HSBC Holdings Share News (HSBA)

LONDON (Alliance News) - UK shares have opened mostly higher Tuesday, though with AIM stocks under-performing.

Wall Street ended with gains on Monday after mostly positive US economic data, but in Tokyo Tuesday, the Nikkei 225 index closed lower for the first time in 12 sessions.

In London, British American Tobacco leads FTSE 100 decliners, down 1.5%, after it confirmed that its Imperial Tobacco Canada subsidiary was amongst three companies ordered to pay CAD15.6 billion in a case that has been running for 10 years in which smokers claimed the companies failed to warn them of the risks associated with smoking.

Building-products company Wolesely is the top blue-chip gainer, up 1.8%, after it said it expects to meet analysts' expectations for its trading profit in the current financial year and reported strong growth in the third quarter of the year.

Premier Oil leads FTSE 250 gainers, up 3.2%, after it said it has taken full ownership of the Solan field project in the UK North Sea.

AO World is the worse mid-cap performer, down 6.4%, as the online white-goods seller reported a narrowed pretax loss in its recently-ended financial year but said it missed its earlier financial expectations due to a weaker-than-expected sales performance in the fourth quarter.

Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.1% at 6,963.52
FTSE 250: up 0.4% at 18,285.77
AIM ALL-SHARE: down 0.1% at 775.04
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Hang Seng: down 0.6% at 27,434.41
Nikkei 225: closed down 0.1% at 20,543.19
DJIA: closed up 0.2% at 18,040.37
S&P 500: closed up 0.2% at 2,111.73
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GBP: up at USD1.5207
EUR: up at USD1.0966

GOLD: flat at USD1,188.52 per ounce
OIL (Brent): up at USD65.37 a barrel

(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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Tuesday's Key Economic Events still to come
(all times in BST)

08:55 Germany Unemployment Rate
09:30 UK Consumer Credit
09:30 UK PMI Construction
09:30 UK Mortgage Approvals
10:00 EU Producer Price Index
10:00 EU Consumer Price Index
13:55 US Redbook index
14:45 US ISM New York index
15:00 US IBD/TIPP Economic Optimism
15:00 US Factory Orders
18:30 US Total Vehicle Sales
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Former Liberal Democrat leader Charles Kennedy has died at his home in Scotland aged 55, his family has told the BBC. The former MP's death is not believed to be suspicious and the cause of death has yet to be confirmed. Kennedy led the Liberal Democrats from 1999 to 2006 but lost his seat in the Ross, Skye and Lochaber constituency in last month's UK General Election.
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Ireland's manufacturing sector expanded at a quicker rate in May, with the pace of expansion the fastest in three months, as new work increased, survey figures from Markit Economics and Investec showed. The seasonally adjusted Investec purchasing managers' index, or PMI, grew to 57.1 in May from 55.8 in the previous month. This marked the highest growth rate in three months, with operating conditions improving throughout the past two years.
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German Chancellor Angela Merkel and French President Francois Hollande met in Berlin on Monday as the negotiations over the Greek debt crisis hang in the balance. The working dinner between the French and German leaders was officially called to consider steps to forge a single digital market in Europe as well to co-ordinate the development of new energy policy across the region and steps to boost youth employment. However, the talks in Merkel's office were overshadowed by deepening tensions between Greece and its international creditors over a debt deal as well concerns that Athens could soon run out of money. The meeting in Berlin was also attended by the President of the European Commission Jean-Claude Juncker as well Benoit Potier, who heads up the so-called European Round Table of top industrialists.
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Germany's unemployment rate held steady in April, figures from Destatis showed. The jobless rate came in at an adjusted 4.7% in April, the same rate as in the previous month. In the same month of the previous year, the rate was 5.0%.
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India's central bank lowered its key interest rates by 25 basis points as widely expected by economists. The Reserve Bank of India, governed by Raghuram Rajan, decided to cut its repo rate to 7.25% from 7.50% with immediate effect and the reverse repo rate was adjusted to 6.25% from 6.50% on Tuesday. The bank reduced its key rates by 25 basis points each in January and March in unscheduled sessions.
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Policymakers of the Reserve Bank of Australia kept its key interest rate at a record low after lowering it by a quarter point last month, as they observed that the current stance is appropriate. The policy board governed by Glenn Stevens decided on Tuesday to leave the cash rate at 2.00% as widely expected by economists. The bank lowered the rates by 25 basis points each in February and May.
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A passenger ship with more than 450 people on board has sunk in China's Yangtze River during a heavy storm, Chinese state media reported. As of 11 am Tuesday, 13 of the 458 people on board have been rescued, reports cited the Ministry of Transport as saying, including the captain and the chief engineer. The ship sank around 9:30 pm Monday local time near Jianli in Hubei province, the official Xinhua news agency reported.
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The Cairo Criminal Court was due Tuesday to issue its verdict in the trial of former Egyptian president Mohammed Morsi, who faces a potential death sentence on prison break charges. Prosecutors charged that Morsi and other leaders in the Muslim Brotherhood conspired with foreign Islamist organizations to storm prisons during the 2011 uprising that toppled long-time ruler Hosny Mubarak.
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Two of the five members of Burundi's electoral commission resigned on Monday, arguing it was not possible to hold the presidential elections foreseen for June 26 while anti-government demonstrations were rocking the country. The two have reportedly fled Burundi.
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US Secretary of State John Kerry was headed home to Boston Monday after breaking his leg in a biking accident in Switzerland, and it was unclear how the accident would affect his ability to lead the Iran nuclear talks for the US. Kerry cut short an international trip after the accident Sunday and was being accompanied home by his US doctor, Dennis Burke, to ensure he remained comfortable during the trip. The accident occurred Sunday while Kerry, 71, was cycling in the Alps.
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The US intelligence community was left without the use of several surveillance powers after the US Senate failed to extend key parts of anti-terrorism legislation amid a dispute about the National Security Agency's controversial telephone metadata collection programme. Senator Rand Paul, an outspoken critic of government surveillance programmes and a Republican candidate for president, prevented the Senate from passing the USA Freedom Act before a deadline that saw separate, existing authorization for the surveillance powers expire at midnight local time. The USA Freedom Act is a compromise measure that would curtail some of the now-expired powers granted to the NSA in the wake of the September 11, 2001, terrorist attacks, but still give the agency the ability to track those it has identified as threats.
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BROKER RATING CHANGES
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UBS RAISES HISCOX PRICE TARGET TO 830 (765) PENCE - 'NEUTRAL'
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SOCGEN CUTS BBA AVIATION PRICE TARGET TO 360 (375) PENCE - 'HOLD'
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COMPANIES - FTSE 100
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HSBC Holdings will announce a plan next week to cut thousands more jobs across its global workforce, Sky News reports. The report indicated that Chief Executive Officer Stuart Gulliver will disclose a target when he updates shareholders on the bank's strategy on June 9, laying out a reduction that will probably affect 10,000 to 20,000 people. The numbers were still being worked on and had yet to be finalised. Europe's biggest lender employed 258,000 people at the end of last year.
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UK Chancellor George Osborne is set to outline plans for privatising The Royal Bank of Scotland Group when he makes his Mansion House speech next week, the Financial Times reported.
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British American Tobacco confirmed that its Imperial Tobacco Canada subsidiary was amongst three companies ordered to pay CAD15.6 billion in a case that has been running for 10 years in which smokers claimed the companies failed to warn them of the risks associated with smoking. The judgement by the Quebec Superior Court in Canada follows a ten-year legal challenge against BAT's Canadian subsidiary, Imperial Tobacco Canada, as well as Philip Morris International and Japan Tobacco International's Canadian subsidiaries. BAT said it was not a party to the proceedings and is not a party to the judgement, only its Canadian subsidiary. Imperial Tobacco Canada's share of the total damages would be CAD10.4 billion, it said. However, the companies intend to appeal the judgement.
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Wolseley said it expects to meet analysts' expectations for its trading profit in the current financial year after reporting strong growth in the third quarter of the year, driven by like-for-like sales growth, acquisitions, and an exchange rate boost. The building products company reported a trading profit from ongoing businesses of GBP195 million for the three months to April 30, up 29% from GBP151 million a year earlier, as revenue grew 16.6% to GBP3.30 billion from GBP2.83 billion and the company improved its gross margins. The revenue increase if exchange rates had remained constant over the year would have been 12.4%, while the currency movements buoyed trading profit by GBP11 million.
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British Land Co said it has launched a GBP350 million offering of senior, unsecured convertible bonds due 2020, money it will use to fund the recently announced GBP210 million acquisition of One Sheldon Square, Paddington Central and the GBP135 million acquisition of Surrey Quays Leisure Park, Canada Water, as well as committed development spending.
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The prospective bidders for Tesco's Dunnhumby customer data business are set to cut the value of their offers following the restructuring of one of the unit's biggest contracts, Sky News reports citing sources. Private equity suitors for the business, which runs the retailers' Clubcard operation, started holding talks with Tesco last week and are understood to have since cut their projected valuations of the company from GBP2 billion to around half that, Sky News said. The cut is thought to have been made after bidders were informed that a renegotiation of Dunnhumby's contracts with US retailer Kroger meant the profitability of the business being sold is now substantially lower than initially estimated, it added.
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COMPANIES - FTSE 250
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AO World reported a narrowed pretax loss and rise in revenue in its recently-ended financial year as it recovered from costs associated with its initial public offering in London the previous year, but said it missed its earlier financial expectations due to a weaker-than-expected sales performance in the fourth quarter. The FTSE 250-listed online domestic appliances retailer said it made a pretax loss of GBP2.9 million in the year to March 31, compared with a loss of GBP7.6 million the prior year, while revenue grew 24% to GBP476.7 million from GBP384.9 million.
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The UK government said it has shortlisted FirstGroup, National Express Group and a joint venture containing Stagecoach Group as the three bidders for the new East Anglia rail franchise. The government said Abellio East Anglia, a joint venture between Dutch railway operator Abellio and Stagecoach, First East Anglia and National Express East Anglia Trains will now work to develop their proposals for the franchise before the invitation to tender in August.
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St Modwen Properties said it has performed well in 2015 so far on the back of a robust performance in commercial and residential regional property markets. St Modwen said its results for 2015 also will be given a boost by the company having achieved unconditional status on the New Covent Garden Market regeneration project at the Nine Elms area in south London. St Modwen said its full-year expectations are unchanged and said its first-half pretax profit is expected to be significantly ahead year-on-year.
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Healthcare services provider Synergy Health posted a rise in pretax profit for its recently ended financial year, and said its current financial year has started well. Synergy's results come after the US Federal Trade Commission said last week it intends to block STERIS Corp's proposed USD1.9 billion cash and share takeover of Synergy, citing concerns about lessening competition it the market for contract radiation sterilisation services. The two companies have said they intend to contest the FTC's attempt to block the acquisition. For the year to March 29 Synergy posted a pretax profit of GBP43.6 million, up from GBP42.9 million a year before.
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LondonMetric Property said it will pay a special dividend for its 2015 financial year as the valuation of its portfolio rose over the course of the year and its profit jumped on the back of higher rental income. FTSE 250-listed LondonMetric said its will pay a final dividend of 3.5 pence per share, leaving its total dividend for the year flat at 7 pence, but said it also will pay a 2 pence per share special dividend due to the exceptional gains the company made on the redevelopment and sale of the One Carter Lane property, which it sold for GBP138.8 million. The group's reported profit for the year to the end of March was GBP159.5 million, up 27%.
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Fund manager Henderson Group said it has struck a deal to acquire Australia's Perennial Fixed Interest Partners and Perennial Growth Management from owner IOOF Holdings and the employee shareholders of each company. In a separate deal, Henderson also said it has acquired the remainder of 90 West Asset Management Pty Ltd, a natural resources fund fund manager also based in Australia. That has meant it has pushed its ownership of the business up to 100% from 41% previously.
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Premier Oil said it will consolidate production at the Solan field in the UK North Sea as it takes full ownership of the project after acquiring the 40% stake in the project it did not already own. The company has acquired Chyrsaor's 40% stake in the field for no upfront consideration. In return, Premier will pay Chyrsaor a payment of up to USD3 million per year and royalty payments of up to USD100 million, after allowing the repayment of the USD530 million plus interest of the outstanding loan provided by Premier to Chyrsaor.
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Amec Foster Wheeler warned its scope revenue will be "modestly" lower in 2015 than in 2014 and that its trading margin will suffer a "further modest reduction" compared to its previous guidance, as challenging conditions in the upstream oil and gas industry continues. The FTSE 250-listed oil services company also said its expects trading profit to be more second half weighted than in 2014. Amec Foster Wheeler said scope revenue was GBP1.60 billion in the four month period to end-April, falling from GBP1.62 billion a year earlier. Amec Foster said revenue was down 0.9% on a pro-forma basis and down 3.6% on a like-for-like basis.
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Odey Asset Management, run by hedge fund manager Crispin Odey, has increased its stake in Plus500 to 21.33%, according to filings with the London Stock Exchange, a move that could be a factor in Playtech's attempt to acquire the struggling business in a GBP459.6 million deal.
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COMPANIES - INTERNATIONAL
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Disconnect, an app developer, has complained to European Commission's Competition Directorate about Google's abuse of Android dominance. Google removed a Disconnect app from its Play mobile app store last year, citing violation of a policy prohibiting software which interferes with other apps. Disconnect, which makes privacy and security applications, complained to European regulators that Google abused its dominant position in the mobile market to discriminate against Disconnect and favor Google's own privacy and security software.
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General Electric said that it began negotiations on a new national contract with the International Union of Electronic Workers/Communications Workers of America. Negotiations with the United Electrical, Radio and Machine Workers of America will begin June 2. GE holds separate talks with each union. The current four-year contracts with the unions expire at midnight on June 21.
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Tuesday's Scheduled AGMs/EGMs

WANdisco
Gem Diamonds
OneSavings Bank
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By Tom Waite; thomaslwaite@alliancenews.com; @thomaslwaite

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