LONDON (Alliance News) - Despite futures indicating a flat open, stocks in London edged higher early Thursday as an upbeat trading update from housebuilder
Persimmon buoyed the sector, and
Glencore managed to stem its recent subpoena-driven losses with a news of a share buyback.London's mid-cap FTSE 250 index was also higher early Thursday, with a special dividend from
Superdry and a strong start to the year for
Electrocomponents helping to offset
Sophos' slump.Focus in the day ahead lies on the release of the latest Federal Open Market Committee minutes, while investors continue to eye Friday's tariff deadline.The FTSE 100 index was up 0.3%, or 22.05 points, at 7,595.14. The mid-cap FTSE 250 index was up 0.2%, or 36.50 points, at 20,689.01. The AIM All-Share index was up 0.2% at 1,082.41.The Cboe UK 100 was up 0.3% at 12,865.65, the Cboe UK 250 was up 0.2% at 18,892.84, and the Cboe UK Small Companies was up 0.1% at 12,610.12.In the FTSE 100, housebuilder
Persimmon was up 2.3%, the best performer in the index.The company said total revenue in the first six months of 2018 was GBP1.84 billion, up 5% on last year, with housing revenue of GBP1.74 billion also 5% higher year-on-year. The average selling price increased by 1.2% to GBP215,800.The value of the company's total forward sales of new housing at June 30 stood at GBP1.68 billion, up 5% on last year."As we had expected, the Persimmon trading update looks stronger than those that have somewhat spooked the market in the last few weeks. Persimmon is not exposed to London, has less of a south east bias than the sector average and is less reliant on its buyers having to sell an existing home in order to buy," said Robin Hardy, an analyst at Shore Capital.Housebuilding stocks were higher on the update, with
Barratt Developments up 1.6%,
Taylor Wimpey 1.1% higher and
Berkeley Group up 0.8%.
Glencore was 1.9% higher after the miner said it is to begin a share buyback programme worth USD1 billion, with the first part commencing immediately.Glencore, which earlier in the week was subpoenaed by the US Justice Department, is to buy GBP350 million worth of stock back from shareholders up to August 7, and will then go ahead with further buybacks.At the bottom of the large-caps was
Associated British Foods, down 3.3%, as it backed its annual outlook but was downbeat on its Sugar expectations for next year.For the full-year, AB Foods said it expects good profit growth in Grocery, Agriculture and Ingredients. However, the company now expects reduced profit from AB Sugar due to lower EU sugar prices, but increased profit from Primark driven by higher margins.Consequently, AB Foods said its outlook is unchanged with progress expected in adjusted operating profit and adjusted earnings per share.For the third quarter, AB Sugar revenue was down 17%, as expected. This was "entirely the result of significantly lower EU prices which adversely affected our UK and Spanish businesses", the company said.AB Foods continued: "EU sugar prices are continuing to decline driven by low world sugar prices and excess supply following very high sugar production in the EU last year. For our next financial year, this level of EU sugar prices would represent a substantial reduction compared to those achieved this year. As a result, our expectations for sales and profit at AB Sugar, both for this financial year and next, are lower than previously expected."At the top of the FTSE 250 was fashion retailer
Superdry, 8.5% higher. The company declared a special dividend as annual revenue climbed, though profit dipped following the impairment of the Berlin Kranzler store.Revenue rose 16% to GBP872.0 million in the year to April 28, though pretax profit fell 23% to GBP65.3 million. This reflected the fair value movement on forward exchange contracts as well as an impairment of the Berlin Kranzler store.Underlying pretax profit rose 12% to GBP97.0 million. The company declared an ordinary dividend of 31.2p per share, up 11% on last year and taking its full-year dividend to 31.2p, along with a special dividend of 25.0p.
Electrocomponents climbed 4.3% after the electrical products distributor said it has made a strong start to its financial year, with double digit revenue growth and improved profitability.First quarter like-for-like revenue rose 10%, with all five regions in which the company operates seeing good growth in the three months to June 30. The Americas was the fastest growing segment, with like-for-like sales growing 13%, driven by market share gains in a "strong underlying market"."The year has started well with our continued focus on the customer, digital leadership and sales effectiveness driving strong results across the business. We are making good progress on our initiatives to further simplify the way we operate in order to drive a more efficient and scalable operating model. All this means we are confident of delivering further strong progress in the current financial year," said Chief Executive Lindsley Ruth.
Sophos slumped 20% after it said a lower-than-anticipated growth in first quarter billings was driven by its Enduser security business, "which faced a particularly challenging comparable".The company said it expects to report first quarter billings growth of 6%, up 2% at constant currency," and expects to report mid-teens growth in new customer and network security billings in the period.In mainland Europe early Thursday, the CAC 40 in Paris was up 0.2% while the DAX 30 in Frankfurt gained 0.5%."In focus today will be the build up to 'T-day' tomorrow with the US and China set to impose import tariffs on each other. The big question for now is who will go first?" questioned Michael van Dulken, head of research at Accendo Markets."The latest Fed FOMC Minutes could also shift market expectations about the path of US rate rises, with an impact on the USD and a knock-on for most asset classes," he added.In the economic calendar on Thursday, there is US ADP employment change at 1315 BST followed by initial and continuing jobless claims at 1330 BST. The Markit composite PMI is at 1445 BST, with the ISM non-manufacturing PMI at 1500 BST.In the central bank events calendar on Thursday, Bank of England Governor Mark Carney will speak at 1100 BST while in the US, the minutes from the latest Federal Open Market Committee will be released at 1900 BST."Following the recent run of upbeat UK economic data releases and BoE chief economist Andy Haldane's surprise shift last month to support an immediate hike in interest rates, market expectations for an August rate hike have increased to around 70%. Comments from Carney will be watched for further signs that the BoE is edging towards hiking next month," said analysts at Lloyds Banking.In Asia on Thursday, the Japanese Nikkei 225 index closed down 0.8%. In China, the Shanghai Composite closed down 0.9%, while the Hang Seng index in Hong Kong is 0.6% lower in late trade.Markets in the US were closed on Wednesday for the Independence Day holiday, and re-open on Thursday.
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