(Alliance News) - Stocks in London opened higher on Thursday, following positive news from China about the spread of Covid-19.
The number of daily Covid-19 deaths in China has fallen by nearly 80% since the start of the month, authorities have said, in a sign that the country's unprecedented infection surge may have started to abate.
In early UK company news, Guinness-brewer Diageo reported strong half-year growth. Provident Financial is set to change its name to Vanquis Banking and get a new CEO. Holiday operator Jet2 expects to beat full-year market expectations.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.3% at 7,783.75
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Hang Seng: up 2.3% at 22,540.40
Nikkei 225: closed down 0.1% at 27,362.75
S&P/ASX 200: Sydney market closed for Australia Day.
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DJIA: closed down 9.88 points at 33,743.84
S&P 500: closed down 0.73 point at 4,016.22
Nasdaq Composite: closed down 20.91 points, or 0.2%, at 11,313.36
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EUR: up at USD1.0918 (USD1.0886)
GBP: up at USD1.2391 (USD1.2354)
USD: down at JPY129.62 (JPY129.78)
Gold: up at USD1,941.42 per ounce (USD1,933.82)
(Brent): up at USD86.30 a barrel (USD86.11)
(changes since previous London equities close)
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ECONOMICS
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Thursday's key economic events still to come:
08:30 EST US CFNAI Chicago Fed national activity index
08:30 EST US advance economic indicators report
08:30 EST US unemployment insurance claims report
10:00 EST US new residential sales
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The chair of retailer Marks & Spencer has become the latest business leader to criticise the UK government's economic policy, with Archie Norman calling plans to ease post-Brexit trade "overbearing" and "baffling". Norman, who is also an ex-Conservative member of Parliament, has urged the UK foreign secretary during talks with the EU not to consider separate labelling for goods sold in Northern Ireland. "The overbearing costs of a labelling regime would raise prices and reduce choice for consumers, further disadvantage UK farmers and suppliers and impact UK retailers' competitiveness in other international markets," Norman wrote according to excerpts obtained by the Telegraph.
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BROKER RATING CHANGES
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RBC cuts Ocado to 'underperform' (sector perform) - price target 560 (800) pence
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Socgen raises BAE Systems to 'buy' (hold) - price target 974 (837) pence
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JPMorgan raises Hiscox to 'neutral' (underweight) - price target 1,200 (930) pence
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COMPANIES - FTSE 100
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Wealth manager St James's Place said that funds under management fell to GBP148.37 billion on December 31 from GBP153.99 billion a year earlier. Gross inflows during 2022 fell to GBP17.03 billion from GBP18.20 billion in 2021, whilst net inflows fell to GBP9.78 billion from GBP11.04 billion. "2023 has started in much the same way that 2022 ended, but it is encouraging to see more recent positive indicators that UK inflation may have peaked, together with some evidence that currency and investment markets are more stable," said Chief Executive Andrew Croft.
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Diageo reported net sales of GBP9.42 billion in the six months to December 31, up 18% year-on-year from GBP7.96 billion. The London-based brewer and distiller said pretax profit increased to GBP3.06 billion versus GBP2.72 billion a year earlier. The company declared an interim dividend of 30.82 pence per share, up 5% from 29.36 pence. Looking ahead, Diageo said it expects to return up to GBP4.5 billion of capital to shareholders in February. It also reiterated its medium-term guidance, between financial year 2023 and 2025, of organic net sales growth in the range of 5% to 7%.
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COMPANIES - FTSE 250
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IG Group said that in the six months ended November 30 revenue jumped 10% to GBP519.1 million, up from GBP471.5 million a year earlier. The London-based contracts-for-difference trading provider reported that pretax profit fell by 2% to GBP240.5 million from GBP245.2 million year-on-year. The company declared a 2.3% increase in its interim dividend of 13.26 pence, up from 12.96p. IG said that it is extending its share buyback programme by GBP50 million, to a total of GBP200 million. Looking ahead, IG said it expects financial year 2023 to be in line with expectations and reiterated its medium-term guidance. Chief Executive June Felix said: "Despite a softening in trading demand due to the global economic environment, our high-quality clients have continued to find opportunities to trade, demonstrating the resilience of the business model."
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OTHER COMPANIES
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Provident Financial will change its name to Vanquis Banking Group to reflect its new focus on credit cards, vehicle finance and personal loans. Malcolm Le May plans to step down as chief executive officer in the summer and will be replaced by Ian McLaughlin, currently the CEO of Bank of Ireland UK. Provident Financial said trading was in line with market expectations in the fourth quarter of 2022, amid strong net lending.
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Holiday airline Jet2 said it now expects financial 2023 results ahead of current market expectations, with pre-foreign exchange revaluation pretax profit between GBP370 million and GBP385 million. Jet2 explained that pricing and margins are "significantly higher". Looking ahead, the company said on sale seat capacity for summer 2023 is currently 6.6% higher than summer 2022 at 15.2 million seats.
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SAP said it plans to trim its workforce and is mulling a possible sale of its more than 70% stake in Qualtrics International, two years after the experience management company's initial public offering in New York. Walldorf, Germany-based software firm SAP also reported higher fourth-quarter revenue, with its cloud offering leading the way. SAP said it will cut 2.5% of its workforce, the latest technology company to announce job cuts and mirroring industry peers in the US. The company employs just under 112,000 people, so it is around 3,000 roles that will be chopped.
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By Sophie Rose, Alliance News reporter
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