(Alliance News) - Stock prices in London opened mixed on Monday with Aveva the worst performer in the FTSE 100 after the software company said it expects interim revenue to fall.
The FTSE 100 index was down 17.10 points, or 0.3%, at 5,999.55 early Monday. The mid-cap FTSE 250 index was flat at 18,071.13. The AIM All-Share index was down 0.1% at 988.93.
The Cboe UK 100 index was down 0.3% at 596.02. The Cboe 250 was up 0.1% at 15,365.61, and the Cboe Small Companies flat at 9,510.27.
In mainland Europe, the CAC 40 in Paris rose 0.1% and the DAX 30 in Frankfurt was up 0.2%.
"European bourses are heading out of the blocks in a mixed fashion, following on from gains in China on hopes that President Xi Jinping will announce further reforms which could drive foreign capital inflows at a speech on Wednesday. The risk-on mood is underpinning equities whilst dragging on the safe haven US dollar. However, rising Covid cases both in the UK and on the continent plus Brexit concerns coming to a head could keep the lid on any upwards movement and is keeping the FTSE in the red," said City Index analyst Fiona Cincotta.
The Japanese Nikkei 225 index ended down 0.3% on Monday. In China, the Shanghai Composite closed up 2.6%, while the Hang Seng index in Hong Kong is up 2.4%.
In the FTSE 100, Rolls-Royce was the best performer, up 4.5% as shares of the jet engine maker continued to recover from 17-year lows reached last week.
At the other end of the large caps, Aveva was the worst performer, down 3.6% after the industrial software firm said it has performed "creditably" in the first half against a challenging backdrop, but revenue is expected to fall.
For the half year ended September 30, Aveva expects to report revenue of around GBP333 million, down from GBP391.9 in the first half of financial 2020.
Separately, the Cambridge, England-based company said its proposed acquisition of OSIsoft remains on track and it is making progress on debt financing relating to the buyout.
GVC Holdings was down 1.8%. The gambling firm said it was awarded four sports-betting licences in Germany by the country's regulator. Some of the terms include a wagering limit of EUR1,000 per month that can be increased to EUR10,000. There also will be deposit limits until customer verification processes are complete and a maximum annual bonus per customer of EUR100.
The Ladbrokes betting chain owner said the licences have been issued with immediate effect, but the timing for implementation are yet to be formally agreed. GVC is working with the regulator on an implementation plan with terms expected to be in place in the early part of 2021.
Following implementation, GVC estimates that earnings before interest, tax, depreciation and amortisation will be reduced by up to GBP40 million on an annual basis. The company said this hit to earnings from the German licenses will be incremental to the GBP70 million negative impact of its new Tolerance Policy. GVC reported underlying Ebitda of GBP761.1 million for 2019.
Pearson was down 1.0%. Large shareholders of the education publisher are calling for the resignation of Chair Sidney Taurel over the pay package offered to the educational publisher's new chief executive, former Walt Disney executive Andy Bird, the Financial Times reported.
Bird is to receive a USD1.3 million base salary as well as a co-investment opportunity which will see him buy USD3.8 million shares in Pearson when he becomes CEO, the newspaper noted. In return, he will qualify for an award of up to USD9.4 million.
In September, a third of Pearson shareholders voted against the deal. Bird is due to become CEO on October 19, succeeding John Fallon. Three top 20 shareholders told the Financial Times that Taurel's handling of the succession process was "unfinished business" and that his "position was in danger".
On AIM, shares in mobile payments and messaging company Fonix Mobile started trading at 93.40 pence each, up 3.8% from its initial public offering price of 90.00p. The company raised GBP45 million in its IPO and had a GBP90 million market capitalisation at its IPO price.
The pound was quoted at USD1.3040 early Monday, up from USD1.3010 at the London equities close Friday.
Pubs, gyms and casinos will be forced to close and all but essential travel to and from coronavirus hotspots banned under new measures aimed at limiting the spread of the coronavirus in the UK.
Prime Minister Boris Johnson will spell out his three-tier strategy on Monday with areas in England labelled as medium, high or very high risk, which will inform the "appropriate interventions" needed in each area. Merseyside is expected to be among the areas subjected to Tier 3 restrictions – but there is still disagreement about a financial support package for the area should harsh measures be imposed.
"The UK economy will also be under scrutiny as further lockdown measures are expected to be announced in a week where Brexit negotiations are coming to a head, with no obvious signs of agreement yet in evidence," said Interactive Investor's Richard Hunter.
The euro was priced at USD1.1816, lower from USD1.1821. Against the yen, the dollar was quoted at JPY105.46, down from JPY105.68.
In commodities, Brent oil was trading at USD42.40 a barrel Monday morning, down from USD43.32 late Friday in London. Gold was USD1,923.88 an ounce, flat from USD1,924.20.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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Pearson (PSON)
Rolls-Royce (RR.)
Fonix (FNX)