LONDON MARKET OPEN: Stocks Gain After Powell Remarks; Indivior Surges

(Alliance News) - London stocks on Thursday started the second day of US Federal Reserve Chair Jerome Powell's testimony to Congress in positive territory after dovish remarks made on Wednesday.Reckitt Benckiser was among the stocks pushing the FTSE 100 higher after agreeing to settle a US probe for USD1.4 billion, while former subsidiary Indivior surged on boosted guidance.The large-cap index was 19.88 points higher, or 0.3%, at 7,550.57 early Thursday. The mid-cap FTSE 250 index was up 77.01 points, or 0.4%, at 19,496.39, while the AIM All-Share was flat at 914.43.The Cboe UK 100 index was up 0.2% at 12,800.40. The Cboe UK 250 was 0.3% higher at 17,387.03, while the Cboe UK Small Companies was up 0.7% at 11,313.55.In mainland Europe, the CAC 40 index in Paris and DAX 30 in Frankfurt were up 0.3% and 0.2% respectively in early trade.Stocks in Europe started Thursday's session on the front foot after dovish remarks from US Federal Reserve Chair Jerome Powell. In comments welcomed by Wall Street, Powell said many central bankers believed the case for lower rates "had strengthened" last month given the rising "crosscurrents" in the economy.In his highly anticipated testimony to Congress, Powell repeatedly stressed the importance of keeping the US economy growing to ensure its benefits reach Americans left at the margins and said the central bank will deploy all its tools to support continued expansion."Willingness to cut the [federal funds rate] removed the latest concerns of the most cautious market participants and launched a new round of rally, affecting a wide range of instruments - from the dollar and stock indexes to commodities," said analysts at FxPro.This positive sentiment in stock markets flowed through to Asia on Thursday, with the Japanese Nikkei 225 index ending up 0.5%. In China, the Shanghai Composite closed up 0.1%, while the Hang Seng index in Hong Kong is 0.7% higher in late trade.The day ahead has US inflation readings at 1330 BST. In addition, the Bank of England will release its financial stability report at 1030 BST, the European Central Bank releases accounts from its last monetary policy meeting at 1230 BST and Powell returns to Congress at 1500 BST. Already released, German inflation accelerated in June, as initially estimated, on higher package holiday prices.The consumer price index rose 1.6% year-on-year in June, reaffirming the provisional reading and faster than the 1.4% rise recorded for May. Month-on-month, consumer prices were up 0.3%, again in line with the flash reading.The higher inflation rate in June was caused by package holidays, Destatis said, with prices up 6.1% in June after a 9.0% fall in May. This helped to offset energy product prices rising just 2.5% in June, slowing from a 4.2% rise in May.In London, Reckitt was up 2.3% after agreeing to pay up to USD1.4 billion to resolve an investigation into the sales and marketing of Suboxone Film.Suboxone Film contains buprenorphine, a controlled substance that is used an an opioid replacement for addicts.The agreement has been reached with the US Department of Justice and the Federal Trade Commission. Suboxone Film is a product owned by Indivior, Reckitt's former prescription pharmaceuticals business which was demerged from the Reckitt group in 2014. Indivior now is separately listed on the London Stock Exchange.The payment will fully resolve all federal investigations into Reckitt in connection to Indivior's indictment and claims relating to state Medicaid programs for those states choosing to participate in the settlement."While RB has acted lawfully at all times and expressly denies all allegations that it engaged in any wrongful conduct, after careful consideration, the board of RB determined that the agreement is in the best interests of the company and its shareholders," said Reckitt.The company continued: "It avoids the costs, uncertainty and distraction associated with continued investigations, litigation and the potential for an indictment at a time of significant transformation under RB 2.0 and during CEO transition."Nurofen painkiller maker Reckitt currently has a provision of USD400 million which it will increase to USD1.5 billion at its half-year results.Separately, Indivior on Thursday raised its guidance following a stronger than expected first half.Indivior - which did not mention the Reckitt announcement in its own on Thursday - now expects net revenue in a range of USD670 million to USD720 million, a sharp increase from previous forecasts of USD525 million to USD575 million. Net income is expected between USD80 million to USD130 million. Prior to this, the company had anticipated anything from a loss of USD40 million to income of USD10 million.The primary driver has been a market share outperformance from Suboxone Film, the company explained. Indivior shot up 23% in early dealings.Credit checking firm Experian was towards the bottom of the FTSE 100 index, down 1.3% after Goldman Sachs cut the stock to Neutral from Buy.FTSE 250 technical products and services firm Diploma was up 2.8% after agreeing the GBP56.0 million takeover of a gasket and fluid-sealing products maker.Virginia Sealing Products specialises in customers who process and transport hazardous materials but also operates in markets such as power generation, pulp & paper, and marine. Diploma is paying GBP56.0 million in cash upfront, but it may also pay a further GBP8.0 million if VSP meets various operating profit targets. The deal will be funded from existing cash and new debt, but Diploma said it "will continue to maintain a strong balance sheet".