SpaceandPeople Share News (SAL)

LONDON (Alliance News) - London shares are mixed Wednesday midday, while US stocks are called to open with a modest rebound from Tuesday's losses, as investors monitor a busy US economic calendar amid speculation over the timing of an expected interest rate hike by the US Federal Reserve.

US stock index futures point to a higher open, with the Dow 30, the S&P 500 and the Nasdaq 100 all seen up 0.8%, having lost between 2.8% and 3.0% on Tuesday after the latest manufacturing data from China intensified concerns about the world's second largest economy.

Ahead of the long weekend in China to celebrate the 70th anniversary of WWII Victory Day, Asian equities closed lower Wednesday. The Japanese Nikkei closed down 0.4%, while the Hang Seng lost 1.2% and the Shanghai Composite 0.2%. Stocks had traded much lower earlier in the day but recovered some of their losses throughout the session.

Investors will focus Wednesday on a busy economic calendar in the US. ADP employment, due at 1315 BST, will attract even more scrutiny than usual as the market searches for clues on the timing of a potential US interest rate hike by the Federal Reserve.

Lloyds Bank said it has pencilled in a rebound to 220,000 in August, which is stronger than consensus estimates for a 201,000 lift, after rising by 185,000 in July.

"The Federal Open Market Committee will also be interested in the final estimates of second quarter nonfarm productivity and unit labour cost growth, where the upward revision to second quarter GDP growth from 2.3% to 3.7% should be matched by a sizeable and welcome rise in hourly productivity growth from its previous 1.3% preliminary second quarter estimate," Lloyds said.

US nonfarm productivity and US unit labour costs are due at 1330 BST. Later in the afternoon, US factory orders are expected at 1500 BST and Energy Information Administration crude oil stocks are at 1530 BST.

Outside the US, UK construction activity growth improved by less than expected in August, survey results from the Chartered Institute of Procurement and Supply and Markit Economics revealed Wednesday. The seasonally adjusted Markit/CIPS UK Construction Purchasing Managers' Index rose to 57.3 from 57.1 in July. Economists had forecast a higher score of 57.5.

The pound slightly weakened against the dollar after the data, standing at USD1.5275, having traded at USD1.5302 prior to it.

UK stocks were mixed Wednesday midday, with the FTSE 100 flat at 6,056.80, the FTSE 250 down 0.1% at 16,826.56, and the AIM All-Share up 0.1% at 731.19. In Europe, the CAC 40 in Paris and the DAX 30 in Frankfurt were both up 0.3%.

On the London Stock Exchange, Ashtead Group traded up 5.6% after it said its pretax profit and revenue both surged higher in the first quarter of its financial year and said its full-year results look set to meet its expectations.

The industrial equipment rental company said pretax profit rose 23% in the quarter to the end of July to GBP155.4 million from GBP117.5 million a year earlier, as its revenue rose to GBP618.6 million from GBP457.9 million, driven by a rise in its rental revenue to GBP539.6 million from GBP417.7 million.

Hikma Pharmaceuticals was another strong performer in the blue chip index up 3.6% at 2,306.00 pence, after Barclays raised its its price target on the company to 2,760.00p from 2,050.00p according to traders.

Meanwhile, oil-related stocks were amongst the fallers in the FTSE 100, with Royal Dutch Shell 'A' shares down 1.1% and BP down 1.4%. Oil prices declined sharply on Tuesday following the weak economic data from China, giving up some of its strong weekend gains. At midday in London, Brent oil traded at USD48.61 a barrel, and West Texas Intermediate was at USD44.20.

In the FTSE 250, Halfords Group was the biggest faller, down 10%. The car parts and bicycle retailer said its cycling sales have declined so far in the second quarter and will be below expectations for the period, though trading elsewhere in the business remains robust.

Halfords said its cycling sales in the eight weeks from July 4 to August 28 were down 11% on a like-for-like basis against tough comparatives and will now be below its expectations for the second quarter. The "disappointing" performance was driven by mainstream bikes and associated parts and accessories, which Halfords said it considers to be a market-driven issue resulting from higher levels of discounting and poor weather conditions which have deterred cyclists.

Diploma was down 7.7% after it said its revenue growth in the first nine months was held back by the slowdown in the oil and gas industry and sluggish European industrial markets and said its underlying operating margin will take a hit.

The technical products and services company said its revenue for the nine months to the end of September is expected to rise by around 9.0%, driven primarily by acquisitions but offset slightly by translational currency effects. But the group said the issues it has faced so far in its current financial year have continued to be an issue and said its underlying revenue growth, stripping out acquisitions and currency effects, will be around 1.0%.

In the AIM All-Share, SpaceandPeople was up 16%. The marketing company said it has secured an exclusive deal to promote brands across all Network Rail stations in the UK for five years. The agency said it now holds the exclusive rights to promote brands in Network Rail stations under the deal. No financial details were disclosed.

Shares in Bango were up 9.3%. The mobile payments company said its has partnered with Telkom South Africa to launch carrier billing in Google Play, a first for the African market. Under the deal, Telkom will use Bango's payments platform to provide the service to Android customers. The Google Android platform currently represents 89% of Africa's smartphone market.

After the close of the London stock market, the changes from the September FTSE quarterly index review will be announced. Engineering company Weir Group is expected to drop into the FTSE 250, to be replaced in the FTSE 100 by Berkeley Group Holdings.

By Daniel Ruiz; danielruiz@alliancenews.com

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