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(Alliance News) - Stock prices in London are seen opening higher on Thursday as a key summit of central bankers gets underway in the US.
In early company news, Irish building materials firm CRH raised its dividend after robust half-year results. North Sea-focused oil and gas firm Harbour Energy upped its share buyback programme. Building products supplier Grafton also hiked its payout.
IG futures indicate the FTSE 100 index is to open 22.49 points higher at 7,494.00. The index closed down 16.60 points, or 0.2%, at 7,471.51 on Wednesday.
CRH delivered strong first-half earnings as the Irish building materials firm said it contended with a challenging inflationary cost backdrop.
For the six months to June 30, revenue was USD15.0 billion, up 14% from USD13.2 billion last year and pretax profit rose 29% to USD1.2 billion from USD929 million.
First-half earnings before interest, tax, depreciation and amortisation was USD2.2 billion, up 22% from USD1.8 billion the year before.
The Dublin-based firm declared a 24.0 US cents interim dividend, up 4.3% on 23.0 US cents in the prior year.
Looking ahead, CRH expects annual Ebitda to be USD5.5 billion, up 10% from USD5.0 billion in 2021, in a "challenging cost environment".
CRH also said its acquisition pipeline remains strong and its "significant" balance sheet capacity provides flexibility to capitalise on opportunities to deliver further value for shareholders.
"CRH has delivered another strong performance with further growth in sales, Ebitda and margin despite a challenging and volatile cost environment. This performance reflects the continued execution of our integrated and sustainable solutions strategy. Looking ahead, despite some continued cost headwinds, the strength of our balance sheet and resilience of our business leaves us well positioned to deliver superior value for all our stakeholders," said Chief Executive Officer Albert Manifold.
Harbour Energy also aid it delivered a strong first-half performance, helped by an increase in oil and gas prices, as the North Sea-focused firm increased its shareholder returns.
For the six months to June 30, revenue and other income was USD2.67 billion, surging from USD1.50 billion last year and pretax profit was USD1.49 billion, multiplied from USD120.2 million.
Crude oil sales amounted to USD1.54 billion, up from USD897 million last year, with a post-hedge realised price of USD82 per barrel of oil equivalent, up from USD58 the year prior.
Turning to returns, Harbour had initiated a USD200 million share buyback in June and on Thursday increased this to USD300 million.
"In an environment of considerable fiscal, economic and geopolitical uncertainty, our strategy to build a global, diversified oil and gas company focused on safe and responsible operations, value creation and shareholder returns remains valid. We are financially strong and have continued to deleverage our balance sheet at pace. As a result, we have significant optionality over our future capital allocation including for continued organic investments, meaningful M&A and additional shareholder returns," said Chief Executive Officer Linda Cook.
Grafton raised its interim dividend and said it expects an annual performance in line with expectations.
For the six months to June 30, revenue was GBP1.15 billion, up 12% from GBP1.03 billion last year but pretax profit was GBP132.4 million, down 7.3% from GBP142.9 million.
Grafton raised its interim dividend 8.8% to 9.25p from 8.50p last year.
Looking ahead, Grafton expects full-year adjusted profit expected to be in line with analyst consensus.
CEO Gavin Slark commented: "Our first half performance saw a significant normalisation of activity levels following exceptional pandemic related spikes in trading in the first half of 2021. While inflation remains a continuing feature in our markets, we saw improved supply chain consistency as trading patterns normalised and building materials shortages eased.
"Though potential macro-economic headwinds remain, Grafton is uniquely placed to outperform given its leading market positions, geographic diversity and the relative resilience of its core repair, maintenance and improvement market. Given the strength of our brands and their market positions together with an exceptionally strong financial position, our focus remains on delivering a strong financial outcome for the year despite the uncertainties in our markets."
The annual Jackson Hole Economic Symposium in Wyoming starts on Thursday, under the theme 'Macroeconomic Policy in an Uneven Economy'. US Federal Reserve Chair Jerome Powell delivers a keynote speech at 8 am Friday morning local time in the western US state, which is 1400 GMT.
There are concerns that the Fed's aggressive approach to combating soaring inflation could lead to a recession in the US, which could, in turn, hit a global economy still recovering from the Covid-19 pandemic.
Powell's address follows successive 75 basis point rate hikes by the Fed, with markets now looking for clues as to whether the central bank will enact a similar move next month.
CMC Markets analyst Michael Hewson commented: "The Jackson Hole Symposium gets underway today with the main focus expected to be on Federal Reserve Chairman Jay Powell's speech which markets have become increasingly nervous about over the past few days, and which has seen bond yields move sharply higher in the expectation he will deliver a hawkish message.
"The symposium will be closely scrutinised for evidence of the Federal Reserve's intent with respect to its September meeting, 50bps or 75bps, as well as the intent of other central banks more broadly at a time when inflation expectations are surging against a backdrop of concern over the risks of overtightening monetary policy at a time, when the challenges facing the global economy are numerous."
New York ended higher on Wednesday. The Dow Jones Industrial Average closed up 0.2%, the S&P 500 up 0.3%, and the Nasdaq Composite up 0.4%.
In Asia on Thursday, the Nikkei 225 index in Tokyo closed up 0.6%. The S&P/ASX 200 in Sydney ended up 0.7%. In China, the Shanghai Composite was up 0.3%, while the Hang Seng index in Hong Kong was up 2.1%.
Hong Kong Exchanges & Clearing delayed opening of the market on Thursday, due to a typhoon which has caused disruption in the city.
The timing is particularly unfortunate, as the exchange was expecting the first day of trading for the biggest new listing of the year, China Tourism Group Duty Free, the Financial Times reported.
Typhoon Ma-on – which shares a name with a mountain in Hong Kong and translates as "saddle" – was packing wind speeds of up to 110 kilometres, 62 miles, per hour on Wednesday evening and lay about 300 kilometres off China's southern coast.
The Hong Kong market is holding a shortened session that started at 1pm local time, 0500 GMT.
The pound was quoted at USD1.1850 early Thursday, up from USD1.1813 at the London equities close Wednesday.
The euro was priced at USD1.0021, back above parity with the dollar and up from USD0.9981. Against the yen, the dollar was trading at JPY136.50 in London, lower against JPY136.80.
Brent oil was quoted at USD102.00 a barrel Thursday morning, up from USD100.77 late Wednesday. Gold stood at USD1,759.57 an ounce, higher against USD1,752.55.
In the economic calendar, there is a US GDP reading at 1330 BST, before the hotly-awaited Jackson Hole symposium kicks off.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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