HSBC Holdings Share News (HSBA)

LONDON (Alliance News) - Shares have opened higher Thursday, with UK government shareholdings in Royal Bank of Scotland and Royal Mail the story of early trading.

Shares in Royal Mail lead FTSE 100 decliners, down 3.1% at 500.50 pence, after the government said it has raised GBP750 million by selling a further 15% stake in Royal Mail for 550p a share, significantly more than it got per share when it first floated the mail operator in a criticized initial public offering nearly two years ago.

RBS is a top gainer, up 1.1%, after UK Chancellor George Osborne used his Mansion House speech Wednesday evening to announce that he will begin selling the UK's 80% stake in RBS after both the Bank of England and banking group Rothschild recommended that the time has come to initiate the lender's return to full private ownership.

Osborne made no mention of a change to the UK bank levy, and shares in Standard Chartered are down 2.0% in early deals. HSBC shares are off 0.3%.

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 6,834.26
FTSE 250: up 0.2% at 18,070.76
AIM ALL-SHARE: up 0.1% at 774.60
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Hang Seng: up 0.9% at 26,922.81
Nikkei 225: closed up 1.7% at 20,382.97
DJIA: closed up 1.3% at 18,000.40
S&P 500: closed up 1.2% at 2,105.20
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GBP: down at USD1.5441
EUR: down at USD1.1287

GOLD: down at USD1,184.25 per ounce
OIL (Brent): up at USD65.65 a barrel

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

13:30 US Initial and Continuing Jobless Claims
13:30 US Retail Sales
13:30 Canada Capacity Utilization
13:30 Canada New Housing Price Index
14:30 US Export and Import Price indices
15:00 US Business Inventories
15:30 US EIA Natural Gas Storage
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The World Bank downgraded its global growth outlook as developing countries face a series of tough challenges in 2015. The global economy is expected to expand 2.8% instead of 3% estimated in January, the bank said in its Global Economic Prospects report. For next year, growth is forecast to improve to 3.3% and then 3.2% in 2017. Developing countries are projected to grow by 4.4% this year, with a likely rise to 5.2% in 2016, and 5.4% in 2017. However, in high-income countries, recovery is gaining momentum, as growth in the euro area and Japan picks up and the US continues to expand, despite a weak start to the year, the lender said.
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House prices in the UK are expected to move higher over the next three months, the latest survey from the Royal Institution of Chartered Surveyors showed, with an index score of +34. That touches a nine-month high, and it's up from +32 in April, although it was shy of expectations for +36. The increase in prices was the natural result of the Conservative Party's electoral victory last month, RICS said.
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The negotiations over Greece's bailout should be stepped up, Prime Minister Alexis Tsipras said early Thursday after crunch talks with his German and French counterparts, held amid growing fears that Athens could soon run out of money. "We have decided to intensify the discussions so that the remaining differences can be bridged, so that we reach a solution in the near future," Tsipras said after the two-hour meeting with German Chancellor Angela Merkel and French President Francois Hollande. It was the second time in three weeks that Tsipras, Merkel and Hollande met to discuss Greece's economic woes.
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German Chancellor Merkel's government may be satisfied with Greece committing to at least one economic reform sought by creditors to open the door to bailout funds, Bloomberg reported Wednesday citing two people familiar with Germany’s position. The report said that while the German government still insist on a package of steps that includes higher taxes, state asset sales and less generous retirement benefits, they may settle for a clear commitment by the Greek government to a measure up front to unlock aid, said the people, who asked not to be identified discussing the government’s negotiating stance.
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S&P Ratings Services cut its long-term sovereign credit rating on Greece to 'CCC' from 'CCC+', citing the likelihood of the nation defaulting on its commercial debt within the next 12 months in the absence of a bailout deal with its official creditors.
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Russian President Vladimir Putin denied that his country had become an international outcast after being expelled from the Group of Eight and slapped with sanctions over its actions in Ukraine. Putin spoke during an official trip to Italy and the Vatican. He first met Italian Prime Minister Matteo Renzi and visited the EXPO world fair in Milan, and later travelled to Rome to meet Italian President Sergio Mattarella and Pope Francis. "You asked about our relations with the G7. We have no relations with the G7," Putin said in a press conference with Renzi. "We had an alternative point of view but our partners have decided they do not need this alternative point of view," he added.
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China's industrial production growth improved slightly in May, just above economists' expectations, while retail sales growth accelerated as expected, figures from the National Bureau of Statistics showed. Industrial production grew 6.1% year-over-year in May, following a 5.9% gain in April. Economists had expected a 6.0% climb for the month. The statistical office also said retail sales surged a price-adjusted 10.1% in May, in line with consensus estimate, slightly faster than previous month's 10.0% hike. In March, sales had risen 10.2%.
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South Korea's central bank lowered a key interest rate to 1.5% on Thursday, citing concerns about the impact of Middle East Respiratory Syndrome, reports said, as the number of confirmed infections continued to rise. "The trend of decline in exports has accelerated and...consumption, which had been showing a recovery, appears to have contracted since the outbreak of MERS," the Monetary Policy Committee of the Bank of Korea wrote in its policy decision, according to Yonhap News Agency. "The downside risks to the domestic growth path forecast in April have expanded." The bank has made four rate cuts since August, and the current rate is a record low, Yonhap reported.
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Following recent setbacks in the fight against Islamic State militants, the White House announced that President Barack Obama has approved sending up to 450 additional US troops to Iraq. The additional US military personnel will train, advise, and assist the Iraqi security forces at Taqaddum military base in eastern Anbar province.
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BROKER RATING CHANGES
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LIBERUM RAISES MAJESTIC WINE TO 'BUY' ('HOLD') - TARGET 500 PENCE
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LIBERUM CUTS ANITE TO 'HOLD' ('BUY') - TARGET 100 PENCE
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WH Ireland Suspends Recommendation, Price Target On UK Oil & Gas
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COMPANIES - FTSE 100
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Chancellor George Osborne is to begin selling the UK's 80% stake in Royal Bank of Scotland Group after both the Bank of England and banking group Rothschild signalled that the time has come to initiate the lender's return to full private ownership. Delivering his annual speech at Mansion House in London, Osborne said that kicking off the sale of the government's stake six years since completing the injection of GBP45.5 billion into the bank is the "right thing" to do. The Chancellor's speech had been highly anticipated by a wide range of stakeholders, including bankers, investors and taxpayers, who had been waiting to hear about his plans for the RBS stake and the bank levy imposed on banks in 2011. While Osborne provided details about selling the RBS stake, his speech did not include explicit reference to the levy, which has been seen to have played a part in HSBC Holdings's decision to review whether to relocate its global headquarters from London, although the Chancellor said that making Britain the "best place" for the headquarters of European and global banks is in the national interest. The levy has been seen to disproportionately affect HSBC and fellow Asia-focused lender Standard Chartered as it is imposed on global, rather than just UK, balance sheets.
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Bank of England Governor Mark Carney said that all firms active in financial transaction markets, including dealers and asset managers, should ensure that senior managers are held directly accountable for failures in their areas of responsibility, and the core principles of the new regime governing this in banks and insurers will also apply to senior staff at the central bank. In his Mansion House speech Wednesday, Carney said that from next year, senior managers of banks and insurers will be held directly accountable for failures in their areas of responsibility and this should be extended to all firms active in so-called Fixed Income Clearing Corporation markets, including dealers and asset managers.
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The UK government said it has raised GBP750 million by selling a further 15% stake in Royal Mail for 550 pence a share, significantly more than it got per share when it first floated the mail operator in a criticized initial public offering nearly two years ago. The Department for Business, Innovation & Skills had announced Wednesday that it would be selling half its remaining 30% stake in Royal Mail in an accelerated bookbuild. The sale means the UK government is left with 149.9 million Royal Mail shares, a 15% stake. Chancellor Osborne later said a 1% stake of the remaining 15% would be gifted to the company's staff. Staff took a 10% stake in the initial IPO.
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The UK anti-trust regulator issued a final order requiring Ryanair Holdings to sell down its 29.8% stake in Irish rival Aer Lingus Group to 5%, boosting International Consolidated Airlines Group's chances of successfully acquiring Aer Lingus. The move marks the end of a long-running battle between the regulator and Ryanair, which has several times said it should not be required to sell down the stake it had built up when trying to buy Aer Lingus itself. IAG has made a EUR1.4 billion offer for Aer Lingus, and has won the backing of the Irish government for the deal, the Irish flag carrier's other major shareholder. That meant the success of the bid was dependent on Ryanair accepting the deal.
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COMPANIES - FTSE 250
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Home Retail Group reported a drop in total sales in both its Argos and Homebase businesses in the first quarter of its financial year, but a rise in like-for-like sales in Homebase as it continues with its 'Transformation Plan' and store-closure programme. The owner of the Argos electronics and general merchandise chain and the Homebase DIY chain said that total sales in Argos declined 2.6% to GBP846 million in the 13 weeks to May 30, as like-for-like sales fell 3.9%. Total Homebase sales decreased 1.6% to GBP438 million, but like-for-like revenue was up 5.4% in the period.
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PZ Cussons said the group's performance in its recently-ended financial year was in line with expectations, as it did well in the UK, Australia and Indonesia, and as trading in Nigeria is stabilising. The maker of bath products Imperial Leather and Original Source said that in the year to May 31, all brands performed well in the UK driven by a significant renovation and innovation programme, while performance in the smaller markets of Poland and Greece was in line with expectations.
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Ophir Energy saw its shares rise early Thursday after it said a new independent reserves report had confirmed its has over 1 billion barrels of oil equivalent in its reserves, which it claimed is one of the largest in the European mid-cap sector. The independent reserves and resources reports support its previous management estimates, the company said, with combined net 2P and 2C resources as at the end of 2014 at over 1 billion barrels of oil equivalent. This is split between certified net proven and probable reserves, its 2P reserves, of 59.6 million barrels of oil equivalent, and certified best estimate of contingent resources, its 2C reserves, of 950.0 million barrels of oil equivalent.
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Halma said it expects to make "further progress in the year ahead" as it posted a small decline in pretax profit for its recently ended financial year. The safety, health and environmental technology company posted a pretax profit of GBP133.6 million for the 52 weeks to March 28, compared to GBP138.7 million for the 52 weeks to March 29 2014, as a rise in revenue to GBP726.1 million from GBP676.5 million was offset by exceptional costs of GBP20.0 million. Halma proposed a final dividend of 7.31 pence, taking its total dividend for 11.96p, up from 11.17p a year before.
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WS Atkins said its outlook remains positive despite challenging markets that are being affected by low oil prices and economic and political uncertainty, after it reported higher underlying profits for its last financial year. The project designer, engineer and management consultancy reported a pretax profit of GBP106.7 million for the year to end-March, down from GBP114.2 million a year earlier.
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Petrofac said said it has been awarded an engineering and procurement contract, expected to be worth about USD900 million, by Petroleum Development Oman to provide services for its Yibal Khuff project, a field located approximately 350 kilmetres south west of Muscat in the Sultanate of Oman.
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Greene King and Spirit Pub said Greene King's takeover offer for Spirit Pub is no longer conditional on approval by the UK Competition and Markets Authority, after Greene King waived the CMA approval condition to which the offer was subject. Greene King is buying Spirit Pub in a GBP773.4 million takeover. Spirit shares are expected to be delisted on June 24, following which a 6.5 pence special interim dividend will be paid.
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COMPANIES - LONDON MAIN MARKET AND AIM
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New World Oil and Gas announced a new share placing and open offer to raise up to GBP3.5 million, funds the oil investment firm said it needs to continue operating longer than another three months as it currently has only GBP290,000 in cash. New World had said on Monday it was still expecting to proceed with an open offer and placing, after an earlier GBP1.5 million placing was rejected by shareholders at a May extraordinary general meeting. That placing had been plagued by confusion over the size of shareholdings in the company, including those of Judith Williams and her son and of Metal Tiger. The new offer, made on the basis of 5.534 new shares for each one existing share, will see the issue of up to 3.89 billion shares at a price of 0.09 pence, a 65% discount to New World's closing price on May 18, the last day prior to the stock's suspension, but only a 5.3% discount to its price on April 28, the last day before the announcement of the original placing.
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UK Oil and Gas Investments said late Wednesday it has raised GBP6.0 million after conducting a placing of over 266.7 million new shares in the company, a price of 2.25p. The company's shares fell on Wednesday after it confirmed media speculation that it would raise funds via a placing to advance its assets, including the Horse Hill license area. UK Oil and Gas shares closed down 3% to 2.42 pence per share Wednesday. The company, which is involved in the Horse Hill oil discovery near Gatwick Airport in the UK Weald basin, said earlier Wednesday it was in talks with potential investors about raising a minimum of GBP4.5 million at a target price of 2.25 pence via an accelerated book-build process by WH Ireland.
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Thursday's Scheduled AGMs/EGMs

Dignity
REA Holdings
Graphite Enterprise Trust
Ascent Resources
Camkids Group
Black Sea Property
Source BioScience
e-Therapeutics
Martin Currie Global Portfolio Trust
Synergy Health
MX Oil
Serabi Gold
SciSys
Verona Pharma
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By Tom Waite; thomaslwaite@alliancenews.com; @thomaslwaite

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