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(Alliance News) - Stocks in London are called higher on Monday, following a tech-led rally in New York stock markets, which drove the S&P 500 to an all-time high.
The US Federal Reserve has entered its 'blackout' period ahead of next Wednesday's monetary policy decision, meaning the market will not be hearing from any of the central bank's officials.
As a result, closer attention will be paid to key economic data from the US, including fourth-quarter gross domestic product figures on Thursday, as well as core personal consumption expenditures on Friday.
"Strong US economic data has been tempering the expectation of a March rate cut from the Fed. But the Fed is still broadly expected to cut in May, if it doesn't in March," noted Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
There will also be earnings from US firms to consider, with highlights including Netflix on Tuesday and Tesla on Wednesday.
Other key events will be the Bank of Japan monetary policy decision on Tuesday, and the European Central Bank's rate call on Thursday.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: called up 26.4 points, 0.4%, at 7,488.33
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Hang Seng: down 2.4% at 14,934.63
Nikkei 225: closed up 1.6% at 36,546.95
S&P/ASX 200: closed up 0.8% at 7,476.60
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DJIA: closed up 395.19 points, 1.1%, at 37,863.80
S&P 500: closed up 1.2% at 4,839.81
Nasdaq Composite: closed up 1.7% at 15,310.97
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EUR: up at USD1.0902 (USD1.0884)
GBP: up at USD1.2709 (USD1.2669)
USD: down at JPY148.07 (JPY148.18)
Gold: down at USD2,020.39 per ounce (USD2,035.35)
Oil (Brent): down at USD78.23 a barrel (USD79.06)
(changes since previous London equities close)
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ECONOMICS
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No major announcements are scheduled on Monday's economic calendar
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UK Prime Minister Rishi Sunak is bracing for a battle with the House of Lords over his controversial Rwanda deportation plan. The first test will come on Monday with a debate on a motion seeking to delay the Rwanda treaty. Many peers have already expressed deep unease about the stalled scheme to put some asylum seekers on a one-way flight the east African nation. But the prime minister has urged the Upper House not to block the "will of the people". Monday's debate will centre on a report by the Lords International Agreements Committee recommending Parliament should not ratify the Rwanda treaty until ministers can show the country is safe.
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The average homeowner in England and Wales who sold up last year made around GBP100,000 more than the amount they had originally paid for their property, according to analysis. Estate agent Hamptons, which carried out the research, looked at householders selling in 2023 who had bought their homes in the past 20 years. It found those who had bought a property within this timeframe and sold it last year sold for an average of GBP102,650 more than they paid. This was down from a record gross profit of GBP112,930 in 2022, according to the research, which used Land Registry data. In percentage terms, the average seller in England and Wales last year made a 48% gain, down from 54% in 2022. The decrease in average gains is partly due to small house price falls last year, but also because more households moved home sooner, researchers said.
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BROKER RATING CHANGES
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Barclays cuts Sage Group to 'underweight' (equal weight) - price target 985 (1,050) pence
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Morgan Stanley raises Berkeley target to 4,516 (3,920) pence - 'underweight'
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COMPANIES - FTSE 100
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Endeavour Mining updated on its fourth-quarter and full-year trading. The gold miner, with operations in the Ivory Coast, Senegal and Burkina Faso expects production to total 1.1 million ounces for the 2023 full year, down 8% from 2022. With all-in sustaining costs of around USD964 per ounce, the company said this will create shareholder returns of USD266 million and amount to growth investment of USD542 million. Its fourth quarter output was at 280,000 ounces, flat from the third quarter but down from 294,000 ounces year-on-year. Endeavour expects production to increase by up to 18% in 2024, thanks to several project start-ups due to commence in the second quarter. All-in sustaining costs are expected to remain low at between USD955 to USD1,0.35 per ounce.
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COMPANIES - FTSE 250
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HgCapital Trust said its manager Hg has agreed a full realisation of its shareholder in Argus Media, a provider of intelligence to the global energy and commodity markets. The deal values HgCapital's stake in Argus at around GBP52 million, which would be a 7% uplift over the pro-forma carrying value of the asset back at the end of September. The transaction is expected to close next month, subject to regulatory approvals.
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OTHER COMPANIES
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London-based advertising agency S4 Capital said its fourth-quarter trading was in line with its expectations outlined in November. Consequently, it now expects a like-for-like decline in net revenue of around 4% in 2023 as a whole, and operational Ebitda margin in the range of 10-11% - the margin was improved in the second half thanks to "significant" cost reductions. "After four years of very strong growth, 2023 was a difficult year impacted by volatile macro conditions and, consequently, cautious spending from clients, particularly those in the technology sector and from smaller project-based assignments. Our client relationships remain strong and we have also managed costs tightly," said Executive Chair Martin Sorrell. "While it is early in the year, we are not expecting 2024 to show macro-economic improvement, and client caution on marketing spend will likely persist, although not at last year's level..."
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Designer and builder of smart software solutions SmartSpace Software said it has received a non-binding indicative proposal for a possible cash offer from Sign In Solutions, a firm majority owned and controlled by funds managed or advised by PSG Equity. The price of 90 pence per share is one that SmartSpace's board would be "minded unanimously to recommend that shareholders accept". It represents a 32% premium to Friday's closing price of 67.98p. "The possible offer is subject to the satisfaction or waiver of a number of customary pre-conditions, including satisfactory completion of due diligence. Discussions between the parties are advancing but there can be no certainty that an offer will be made, even if the pre-conditions are satisfied or waived," the firm noted. Sign In now has until February 19 to announce its firm intention to make an offer, or announce it does not intend to make an offer.
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Aquaculture biotechnology firm Benchmark Holdings said it is undertaking a formal review of its strategic options, which could include the sale of the company as a whole, or one or more of its business units. The firm believes its current share price "materially undervalues" its businesses and long-term prospects. This "may at least in part be due to the tightly held and illiquid nature of its ordinary shares", it considered. The formal review will establish whether there are any potential bidders that will offer a value of the firm or its assets that the board considers to be "attractive" relative to the board's view of its intrinsic value. It is not currently in any discussions with any potential buyer.
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By Elizabeth Winter, Alliance News deputy news editor
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