Marks & Spencer Share News (MKS)

LONDON (Alliance News) - Shares are flat at the open in London Tuesday, as markets await the outcome for Greece of the Eurogroup meeting set for midday and the EU leaders summit in the evening.

German Chancellor Angela Merkel said it was up to Greek Prime Minister Alexis Tsipras to make proposals, adding that the last offer made to Greece before it opted for its controversial referendum was "generous".

In the FTSE 100, engineer Weir Group is the biggest faller, down 2.3%, after announcing a USD47 million deal to acquire the US's Delta Industrial Valves. Just behind, down 1.7%, is Rolls-Royce. JPMorgan cuts the aerospace company to Underweight from Neutral following its profit warning on Monday.

Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: flat at 6,537.57
FTSE 250: flat at 17,450.78
AIM ALL-SHARE: up 0.1% at 759.12
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Hang Seng: down 1.3% at 24,915.22
Nikkei 225: closed up 1.3% at 20,376.59
DJIA: closed down 0.3% at 17,683.58
S&P 500: closed down 0.4% at 2,068.76
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GBP: down at USD1.5571
EUR: down at USD1.1028

GOLD: down at USD1,167.86 per ounce
OIL (Brent): up at USD57.02 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)

09:30 UK Industrial and Manufacturing Production
12:00 EU Eurogroup meeting
13:30 US Trade Balance
13:30 Canada International Merchandise Trade
13:55 US Redbook index
15:00 US IBD/TIPP Economic Optimism
15:00 US JOLTS Job Openings
15:00 UK NIESR GDP Estimate
17:00 EU leaders special summit
20:00 US Consumer Credit Change
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French President Francois Hollande and German Chancellor Angela Merkel said Monday that they respect the outcome of the weekend's Greek referendum opposing more austerity and are open to negotiations, a day before Greece's prime minister heads to Brussels to lay out his newest plans for other eurozone leaders. Hollande stressed the "urgency" of finding a solution to the economic impasse, while Merkel said it is up to Greek Prime Minister Alexis Tsipras to make proposals about how to lead the Greek economy forward. "The situation has to be solved," Merkel said, adding that the last offer made to Greece before it opted for a controversial referendum was "generous."
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Greek banks are fast running out of money despite been propped up for months by funds provided to the nation's central bank through the European Central Bank's Emergency Liquidity Assistance scheme. Reports said that banks in Greece would remain closed through Wednesday. On Monday, the ECB said it will maintain the ELA provisions to Greece at around EUR90 billion - the same level that was agreed on June 26, prior to Sunday's anti-austerity referendum. "The governing council is closely monitoring the situation in financial markets and the potential implications for the monetary policy stance and for the balance of risks to price stability in the euro area," the ECB said in a statement issued after a meeting in Frankfurt. Greece is due to repay EUR3.5 billion in loans to the ECB on July 20.
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The UK is showing signs of 'two-tier' growth in the second quarter, as the service sector continued its steady progress ahead of the weaker growth of manufacturing, the results of the quarterly economic survey released by the British Chambers of Commerce (BCC) showed. The survey provided further evidence that the service sector results remain broadly positive in the second quarter, while all the key manufacturing balances fell. The BCC's survey showed that most balances in the service sector are now higher than the average 2007 pre-recession levels, while that for the manufacturing sector are now lower.
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Germany's industrial production remained unchanged in May from the prior month, Destatis reported. Production was forecast to rise 0.1% after expanding 0.6% in April, which was revised down from 0.9%. Excluding energy and construction, production was up 0.4%.
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Foreign ministers from Iran and six world powers gathered Monday in Vienna to clear away the few remaining - but stubborn nonetheless - stumbling blocks standing in the way of a broad nuclear deal that could bring Iran back into the international fold. "A comprehensive agreement is within reach," Chinese Foreign Minister Wang Yi told reporters, with less than 48 hours remaining before the talks reach a self-imposed deadline of midnight Tuesday. The chief diplomats met at the Palais Coburg hotel for a final push on the long-term accord that would limit Iran's civilian nuclear activities and prevent them from being used for making weapons. The group of Britain, China, France, Russia, the US and Germany would lift embargoes on Iran's oil, banks and other sectors in return. One of the key unresolved issues is the timing and sequence of lifting the sanctions.
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Islamic State jihadists struck back at Kurdish forces in northern Syria, launching a major offensive along a 150 kilometre front. The Syrian Observatory for Human Rights said the jihadists had recaptured the town of Ain Issa, 50 kilometres north of the group's stronghold of al-Raqqa, two weeks after it fell to the Kurdish People's Protection Units (YPG). With clashes continuing around Ain Issa, the Observatory said YPG said it had regained control of a nearby village, thanks in part to strikes on the jihadists by a US-led coalition.
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BROKER RATING CHANGES
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Investec Upgrades Lloyds To Hold From Sell, Target Price To 86p From 84p
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UBS RAISES LAND SECURITIES TO 'BUY' ('NEUTRAL') - TARGET 1,425 (1,300) PENCE
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JPMORGAN CUTS ROLLS-ROYCE TO 'UNDERWEIGHT' ('NEUTRAL') - TARGET 640 (900) PENCE
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COMPANIES - FTSE 100
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Marks & Spencer Group reported year-on-year growth in sales in the first quarter of its financial year and said that all guidance for the full year remains unchanged. The clothing and food retailer said that total group sales were up 1.3% in the 13 weeks to June 27 from a year before, as food sales grew 3.2% and general merchandise revenue rose 0.2%. On a like-for-like basis, food sales grew 0.3% but general merchandise declined 0.4%. M&S said it is on track to deliver its full-year guidance of 150 to 200 basis points gross margin improvement in general merchandise.
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Engineer Weir Group said it has struck a USD47 million deal to acquire Delta Industrial Valves. Delta is a US-based manufacturer of knife gate valves for the mining, oil sands and other industrial markets. The consideration will comprise a USD37 million initial consideration, with USD21 million to be paid in cash and USD16 million to be paid in Weir equity. Up to another USD10 million will be paid over the next 18 months based on Delta meeting profit growth targets.
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The UK Competition and Markets Authority published its provisional findings following a year-long investigation into the energy market, finding that a range of problems have hindered competition in the market and proposing a series of potential remedies to the issues it has identified. The Big Six energy providers in the UK comprise British Gas, which is owned by Centrica, SSE, ScottishPower, E.On, EDF and nPower.
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RSA Insurance Group named Scott Egan, the interim chief executive of UK competitor Towergate Insurance, as its new chief financial officer. Egan is expected to join the insurer in the fourth quarter of 2015, with the exact date to be confirmed at a later date, succeeding Richard Houghton, who stood down from the board of directors in May of this year.
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Engineer Smiths Group said it has appointed Andrew Reynolds Smiths as its new chief executive, with plans for him to take the helm on September 25. Reynolds Smith is currently the chief executive of GKN Automotive, the driveline systems and powde metals components arm of GKN, another FTSE 100-listed engineering company. He replaces Philip Bowman, who announced his plans to retire by the end of 2015 back in December.
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Innate Pharma, a French biopharmaceutical company developing therapeutic antibodies for the treatment of cancer and inflammatory diseases, announced that the co-development and commercialisation agreement with AstraZeneca on Innate Pharma's proprietary anti-NKG2A antibody, IPH2201, received HSR clearance. The company also said that on June 30, Innate Pharma received the initial payment of USD250 million from AstraZeneca.
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AstraZeneca has agreed to pay the US and participating states a total of USD46.5 million, plus interest, to resolve allegations that it knowingly underpaid rebates owed under the Medicaid Drug Rebate Program, the US Justice Department announced. Of that amount, AstraZeneca will pay roughly USD26.7 million, plus interest, to the US, and the remainder to states participating in the settlement.
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COMPANIES - FTSE 250
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Cinema operator Cineworld Group said it grew revenue across its business in the first 26 weeks of the year, boosted by a strong slate of films, and said it expansion plans are on track. Cineworld said its pro-forma total revenue for the 26 weeks to July 2, which includes the Cinema City Holding BV business in Central and Eastern Europe, was up by 11.2%. It also sees a promising second half in store, with a robust film release schedule, including new Star Wars, Hunger Games and James Bond films, and it remains confident of meeting market expectations for the full year.
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Defence company Ultra Electronics Holdings said it has won a contract for the design and development of reactor control and cooling systems for Royal Navy submarines in the UK. Ultra said the GBP18 million deal has been awarded by Rolls-Royce Holdings and is the result of a collaboration between the two companies.
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Stagecoach Group said it has been notified by the UK's Department of Transport that it has ended talks with its Stagecoach South Western Trains subsidiary on the award of the new South West rail franchise. Stagecoach said the current franchise is due to end in 2017, and South West Trains has submitted proposals to the department as part of government plans for a new direct franchise award through to at least April 2019. But the department has now indicated it plans to invite potential applicants to tender for a new long-term franchise, will will start sometime in 2017.
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Interserve, a UK support services and construction company, said that trading has continued in line with its expectations since mid-May. "Performance in Support Services, Equipment Services and International Construction is encouraging, offsetting UK Construction where near-term conditions remain more challenging," Interserve said in a statement.
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Kitchens and joinery products supplier Howden Joinery Group said it has reached an agreement with the trustees of its defined-benefit pension scheme on the schedule of payments to fund the scheme's deficit. Howden said the deal will mean it will continue to make deficit contributions of around GBP35 million per year for the 27 months from April 5, 2015 to June 30, 2017. The agreement will result in an expected cash contribution to the deficit in the current financial year to the end of December of GBP45 million.
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3i Infrastructure said it has partnered with investment house AMP Capital to acquire ESVAGT, an emergency rescue and response vessels provider to the offshore oil and gas industry, from Danish conglomerate Maersk Group. 3i Infrastructure, which is advised by 3i Group's 3i Investments, said it is investing about GBP109 million for a 50% stake in the Danish company, equal to AMP's shareholding. ESVAGT, which has been operating since 1981 and employs more than 800 people, provides its services in and around the North Sea and the Barents Sea.
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COMPANIES - LONDON MAIN MARKET AND AIM
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ASOS reported growth in sales in the four months to June 30 in both its UK and international businesses and said that sales for the full year should be at the higher end of its guided growth range. The online fashion retailer said that retail sales in the four months grew 20% on the same period the year before, with UK sales rising 27% and international revenue up 16%, all at actual currency rates. It said that the rise in international sales benefited from price investments which it is making to try to turn that part of the business around.
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COMPANIES - INTERNATIONAL
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German broadcaster ProSiebenSat.1 and publishing company Axel Springer are in talks to combine their businesses, according to reports citing people familiar with the matter. The reports said that negotiations remain at an early stage yet and could still break down. A deal would face several issues, including regulatory scrutiny. The two companies' combined market capitalisation is about EUR14.4 billion.
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South Korean giant Samsung Electronics said that it expects operating income for the second-quarter of fiscal 2015 to be KRW6.90 trillion, compared to KRW7.19 trillion reported in the second--quarter of fiscal 2014. The company also expects sales for the second-quarter to be KRW48.00 trillion, compared to KRW52.35 trillion reported in last year.
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Israeli generic drugmaker Teva Pharmaceutical Industries is preparing to raise its bid for rival drugmaker Mylan by as much as USD2 billion, to USD43 billion, and may announce the improved proposal as soon as this week, Bloomberg reported citing people familiar with the matter. The report indicated that Teva may offer USD86 to USD88 per share for Mylan. That compares to the USD82 per share Teva offered in April. Unlike its previous expression of interest, Teva plans to make the next offer formal as it seeks to thwart the US drugmaker's pursuit of Ireland-based drugmaker Perrigo, the report said.
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Tuesday's Scheduled AGMs/EGMs

Ambrian
LGO Energy
3i Infrastructure
Marks & Spencer Group
Young & Co's Brewery
Northern Investors Co
Totally
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By Tom Waite; thomaslwaite@alliancenews.com; @thomaslwaite

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