Next Share News (NXT)

LONDON (Alliance News) - After two positive days clawing back Brexit-related losses, London share prices opened slightly lower Thursday, with UK domestic-oriented lender Royal Bank of Scotland leading blue-chip decliners, down 4.1%.

The UK political jockeying was set to intensify Thursday, as Conservative Party leadership candidates faced a deadline to throw their hats into the ring.

Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 0.5% at 6,330.13
FTSE 250: down 0.5% at 15,920.16
AIM ALL-SHARE: up 0.3% at 699.96
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Hang Seng: up 1.0% at 20,631.70
Nikkei 225: closed up 0.1% at 15,575.92
DJIA: closed up 1.6% at 17,694.68
S&P 500: closed up 1.7% at 2,070.77
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GBP: down at USD1.3423 (USD1.3519)
EUR: soft at USD1.1097 (USD1.1111)

GOLD: down at USD1,313.62 per ounce (USD1,323.55)
OIL (Brent): up at USD50.59 a barrel (USD49.96)

(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
(all times in BST)

0855 Germany unemployment rate
0900 Italy public deficit/GDP
0930 UK gross domestic product
0930 UK business investment and index of services
0930 UK current account
1000 EU consumer price index
1000 Italy consumer price index
1100 Italy producer price index
1100 Ireland gross domestic product
1230 EU ECB monetary policy meeting accounts
1330 US initial and continuing jobless claims
1330 Canada gross domestic product
1330 Canada industrial product and raw material price indices
1445 US Chicago purchasing managers' index
1530 US EIA natural gas storage
1830 US Fed's Bullard speech
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Britain's withdrawal from the EU should be orderly, and there will be no negotiations until the UK formally notifies its intention, European Council President Donald Tusk after an informal meeting of EU27 leaders on Wednesday. At the meeting, leaders discussed the consequences of the Brexit. Leaders made it clear that access to the single market requires acceptance of all four conditions, including the freedom of movement. "There will be no single market "à la carte", he added. Earlier German Chancellor Angela Merkel said the UK will not receive any special favours and the negotiations will not be a cherry-picking exercise.
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Tory heavyweights Boris Johnson and Home Secretary Theresa May will set out their competing visions for Britain outside the EU as they formally enter the race to succeed UK Prime Minister David Cameron in Downing Street. Johnson, who led the Leave campaign in the referendum, will use his launch speech to present what was described as a "positive, optimistic vision" of Britain outside the EU, offering "a chance to believe in ourselves". In her launch, May will promise to reunite both the Conservative Party and the country in the wake of the referendum campaign while securing the best deal possible for the UK in the negotiations with Brussels. In an olive branch to Brexit supporters, the Home Secretary - who was in the Remain camp - will set out plans for a new government department to take charge of negotiating Britain's exit from the EU to be headed by a senior minister who campaigned for Leave.
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Labour leader Jeremy Corbyn is braced for a leadership challenge after he rejected an attempt by deputy leader Tom Watson persuade him to stand down. Former shadow business secretary Angela Eagle - who quit in the mass walkout of frontbenchers - appears ready to announce ready to announce she will run as a "unity" candidate, while former shadow work and pensions secretary Owen Smith is also reportedly considering a challenge.
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Consumer confidence in the UK remained slightly soft in June, the latest poll from GfK revealed, with an index score of -1. That was unchanged from the May reading, and it beat expectations for -2. The survey was conducted before last week's Brexit vote - although the polling company will do an extra mid-month survey to try to gauge the effect of the UK's surprising referendum result.
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The global economy looks likely to "hold steady" in the short-term despite Britain's decision to leave the European Union, US President Barack Obama said after meeting with his North American counterparts in Canada. However, he warns, "there are genuine longer-term concerns about global growth if Brexit goes through and that freezes investment possibilities in Britain, or Europe as a whole." Obama says he has told European leaders to "catch their breath" as they come up with an orderly plan for the transition and was reassured by German Chancellor Angela Merkel that the continent is not interested in "retribution" but in making sure the process works.
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The leaders of the US, Mexico and Canada vowed Wednesday to press forward with cooperation on trade and addressing climate change despite growing calls for isolationism in the US presidential election by Republican candidate Donald Trump. US President Obama, Canadian Prime Minister Justin Trudeau and Mexican President Enrique Pena Nieto underscored the importance of a unified continent at the North American Leaders' Summit in Canadian capital Ottawa with a joint energy pact and a recommitment to free trade.
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Germany's unemployment rate decreased slightly in May, preliminary figures from Destatis showed. The adjusted jobless rate dropped to 4.2% in May from 4.3% in the previous month, which was revised up from 4.2% estimated initially. In the corresponding month last year, the unemployment rate was 4.7%.
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Industrial production in Japan fell a seasonally adjusted 2.3% on month in May, the Ministry of Economy, Trade and Industry said in a preliminary reading. That was well shy of forecasts for a decline of 0.2% following the 0.5% increase in April. On a yearly basis, industrial production fell 0.1% - missing forecasts for a gain of 1.9% following the 3.3% contraction in the previous month.
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Automobile production in Japan increased in May after a downturn in the previous month, figures from the Japan Automobile Manufactures Association showed. Production volume of vehicles rose 1.7% or by 11,275 units year-over-year to 686,814 units in May. Meanwhile, domestic automobile demand declined 2.1% to 331,587 units in May. Automobile exports grew 4.6% in May from a year ago to 302,682 units. It was the third consecutive monthly increase.
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Initial information extracted from one of the two black boxes of the Egyptair jet that crashed into the Mediterranean last month suggests there was smoke in its toilet area, investigators said. The data had been successfully downloaded from the plane's flight data recorder, the Egypt-led investigation committee said. "The recorded data on the device is consistent with messages of the plane's ACARS system that indicate smoke in its toilet and avionics room," the committee said in a statement.
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An aid convoy entered two rebel-held towns, besieged by government forces, near the Syrian capital Damascus, for the first time since 2012, the International Committee of the Red Cross said. The convoy, composed of 37 trucks, is to deliver food and medical assistance to people of Zamalka and Arbeen in the Eastern Ghouta region, ICRC said in a statement.
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BROKER RATING CHANGES
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UBS RAISES NEXT TO 'BUY' ('NEUTRAL') - TARGET 5750 (7000) PENCE
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TRADERS: BARCLAYS CUTS SHAWBROOK TO 'EQUAL WEIGHT' ('OVERWEIGHT')
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TRADERS: JEFFERIES CUTS HENDERSON GROUP TO 'UNDERPERFORM' ('HOLD')
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TRADERS: BARCLAYS CUTS HENDERSON GROUP TO 'EQUAL WEIGHT' ('OVERWEIGHT')
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TRADERS: BARCLAYS RAISES CLOSE BROTHERS TO 'OVERWEIGHT' ('EQUAL WEIGHT')
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TRADERS: BARCLAYS RAISES ICAP TO 'OVERWEIGHT' ('EQUAL WEIGHT')
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TRADERS: JPMORGAN CUTS RECKITT BENCKISER TO 'NEUTRAL' (OVERWEIGHT)
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TRADERS: MACQUARIE STARTS RECKITT BENCKISER WITH 'OUTPERFORM' - PRICE TARGET 7900 PENCE
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BERENBERG CUTS TRAVIS PERKINS TO 'HOLD' ('BUY') - TARGET 1,540 (2,300) PENCE
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COMPANIES - FTSE 100
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Life insurer and investment manager Legal & General Group said its Retirement arm has seen strong new business sales in the first half of 2016, with little disruption seen from the Brexit referendum. L&G said it has seen GBP4.0 billion in new business sales for its Retirement division in the half year to the end of June, covering bulk annuities, individual annuities and lifetime mortgages. "Political and market uncertainty around the EU referendum did not get in the way of business, as companies or individuals will always need to manage their employees' or own retirement," said Kerrigan Procter, L&G Retirement managing director.
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3i Group said it has increased the book value of its investment in Action, the Benelux-based non-food retailer, following strong trading and a number of approaches the FTSE 100-listed private equity provider has received in respect of the investment. 3i said it has increased the book value of its investment in Action to GBP1.46 billion from GBP902.0 million at the end of March.
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Anglo-Australian miner Rio Tinto said it has transferred its 53.8% shareholding in Bougainville Copper to an independent trustee. Equity Trustees Ltd will manage the distribution of the shares between the Autonomous Bougainville government for the benefit of all the Panguna landowners and the people of Bougainville, and the Independent State of Papua New Guinea.
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The chief executive of Royal Dutch Shell will call upon the UK government to implement effective government policy to ensure the country can meet its energy needs whilst tackling climate change, in a speech Thursday. Ben van Beurden will tell Shell's Powering Progress Together Forum in London that the UK can not "sit back and relax" and ignore its commitments to lowering its carbon footprint. "It's important for governments to create the right conditions for companies to not only deliver energy but to do so with fewer emissions," he added.
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COMPANIES - FTSE 250
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Breakdown cover provider AA said it has struck a deal to sell its Irish business, which focuses on providing insurance and motoring services, for a total of EUR156.6 million. AA is expecting to close the deal in late July as it offloads AA Ireland to Carlyle Cardinal Ireland Fund and Carlyle Global Financial Services Partners II, subject to approval from the Competition & Consumer Protection Commission in Ireland and the Central Bank of Ireland AA Ireland will retain the AA brand once the deal is completed, and AA will provide certain transitional services to the Irish business. AA will remain responsible for the defined benefit pension plan of AA Ireland.
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Chinese conglomerate Fosun Group has increased its holding in Thomas Cook Group to 8.2%, taking advantage of the decline in sterling and the UK travel operator's share price since the Brexit vote last week. Fosun has increased its holding in Thomas Cook from 7.0% previously. Fosun, the largest privately-owned conglomerate in China, created a joint venture with Thomas Cook in June 2015 to develop inbound and outbound tourism activities for the Chinese market.
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Outsourcer Serco Group affirmed its expectations for the year and said its underlying trading profit for calendar 2016 will be significantly weighted to the first half. Serco said in May that profit in 2016 would be ahead of previous guidance thanks to one-off benefits accrued in the first half, particularly thanks to good outcomes on a number of commercial renegotiations. On Thursday, Serco said nothing has occurred to change that view, and it affirmed expectations that underlying trading profit will be weighted to the first half as the boosts seen in that period were one-offs and will not recur.
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John Wood Group said it is still expecting for earnings to be around 20% lower in 2016 compared to last year but reiterated its commitment to deliver a significantly higher dividend for the year. John Wood said it still plans to increase its dividend for the full year by a "double digit percentage".
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COMPANIES - LONDON MAIN MARKET AND AIM
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Recruiter Harvey Nash Group said trading in the first four months of its financial year was in line with its expectations, despite challenging conditions in the market. Harvey Nash said gross profit in the four months to the end of May grew 8.0%, with good performances in Europe and the US offsetting more sluggish trading in Asia Pacific and a flat performance in the UK. Profit in permanent recruitment was up just 3%, but in temporary recruitment it was up 12%. Total gross profit was up 4% on a constant currency basis.
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COMPANIES - INTERNATIONAL
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The US Federal Reserve Board on announced it has not objected to the capital plans of 30 bank holding companies participating in the Comprehensive Capital Analysis & Review. The Board objected to two firms' plans. One other firm's plan was not objected to, but the firm is being required to address certain weaknesses and resubmit its plan by the end of 2016. The Fed did not object to the capital plan of Morgan Stanley, but is requiring the firm to submit a new capital plan by the end of the fourth quarter of 2016 to address certain weaknesses in its capital planning processes. It did object to the capital plans of Deutsche Bank and Santander based on qualitative concerns.
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Boeing is proposing to stretch its largest 777 model to create a twin-engine behemoth aimed at delivering a knock-out blow to Airbus Group's struggling A380 superjumbo jet, Bloomberg reported citing people familiar with its plans. The US planemaker has approached several carriers about the plane it calls the 777-10X, including Emirates Airline, the world's largest operator of both Boeing's 777 and Airbus's double-decker aircraft, the report said.
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Thursday's Shareholder Meetings

3i Group
Stobart Group
Harvey Nash Group
Sprue Aegis
21st Century Technology
Auctus Growth
Westminster Group
Alecto Minerals
Porta Communications
Strat Aero
DCD Media
Trinity Exploration & Production
KEFI Minerals
Bond International Software
YOLO Leisure & Technology
Nostra Terra Oil& Gas
London Capital Group
Regal Petroleum
Venn Life Sciences
Onzima Ventures
Atlantis Resources
Advanced Oncotherapy
Alexander Mining
Braemar Shipping Services
Clontarf Energy
Cyan Holdings
Eurasia Mining
Nighthawk Energy
HC Slingsby
Tiziana Life Sciences
Watchstone Group
GameAccount Network
Energiser Investments
Plaza Centers
Scottish Mortgage Investment Trust
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By Tom Waite; thomaslwaite@alliancenews.com; @thomaslwaite

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