LONDON (Alliance News) - Stocks in London were up Monday morning, with Reckitt Benckiser at the top of the FTSE 100 after it said its pretax profit increased in 2015 thanks to improved margins.
The FTSE 100 index was up 1.8% at 5,807.89 points, the FTSE 250 up 1.8% at 15,704.31 and the AIM All-Share up 0.6% at 668.66. In Europe, the CAC 40 in Paris was up 2.4% and the DAX 30 in Frankfurt up 2.2%.
Consumer goods group Reckitt Benckiser, which makes products including cleaning brand Cillit Bang, Durex condoms and Finish dishwashing tablets, was up 5.1% after it said pretax profit for the year to the end of December was GBP2.21 billion, up from GBP2.13 billion in 2014. Net revenue was GBP8.87 billion, up slightly from GBP8.34 billion the year earlier, but cost of sales declined enough to offset a minor uptick in its net operating costs.
Reckitt said the improvement in its margins was down in part to a good sales mix, benefits from low commodity prices, and cost cutting undertaken across the business. Sales growth in constant currencies hit 5.0% in the year and 6.0% on a like-for-like basis, but this was held back on a reported basis by adverse currency translation effects.
Property developer Hammerson was up 2.5% after it said its pretax profit rose in 2015 as its rental income was boosted by ongoing strong demand for premium retail space in the UK.
The FTSE 100-listed group said its pretax profit for the year to the end of December was GBP731.6 million, up from GBP702.1 million a year earlier as its net gains from its property investments, including those with joint ventures and associates, increased.
Gross rental income for Hammerson increased to GBP236.0 million from GBP206.5 million, driven by strong demand for premium space in its UK shopping centre estate. It secured 400 lettings over the course of the year, driving 2.3% like-for-like growth in its net rental income stream over the year.
BAE Systems was up 1.8% after it confirmed the appointment of Charles Woodburn as its new chief operating officer, a hire flagged in reports at the weekend and which will be widely seen as a signal to the group's chief executive succession plans.
The blue-chip defence contractor said Woodburn, currently the chief executive of oilfield services company Expro, will join the company in the COO role in the second quarter of the year, reporting directly to Chief Executive Ian King.
HSBC Holdings late Sunday said its board decided unanimously that its headquarters will remain in London, extending a stay stretching back to 1992, when it acquired the UK's Midland Bank and then moved its head office from Hong Kong, where it had been founded in 1865.
The banking giant's threat to leave its Canary Wharf headquarters came in April 2015, when a review was first confirmed at its annual meeting of shareholders. The later stages of the review pitted the group's home markets of the UK and Hong Kong against one another, the bank said, with London's victory confirming the capital's importance as an international financial hub.
Shares in HSBC Holdings were up 1.3% Monday after the open.
Gold miners Randgold Resources and Fresnillo were among the few blue-chip fallers, down 2.8% and 2.9%, respectively, after the gold price retreated to USD1,213.80, having stood at USD1,234.70 at the London equities close on Friday. Nevertheless, the metal is still up 14% so far in 2016.
In the FTSE 250, Hays was up 5.3% after HSBC upgraded the recruiter to Buy from Hold.
Georgia Healthcare Group, which was spun out of BGEO Group and floated on the London Stock Exchange in November, reported a jump in full-year pretax profit.
The group's pretax profit rose to GEL23.6 million in 2015, from GEL14.5 million the prior year, boosted by growth in both healthcare services and medical insurance. Net revenue rose to GEL242.7 million from GEL198.1 million, as operating expenses edged up to GEL40.5 million from GEL34.4 million.
Shares in BGEO Group were up 4.2%, while Georgia Healthcare was untraded at 167.37 pence.
At the other end of the index, Acacia Mining was down 4.8%. 2015 was "another year of transformation" as the gold and copper miner maintained its dividend despite swinging to a huge pretax loss thanks to a drop in revenue and some hefty impairment charges.
The miner swung to a USD124.2 million pretax loss in 2015 from a USD115.2 million profit in 2014, after it booked a substantial amount of impairments and saw revenue decline to USD868.1 million from USD930.2 million. Impairments totalled USD146.2 million in 2015 and was the cause for the loss, with Acacia Mining not booking any impairments last year.
The People's Bank of China played down currency fears over the weekend offsetting a bigger-than-expected decline in Chinese trade figures.
In an interview published in Caixin, China's central bank governor, Zhou Xiaochuan, said that there is no foundation for the yuan to keep depreciating and that it is normal for foreign reserves to rise and fall as long as the fundamentals face no problems.
The PBoC set Monday's central parity rate for yuan at CNY6.5118 per dollar, compared to February 5's reference rate of CNY6.5314. The central bank sets the reference rate every morning and allows the currency to move up to 2% from that level. The dollar was at CNY6.4840 on Monday after the London equities open.
Data from the General Administration of Customs showed that China's exports plunged 11% year-over-year at the start of the year, much faster than the 2.0% fall expected by economists. Imports also slumped 19% in January from a year ago. The expected decrease for the month was only 3.9%.
The visible trade surplus of the country came in at USD63.29 billion in January, which was above a USD60.6 billion surplus forecast by economists.
The Shanghai Composite avoided heavy losses on Monday, down 0.6%, after it reopened following a week closed for the Lunar New Year celebrations. Meanwhile, the Hang Seng index in Hong Kong ended up 3.1%, and the Japanese Nikkei 225 index closed up 7.2%.
Japan's gross domestic product contracted an annualized 1.4% on year in the fourth quarter of 2015, preliminary readings from the Cabinet Office revealed.
That missed forecasts for a decline of 0.8% following the upwardly revised 1.3% increase in the third quarter. On a quarterly basis, GDP was down 0.4%, also shy of expectations for a decline of 0.2% following the 0.3% gain in the three months prior. Nominal GDP slipped 0.3% on quarter versus expectations for a fall of 0.1% following the upwardly revised 0.6% increase in the previous three months.
Wall Street ended higher on Friday, ahead of a long weekend, as the New York market will remain closed Monday for President's Day. The DJIA and the S&P 500 ended both up 2.0% and the Nasdaq Composite finished up 1.7%.
In the economic calendar, eurozone's trade balance data are due at 1000 GMT, while the European Central Bank President Mario Draghi speaks at the European Parliament at 1400 GMT.
By Daniel Ruiz; danielruiz@alliancenews.com
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