Fund Deal. Declares Interim Dividend Of 2 Pence.
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AB Dynamics Says Trading Is In Line With Market Expectations In Six Months To Feb. Sees Revenue Growth From Existing Clients As Well As New Client Wins. Says Overseas Growth Has Continued.
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Wednesday's Scheduled AGMs/EGMs
Titon Holdings
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By Steve McGrath; steve.mcgrath@alliancenews.com; @stevemcgrath1
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