HSBC Holdings Share News (HSBA)

(Alliance News) - Britain partially reopens schools on Monday and allows the most vulnerable to venture outdoors, despite warnings that the world's second worst-hit country is moving too quickly out of its coronavirus lockdown.

A death toll that now officially stands at 38,489 has piled political pressure on Prime Minister Boris Johnson, who was elected in December with a big majority.

Johnson spent much of the past week stamping out a scandal sparked by his chief adviser's decision to drive to a picturesque castle with his family while everyone was under orders to limit outdoor exercise to an hour a day. Dozens of members of Johnson's own party joined a failed effort by the opposition to get Dominic Cummings fired for undermining the government's public message on health.

The furore over Cummings appears to have abated but concern about Johnson's handling of the crisis remains. His public support has suffered the sharpest fall for a Conservative party leader in 10 years – nine points in a YouGov poll and 21 points in a survey for the Daily Mail.

Yet the mood in Britain is clearly improving as the number of daily deaths drops. Parks and beaches have been filled for two successive weekends in what has been one of the driest springs in over 100 years.

Here is what you need to know at the London market open:
----------
MARKETS
----------
FTSE 100: called up 1.3% at 6,157.00
----------
Hang Seng: up 3.5% at 23,761.56
Nikkei 225: closed up 0.8% at 22,062.39
DJIA: closed down 17.53 points, 0.1%, at 25,383.11
S&P 500: closed up 0.5% at 3,044.31
----------
GBP: up at USD1.2392 (USD1.2330)
EUR: up at USD1.1140 (USD1.1117)

Gold: up at USD1,742.40 per ounce (USD1,732.75)
Oil (Brent): up at USD37.80 a barrel (USD35.72)

(changes since previous London equities close)
----------
ECONOMICS AND GENERAL
----------
Monday's Key Economic Events still to come

Whit Monday. Frankfurt and Zurich markets closed. Paris market open.
Ireland June Bank Holiday.

0930 BST UK CIPS -Markit manufacturing purchasing managers' index

0955 CEST Germany manufacturing PMI
1000 CEST EU manufacturing PMI

0945 EDT US manufacturing PMI
1000 EDT US construction spending
1000 EDT US ISM manufacturing report on business
----------
The easing of restrictions related to the coronavirus pandemic led to a rise in Chinese manufacturing output in May, IHS Markit figures showed on Monday. The headline seasonally adjusted purchasing managers' index - a composite indicator designed to provide a single-figure snapshot of operating conditions in the manufacturing economy - rose to 50.7 in May from 49.4 in April. The above 50.0 reading signalled a renewed improvement in overall operating conditions, albeit only marginal. May data signalled a further increase in output, IHS Markit said, following February's record decline, with firms widely mentioning the resumption of works due to an easing of Covid-19 related measures. However, Demand conditions remained subdued, with total new work declining again in May, driven by weaker external demand, as many nations faced strict measures to stop the spread of the Covid-19 pandemic. Supply chains, meanwhile, stabilised in May, following severe disruptions in prior months due to restrictions related to the Covid-19 pandemic.
----------
The manufacturing downturn in Japan accelerated in May, the latest IHS Markit survey showed, as the coronavirus pandemic reduced workloads, limited production capacity and heavily disrupted supply chains. The headline au Jibun Bank Japan manufacturing purchasing managers' index - a composite single-figure indicator of manufacturing performance - fell for a fourth successive month in May to 38.4, signalling a sharper rate of deterioration in the health of the sector than in April, when it was recorded at 41.9. The figure is the lowest since March 2009. IHS Markit said 55% of companies recorded lower output volumes in May when compared to April, which was due to production suspensions and sinking demand conditions. Some firms managed to remain operational, but at a capacity that was significantly below potential.
----------
The number of coronavirus cases worldwide has topped six million as the disease spread rapidly across Latin America and political leaders feuded over how to deal with the pandemic. Much of the world is moving at varying speeds to lift lockdowns that have wrecked economies and stripped millions of their jobs while Muslims in Jerusalem and other cities flocked to newly reopened mosques on Sunday. But in Brazil - the epicenter of South America's outbreak with nearly 500,000 confirmed caes, lagging only behind the US - disagreement among its leaders over lockdown measures has hampered efforts to slow the outbreak.
----------
The EU's chief Brexit negotiator Michel Barnier on Sunday accused Britain of falling behind on its commitments and warned there would be no agreement if it continued. London "has been taking a step back - two steps back, three steps back - from the original commitments," he told the Sunday Times ahead of a fourth round of Brexit negotiations set to start this week. Should London not follow the wording of the political declaration both sides agreed last autumn as the starting point for talks on the future relationship, there will be no agreement, Barnier warned. Last week, Barnier said that the upcoming round of negotiations would be crucial in securing a post-Brexit trading deal with Britain. Three previous rounds of talks have ended without any tangible results.
----------
The European Central Bank could announce Thursday hundreds of billions of euros in new bond-buying to keep fighting the pandemic crisis, analysts predict, as EU governments prepare to wrangle for months over a joint response. While some policymakers have urged abandoning the ECB's self-imposed limits on buying government debt to stoke growth and inflation, the meeting is also the first since a ruling by Germany's Constitutional Court urging restraint of the central bank's powers. "At a minimum, we think (governors) will add a further EUR500 billion" to the 750-billion-euro Pandemic Emergency Purchase Programme (PEPP) decided in March, Capital Economics analyst Andrew Kenningham said. If the ECB keeps up its present pace of buying government and corporate debt, "the total envelope will be exhausted by early October", he added. "The only questions are exactly what changes are announced and when".
----------
BROKER RATING CHANGES
----------
GOLDMAN RAISES PEARSON TO 'BUY' ('NEUTRAL') - TARGET 678 (625) PENCE
----------
JEFFERIES RAISES STANDARD CHARTERED TO 'BUY' ('UNDERPERFORM') TARGET 575(438)P
----------
JEFFERIES CUTS HSBC TO 'HOLD' (BUY) - PRICE TARGET 400 (790) PENCE
----------
COMPANIES - FTSE 100
----------
Associated British Foods said trading at re-opened stores has been "reassuring" as it plans to open its shops in England in two weeks' time. All its Primark stores were closed over a 12-day period from March 11. As European governments have begun to ease restrictions on clothing retail, it has been able to re-open stores, as of Monday trading in 112 shops, or 34% of its total selling space. It is working to re-open its stores in England on June 15, at that date expecting to be operating from 281 stores, representing 79% of total selling space. AB Foods is awaiting further guidance for the stores in Northern Ireland, Wales and Scotland and anticipate openings in late June. The firm said it managed to exceed its estimate of a 50% reduction in Primark overheads in May and April. "Trading in our re-opened stores has been both reassuring and encouraging, with customer queues outside most stores and, once in store, spending on larger basket sizes. However, the trading results since re-opening were delivered over a very short period, will have been influenced by a number of specific factors, and may not be indicative of a long term pattern. Cumulative sales since re-opening, on a like-for-like basis, were down on the same period last year in aggregate," said AB Foods.
----------
COMPANIES - MAIN MARKET AND AIM
----------
Ted Baker said it plans to raise GBP95 million as it swung to a loss in its recently-ended financial year. The upmarket fashion retailer reported a pretax loss of GBP79.9 million for the year to January 25 versus a profit of GBP30.7 million the year before. Revenue fell 1.4% to GBP630.5 million. Ted Baker intends to raise GBP95 million in a fully underwritten placing and open offer and firm placing. "I am confident that our transformation plan will enable us, Ted Baker, to capitalise on our opportunities and deliver value for all of our shareholders," said Chief Executive Rachel Osborne.
----------
COMPANIES - GLOBAL
----------
Google, a unit of Alphabet, has rejected demands it pay hundreds of millions of dollars per year in compensation to Australian news media under a government-imposed revenue sharing deal. The company's top executive in Australia said Google made barely AUD10 million, around USD6.7 million, per year from news-linked advertising, a fraction of a government watchdog's estimates for the sector. In an effort being closely watched around the world, Australia is set to unveil plans to force major internet firms to share advertising revenue they earn from news featured in their services. The country's competition regulator, the ACCC, has estimated that Google and Facebook together earn some AUD6.0 billion per year from advertising in Australia. Leading news publishers have demanded the two companies pay at least 10% of that money each year to local news organisations, which they say have lost the vast majority of their advertising revenue to the global technology giants.
----------
Monday's Shareholder Meetings

Intu Properties
Rockhopper Exploration
Lidco Group
CloudCall Group
----------
By Tapan Panchal; tapanpanchal@alliancenews.com

Copyright 2020 Alliance News Limited. All Rights Reserved.