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(Alliance News) - CMC Markets on Thursday said its "consistently strong trading performance" has continued, a day after FTSE Russell announced the online trading firm will be joining the FTSE 250 later this month.
CMC said net operating income run-rate for the two months to the end of August was only slightly below the first quarter, and client income has continued to be "in excess" of a year ago.
"As a result, the board is confident that with the strong underlying performance and diversity of the business, FY 2021 net operating income will exceed the upper end of current market consensus," said CMC.
Net operating income consensus, the firm noted, is around GBP287.6 million, ranging between GBP282.4 million to GBP300.6 million.
The revenue performance since the start of the financial year has been driven by existing clients trading more as well as the platform continuing to attract new customers, CMC added, which has led to an increase in variable operating costs.
CMC's update comes after FTSE Russell said the stock is set for a promotion to the FTSE 250 effective from the market open on Monday, September 21.
As part of its quarterly review late Wednesday, FTSE Russell also said broadcaster ITV will drop out of the FTSE 100, to be replaced by retailer B&M European Value Retail.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: called up 0.2% at 5,953.60
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Hang Seng: down 0.9% at 24,893.84
Nikkei 225: closed up 0.9% at 23,465.53
DJIA: closed up 1.6% at 29,100.50
S&P 500: closed up 1.5% at 3,580.84
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GBP: lower at USD1.3286 (USD1.3302)
EUR: lower at USD1.1796 (USD1.1834)
Gold: lower at USD1,928.78 per ounce (USD1,941.20)
Oil (Brent): lower at USD44.40 a barrel (USD44.82)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Thursday's Key Economic Events still to come
10:00 CEST EU Eurozone services PMI
11:00 CEST EU Retail trade
09:55 CEST Germany Services PMI
11:00 BST Ireland Live register
09:30 BST UK CIPS/Markit services PMI
08:30 EDT US International trade in goods & services
08:30 EDT US Unemployment insurance weekly claims report - initial claims
09:45 EDT US Services PMI
10:00 EDT US ISM Report on business services PMI
10:30 EDT US EIA weekly natural gas storage report
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Growth in China's service sector eased by a hair in August, data showed, though the industry is continuing its recovery from lows seen earlier in the year due to Covid-19. The headline seasonally adjusted business activity index slipped to 54.0 in August from 54.1 in July, Caixin said. Any number above 50.0 denotes growth. "The data therefore adds to signs that the sector continued to recover from the marked drops in activity earlier in the year following the Covid-19 outbreak," Caixin said. For the first time since January, employment in the sector grew, Caixin put this down to companies having "higher operational requirements". Less promisingly, optimism waned slightly in August, Caixin reported. While some companies expect Covid-19's bite to ease and market conditions to improve, others expect the virus to weigh on business and sales "in the months ahead".
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A new GBP500 million funding package will support trials of a 20-minute Covid-19 test and efforts to explore the benefits of repeatedly testing people for the virus, the UK's health secretary has announced. Money will go towards launching a new community-wide repeat population testing trial in Salford, Greater Manchester. Existing trials in Southampton and Hampshire, using a no-swab saliva test and a rapid 20-minute test, will also be expanded through the new funding. Health Secretary Matt Hancock said: "Testing is a vital line of defence in combating this pandemic. "Over the past six months we have built almost from scratch one of the biggest testing systems in the world. "We need to use every new innovation at our disposal to expand the use of testing, and build the mass testing capability that can help suppress the virus and enable more of the things that make life worth living.
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UK Prime Minister Boris Johnson reportedly wants parliament "back to normal" by the end of 2020, urging MPs to lead from the front on the return to workplaces. Johnson, according to reports in The Times and The Daily Telegraph, spoke of the importance of returning to workplaces to Conservative backbenchers as the country seeks to strike a balance between public and economic health. Downing Street fears huge job losses in town and city centre shops and cafes if workers do not return to their pre-lockdown commuter patterns. But there are allegedly divisions in government over whether the time is right, with the coronavirus rate still growing in parts of the country, to put pressure on employees to return to the workplace. The Telegraph reported the launch of a public information campaign pushing for home working to be curtailed has been put back. It was due to begin this week but the paper reported it would start next week at the earliest, suggesting the Cabinet Office wanted more civil servants back to their desks before urging the rest of the country to return.
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BROKER RATING CHANGES
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MORGAN STANLEY CUTS NEXT TO 'UNDERWEIGHT' ('EQUAL-WEIGHT') - TARGET 3650 PENCE
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MORGAN STANLEY CUTS LAND SECURITIES TO 'EQUAL-WEIGHT' ('OVERWEIGHT') - TARGET 610 (740) P
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MORGAN STANLEY CUTS BRITISH LAND TO 'EQUAL-WEIGHT' ('OVERWEIGHT') - TARGET 380 (450) PENCE
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COMPANIES - FTSE 100
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Sanofi and GlaxoSmithKline have kicked off the next phase of a trial of their Covid-19 vaccine candidate. The duo have recruited 400 participants for Phase 1/2 of the study of their adjuvanted recombinant protein-based vaccine candidate. This part of the study probes the tolerability and effectiveness of the vaccine candidate and the companies expect to report first results in early December. They also aim to begin phase 3 of the trial before the end of the year, should results from the current stage be promising. In August, GSK said it was in advanced discussions with the European Union to supply up to 300 million doses of the vaccine. Glaxo said the doses would be manufactured in European countries including France, Belgium, Germany and Italy. It noted that the discussions mark a key milestone in protecting and serving the European population against Covid-19.
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Melrose Industries said its interim results were constrained by the coronavirus outbreak and global restrictions put in place to curtail the spread of the virus. For the half year ended June 30, revenue fell 26% to GBP4.12 billion from GBP5.57 billion last year and its pretax loss widened to GBP685 million from GBP109 million the year before. Melrose said it "considers it inappropriate" to pay an interim dividend for 2020 in light of the coronavirus crisis. The turnaround specialist said trading over the summer months has been at the higher end of expectations, particularly in automotive and key Nortek markets. The company backed its business model to "once again deliver" in the challenging circumstances brought about by the pandemic.
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COMPANIES - FTSE 250
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PPHE Hotel Group said trading was significantly impacted by the coronavirus outbreak from March which resulted in reduced customer demand and property closures. For the half year ended June 30, revenue fell 60% to GBP61.9 million from GBP155.3 million last year and it swung to a pretax loss of GBP40.7 million from a profit of GBP4.3 million the year before. Revenue per available room declined by 58.3%, with occupancy declining to 34.7% compared with 76.8% in the first half of 2019. PPHE said it is currently operating 84% of its 45 properties across Europe.
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Kainos Group said trading from April 1 continues to be resilient across its two specialist business areas, Digital Services and Workday Practice. Kainos said its performance is supported by long-term customer relationships and diversified revenues across customers, end markets and geographic regions. As such, it expects results for the full year ending March 31 to be in line with consensus forecasts. "Notwithstanding this strong performance, a robust pipeline and significant backlog, we remain mindful of the current economic disruption caused by Covid-19. We maintain a close dialogue with our customers and partners, and continue to pay careful attention to the impact that Covid-19 related disruption may have on them," the company said.
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COMPANIES - GLOBAL
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Verizon Communications will spend USD1.9 billion to speed up its deployment of superfast 5G telecom service as a top bidder for US bandwidth that balances range and data speed. The Federal Communications Commission on Wednesday released results of bidding for leases to use portions off the 3550-3650 MHz bandwidth. Dish Network – bidding as Wetterhorn Wireless – was in second place with a winning offer of USD913 million, according to the FCC. The remainder of the top five bids were cable companies Comcast, Spectrum and Cox, the agency said. The US last month announced that 100 megahertz of "contiguous, coast-to-coast mid-band spectrum" long reserved for the military would also be auctioned off to telecommunications firms for use in ultra-speedy 5G networks. The bandwidth in the range from 3450 and 3550 megahertz was identified for use in 5G networks and can be made available without impairing military or national security capabilities, according to senior administration officials.
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Thursday's Shareholder Meetings
Severfield
Value & Income Trust
Dart Group
Lindsell Train Investment Trust
Invesco Asia Trust
Ninety One
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By Lucy Heming;Â lucyheming@alliancenews.com
Copyright 2020 Alliance News Limited. All Rights Reserved.
