(Alliance News) - Stocks in London were called to open flat on Monday, as the dollar softened ahead of a consequential week for US economic data and monetary policy guidance.
Before the key US jobs report on Friday, Federal Reserve Chair Jerome Powell will testify before Congress on Tuesday and Wednesday.
"Looking at the latest set of data, the U-turn of easing inflation and last month's blowout jobs figures, we don't expect to hear anything less than hawkish from Powell. But it's always possible that a word like 'disinflation' slips out of his mouth, and that we get a boost on risk," said Swissquote Bank's Ipek Ozkardeskaya.
In early corporate news, AstraZeneca reported positive data for Enhertu. WANdisco confirmed it is exploring a secondary US listing, and Foxtons confirmed buying a rival London estate agent.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: called down 2.1 points at 7,945.01
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Hang Seng: up 0.5 at 20,662.09
Nikkei 225: closed up 1.1% at 28,237.78
S&P/ASX 200: closed up 0.6% at 7,328.60
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DJIA: closed up 387.40 points, or 1.2%, at 33,390.97
S&P 500: closed up 64.29 points, or 1.6%, at 4,045.64
Nasdaq Composite: closed up 226.02 points, or 2.0%, at 11,689.01
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EUR: up at USD1.0642 (USD1.0601)
GBP: up at USD1.2028 ( USD1.1979)
USD: soft at JPY135.72 (JPY136.21)
GOLD: up at USD1,853.45 per ounce (USD1,845.56)
OIL (Brent): down at USD85.23 a barrel (USD85.34)
(changes since previous London equities close)
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ECONOMICS
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Monday's key economic events still to come:
09:30 CET EU construction purchasing managers' index
11:00 CET EU retail trade
09:30 CET Germany construction PMI
09:30 GMT UK construction PMI
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Around 630,000 UK small and microbusinesses are at risk of going bust in the face of rocketing costs and pressures on consumers, according to new research. Data analysis of 2.3 million British microbusinesses – which are typically firms with fewer than 10 employees – highlighted growing pressure among small businesses due to rocketing costs, such as increased energy bills. The Venture Forward report, produced by GoDaddy, indicated that the potential collapse of these companies would be a roughly GBP12 billion blow to the economy. It comes ahead of the spring government budget for the prime minister and Chancellor Jeremy Hunt.
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The UK will be a science and technology "superpower" by the end of the decade, under a new plan announced by Prime Minister Rishi Sunak. Funding of more than GBP360 million has been promised by the UK government, as the prime minister hopes a science and technology framework will place the UK at the forefront of new technologies including artificial intelligence and supercomputing. That ambition has been one of the central aims of Sunak's premiership, with Michelle Donelan recently appointed to head up the new Department for Science, Innovation & Technology.
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BROKER RATING CHANGES
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RBC raises B&M European Value Retail to 'outperform' (sector perform) - price target 550 (460) pence
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HSBC raises Nichols to 'buy' (hold)
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Barclays cuts InterContinental Hotels to 'equal weight' (overweight)
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COMPANIES - FTSE 100
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Shell's new chief executive, Wael Sawan, said the US is more attractive for energy investment than the UK, in an interview with the Times. Sawan told the newspaper that the UK government should look to the US's recent actions, such as the 'inflation reduction act', which gives a USD369 billion subsidy package to encourage domestic green investment. Sawan said he would "think twice" about further oil investment in the UK, citing "more attractive" propositions, such as the US Gulf of Mexico. Recent developments in the UK such as ad-hoc interventions, delays to planning, and a lack of clarity over subsidies are likely to hinder Shell's goal to invest GBP25 billion in the UK over the next decade, he said.
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AstraZeneca noted positive high-level results from an analysis of the ongoing Destiny-PanTumor02 phase II trial for Enhertu. Enhertu, or trastuzumab deruxtecan, met the target for objective response rate and showed a durable response across multiple HER2-expressive advanced solid tumours in heavily pretreated patients. Enhertu is being jointly commercialised by Astra and Daiichi Sankyo.
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COMPANIES - FTSE 250
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Shipping services provider Clarkson raised its shareholder payout for the 20th year in a row, amid a "record" performance. In 2022, revenue jumped to GBP603.8 million from GBP443.3 million. Pretax profit increased to GBP100.1 million from GBP69.1 million. The firm increased its final dividend to 64p from 57p, resulting in a full-year payout of 93p, up from 84p. "Whilst the global geo-political outlook for 2023 and beyond remains uncertain, the strength of business and balance between supply and demand, supported by our record level of forward order book, gives us confidence in the outlook for Clarksons," said CEO Andi Case.
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OTHER COMPANIES
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WANdisco confirmed it is in the "early stages of proactively exploring" a potential additional listing in the US. The Sheffield-based data-management software company specialises in distributed computing. It said: "As a dual UK and US headquartered technology company, WANdisco has long-stated its intention to consider an additional listing of its ordinary shares in the United States." The firm said it remains committed to London's AIM and maintaining its listing there.
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Craneware reported revenue for the six months to December 31 rose 6% to USD84.7 million from USD80.2 million a year before, though pretax profit fell to USD5.2 million from USD6.2 million. The company focused on optimising financial performance for healthcare providers maintained an interim dividend of 12.5p. Craneware said it is confident of delivering annual results in line with current consensus, and the building blocks are in place to accelerate growth as the headwinds facing the US healthcare market ease. "We are financially strong, with healthy cash reserves and a solid foundation of Annual Recurring Revenue," said CEO Keith Neilson.
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London-based estate agent firm Foxtons confirmed the acquisition of Atkinson McLeod for GBP7.4 million, to be funded from its existing cash reserves. Atkinson McLeod is an estate agent operating in Central East London, with four branches, bringing in around 90% of its revenue from around 1,100 tenancies. The acquisition is part of Foxton's strategy to acquire lettings businesses "that deliver an attractive return on invested capital, enhance earnings and improve the resilience of the group's earnings", as well as strengthening its lettings brand. The acquisition is expected to be accretive to earnings this year, it said. Monday's announced confirmed a report by Sky News on Sunday.
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By Elizabeth Winter, Alliance News senior markets reporter
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