LONDON (Alliance News) - Stocks opened broadly flat in London on Monday after little in the way of economic or company news to move shares.
In the FTSE 100, shares in British Gas-owner Centrica were higher following a report in The Sunday Times it was holding talks about a tie-up with French state-owned energy company Engie.
Beyond the larger companies, shares in junior miner Landore Resources surged after it said it made made a significant gold discover at its Junior Lake property in Canada.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 0.1% at 6,140.12
FTSE 250: up 0.1% at 16,853.28
AIM ALL-SHARE: up 0.1% at 712.58
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Hang Seng: market closed for holiday
Nikkei 225: down 0.3% to 16,123.27
DJIA: closed up 0.6% at 17,792.75
S&P 500: closed down 0.6% at 2,072.78
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GBP: flat at USD1.4226 (USD1.4173)
EUR: flat at USD1.139 (USD1.1365)
GOLD: down 0.3% at USD1,217.70 per ounce (USD1,211.90)
OIL (Brent): down 0.8% at USD38.25 a barrel (USD38.59)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Monday's Key Economic Events still to come
(all times in BST)
Holiday - China Ching Ming Festival
09:00 Italy public deficit/GDP
09:30 UK PMI construction
09:30 EU Sentix Investor Confidence
10:00 EU unemployment rate
10:00 EU producer price index
13:00 Ireland consumer confidence
14:45 US ISM New York index
15:00 US Labor Market Conditions index
15:00 US Factory Orders
15:30 Canada Bank of Canada Business Outlook survey
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Union leaders will meet to discuss the crisis gripping the steel industry as efforts continue to save thousands of jobs. The meeting comes amid reports that Marc and Nathaniel Meyohas, the brothers behind the Greybull investment firm, are putting the finishing touches to a buy-out of Tata's Scunthorpe steelworks. The Daily Telegraph reported that they are ready to pour GBP400 million into the struggling Lincolnshire plant, saving about 9,000 jobs. UK Business Secretary Sajid Javid has signalled ministers are working on plans to reduce energy costs and take on some of the pension liabilities in an effort to attract a buyer for Tata's loss-making UK assets.
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Britain's anti-doping agency UKAD faces a government investigation and also pledged Sunday to conduct its own review into wide-ranging doping allegations over a doctor and high-level sport. Culture, Media and Sport Secretary John Whittingdale wants to probe why UKAD did not take action against Mark Bonar after an athlete said he was given doping substances by the medic. "I have asked for there to be an urgent independent investigation into what action was taken when these allegations were first received," The Sunday Times quoted Whittingdale as saying. The Sunday Times and German broadcasters WDR, in a documentary to be aired later in the day, also said that Bonar has prescribed performance-enhancing drugs to some 150 elite athletes including Premier League footballers and Tour de France cyclists.
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A passenger flight headed to Faro, Portugal, took off from Brussels Airport on Sunday, the first passenger flight to depart from the airport after suicide bombings killed more than 30 people there and at a Brussels metro station last month. According to the airport's website, flights to Turin and Athens were also due to take off on Sunday, with a longer list of departing flights scheduled for Monday. Passenger air traffic has been at a standstill at the airport since March 22, when two men blew themselves up in the facility's departure hall and a third man set off an explosion at the Maelbeek metro station near the EU headquarters in Brussels.
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Greek authorities were bracing for a backlash on Sunday from migrants who will be forced to return to Turkey next week under a migration deal between the EU and Ankara. Under a deal struck between the EU and Turkey last month, migrants who arrived in Greece after March 20 who do not apply for asylum or fail to qualify will be returned to Turkey starting Monday. For every migrant sent back to Turkey, one Syrian refugee will be directly taken from Turkey and resettled in Europe. Migrants likely to be sent back to Turkey rallied in protest on the islands of Lesbos and Chios on Saturday, denouncing the returns as "deportations."
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The International Monetary Fund sees agreement on a "coherent" rescue programme for Greece as still far away, according to a letter from IMF chief Christine Lagarde published Sunday. "My view of the ongoing negotiations is that we are still a good distance away from having a coherent programme that I can present to our executive board," Lagarde wrote in her letter to Greek Prime Minister Alexis Tsipras. She reiterated that the IMF could only support a programme "that is credible and based on realistic assumptions." Lagarde's letter came in reaction to a letter from Tsipras in which he demanded a clarification of the IMF position.
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A huge leak of 11.5 million documents from a Panama-based law firm reveals how top politicians, sports stars and criminals hide their money using offshore tax havens, Germany's Sueddeutsche Zeitung said Sunday. The leaked data link at least 12 current and former heads of state and 128 other politicians to illicit financial transactions. Those implicated include Russian President Vladimir Putin, former Egyptian autocrat Hosny Mubarak and Syrian President Bashar al-Assad. The leak comes from Mossack Fonseca, one of the world's biggest and most secretive offshore law firms. The firm said it had never faced charges for criminal wrongdoing in its efforts to help clients launder money, dodge tax and circumvent financial sanctions.
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BROKER RATING CHANGES
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UBS RAISES ADMIRAL GROUP PRICE TARGET TO 1840 (1708) PENCE - 'NEUTRAL'
Liberum Raises International Consolidated Airlines Group Target To 875p From 700p, Keeps Buy
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COMPANIES - FTSE 100
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Anglo American said it has agreed to sell its 70% stake in the Foxleigh metallurgical coal mine in Queensland, Australia. No financial details on the sale were disclosed, but Anglo said it has sold the stake to a consortium led by Taurus Fund Management. Foxleigh is an open-cut coal mine which produces high-quality pulverised coal injection coal, Anglo said. It is located in the Bowen Basin in Queensland and delivered 1.86 million tonnes of production attributable to Anglo in 2015.
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Centrica is in early talks over a tie-up with the oil and gas production arm of Engie, the French state-backed energy giant, the Sunday Times reported without saying where it got the information. The report said that Centrica is "understood" to have hired investment bank JP Morgan for advice. Engie and Centrica co-own Cygnus, one of the largest gas fields in the North Sea. "A combination with Engie?s oil and gas arm, perhaps under a new joint venture vehicle, would allow both companies to reduce costs by cutting overlap and extracting better terms from suppliers. It is unclear whether a deal will be struck," the report said.
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Anglo-South African paper and packaging company Mondi said Russian authorities have started an investigation into its Russian business. Mondi said the Federal Anti-Monopoly Service of the Russian Federation said last week it had initiated an investigation into Mondi Syktyvkar for violating anti-monopoly laws in regards to pricing of offset paper. Mondi said it has not received any notification to this effect from the Russian regulator and has no further details on the probe.
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COMPANIES - FTSE 250
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Polymetal International said it has reached a binding agreement with a subsidiary of multi-commodities miner and trading house Glencore to acquire Orion Minerals, the holding company for the Komarovskoye gold deposit in Kazakhstan. FTSE 250-listed Polymetal will pay USD100.0 million in cash to Kazzinc, a Glencore-owned business, to buy the site. Kazzinc also will receive a deferred consideration linked to future production from the deposit. Komarovskoye is located in north-western Kazakhstan, around 187 kilometres from Polymetal's Varvarinskoye mine. The site comprises and open pit mine and heap leach facility with grid power available on the site.
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Oil services company John Wood Group said it has won a two-year extension to its service contract with TAQA, the Abu Dhabi state-owned oil company, in the North Sea. Under the contract, which has three one-year extension options in place beyond the initial two-year term, John Wood's Wood Group PSN unit will continue to provide engineering, construction and maintenance services to five offshore assets for TAQA. These comprise the Cormorant Alpha, North Cormorant, Eider, Tern and Harding projects.
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The merger between Just Retirement Group and Partnership Assurance Group has now completed, paving the way for the newly combined JRP Group to begin its first day of trading on the London Stock Exchange on Monday. The combined company, valued at GBP1.4 billion by market capitalisation and with GBP15 billion in assets under management, offers defined benefit pensions de-risking to corporate clients, individually underwritten retirement income products, care plans for people moving into residential care, and lifetime mortgages.
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COMPANIES - LONDON MAIN MARKET AND AIM
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Defence manufacturer Chemring Group said the implementation of its ammunition contract with a customer in the Middle East has started, with a letter of credit in place and an advance payment now received. Chemring was forced into a profit warning in October 2015 due to delays on the ammunition contract, which was signed in September last year. On Monday, however, Chemring said in-house and supply-chain production has started on the contract, with initial revenue to be recognised in the second quarter of its current financial year to the end of October. Chemring expects the deal to make a significant contribution to its results in the 2016 financial year.
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Exhibitions company ITE Group said trading in the first half of its financial year was in line with its expectations, with total revenue higher but like-for-like sales lower. ITE said revenue for the six months to the end of March was around GBP63.0 million, compared to GBP56.1 million a year earlier, though like-for-like sales were down by around 4.0% year-on-year. Like-for-like trading volumes were down around 9.0% year-on-year, ITE said, in line with its expectations. But while a stabilisation in the oil price has helped strengthen currencies in some key markets for ITE, its exposure to Russia will mean its full-year results remain sensitive to trading of the ruble against sterling, it said.
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Landore Resources said it has made a significant gold discovery at the Junior Lake project in Ontario, Canada. Landore said follow-up drilling on the BAM East gold prospect at the project has established the presence of a significant gold discovery at the site, with gold mineralisation open along the east and west of the site. Intersections of up to 5.74 grams per tonne of gold were seen in the drill holes, Landore said, adding current drilling indicates mineralisation may be increasing with depth.
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COMPANIES - INTERNATIONAL
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Alaska Air Group is expected to announce on Monday that it won the auction for Virgin America Inc, besting rival JetBlue Airways in a bidding process that culminated in a cash price of about USD2.5 billion, the Wall Street Journal reported citing people familiar with the matter. The report indicated that The deal signed Friday night was more than USD1 billion over Virgin America's market capitalisation on Friday, which had started to rise last month on takeover speculation. San Francisco-based Virgin America, which began flying in 2007, is 54%-owned by Richard Branson's Virgin Group and New York-based Cyrus Capital Partners. The company went public in November 2014.
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Honda Motor will conduct at least the sixth round of major recalls involving its Fit compact in less than three years, Bloomberg reported. The company will recall more than 283,000 Fit cars and Vezel crossovers after reports of six fires related to a control systems flaw and two collisions linked to a power steering defect, the report quoted japan transport ministry official Yuichi Yamamoto as saying. The automaker recalled the 2016 Civic in February after 2-litre engines seized up in quality-control checks and in the field, resulting in a fire and one reported injury.
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The board of directors of Orange concluded that an agreement regarding a possible consolidation with Bouygues Telecom has not been reached and has decided to terminate the discussions with Bouygues that have been ongoing since 5 January 2016. Orange said it would pursue the deployment of its strategic plan, launched in 2015, that is focused on investment in very high-speed broadband networks and providing an unmatched customer experience. The group confirms all of its financial objectives. Separately, Bouygues confirmed that it was not possible to find agreement with Orange and said its board had unanimously agreed to withdraw from the negotiations.
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Taiwanese tech manufacturing giant Foxconn took over ailing Japanese electronics company Sharp in a deal worth nearly USD3.5 billion signed Saturday. Apple supplier Foxconn will invest JPY389 billion in the business, JPY100 billion less than previously planned. The deal would give Foxconn a controlling stake of 66%. "Both sides agreed. Suggestions made from external assessment also show it's a reasonable deal," Tai Jeng-wu, a member of Foxconn's board of directors, said ahead of the formal signing. Foxconn had suddenly put its offer on hold a month ago, saying it needed to examine more closely new information it received about Sharp's financial health.
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Orders for Tesla Motors' Model 3 electric car have now topped 276,000 since the company began taking orders on March 31, the company Chief Executive Elon Musk tweeted. The Model 3, which is slated to go into production in late 2017, is a sedan capable of seating five and going 215 miles on a charge and 0-60 mph in less than 6 seconds, starting at a price of USD35,000. Musk also said the company is planning to send out gifts to people who waited in line at Tesla stores as a token of appreciation.
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Monday's Scheduled AGMs/EGMs
UK Oil & Gas Investments
Scottish American Investment Trust
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By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
Copyright 2016 Alliance News Limited. All Rights Reserved.
Admiral (ADM)
International Airlines (IAG)
Centrica (CNA)
Landore (LND)