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(Alliance News) - Stocks in London are set to open slightly higher on Monday, as risk sentiment improves after a difficult period for markets last week.
"Risk sentiment is improved compared to Friday as tensions in the Middle East didn't escalate as much as feared during the weekend. Hamas released two hostages and humanitarian aid started to enter Gaza from the Egyptian border," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
"But tensions remain extremely high and risk of serious escalation prevails as Israel stepped up air raids in Gaza and Hezbollah could drag Lebanon into war, and spread tensions through the region."
Over the weekend, Israel's Defence Minister Yoav Gallant said he expects that fighting could last for months in the war against the Islamist Hamas in the Gaza Strip.
"In terms of the operational aspects of manoeuvring - at the end of the day, nothing will stop the IDF. It is a combination of two things - our aerial capabilities and ground manoeuvring," Gallant said on Sunday in Tel Aviv.
In early corporate news, Keller said it expects its full-year profit to be ahead of market consensus. Meanwhile, Upland Resources rejected a takeover approach.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: called up 0.1% at 7,406.20
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Hang Seng: financial markets in Hong Kong closed for Chung Yeung Festival public holiday
Nikkei 225: closed down 0.8% at 30,999.55
S&P/ASX 200: closed down 0.8% at 6,844.10
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DJIA: closed down 286.89 points, or 0.9%, at 33,127.28
S&P 500: closed down 53.84 points, or 1.3%, at 4,224.16
Nasdaq Composite: closed down 202.37 points, or 1.5%, at 12,983.81
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EUR: down at USD1.0577 (USD1.0594)
GBP: down at USD1.2150 (USD1.2156)
USD: up at JPY149.94 (JPY149.84)
Gold: down at USD1,975.69 per ounce (USD1,996.01)
(Brent): down at USD91.25 a barrel (USD93.20)
(changes since previous London equities close)
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ECONOMICS
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Monday's key economic events still to come:
16:00 CEST EU FCCI Flash consumer confidence indicator
08:30 EDT US Chicago Fed national activity index
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Scores of Palestinians were killed in central Gaza on Sunday after Israel stepped up its strikes on the war-torn enclave and another convoy of 17 aid trucks arrived as the Hamas-run territory faces "catastrophic" shortages. With the violence raging unchecked, Iran said the region could spiral "out of control". Israeli Prime Minister Benjamin Netanyahu issued a stark warning to Lebanon's Hezbollah, saying getting involved would be "the mistake of its life". Washington warned any actors looking to inflame the conflict that it would not hesitate to act in the event of any "escalation". Hamas militants in Gaza stormed across the border into Israel on October 7, launching a raid that killed at least 1,400 people, mostly civilians who were shot, mutilated or burnt to death on the first day, according to Israeli officials. They also seized more than 200 hostages in the worst-ever attack in Israel's history.
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BROKER RATING CHANGES
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Goldman raises InterContinental Hotels target to 6,350 (6,200) pence - 'neutral'
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RBC raises United Utilities target to 1,125 (1,075) pence - 'sector perform'
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Jefferies cuts Rentokil Initial price target to 650 (740) pence - 'buy'
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COMPANIES - FTSE 100
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AstraZeneca and Daiichi Sankyo's Enhertu has been approved in the EU as monotherapy for the treatment of adult patients with advanced non-small cell lung cancer. Daiichi is a Tokyo-based pharmaceutical company. AstraZeneca is a Cambridge-based pharmaceutical firm. Astra said Enhertu has been recommended for approval as monotherapy for the treatment of adult patients with advanced non-small cell lung cancer whose tumours have an activating HER2 mutation and who require systemic therapy following platinum-based chemotherapy with or without immunotherapy. Enhertu, known as trastuzumab deruxtecan on a generic basis, is a specifically engineered HER2-directed antibody-drug conjugate being jointly developed and commercialised by AstraZeneca and Daiichi Sankyo.
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COMPANIES - FTSE 250
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Keller said that it has maintained "positive" trading in the its third quarter, ended September 30, following is "exceptionally strong" first half performance. Based on this, the geotechnical engineering firm now expects full year underlying operating profit to be materially ahead of current market expectations. "This performance reflects continued momentum and operational improvements within the business and the outstanding contribution of colleagues across the group, whom I would like to thank for their dedication and hard work," said Chief Executive Michael Speakman.
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Vistry Group provided a trading update for the period from July 1 to date. It said it is targeting an adjusted pretax profit of GBP450 million for 2023, excluding the impact of transitioning the Housebuilding business to Partnerships. "As previously described, this impact is created by the re-evaluation of the full life margin of the group's Housebuilding sites to reflect the increased pre-sale elements and the associated discount in price," it explained. Vistry said it estimates the final 2023 impact of the reduction in full site margins to be in the region of GBP40 million and as a result, the company's targeted adjusted pretax profit, including this impact, is GBP410 million.
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OTHER COMPANIES
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Roche has acquired Telavant Holdings in a more than USD7 billion deal which adds an inflammatory bowel disease treatment to its portfolio. The drugmaker will pay USD7.1 billion upfront to Telavant's current owners Roivant Sciences and Pfizer, as well as a near-term milestone payment of USD150 million. Roivant owns 75% of Telavant, and Pfizer the remaining 25%. "The agreement includes the development, manufacturing and commercialisation rights in the US and Japan for Televant's RVT-3101," Roche said. "RVT-3101 is a promising new therapy in development for people suffering from inflammatory bowel disease, including ulcerative colitis and Crohn's disease. Inflammatory bowel disease is a group of chronic gastrointestinal disorders with almost 8 million people diagnosed worldwide and 80% of all individuals not experiencing lasting remission."
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Upland Resources said it has received an "unsolicited, very preliminary" takeover approach from SEC Capital. The possible offer was for Upland shares, at an indicative price of 14 pence. Shares in Upland closed at 2.93p on Friday in London. "The board has unequivocally rejected the approach as it believes it significantly undervalues the current potential of the company," the oil and gas company said.
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Alphawave IP named Rahul Mathur as its new chief financial officer. Mathur has been CFO of Avantus since 2021 and as CFO and Senior Vice President of Finance at Rambus from 2016 to 2021. Commenting on his appointment Co-Founder & Chief Executive Tony Pialis said: "His extensive experience in senior finance positions within listed semiconductor companies will be invaluable as we continue to build the foundations for the next phase of business growth, working with our customers to create next generation AI infrastructure."
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By Sophie Rose, Alliance News reporter
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