LONDON (Alliance News) - Stocks ended in positive territory on Tuesday, with mining stocks, Sage, and BAE Systems all among the risers.The blue-chip FTSE 100 was further helped as the pound weakened ahead of this evening's parliamentary vote on Brexit, with UK Prime Minister Theresa May looking set for a bruising defeat."The UK is settling down to watch what looks set to be the largest ever defeat in the Commons for a Prime Minister. Quite how this will move the process forward is still a mystery, but, given the tragi-comedic nature of the whole exercise, a futile gesture at this stage of proceedings seems entirely fitting...a delay into the summer now seems like a very probable outcome to tonight's vote," said IG chief market analyst Chris Beauchamp.The FTSE 100 index closed up 40.00 points, or 0.6%, at 6,895.02 on Tuesday. The FTSE 250 ended up 12.19 points, or 0.1%, at 18,429.77, and the AIM All-Share closed down 3.62 points, or 0.4%, at 900.28.The Cboe UK 100 ended up 0.8% at 11,715.60, the Cboe UK 250 closed up 0.2% at 16,488.86, but the Cboe Small Companies ended down 0.5% at 11106.49.The pound was lower, quoted at USD1.2761 at the London equities close Tuesday compared to USD1.2890 at the close on Monday.The Withdrawal Agreement secured by the prime minister in Brussels in November looks set to go down to one of the heaviest Commons defeats in modern history, after a last-gasp appeal to Tory rebels fell on deaf ears.May made clear she would not back away from Brexit in response, telling the Cabinet the government is "the servant of the people" and must deliver on the result of the 2016 referendum.Speaker John Bercow has allowed debate on an amendment tabled by Corbyn to ditch May's plan and "pursue every option" to prevent the UK leaving the EU with no deal.Also selected for debate were an SNP amendment to reject the Brexit deal and proposals by Tory backbenchers for the UK to take unilateral powers to end controversial "backstop" arrangements. Labour's Hilary Benn pulled an amendment which would have blocked both the PM's deal and a no-deal outcome, saying it was vital to get "the clearest expression of view" from MPs on the government's proposals.The deal suffered its first official parliamentary defeat in the House of Lords on Monday night as peers voted by 321 votes to 152 - a majority of 169 - to reject it.Downing Street has given little indication on how the prime minister intends to proceed if she is defeated. Under the terms of an amendment passed last week, she must table a motion on her Plan B by Monday. Some reports have suggested she could fly to Brussels, possibly as early as Wednesday, in an attempt to obtain further concessions on the backstop.Andrew Wishart, UK economist at Capital Economics, commented: "Either a narrow or a heavy defeat in Parliament's meaningful vote on Theresa May's Brexit deal tonight would probably prompt the pound to rise. "An inconclusive moderate defeat would arguably be the worst result for the pound, as it would prolong uncertainty and leave the possibility of a no deal on the table."A narrow defeat could mean the deal may get through on a second attempt if May secures some concessions, said Wishart, while a resounding defeat could require a extension to Article 50."A defeat of between 50 and 100 votes would probably be the worst outcome for the pound. Without a clear signal, the prime minister might continue to pursue some version of her deal through a divided Parliament. That would only serve to delay a resolution to Brexit, increasing the chances of a no deal exit," the economist added. In European equities on Tuesday, the CAC 40 in Paris ended up 0.5%, while the DAX 30 in Frankfurt ended up 0.3%.Data from Germany's Federal Statistical Office showed the economy grew at its slowest rate in five years.Gross domestic product rose 1.5% year-on-year, having expanded 2.2% in 2017. The pace exceeded the average 1.2% growth rate of the last 10 years, though growth was the weakest since 2013, when the economy advanced just 0.5%.The euro stood at USD1.1393 at the European equities close Tuesday, down from USD1.1477 at the same time on Monday.Stocks in New York were higher at the London equities close, with the DJIA up 0.3%, the S&P 500 index up 0.7%, and the Nasdaq Composite rising 1.2%. Earnings season in the US continued on Tuesday with figures from banks JPMorgan Chase and Wells Fargo. JPMorgan, shares down 0.9%, said net income rose 67% to USD7.07 billion. The prior year's result included a USD2.4 billion reduction following the tax cut legislation. Net revenue for the fourth-quarter was USD26.11 billion, up 7% from USD24.46 billion last year. On a managed basis, net revenue was USD26.8 billion, up 4% from the prior year. Analysts expected revenue of USD26.9 billion for the quarter.Wells Fargo, shares 2.5% lower in morning trade, said net income in the fourth quarter fell to USD6.1 billion from USD6.2 billion a year ago. Revenue fell to USD21.0 billion from USD22.1 billion last year, though earnings per year rose to USD1.21 from USD1.16.Gold was soft amid Tuesday's risk-on attitude to equities, quoted at USD1,288.23 an ounce at the London equities close Tuesday against USD1,290.33 at the close on Monday.Brent oil, meanwhile, was largely unchanged, quoted at USD59.92 a barrel at the London equities close Tuesday from USD60.11 late Monday.In London, miners helped the FTSE 100 rally after news of stimulus from China, which comes in the wake of weak trade data. Antofagasta shares gained 1.3%, Rio Tinto shares 0.8%, and BHP Group climbed 1.1%.Data on Monday showed China's exports and imports in December declined at the worst rate in two years. Exports dropped 4.4% year-on-year in December, substantially worse than the 3% rise predicted by economists. Imports decreased 7.6% from a year ago, defying expectations for a 5% rise.Accounting software provider Sage rose 2.0% after agreeing to sell its outsourcing business, Sage Payroll Solutions, to iSolved HCM.Sage will sell the division for GBP78 million, of which GBP73 million will be paid in cash on completion. The remaining GBP5 million represents a contingent consideration, the company added.The company expects to report a statutory profit on disposal of GBP23 million at the end of the divesting process. Defence firm BAE Systems finished 1.9% higher after Barclays raised its rating on the stock to Equal Weight from Underweight.Among those in the red on Tuesday were gambling stocks, with FTSE 100 constituents GVC and Paddy Power Betfair closing down 2.4% and 1.0% respectively. In the FTSE 250, William Hill shed 2.1% and 888 sank 7.1%.A report released on Monday showed the US Department of Justice has reversed its stance on online betting.In 2011, the DoJ had ruled the 1961 Wire Act was only related to sports betting online, having been asked a year before that by the Criminal Division to make a judgement.In a report compiled November 2, 2018, but released on Monday, the DoJ said: "This office concluded in 2011 that the prohibitions of the Wire Act in 18 USC 1084 are limited to sports gambling."Safely the worst performer in the FTSE 250 on Tuesday, however, was Provident Financial after the subprime lender issued a profit warning. The stock closed down 21%.The group expects to report exceptional costs of GBP55 million in 2018, associated with the implementation of its home credit recovery plan, intangible and tangible asset write offs, redundancy and consultancy costs, and non-cash pension charges."Moneybarn has continued to perform well and CCD has performed in line with internal plans during the last quarter of the year. Vanquis Bank has delivered further customer and receivables growth although impairment has been modestly higher than expected," the company said.Provident expects profit for 2018 to come in towards the lower end of market expectations. Currently, the market forecasts the lender's pretax profit to be between GBP151 million and GBP166 million. A year ago, the company reported a GBP123.0 million pretax loss.Mediclinic International closed down 3.5% after Spire Healthcare - in which Mediclinic holds just below a 30% stake - lowered its annual earnings guidance. Spire expects earnings before interest, taxation, depreciation and amortization before exceptional and other items will be between GBP119 million and GBP120 million, compared to GBP150 million in 2017.This Ebitda guidance range for 2018 has been lowered from the GBP120 million to GBP125 million issued in September.Spire shares closed down 12% on Tuesday.Spirent Communications closed up 14% after saying it expects to beat market expectations in 2018 after order intake and revenue increased.The company is expecting to achieve a USD75 million to USD77 million adjusted operating profit for 2018, exceeding market expectations. The company's adjusted operating profit in 2017 was USD58.9 million."We expect to exceed the market's profit expectations for the financial year 2018. We have market leading technology offerings and are well placed to optimise opportunities as they continue to arise," Chief Executive Eric Hutchinson said.In Wednesday's corporate calendar, housebuilder Bovis Homes, cinema operator Cineworld, and technical equipment firm Diploma release trading updates, while gold miner Hochschild Mining releases full-year production. In the economic calendar on Wednesday, Germany's consumer price index is at 0700 GMT and UK producer prices and consumer inflation figures are at 0930 GMT. In the US, the import and export price indices are due at 1330 GMT.
11 May 2016 15:05
