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LONDON (Alliance News) - UK shares have opened sharply lower Friday, following losses on Wall Street and in Asia, amid growing concerns about the eurozone economy and the spread of the Ebola virus.
Vedanta leads FTSE 350 losers, down 5.8%, after saying its overall oil and gas production decreased in the first half following planned maintenance work on its operations.
Cake and bread bakery goods maker Finsbury Food Group said it has acquired the Fletchers Group, a group of bakeries, for around GBP56 million in a reverse takeover.
Here is what you need to know at the UK market open:
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MARKETS
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FTSE 100: down 0.6% at 6,390.69
FTSE 250: down 1.1% at 14,656.24
AIM ALL-SHARE: down 1.0% at 715.67
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Hang Seng: down 1.9% at 23,089.68
Nikkei 225: closed down 1.2% at 15,300.55
DJIA: closed down 2.0% at 16,659.25
S&P 500: closed down 2.1% at 1,928.21
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GBP-USD: down at USD1.6093
EUR-USD: flat at USD1.2685
GOLD: down at USD1,221.92 per ounce
OIL (Brent): down at USD88.82 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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Friday's Key Economic Events still to come
(all times British Summer Time)
all day IMF and G20 meetings
09:00 Italy Industrial Output
09:30 UK Trade Balance
10:00 UK CB Leading Economic Index
13:30 US Import and Export Price Index
13:30 Canada Unemployment Rate
14:00 US Philadelphia Fed's Plosser speech
15:30 Canada Bank of Canada Business Outlook Survey
19:00 US Monthly Budget Statement
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The World Health Organization has warned that Ebola is now entrenched in the capital cities of all three worst-affected countries and is accelerating in almost all settings, the BBC reports. WHO deputy head Bruce Aylward warned that the world's response was not keeping up with the disease in Guinea, Liberia and Sierra Leone, the broadcaster said. The news comes after the UK government said people arriving in the UK from areas hit by Ebola face "enhanced screening" for the virus at Heathrow, Gatwick and Eurostar terminals. The BBC also quotes Whitehall sources as saying it is "very unlikely" a British man who died in Macedonia on Thursday could have contracted the disease.
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The UK Independence Party won its first seat in the British parliament at a by-election, sounding a warning to both Prime Minister David Cameron's Conservatives and the opposition Labour Party ahead of a general election. Douglas Carswell's defection to UKIP in August from the Conservatives and resignation from parliament triggered the vote in the southern coastal town of Clacton. He was returned as eurosceptic UKIP's first representative at Westminster, receiving 60% of the vote against the 25% the Conservative candidate received.
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Student demonstrators in Hong Kong were gathering as their leaders called for protests, after the government called off planned talks on their demands for electoral reform. Thousands started reappearing on the streets late Thursday, and several hundred camped out overnight in the city's Admiralty district and the Mong Kok area in Kowloon. Talks with authorities were planned for Friday, but Chief Secretary Carrie Lam called them off the previous evening, after protest leaders called for a rally to increase pressure during the meeting.
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The members of the Bank of Japan's Monetary Policy Board said that the country's modest economy recovery continues at a modest pace, minutes from the board's September 3-4 meeting revealed. The easing measures put into place have been having the desired effects, the members added, although there remain risks to the economy - including commodity exporters, the European debt situation and the pace of the recovery in the US.
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North Korean leader Kim Jong Un apparently broke tradition by not visiting the mausoleum of his predecessors on the 69th anniversary of the founding of the Workers' Party of Korea Friday, fuelling speculation over his health, a media report said.
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Turkey will not act alone in sending ground forces into Kobane, Foreign Minister Mevlut Cavusoglu said Thursday, despite the looming fall of the Syrian border town to Islamic State militants. As the jihadists' artillery pounded hard-pressed defenders deep inside the Kurdish hold-out, Cavusoglu told reporters in Ankara: "We have never been reticent" about taking on the jihadist group. Speaking after a meeting with new NATO Secretary General Jens Stoltenberg, he said Turkey would only send ground forces if it receives support from the US-led military coalition, which has been targeting Islamic State positions from the air for two months.
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England manager Roy Hodgson described it as a "job well done" as his side cruised to a 5-0 win over the minnows of San Marino at Wembley on Thursday. Captain Wayne Rooney scored his 42nd international goal, seven short of the all-time record, while Phil Jagielka, Danny Welbeck, Andros Townsend and an Alessandro Della Valle own goal completed the scoring.
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BROKER RATING CHANGES
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TRADERS: HSBC CUTS CENTRICA TO 'UNDERWEIGHT' ('OVERWEIGHT')
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TRADERS: UBS RESUMES DIXONS CARPHONE WITH 'BUY' - TARGET 425 PENCE
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TRADERS: GOLDMAN CUTS BRITISH AMERICAN TOBACCO TO 'SELL' ('NEUTRAL')
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COMPANIES - FTSE 100
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Tullow Oil said its partner in the Arouwe block offshore Gabon hit non-commercial oil when it was drilling the Sputnik-1 well, a find that Tullow described as "encouraging". The Vantage Tungsten Explorer drill ship drilled Sputnik-1 to a final depth of 4,868 metres in water depths of 1,023 metres, but encountered non-commercial hydrocarbon pay in up to 300 metres of net sandstone reservoir, Tullow quoted partner Perenco as saying. Tullow Oil separately said it has completed the sale of 53.1% of its Schooner unit interest and 60% of its Ketch asset in the UK southern North Sea to Faroe Petroleum PLC. Faroe now has operatorship of the assets.
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Mick Davis, the former head of Xstrata, attempted a dramatic comeback earlier this year, approaching BHP Billiton with an offer to buy a bundle of mines from the world’s largest natural resources group, the Financial Times reports Friday, quoting people familiar with the matter. BHP rebuffed the bid from X2 Resources, Mr Davis’ new investment vehicle, and instead stuck by a plan to spin-off unwanted assets into a new listed company, the paper said.
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Anglo-Dutch consumer goods company Unilever will invest USD246 million in Thailand, a media report said. The investments will be used to improve local Unilever infrastructure and to target a growing Thai middle class. "Thailand is a strategic country for Unilever globally due its good geographical location, which can serve as a hub for the upcoming ASEAN Economic Community," said Unilever Thailand chairwoman Supattra Paopiamsap, according to the Bangkok Post.
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The UK government is unlikely to sell any more of its 25% stake in Lloyds Banking Group PLC until the lender is given regulatory approval by the Prudential Regulation Authority to start paying dividends again, Reuters reported on Thursday, citing banking and political sources. According to the report, approval for the FTSE 100 bank to recommence dividend payments is thought to be key to pushing the shares up to a level that would enable UK Financial Investments, which manages the government's stakes in bailed-out banks, to convince Britain's finance ministry that a sale would be in taxpayers' best interests.
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COMPANIES - FTSE 250
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Unite Group said it has acquired two developments sites in Aberdeen and Liverpool, which together once opened will add around 12 pence to its net asset valuer per share, and around 2.5 pence per share to its annual EPRA earnings per share. The student accommodation provider said the two new development projects will add a total of around 1,250 new beds and are scheduled to be open in time for the 2017/18 academic year. Unite said the two projects are expected to achieve returns in line with its targets for regional development of 9.5% to 10% yield on cost, and have a combined total development cost of around GBP80 million. It said those costs represent around 60% of the group's planned development activity for 2017 delivery.
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Jupiter Fund Management said its assets under management fell to GBP31.66 billion at the end of September after it sold its private client operations, but it scored GBP231 million of net mutual fund inflows in the third quarter, bringing the total for the first nine months of 2014 to GBP1.1 billion.
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Vedanta Resources said its overall oil and gas production decreased in the first half following planned maintenance work on its operations, partially offset by increased production at its Cambay site in India, with its metal production increasing from the first quarter, but down from the previous year. Oil and gas production decreased 3% in the first half ended September 30, to 206,125 barrels of oil equivalent per day from 212,873 barrels of oil equivalent per day in the same period in 2013. The decrease in production was due to its planned maintenance at its Rajasthan facilities and a suspension of gas sales from the Ravva block.
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Telecom Plus said it expects to post first-half adjusted pretax profit and earnings per share "significantly ahead" of the previous year, leaving it comfortable in meeting market expectations for the full year. The utilities provider also said it will appoint Nick Schoenfeld as chief financial officer in the new year. Schoenfeld has been group finance director of Hanover Acceptances Ltd since 2006, and prior to that held positions in Castorama and the Walt Disney Company. Telecom Plus said it expects to increase its interim dividend payment for the six months to end-September by 19%, reflecting its confidence in achieving expectations of nearly 50% growth in adjusted pretax profit to GBP63 million for the year.
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Croda International said it has poached Jez Maiden from transport operator National Express Group to be its finance director, replacing Sean Christie who announced in June that he would step down from the role in 2015 after nine years. In a statement, the specialty chemicals producer said Christie will leave at the end of April next year. National Express confirmed Maiden's departure, saying he had agreed to remain for the time being to ensure an orderly handover. It has started looking for a replacement and said it will consider internal as well as external candidates.
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COMPANIES - LONDON MAIN MARKET AND AIM
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Finsbury Food Group said it has acquired the Fletchers Group, a group of bakeries, for around GBP56 million in a reverse takeover. Finsbury Food's current market capitalisation is just GBP41.2 million. Finsbury Food said it will pay for the acquisition, which it is acquiring on a debt-free/cash-free basis, via a new debt facility and an oversubscribed placing to raise GBP35 million at a price of 59 pence per share. Finsbury Food shares were last quoted at 61.00p.
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XP Power said it traded in line with expectations in the third quarter of the year, but revenue for the first nine months was flat on the year earlier period at GBP74.8 million as it was hit by the strength of sterling against the US dollar. In a statement, the electronics power control company said revenue was up 6% at constant currencies.
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IGas Energy said it has won an appeal to construct an exploration well in Holt, near Wrexham, England. Wrexham County Borough Council refused to grant planning permission for the company's proposed exploration well in March despite a recommendation to approve it from the council's own planning officer, said IGas in a statement. The Planning Inspectorate of Wales overturned the decision on Wednesday, and approved the appeal, IGas said.
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COMPANIES - INTERNATIONAL
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Carl Icahn is pushing Apple chief executive Tim Cook once again to buy back more of the company's own shares, saying they are trading at half their true value, according to an open letter the activist investor posted online Thursday. "Our valuation analysis tells us that Apple should trade at 203 dollars per share today," said Icahn, who owns 53 million Apple shares, in the letter posted his website Shareholders' Square Table.
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India-based software exporter Infosys Technologies said its second-quarter profit increased from the prior year and topped estimates, supported by revenue growth that matched expectations. The company backed its fiscal year revenue forecast and the board recommended a bonus issue, sending the stock 6% higher on the Bombay Stock Exchange.
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Security software maker Symantec said Thursday its board has approved a plan to separate the company into two, independent publicly traded companies: one business focused on security and one business focused on information management. "As the security and storage industries continue to change at an accelerating pace, Symantec's security and IM businesses each face unique market opportunities and challenges. It has become clear that winning in both security and information management requires distinct strategies, focused investments and go-to market innovation," said Michael Brown, Symantec president and chief executive officer.
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Friday's Scheduled AGMs/EGMs
No Events Scheduled
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By Tom Waite; thomaslwaite@alliancenews.com; @thomaslwaite
Copyright 2014 Alliance News Limited. All Rights Reserved.
