Last checked at LONDON (Alliance News) - Stocks in the London market were trading tentatively higher midday Thursday with Johnson Matthey shares doing particularly well after its full-year results, as investors awaited the outcomes of ECB and OPEC meetings.
Platinum and specialty chemicals company Johnson Matthey pointed to a better year ahead, as pretax profit fell amid tough market conditions in the financial year that ended in March, underlining that optimism with a raised dividend.
Underlying pretax profit, stripping out one-offs, was GBP418.2 million, down from GBP440.1 million the year earlier but ahead of the market consensus estimate of GBP414.8 million.
Shares in the company were up 3.8%, making it the top gainer in the FTSE 100 index.
Johnson Matthey, which makes emission control systems, catalysts and fine chemicals, said the structural drivers for its key operations remain robust for the current financial year, despite challenging macroeconomic conditions which weighed on its performance in financial 2016 continuing.
The group expects its Emission Control Technologies business to be slightly ahead year-on-year in the 2017 financial year, benefiting from vehicle production growth in Europe and Asia and good demand for trucks in Western Europe. This will be slightly held back by lower demand for heavy-duty diesel catalysts for large trucks in North America, which will hit the first half performance of the division.
Johnson Matthey anticipates its Fine Chemicals business will continue to perform well, driven by its active pharmaceutical ingredients manufacturing business in the US and increased capacity coming on line in Europe.
Overall, the company said its results in the 2017 financial year should be ahead of the recently ended year, in line with market expectations.
The FTSE 100 index was up 0.5%, or 27.64 points, to 6,219.57. The FTSE 250 index was down 0.1% to 17,039.17, while the AIM All-Share was up 0.4% at 739.86.
In Europe, the CAC 40 in Paris was flat, and the DAX 30 in Frankfurt was up 0.1%.
Ahead of the open on Wall Street, futures pointed the Dow 30 and S&P 500 down 0.1% and the Nasdaq 100 flat.
Investors attention will be on events in the Austrian capital of Vienna where the European Central Bank and Organization of the Petroleum Exporting Countries are hosting their respective policy meetings.
First up is the ECB's monetary policy decision at 1245 BST, followed by a press conference with President Mario Draghi at 1330 BST. The central bank is widely expected to make no changes to its monetary policy, having introduced broad new measures in March.
OPEC is scheduled to hold a press conference with the acting secretary general at 1500 BST. Expectations for an agreement on a production freeze are low amid tensions between rivals Saudi Arabia and Iran.
"OPEC is getting its wish for higher oil prices, though not through any fault of its own. Nothing is expected today, but the tensions between Iran and Saudi Arabia are such that the risk of a further increase in Saudi output can't be ruled out and with it, the risk of a temporary downward correction in prices," said Kit Juckes, global fixed income strategist at Societe Generale.
At midday, oil prices were making slim gains. Brent crude traded at USD49.74 a barrel, a touch above the USD49.62 a barrel seen at the London equities close on Wednesday.
This was supporting oil stocks, with Royal Dutch Shell 'B' shares up 1.5% and BP up 1.4%.
Oil prices will be in focus again later in the afternoon, with the US Energy Information Administration's crude oil stocks due at 1600 BST.
Elsewhere in the economic calendar, in the US, Challenger jobs cuts are at 1230 BST, ADP employment is at 1315 BST, and initial and continuing jobless claims are at 1330 BST.
Bank of England Governor Mark Carney speaks at the unveiling of the new GBP5 note at Blenheim Palace in Oxfordshire at 1400 BST.
On the London Stock Exchange, price comparison service Moneysupermarket.com Group led FTSE 250 fallers after Jefferies downgraded the stock to Hold from Buy, with a price target cut to 312.00 pence from 440.00p. The stock traded down 6.3% to 310.10p.
Investec shares were down 1.6%, after the Anglo-South African financial services group said it will raise funds through a placing to back a share buyback.
Investec said it plans to raise up to around GBP145.0 million via the placing, which will be carried out through an accelerated bookbuild handled by bookrunner JPMorgan Cazenove.
The funds raised will be used to fund a buyback of sterling and rand preference shares in the company, with any proceeds not directed to this used for general corporate purposes.
Gene and cell therapy company Oxford Biomedica, up 4.0%, said it has signed a research and development collaboration deal with Green Cross LabCell.
Green Cross LabCell is a subsidiary of South Korean biopharmaceutical firm Green Cross Holdings.
Under the agreement, the pair will focus on identifying and developing gene-modified natural killer cell-based therapeutics for treatment of life-threatening diseases, including cancer. The two will share the costs of the collaboration equally.
By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1
Copyright 2016 Alliance News Limited. All Rights Reserved.
21 Jul 2022 09:03
LONDON MARKET OPEN: Large-caps down ahead of ECB; Russian gas resumes
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