LONDON (Alliance News) - The UK government has raised a further GBP4.20 billion from its second sale of Lloyds Banking Group PLC shares, meaning it has now recouped GBP7.41 billion of the roughly GBP21 million that taxpayers injected into the bank during the financial crisis.
UK Financial Investments Ltd, which manages the government's stakes in bailed-out banks, said Wednesday morning it sold a 7.8% stake in Lloyds at 75.5 pence a share, taking the UK government stake down to 24.9%, from 32.7%.
The government sold an initial 6% stake in the bank last September at 75 pence a share, raising about GBP3.21 billion for government coffers.
The UK government now owns about 32.7% of Lloyds, having bailed out the bank with up to GBP21 million in state aid when it ran into financial difficulties following its acquisition of mortgage lender HBOS during the financial crisis.
Life Insurance is the the top gaining FTSE 350 sector, with Standard Life leading the sector and the FTSE 100 higher on the announcement that it has bought Ignis Asset Management from Phoenix Group for GBP390 million in cash. Phoenix Group has seen its shares rise on the back of its sale, which also sees the two companies agreeing to a long-term strategic asset management deal.
Also boosting the sector is Legal & General. L&G said it won the largest-ever bulk annuity contract in the UK with ICI Pension Fund worth GBP3 billion. The deal comes just after the UK government announced last week a shake up of the individual annuity market. Bulk annuities are different from individual annuities and involve taking on the obligations of defined-benefit pension plans.
SSE has been trading higher after the electricity company announced a major asset-disposal plan, cost-cutting initiatives, and a freezing of UK household energy bills ahead of its full-year results next week. The group is targeting about GBP1 billion pounds of combined disposals and cost cutting.
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FTSE 100: up 0.5% at 6,639.66
FTSE 250: up 0.8% at 16,277.06
AIM ALL-SHARE: up 0.1% at 852.06
GBP-USD: up at 1.6548
EUR-USD: down at 1.3794
GOLD: up at USD1,310.21 an ounce
OIL (Brent): up at USD106.17 a barrel
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Key UK Corporate News
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FTSE 100: TUI Travel said it remains on track to deliver first-half results broadly in line with last year, excluding Easter, and is still confident of growing its underlying operating profit by 7% to 10% in the full financial year. GlaxoSmithKline has withdrawn its European marketing authorisation application for the combined use of Meikinist and Tafinlar for the treatment of unresectable or metastatic melanoma with a BRAF V600 mutation. The firm separately announced that it has been granted European marketing authorisation for its type 2 diabetes treatment, Eperzan. BG Group has secured a new exploration opportunity after being awarded new exploration acreage offshore Myanmar.
FTSE 250: Salamander Energy has announced a successful drill stem test at West-Kerendan-1 amid plans to enlarge the Kerendan area in Indonesia. John Laing Investments said it intends to sell up to 34.5 million shares in John Laing Infrastructure Fund, representing a 4.5% stake in the company. Londonmetric Property said its joint venture has completed its acquisition of 27 DFS assets from the administrator of Delphi Properties Limited in a GBP175 million deal. African Barrick Gold said that an underground employee at its Bulyanhulu site in Tanzania died on Tuesday. John Wood Group said its joint venture Neal & Massy Wood Group has been awarded a master services agreement to deliver construction services to the Atlantic LNG Company of Trinidad and Tobago. Entertainment One said its results for the full year ending March 31 will meet expectations, and it will post revenues and underlying earnings before interest, tax, depreciation and amortisation ahead of the previous year. EnQuest said its pretax profit fell in its full-year 2013 despite an increase in revenues, as costs and expenses hit the company. Home emergency company Homeserve said its expects its key profit measure to be in line with market expectations in its current financial year, as it also reiterated that costs related to the settling of previous regulatory issues in the UK had met its expectations. Euromoney Institutional Investor expects to post an adjusted pretax profit for the half-year ending March 31 that is broadly in line with the previous year, although it cautioned that a reduction in adjusted operating margin and the strong pound will hit its second-half. Housebuilder Bellway said its profit almost doubled in the first-half of its financial year, as it took advantage of recovery in the UK housing market.
AIM: Leed Resources is trading higher. The company said its pretax loss narrowed in its first-half, announced spending reduction targets, and said it plans to shift investment focus. Shares in Independent Resources also are up. The exploration and development oil firm has announced a USD837 million unrisked net present value for its Ksar Hadada permit, onshore Tunisia. Cenkos Securities is up after the company said that pretax profit from continuing operations rose to GBP10.7 million in 2013, up from GBP7.0 million in 2012, as revenues from continuing operations increased to GBP51.4 million from GBP43.2 million. Kalimantan Gold Corp is also trading higher after the company announced that the Indonesian Ministry of Forestry has granted subsidiary PT Jelai Cahaya Minerals an extension to its Borrow and Use Exploration Forestry Permit for the Jelai Gold project. Shares in E-Therapeutics are up. The biotechnology company said it has received approval from MHRA to recommence recruitment of new patients into its ETS2101 phase Ia solid tumours trial after a temporary pause over drug storage issues. Shares in 32Red are trading higher. The online gaming company said trading has strengthened in recent weeks, with gross gaming revenue up 19% in the first 24 days in March. Shares in Fitbug are trading higher after the firm agreed terms with six retail distribution partners providing coverage in the UK, France, Germany, Italy, Russia, South Africa, Southeast Asia, Australia and New Zealand. At the other end of the market sits Hightex. The engineering company has seen its shares drop sharply after it reported a widened pretax profit and as it resumed trading on AIM, a move that came after it signed a loan facility agreement of up to USD10 million, giving it enough money to cover its working capital needs for at least six months.
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Top Economics And General
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British wage growth is starting to pick up and income and wages should rise so as to sustain economic growth, Bank of England policymaker Martin Weale told the Reading Post in an interview. "That's another favorable straw in the wind," he said. Economic growth last year appeared to be driven by consumer spending but investment now seems to be playing a bigger part, he observed. Weale said the economic picture will differ from one part of the country to other. "From the committee's point of view, it's the national picture which matters because we set monetary policy for the whole country, not just affluent parts," he said. Further, he urged companies to focus on export market for future growth. As the economy recovers, interest rates should return to more normal levels, central banker noted. But any increase in rates will be relatively gradual.
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German consumer confidence is expected to remain stable in April, a closely watched survey from the market research group GfK showed. The forward-looking consumer confidence index remain unchanged at 8.5%, in line with forecast. The economic outlook of consumers in March was back on the road toward recovery. The indicator gained 1.3 points to 33.2 points. Meanwhile, income expectations dropped three points to 45.6 points in March.
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Russia wants to boost its military presence on the Crimean Peninsula after annexing it from Ukraine, the Interfax news agency reported citing an unnamed defence official. The plan includes deploying Tupolev Tu-22M3 long-range bombers by 2016, as well as air-superiority and maritime patrol aircraft, and submarines. A helicopter carrier will be deployed in 2017."The need for these aircraft in the south was always there, but not is the right time that they return there," Interfax quoted the defence official said saying. Meanwhile, Ukrainian soldiers and their families have been leaving the peninsula, which became part of Russia after a majority supported accession in a referendum earlier this month. The soldiers have been leaving their weapons behind.
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The US aid package of USD1 billion in loan guarantees for Ukraine neared final passage as early as this week, after Democrats in the Senate on Tuesday dropped a provision sought by the International Monetary Fund. A fight over a provision to ratify long-waiting reforms at the IMF had stalled passage of the urgent aid measure for two weeks.
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Chinese Prime Minister Li Keqiang urged Malaysia to provide more information about missing flight MH370, amid relatives' anger at the authorities in Kuala Lumpur, news reports said. Li "urged Malaysia to provide detailed and accurate information" on the Malaysia Airlines flight, which data analysis indicated crashed into the southern Indian Ocean on March 8, the official Xinhua news agency reported. The Malaysian government and Malaysia Airlines have been widely criticized in China, in particular by relatives of the 154 Chinese passengers on board the Boeing 777-200.
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North Korea test-fired two missiles into the sea, an official in Seoul said, prompting condemnation from South Korea, Japan and the US. It was the latest of several such launches this week, as South Korean, Japanese and US leaders criticized the North's nuclear weapons programme during a meeting in the Netherlands. "North Korea fired a ballistic missile at 2:35 am (1735 GMT) and another at 2:45 am," the South Korean military was cited as saying by Yonhap News Agency. The missiles were fired from north of Pyongyang and flew about 650 kilometres before falling into the waters east of the Korean Peninsula, a spokesman for the South's Defence Ministry said.
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An Egyptian court adjourned the trial of Muslim Brotherhood chief Mohammed Badie and 682 alleged supporters to April 28, when it will announce its verdict in the death penalty case. The opening session Tuesday of the trial in the Minya Criminal Court heard prosecution witnesses, who accused the defendants of storming a police station and killing officers in August in the southern town of Udwa. Defence lawyers boycotted the hearing in protest at the death sentences presiding Judge Saeed Youssef handed down Monday to 529 people charged with similar offences.
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Afternoon Watchlist
1345 US Markit Services PMI Preliminary
1430 US EIA Crude Oil Stocks change
2030 US Bank Stress Test Info
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Thursday's Key UK Corporate Events
Hilton Food Group Full Year Results
Thomas Cook Group Trading Update
Graphite Enterprise Trust Full Year Results
Henry Boot Full Year Results
SkyePharma Full Year Results
Afren Full Year Results
Daily Mail and General Trust Trading Statement
Personal Group Holdings Full Year Results
Velocys Full Year Results
Compass Group Trading Statement
International Public Partnerships Full Year Results
London Stock Exchange Group Trading Statement
Tate & Lyle Trading Statement
Photonstar LED Group Full Year Results
Stock Spirits Group Full Year Results
Signet Jewelers Full Year Results
JKX Oil & Gas Full Year Results
IFG Group Full Year Results
Personal Group Holdings Full Year Results
Tamar European Industrial Fund Full Year Results
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Thursday's Key Economic Events
00:20 US Fed's Bullard speech
07:00 UK Nationwide Housing Prices
07:45 France Consumer Confidence
09:00 EU M3 Money Supply
09:00 EU Private loans
09:30 UK Index of Services
09:30 UK Retail Sales
12:30 US Continuing Jobless Claims
12:30 US Core Personal Consumption Expenditures
12:30 US FOMC Member Pianalto Speech
12:30 US Gross Domestic Product
12:30 US Initial Jobless Claims
12:30 US Personal Consumption Expenditures Prices
14:00 US Pending Home Sales
14:30 US EIA Natural Gas Storage change
15:00 US Kansas Fed manufacturing activity
23:30 Japan Jobs/applicants ratio
23:30 Japan National Consumer Price Index
23:30 Japan Tokyo Consumer Price Index
23:30 Japan Overall Household Spending
23:30 Japan Unemployment Rate
23:50 Japan Retail Trade
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By Alice Attwood; aliceattwood@alliancenews.com; @AliceAtAlliance
Copyright © 2014 Alliance News Limited. All Rights Reserved.
16 Oct 2013 11:57
