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(Alliance News) - London's FTSE 100 is called to open lower on Friday, though oil prices got a boost, on fears of a conflict escalation in the Middle East.
Iran's state media reported explosions in the central province of Isfahan Friday, as US media quoted officials saying Israel had carried out retaliatory strikes on its arch-rival.
Air defence systems over several Iranian cities were activated, state media reported, after the country's official broadcaster said explosions were heard near the city of Isfahan.
Israel had previously warned it would hit back after Iran fired hundreds of missiles and drones at Israel over the weekend. Most of them were intercepted.
"It is now clear that the escalating shadow warfare between Israel and Iran, running alongside the Gaza conflict, has finally ignited the powder keg in the Middle East, and we have moved decisively out of the shadows and into the glaring light of open conflict," SPI Asset Management analyst Stephen Innes commented.
In early UK corporate news, Man Group reported growth in assets under management, shaking off over USD1.5 billion worth of net outflows. 888 said first-quarter revenue declined but topped expectations, ahead of a possible name change for the William Hill owner.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: called down 0.5% at 7,834.95
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Hang Seng: down 1.1% at 16,207.91
Nikkei 225: down 2.7% at 37,068.35
S&P/ASX 200: down 1.0% at 7,567.30
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DJIA: closed up 22.07 points, 0.1%, to 37,775.38
S&P 500: closed down 0.2% at 5,011.12
Nasdaq Composite: closed down 0.5% at 15,601.50
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EUR: down at USD1.0634 (USD1.0660)
GBP: down at USD1.2410 (USD1.2464)
USD: down at JPY154.41 (JPY154.60)
GOLD: lower at USD2,381.27 per ounce (USD2,384.41)
(Brent): higher at USD88.25 a barrel (USD87.15)
(changes since previous London equities close)
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ECONOMICS
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Friday's key economic events still to come:
14:30 BST US Chicago Fed President Austan Goolsbee speaks
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UK retail sales volumes climbed year-on-year in March, but were flat on the month before. According to the Office for National Statistics, retail sales rose 0.8% in March from a year prior, though were still 1.2% below the pre-pandemic level in February 2020. Sales had declined 0.3% on-year in February. Sales were flat in March from February, following a 0.1% rise in February from January. February's reading was upwardly revised. Retail sales volumes for that month were initially reported to have been flat from January. The outcome for March fell short of FXStreet-cited market consensus. Growth of 0.3% had been expected. "Within retail, sales were mixed, with automotive fuel and non-food stores sales volumes rising by 3.2% and 0.5%, respectively. This was offset by falls in food stores and non-store retailers of 0.7% and 1.5%," the ONS said. "Looking at the quarter, sales volumes increased by 1.9% in the three months to March 2024 when compared with the previous three months. This was following low sales volumes over the Christmas period for retailers."
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The UK will avoid implementing most post-Brexit checks on EU food imports due to start this month so as to prevent major disruption at ports, the Financial Times reported. The EU introduced strengthened checks on goods coming from the UK since the country's departure from the bloc entered into force in January 2021. But London has already delayed implementing some checks and formalities on five occasions amid fears the measures would harm the economy and stoke inflation. According to a confidential presentation sent by the UK government to port authorities and seen by the FT, the Department for Environment, Food & Rural Affairs said carrying out all the health and safety checks from April 30 could trigger "significant disruption".
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BROKER RATING CHANGES
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Peel Hunt starts NatWest with 'buy' - price target 330 pence
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Peel Hunt starts Lloyds Banking Group with 'hold' - price target 55 pence
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COMPANIES - FTSE 250
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Man Group reported an increase in its assets under management in the first-quarter of the year. The hedge fund manager said assets under management rose 4.9% to USD175.7 billion from USD167.5 billion at the end of December. Man Group reported a net outflow of USD1.6 billion, but a positive investment performance to the tune of USD9.8 billion.
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OTHER COMPANIES
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Gambling firm 888 Holdings said first quarter revenue topped guidance slightly, despite a small decline in the UK & Ireland online segment. The William Hill and Mr Green owner reported first-quarter revenue of GBP431 million, down 3.2% on-year but ahead of the GBP420 million and GBP430 million it had predicted. UK & Ireland online revenue alone fell 1% due to "reduced sports venues and increased customer investment across the Cheltenham Festival in comparison to last year", which a 4% growth in gaming could not offset. 888, which had set out a "value creation plan" last month, said shareholders will get a vote on its possible name change to Evoke at its annual general meeting in May. Chief Executive Per Widerstrom said: "I am pleased to report that Q1 2024 revenue was slightly ahead of our guidance, with strong player volumes converting into improved revenue run rates. Having lapped various regulatory and compliance changes during the quarter, and with increased marketing investment supported by an exciting product pipeline, we remain confident in a return to growth from Q2 2024."
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Old Mutual said it won regulatory approval in South Africa to establish a bank, following a "stringent" review. The Anglo-South African financial services firm said the approval allows it to proceed to the "next critical stage" to establish a bank. The group said it will now formally transition from "bank build mode" and enter into a strict and rigorous industry testing phase with selected bank partners. Chief Executive Office Iain Williamson said the approval to establish a bank is a "material catalyst" int he group's strategic plans.
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Nexus Infrastructure expects to match board expectations in the first half of its financial year, with revenue of GBP26 million predicted for the six months ended March 31. The infrastructure firm's order book is predicted to have risen 26% for the quarter to GBP72 million from GBP57 million on January 31. It would represent a 57% surge from GBP46 million at the end of its last financial year. It hailed its "strong balance sheet", noting cash and cash equivalents of GBP9.3 million, but added that figure is "marginally lower than the board's expectations". Chief Executive Charles Sweeney said: "The group has made good progress on our strategy in the first half" and "will maintain our focus on operating discipline and management of costs". Its half year results will be announced on May 16.
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By Emily Parsons, Alliance News reporter
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