Last checked at 
(Alliance News) - Stocks in London are called lower on Monday, after soft economic data from China pointed to a weak demand outlook.
The Chinese consumer price index for June was flat, coming down from the 0.2% seen in May, according to the National Bureau of Statistics, and was worse than expected as domestic demand slowed.
Meanwhile, producer prices – which measure the cost of goods at the factory gate – tumbled 5.4% on-year, following a 4.6% slide in May. Economists polled by Bloomberg had expected prices to sink 5%.
"The Chinese efforts to boost economy and inflation are not working," Swissquote Bank's Ipek Ozkardeskaya considered.
After softer-than-expected US jobs data on Friday, a focal point for this week will be the US consumer price inflation print on Wednesday, followed by producer price inflation data on Thursday.
On Friday, earnings season kicks off with second-quarter results from banks JPMorgan, Wells Fargo, Citigroup as well as asset manager Blackrock.
In early UK company news, BT confirmed that its chief executive, Philip Jansen, will step down next year. Unite said "record" levels of reservations are continuing for the upcoming academic year. Petro Matad reported some disappointing results from the Velociraptor-1 exploration well.
Here is what you need to know at the London market open:
----------
MARKETS
----------
FTSE 100: called down 15.6 points, 0.2%, at 7,241.34
----------
Hang Seng: up 0.5% at 18,450.90
Nikkei 225: closed down 0.6% at 32,189.73
S&P/ASX 200: closed down 0.5% at 7,004.00
----------
DJIA: closed down 187.38 points, 0.6%, at 33,734.88
S&P 500: closed down 0.3% at 4,398.95
Nasdaq Composite: closed down 0.1% at 13660.72
----------
EUR: down at USD1.0948 (USD1.0949)
GBP: down at USD1.2801 (USD1.2832)
USD: up at JPY142.75 (JPY142.27)
GOLD: down at USD1,920.55 per ounce (USD1,929.07)
OIL (Brent): up at USD77.99 a barrel (USD77.47)
(changes since previous London equities close)
----------
ECONOMICS
----------
Monday's key economic events still to come:
UK Chancellor Jeremy Hunt and BoE Governor Andrew Bailey address annual Mansion House event
UK US President Joe Biden meets King Charles at Buckingham Palace
11:00 IST Ireland industrial production and turnover
10:00 EDT US employment trends index
10:30 EDT US Fed San Francisco President Mary Daly speaks
11:00 EDT US Fed Cleveland President Loretta Mester speaks
12:00 EDT US Fed Atlanta President Raphael Bostic speaks
15:00 EDT US consumer credit
----------
A major package of UK tax cuts this autumn was growing less likely as Chancellor Jeremy Hunt signalled the pledge to halve inflation was proving harder than expected. Hunt warned he must "double down" on high prices and cannot take actions that would "pump billions of additional demand" into the economy. In an interview with the Financial Times, Hunt said achieving that promise was "going to be more challenging than we thought". "We will not countenance tax cuts if they make the battle against inflation harder," he said.
----------
Jeremy Hunt will promise "evolutionary not revolutionary" reforms to get pension funds making billions of pounds of riskier investments in fast-growing firms to boost economic growth. Hunt will use a City of London speech on Monday to detail plans to encourage the financial sector to "unlock capital" and increase returns for pensioners. Alongside regulatory reforms, he will welcome an agreement with leading pensions firms to put 5% of their investments, a sum of up to GBP50 billion, into high-growth businesses. Aviva, Legal & General and Phoenix Group are among those understood to be taking part.
----------
The threat of a strike by nuclear power workers has been averted after a pay dispute was resolved. Members of the GMB and Unite working on EDF's Hartlepool and Torness reactors had been due to walk out on Monday. The unions said workers have accepted a "ground-breaking" deal with the energy giant that includes recognition and collective bargaining rights and improved productivity bonuses. The deal is said to cover roles at EDF's seven power stations – Hartlepool, Torness, Heysham 1 and 2, Dungeness, Hunterston Hinkley Point B and Sizewell B.
----------
Bosses in the UK are now more upbeat about their businesses and hiring intentions amid early signs of falling inflation, according to an index. Optimism in June hit its highest point since August 2022 and crossed a threshold which "indicates above-average positivity", according to BDO, an accounting and business advisory firm. BDO's latest optimism index recorded a 0.65-point increase to 100.40 in June, which sent it over the 100-point above-average positivity marker. This was helped by positivity across the services sector and a pick-up in optimism in manufacturing, despite it still facing ongoing supply chain pressures.
----------
BROKER RATING CHANGES
----------
HSBC cuts Derwent London to 'hold' - price target 2,144 pence
----------
HSBC cuts Segro to 'hold' - price target 608 pence
----------
HSBC cuts Hammerson to 'reduce' - price target 12 pence
----------
COMPANIES - FTSE 100
----------
BT Group announced Chief Executive Philip Jansen will step down in the next 12 months "at an appropriate moment". Its nominations committee has begun a formal succession process. "The succession process to replace Philip is something that the board was well prepared for. All appropriate candidates are being considered and we expect to be able to update the market on progress over the course of the summer," said Chair Adam Crozier. The announcement confirmed a Sky News report on Saturday. Citing "City sources", Sky reported that Jansen has been considering multiple offers for positions in the US. BT is working with search firm Spencer Stuart, Sky said, and has already approached a "number of external figures". Frontrunners are thought to include BT consumer business boss Marc Allera, and Non-Executive Director Alison Kirkby, who also heads up Swedish telecoms group Telia Company.
----------
Student accommodation provider Unite updated on its recent trading, noting "record levels" of reservations for 2023/2024 academic year have persisted, with 98% of rooms now sold. This is up from 91% a year ago. Unite UK Student Accommodation Fund's property portfolio edged up to GBP2.92 billion at the end of June, a 1.2% increase on a like-for-like basis from the preceding quarter. Unite's London Student Accommodation Joint Venture's investment portfolio was independently valued at GBP1.94 billion at June 30, up 1.1% on a like-for-like basis over the quarter.
----------
COMPANIES - FTSE 250
----------
Big Yellow Group updated on trading for its first quarter ended June 30, with total revenue rising 6.7% year-on-year to GBP48.1 million, with store revenue rising 5.4% on a like-for-like basis to GBP47.0 million. Closing net rent achieved per square foot rose 9.2% to GBP32.88, though closing occupancy edged down 1.2% to 5.3 million square feet. "We have had a solid start to the year with a return to occupancy growth this quarter, broadly in line with last year. We are continuing to manage yield, offsetting the adverse impact of inflation on our cost base," said CEO Jim Gibson.
----------
OTHER COMPANIES
----------
Petro Matad said the Velociraptor-1 exploration well in the Taats Basin of Block V located in central Mongolia reached a total depth of 1,500 metres with wireline logging completed. However, all the reservoirs encountered were water bearing, the company said. The well will now be plugged and abandoned. The results are "obviously disappointing", said CEO Mike Buck, but "such high impact targets, drillable at modest well cost cannot be ignored when exploring frontier area". The well will serve as a "valuable new data point" to help unlock the potential of the southern Gobi, he added.
----------
Totally reported annual results for the financial year ended March 31, guiding for a weaker revenue performance in the year ahead. The frontline healthcare services provider said revenue rose 6.5% year-on-year to GBP135.7 million from GBP127.4 million, while pretax profit jumped 42% to GBP1.8 million from GBP1.2 million. It proposed a final dividend of 0.125 pence, bringing the annual total to 0.625p, down from 1.00p a year before. It expects revenue in the current financial year to be lower, with earnings before interest, tax, depreciation and amortisation to be "marginally below" the previous year. This reflects "increasingly challenging operating conditions", as well as "improved margins driven by higher volumes in elective care". "The board are confident that the actions and strategy put in place over the past 12 months will ensure the company remains in a strong position to continue to grow significantly over the coming years," it said.
----------
By Elizabeth Winter, Alliance News senior markets reporter
Comments and questions to newsroom@alliancenews.com
Copyright 2023 Alliance News Ltd. All Rights Reserved.
