LONDON (Alliance News) - Stocks in London are set to open slightly lower on Thursday ahead of UK retail sales figures due later in the morning.In early UK company news,
Unilever reported a fall in revenue and profit for the first half of the year,
SSE said hot weather in the UK hurt business, and
Sports Direct International's annual profit was hit by its investment in London-listed department store
Debenhams.IG says futures indicate the FTSE 100 index of large-caps to open 5.53 points lower at 7,670.70 on Thursday. The FTSE 100 index closed up 0.7%, or 49.95 points, at 7,676.28 on Wednesday.Sterling was quoted at USD1.3046 early Thursday, down compared to USD1.3058 at the London equities close on Wednesday."This week should have been a good week for the pound, with a host of economic data due out which has been widely expected to support the view that the UK economy has more than rebounded from its first-quarter slump. The data certainly support that thus far; however the fractious nature of Westminster politics has taken its toll this week," said CMC Markets chief market analyst Michael Hewson.UK retail sales are at 0930 BST, following on from a disappointing inflation reading on Wednesday and in-line wage growth the day before.Retail sales are seen rising 3.9% in June on an annual basis, in line with last month's reading, and are set to rise 0.4% month-on-month, slowing from 1.3% in May.Analysts at Societe Generale said retail sales will likely have benefited in June from the hot weather and royal wedding, but should still be "subdued" compared to May.In company news, consumer goods firm
Unilever said revenue and profit slipped in the first half, hit by a strike in Brazil.Revenue fell 5.0% at actual exchange rates to EUR26.35 billion, but rose 5.7% at constant currencies. Pretax profit slipped 6.3% at actual rates to EUR4.34 billion, though this was 4.0% higher at constant rates.Underlying sales growth was 2.5% in the period, up 2.7% excluding spreads. The trucker's strike in Brazil hit this growth by around 60 basis points, the company said, though the "significant headwind" presented by this event is expected to "partially reverse" in the second half.Overall market conditions remained challenging in the half, with emerging markets sales up 4.1% and developed markets growth "slightly up" as volumes were offset by continued competitive price deflation in Europe and North America. "Our expectation for the full year is unchanged. We expect underlying sales growth in the 3% to 5% range, an improvement in underlying operating margin and strong cash flow. We remain on track for our 2020 goals," said Chief Executive Paul Polman.Unilever will pay a quarterly dividend of EUR0.3872 for the period. Energy provider
SSE said the start of its new financial year has been marked by "lower than expected output of renewable energy" and "persistently high gas prices", in addition to dry, warm weather.Weather in the UK during the period - being 1.5 degrees centigrade warmer than the thirty-year average - led to average domestic gas demand being 10% lower than planned."All of this has resulted in a higher cost of energy, lower-than-expected output of electricity from renewable sources, and lower volumes of energy being consumed," said SSE.The company said this has hurt its adjusted operating profit in the first quarter by around GBP80 million, and could potentially hit its full-year results.In the three months to June 30, the average electricity supplied to households fell to 775 kilowatt hours from 793 a year prior, as gas supplied fell to 65 therms from 66.Miner
Anglo American reported a solid increase in overall production for the second quarter of 2018. On a copper equivalent basis, production for the three months to June rose 6% year-on-year, which excludes the stoppage at its Minas-Rio mine in Brazil due to pipeline leaks.Anglo American's copper production for the second quarter was 12% higher year-on-year to 158,000 tonnes, while for the first six months of 2018 it rose 10% to 313,000 tonnes. The company, listed in both Johannesburg and London, has held its 2018 copper output guidance at between 630,000 tonnes and 660,000 tonnes. In the FTSE 250,
Sports Direct International said revenue rose in its recently-ended financial year, but profit dropped due to a GBP85.4 million hit related to its investment in department store
Debenhams.The sporting goods retailer said revenue rose 3.5% in the year to April 29 to GBP3.36 billion, but reported pretax profit plummeted 73% to GBP77.5 million. On an underlying basis, pretax profit climbed 35% to GBP152.9 million.The company said the profit dive was largely due to a GBP85.4 million hit following a reduction in value of Debenhams. During the year, Sports Direct increased its holding in Debenhams to 29.7%.The retailer said it has decided not to pay a dividend for the year, in line with last year.
Moneysupermarket.com said revenue for the six months to June 30 rose 5% to GBP173.7 million, with pretax profit climbing to GBP51.7 million from GBP49.5 million. The price comparison site lifted its interim dividend to 2.95p from 2.84p last year."Our trading is on track and our Reinvent strategy to help people save more money across more household bills, is moving ahead. In particular, our expanding product engineering hub is making it easier for customers to switch," said Chief Executive Mark Lewis.The company "remains confident" in performing in line with market expectations for the full-year.
Capita said it has won a contract worth GBP30 million over an initial five-year term with Southern Water, with an option to extend for a further three years.Defence outsourcer
Babcock International said, ahead of its annual general meeting later on Thursday, it expects to achieve its underlying earnings guidance for the year.Revenue expectations for the Aviation sector and the Nuclear sector remain unchanged, though defence revenue is now expected to be "temporarily impacted" by the restructuring of the Defence Equipment & Support organisation, which has created the new Submarine Delivery Agency. "Following this restructuring, a review of programme spend timings is contributing to slightly slower than expected UK activity levels in our Marine and Land sectors. As a result of both the positive portfolio actions and the delays in defence activity, the Group now expects low single digit underlying revenue growth for the full year," said Babcock. At Heathrow Airport on Wednesday, computer problems hit
International Consolidated Airlines Group-owned British Airways operations, leading it to cancel a number of short-haul flights.The failure is a blow as airlines gear up for the peak holiday period, and added to earlier disruption caused by a fire alert at Heathrow's air traffic control tower on Wednesday afternoon.A spokesman said: "As with a number of airlines, we are experiencing some disruption at Heathrow a result of an issue with a supplier IT system."We are working with our supplier to urgently resolve the matter and are sorry for the disruption to our customers' travel plans."In political news on Thursday, UK Brexit Secretary Dominic Raab is holding talks in Brussels with the EU's chief negotiator as the government attempts to try and steady its withdrawal strategy after two weeks of turmoil have rocked the Conservative party.Raab's encounter with Michel Barnier on Thursday will be his first in the role of Brexit Secretary after David Davis quit the post in protest at Prime Minister Theresa May's Chequers Cabinet compromise on withdrawal aims.The talks in Brussels also come as May makes her first visit to the Irish border since the referendum on Thursday. Dealing with post-Brexit cross-border trade remains a crunch issue in the withdrawal negotiations, and a source of tension within the Conservative party.In the US on Wednesday, Wall Street ended mostly higher, with the Dow Jones Industrial Average ending up 0.3%, the S&P 500 up 0.3% and Nasdaq Composite closing flat.Released after Wall Street closed on Wednesday, online auction site eBay said second quarter earnings multiplied on last year, its bottom line coming in at USD638 million from just USD29 million last year.The company's revenue for the quarter rose 9.1% to USD2.64 billion from USD2.42 billion last year. Adjusted earnings of USD533 million, or USD0.53 per share for the quarter, beat Reuters-compiled consensus of USD0.51 per share.American Express, meanwhile, reported a 21% increase in second-quarter profit, driven by higher card member spending and loan growth. New York-based American Express' second-quarter profit rose to USD1.62 billion, or USD1.84 per share, beating Reuters consensus of USD1.82. American Express - the biggest credit-card issuer on the basis of purchases - said revenue, net of interest expense, for the quarter grew 9% to USD10.00 billion from USD9.17 billion a year ago.In Asia on Thursday, the Japanese Nikkei 225 index closed down 0.1. In China, the Shanghai Composite is down 0.7%, while the Hang Seng index in Hong Kong is down 0.2%.In the economic calendar on Thursday, continuing and initial jobless claims in the US are due at 1330 BST, with the Philadelphia Fed Manufacturing survey at the same time.
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