(Alliance News) - With the start of a new month, focus this week will be on early indicators of global economic performance the month before.
The data gets underway on Tuesday with a string of manufacturing PMI readings for May, followed by the same for the services sector on Thursday. The main event is on Friday with the US nonfarm payrolls report.
Inflation remains the primary market concern. On Monday, figures from Germany, Italy, Spain and Canada showed continued price pressure. Due out on Tuesday is the eurozone consumer price index at 1000 BST.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.4% at 7,049.03
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Hang Seng: up 0.9% at 29,417.13
Nikkei 225: closed down 0.2% at 28,814.34
New York market closed Monday for holiday.
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EUR: up at USD1.2229 (USD1.2185)
GBP: up at USD1.4230 (USD1.4175)
USD: down at JPY109.45 (JPY110.00)
Gold: up at USD1,916.08 per ounce (USD1,895.00)
Oil (Brent): up at USD70.32 a barrel (USD69.77)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Tuesday's Key Economic Events still to come
0955 CEST Germany manufacturing purchasing manager's index
0955 CEST Germany labour market statistics
1000 CEST EU manufacturing PMI
1100 CEST EU consumer price index
1100 CEST EU unemployment
0930 BST UK CIPS-Markit manufacturing PMI
0945 EDT US manufacturing PMI
1000 EDT US ISM report on business manufacturing PMI
1000 EDT US construction spending
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China's manufacturing sector continued to expand in May, with firms reporting the strongest increase in new work for five months, data from Caixin and IHS Markit showed. China's general manufacturing purchasing managers' index - a composite indicator designed to provide a single-figure snapshot of operating conditions in the manufacturing economy - inched up to 52.0 in May from 51.9 in April. The figure rose further away from the 50.0 threshold, which separates growth from decline. "Latest data signalled a further increase in demand for Chinese manufactured goods, with total sales rising at the fastest rate for five months. The expansion was supported by greater demand both at home and overseas. Notably, new export order growth improved to a six month high in May," IHS Markit said. On Monday, China's National Bureau of Statistics had said its manufacturing PMI inched lower in May to 51.0 from 51.1 in April.
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UK house prices jumped to their highest levels in almost seven years fuelled by strong demand and government support measures, the latest figures from mortgage lender Nationwide showed. On an annual basis, the Nationwide house price index rose 11% in May, up sharply from a 7.1% increase in April. The latest reading was the highest level recorded since August 2014. On a monthly basis, house prices rose 1.8% in May, slowing from a 2.3% rise in April.
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Ireland's manufacturing sector continued to grow in May, marking an improvement for the seventh time in eight months. The headline AIB Ireland manufacturing purchasing managers' index rose to 64.1 points in May from 60.8 in April - setting a new survey high. Any figure greater than 50 indicates overall improvement of the sector. The sharp growth was attributed to "booming" demand, benefiting from Covid restrictions lifting and the economy - in Ireland and Europe - beginning to reopen. The output and new orders indices both hit record highs, while the employment and suppliers' delivery times indices were the second-highest to date, IHS Markit said.
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BROKER RATING CHANGES
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BARCLAYS RAISES INTERMEDIATE CAPITAL PRICE TARGET TO 2,145 (1,570) PENCE - 'OVERWEIGHT'
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MORGAN STANLEY CUTS MARKS & SPENCER TO 'EQUAL-WEIGHT' ('OVERWEIGHT') - TARGET 172 (160) PENCE
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RBC RAISES MARKS & SPENCER PRICE TARGET TO 175 (150) PENCE - 'SECTOR PERFORM'
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COMPANIES - FTSE 100
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JD Sports noted a media report about the position of Executive Chair & Chief Executive Peter Cowgill. The Times reported that the blue-chip retailer has stepped up succession planning for Cowgill, after coming under pressure from institutional investors. Cowgill has been executive chair of JD since 2004 and assumed CEO responsibilities in 2014. However, the Times reported that investors are becoming increasingly concerned about Cowgill's joint roles, which flout usual corporate governance standards. "JD can confirm to both investors and to its international brand partners that the board is not engaged in a process to recruit a chief executive officer or chairman. JD can also confirm that it is continually reviewing the depth of its management team to ensure that the senior operational leadership team in the business has the necessary skills and experience to exploit the ongoing global development opportunities," the company said.
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Ocado is considering expanding its retail operations to new markets outside the UK, the Financial Times reported. The online grocer will consider launching operations in regions where it does not have an existing supermarket customer, leaving several large markets in western Europe as possible targets. "The pandemic, we believe, has permanently accelerated the channel shift [to e-commerce] and some of those markets that were behind the UK are more attractive for somebody to enter aggressively now than they were before the pandemic," Ocado Chief Executive & Co-Founder Tim Steiner told the newspaper in an interview. "If we haven't got the right potential partner there, then they're more attractive for us to think about ourselves."
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COMPANIES - FTSE 250
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Biffa said it delivered a resilient financial performance in the year just past despite the damage of pandemic lockdowns. For the financial year that ended March 26, Biffa posted revenue of GBP1.04 billion, down 10% from GBP1.16 billion last year as it swung to a pretax loss of GBP52.8 million from a GBP56.4 million profit. Biffa declared no dividend for financial 2021, having paid out 2.47p in financial 2020. "We are conscious of the importance of returning to paying dividends and will continue to review the timing of a dividend reinstatement," the company said. Looking ahead, Biffa said full-year expectations for financial 2022 remain unchanged, and it has been encouraged by recent trading.
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Kainos has acquired Finland-based payroll system provider Cloudator's Workday division for an undisclosed sum. Cloudator offers services for the full suite of Workday enterprise cloud applications, including Workday Financial Management, Workday Human Capital Management and Workday Adaptive Planning. It has been a Workday Services Partner since 2012. Kainos said the acquisition of Cloudator's Workday segment will further increase its Workday presence in Europe, adding 55 specialist Workday employees across the continent.
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Tuesday's Shareholder Meetings
Churchill China PLC - AGM
North American Income Trust PLC - AGM
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By Tom Waite; thomaslwaite@alliancenews.com
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