LONDON (Alliance News) - Two gold miners, Randgold and Fresnillo, are the only gainers in the FTSE 100 early Monday, amid a sea of red following the imposition of capital controls in Greece over the weekend and parliamentary approval of a July 5 referendum.
The price of gold has risen amid the breakdown of talks between the debt-laden country and its creditors.
The list of blue-chip losers in London is topped by travel stocks, TUI and IAG.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 2.2% at 6,605.15
FTSE 250: down 2.4% at 17,388.50
AIM ALL-SHARE: down 1.2% at 759.11
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Hang Seng: down 3.1% at 25,825.43
Nikkei 225: closed down 2.9% at 20,109.95
DJIA: closed up 0.3% at 17,946.68
S&P 500: closed flat at 2,101.49
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GBP: down at USD1.5723
EUR: down at USD1.1081
GOLD: up at USD1,180.64 per ounce
OIL (Brent): down at USD62.25 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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Monday's Key Economic Events still to come
(all times in BST)
09:30 UK M4 Money Supply
09:30 UK Mortgage Approvals, Consumer Credit, Net Lending to Individuals
10:00 EU Economic Sentiment Indicator, Consumer and Industrial Confidence
11:00 Ireland Retail Sales
13:00 Germany Consumer Price Index
15:00 US Pending Home Sales
15:30 US Dallas Fed Manufacturing Business Index
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Greece is imposing capital controls and ordering the closure of banks, Prime Minister Alexis Tsipras said Sunday, as Athens scrambled to avert the collapse of the country's financial system. In a televised speech to the nation, he said the Greek central bank recommended the measures after the European Central Bank decided against raising the amount of emergency credit that it provides to the Mediterranean country's banks. Earlier Sunday, the ECB said it was maintaining its Emergency Liquidity Assistance to the Greek financial system at current levels. However, the threat of an imminent default has prompted people to withdraw more money from their accounts, meaning the level of ELA support - currently at EUR89 billion - may not be sufficient. Sunday's developments came amid deep uncertainty in Greece after its parliament approved a referendum for July 5 on the offered terms of the country's bailout.
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The European Central Bank will "continue to work closely with the Bank of Greece," President Mario Draghi said, as the ECB announced Sunday it will maintain emergency credit to Greek banks at the current level. The ECB is monitoring the situation in financial markets and the "potential implications for the monetary policy stance" in the euro area, a statement from the Frankfurt-based central banks says.
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Chinese central bank announced further reduction of interest rates, its fourth move in around seven months, in a bid to boost economic growth, according to a statement on Saturday. The bank cut one-year deposit rate by 25 basis points to 2%, while one-year benchmark lending rates were lowered by 25 basis points to 4.85%. The new rates came into effect on Sunday. The reserve requirement ratio for banks with sizable lending to farmers and small businesses has been cut by 50 basis points.
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A China-backed Asian development bank was officially founded in a signing ceremony in Beijing, state media reported, capping months of debate over which countries would participate and over China's growing financial clout abroad. China will be the single largest shareholder in the Asian Infrastructure Investment Bank, according to the official Xinhua news agency, with the next biggest investors being India and Russia from among the 57 countries taking part. The AIIB aims to invest money in roads, ports, airports, energy provision and telecommunications in developing counties in Asia. Germany is the largest non-regional shareholder. Britain and France have also joined.
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Industrial output in Japan tumbled a seasonally adjusted 2.2% on month in May, the Ministry of Economy, Trade and Industry said. That missed forecasts for a decline of 0.87% following the 1.2% increase in April. On a yearly basis, industrial production shed 4.0% - also shy of forecasts for a decline of 2.3% following the 0.1% fall in the previous month.
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Retail sales in Japan were up 3.0% on year in May, the Ministry of Economy, Trade and Industry said on Monday - standing at JPY11.769 trillion. That beat forecasts for an increase of 2.2% following the 4.9% gain in April.
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Foreign ministers from Iran and world powers interrupted talks on a nuclear deal in Vienna on Sunday, with EU top diplomat Federica Mogherini saying that ministers will resume negotiations only once gaps have been bridged in lower-level talks. Iran's Foreign Minister Mohammad Javad Zarif would resume negotiations on Wednesday, the day after the deadline that Iran and the group of the five UN veto powers and Germany have set themselves for reaching the agreement, Iranian media reported.
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The Tunisian government said it would close down 80 mosques accused of instigating violence as part of tougher security measures, a day after a gunman rampaged through a beach resort in Sousse killing 38 people, mainly foreign tourists.
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The man suspected of beheading his employer and attacking a gas plant in south-eastern France has confessed, AFP news agency reported Sunday, citing sources close to the investigation. Yassin Salhi, 35, admitted to decapitating his boss and placing the head on a fence at the plant belonging to US chemicals company Air Products in Saint-Quentin-Fallavier, near Lyon, on Friday. Salhi, a deliveryman for the company, then rammed his car into gas canisters on the site, causing an explosion. French authorities called it a "terrorist" attack.
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The Israeli navy took over a trawler carrying pro-Palestinian activists headed to the blockaded Gaza Strip early Monday, prompting three other vessels to turn back, activists and the military said. The navy took control of the Marianne in international waters some 80 to 90 nautical miles from the coast of the Gaza Strip, said Irene Macinnes, a Canadian in the Freedom Flotilla organization, told dpa from Athens. Three other boats carrying more pro-Palestinian activists which were sailing behind the Marianne turned around and would no longer try to reach Gaza, she said.
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BROKER RATING CHANGES
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BARCLAYS RAISES SHELL TO 'EMEA TOP PICKS'-LISTE - 'OVERWEIGHT'
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BERENBERG INITIATES SMITHS GROUP WITH 'BUY' - TARGET 1333 PENCE
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Numis Downgrades HSS Hire Group To Add From Buy, Cuts Price Target To 200p From 235p
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COMPANIES - FTSE 100
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Sky is set on Monday to call for a full competition inquiry into BT Group's hold over the national telecommunications network, the Financial Times reports. Sky is set to table a formal submission to UK media and communications regulator Ofcom accusing BT's Openreach infrastructure arm of a slew of service failures and will argue there is sufficient evidence against BT for Ofcom to request the Competition and Markets Authority, the UK's competition watchdog, to conduct a full-blown inquiry.
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Separately , Sky and John Malone’s cable television firm Liberty Global are weighing offers for a GBP4.5 billion controlling stake in Formula One, putting them in competition with a Qatari-backed consortium for control of the motor racing series, the Sunday Times reported.
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COMPANIES - FTSE 250
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Ladbrokes said the announcement of the results of its Business Review, which had been due on Wednesday, will be deferred until further notice following the bookmaker having entered takeover talks with unlisted rival Gala Coral Group.
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Ocado Group is close to securing a deal with an international retailer which will allow the company to expand outside of the UK for the first time, The Daily Telegraph reports. Ocado revealed earlier this year that it has developed a system which will allow it to sell its online grocery technology to overseas retailers. The newspaper said the deal is unlikely to be announced during Ocado's interim results, due Tuesday, but it said the company is likely to express confidence that a deal is close to being done.
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COMPANIES - LONDON MAIN MARKET AND AIM
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Insurance technology and outsourcing company Quindell said its results for the year to the end of December will not be published before the end of June due to the "complexity of the process". Quindell said it is "working through the outstanding points" and said the accounts will be published as soon as possible and said its shares will continue to be suspended until that time.
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Tool and equipment hire company HSS Hire Group said trading in April and May was marginally weaker than its expectations due to some weakness in its key accounts business and reduced demand for cooling equipment. HSS said, however, that trading returned to normal levels in June, with order books building for the second half of the year.
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Lamprell said it is on track to deliver full-year results in line with expectations and has continued to perform well despite challenging market conditions. Lamprell reiterated that it is continuing to cut costs and that its financial results will be "heavily weighted" to the second half of the year.
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Motor support-services company Redde said it looks set to beat market expectations for the full year after robust trading conditions continued in the fourth quarter, prompting it to declare a special dividend. The company also said it will pay a special dividend of 1 pence per share at the end of July, in addition to its final dividend of no less than 4 pence per share, which will make its total dividend for the year at least 8 pence per share, excluding the special payout. Last year, Redde paid out a total of 6.85 pence per share.
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Filtration and environmental technology company Porvair said its pretax profit was slightly higher in the first half of its 2015 financial year, despite revenue declining in line with its expectations due to a lower contribution from large projects. The company said it would pay an interim dividend of 1.3 pence per share, up from 1.2 pence per share a year earlier.
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Arria NLG said it has raise GBP3.75 million through unsecured loan notes in the first stage of a capital plan being managed by investment bank MSL Capital Markets. The next stage of this capital plan involves Arria listing on the New Zealand Stock Exchange, which the company expects to complete this year, although it said it also will consider alternative capital sources.
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Financial market-information website operator ADVFN confirmed it has signed heads of agreement with the directors of investor-information website London South East. This follows speculation over a potential acquisition of London South East, ADVFN said, although it noted there can be no certainty any transaction will take place.
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Central Asia Metals said its full-year production will be impacted by a problem with the Kounrad copper recovery plant in Kazakhstan. The miner said a problem occurred with the solvent-extraction section of the plant which resulted in a "significant quantity" of organic inventory being lost "within a very short time frame," it said in a statement.
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IT managed services company Redcentric said it has secured a GBP3.5 million contract from the Health and Social Care Information Centre in the UK. Under the two-year deal, Redcentric will provide its database-as-a-service offering to power a repository for healthcare data in England.
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COMPANIES - INTERNATIONAL
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General Electric announced that it has reached an agreement to sell its US, Mexico, Australia and New Zealand fleet businesses to Element Financial Corp, a fleet management and equipment finance company, for USD6.9 billion. Separately, GE has signed a memorandum of understanding for the potential sale of its European fleet businesses to Arval, a subsidiary of BNP Paribas.
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German stock exchange operator Deutsche Boerse announced it is in negotiations with SIX Group regarding a full acquisition of the joint venture companies STOXX and Indexium for a purchase price of CHF650 million. Currently, Deutsche Borse owns 50.1% in STOXX and 49.9% in Indexium.
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Selfie sticks will banned from Disney amusement parks worldwide starting next week, a park official said, according to US news reports. Park visitors will have to leave their selfie sticks, which people use to take photos of themselves on their cell phones, at the bag check at park entrances and pick them up on their way out. The policy is to go into effect on Tuesday at Disney parks in Florida and California, according to the Orlando Sentinel. The prohibition takes effect Wednesday at Disney's parks in Paris and Hong Kong.
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Monday's Scheduled AGMs/EGMs
Anglo-Eastern Plantations
Anglo Asian Mining
Ariana Resources
Advanced Oncotherapy
Energiser Investments
Tiger Resource Finance
Vianet Group
Metal Tiger
Starcom
Trinity Exploration
Beowulf Mining
Volvere
Globo
Baron Oil
Savannah Petroleum
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By Tom Waite; thomaslwaite@alliancenews.com; @thomaslwaite
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