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LONDON MARKET PRE-OPEN: CLS Sells 19 Offices; Bango Lags Forecasts

Tue, 31st Dec 2019 07:42

(Alliance News) - Stock prices in London are set for a negative start to Tuesday's abbreviated session, giving back some ground after trading higher over the Christmas week.

In quiet day for UK company news, property investment firm CLS Holdings said it is deepening its focus on London and the South East, selling all assets outside these regions.

IG says futures indicate the FTSE 100 index of large-caps to open 68.95 points lower at 7,565.00 on Tuesday. The FTSE 100 index closed down 0.8%, or 57.85 points at 7,587.05 on Monday.

The retreat on Monday followed a strong Christmas week for London shares, with the FTSE 250 index of mid-caps reaching a record closing high, breaching the 22,000 mark for the first time. It ended down 122.73 points on Monday at 21,936.26.

The London Stock Exchange will close early, at 1230 GMT, for New Year's Eve. It will re-open on Thursday for a full session.

Markets in France also close early on Tuesday, while those in Germany, Italy and Switzerland are closed all day.

In New York on Monday, the Dow Jones Industrial Average and the S&P 500 both ended down 0.6% and Nasdaq Composite finished 0.7% lower.

In Asia on Tuesday, financial markets were closed in Japan. In China, the Shanghai Composite closed up 0.3%, while the Hang Seng index in Hong Kong is down 0.5% in late trade.

In early UK company news, HSBC Holdings is planning to expand its exchange traded fund range in 2020 in order to revitalise its underperforming asset management business, the Financial Times reported.

Nicholas Moreau, who was appointed chief executive of HSBC's asset management division in August, has devised a series of initiatives aimed at reinvigorating growth at a time when the London-listed bank is aggressively cutting costs, the FT said.

In the first half of 2020, HSBC will launch eight ETF's employing environmental, social and governance metrics to tap into rising investor demand for ESG-focused strategies.

HSBC also plans to develop a fixed income ETF platform in 2020 and to launch a range of precious metals tracker funds later in the year, the FT noted.

CLS Holdings said it will sell a portfolio of 19 regional offices in the UK for GBP65.0 million to Capital Partners, a Singaporean investment firm.

The offices are located across the UK outside of the South East. Therefore the sale is in line with the FTSE 250-listed company's strategy of actively recycling its capital and focusing the UK portfolio on London and the South East, it said.

Following the completion of the transaction, CLS will hold only two assets in the UK outside of the South East. The sale of those assets are expected to complete in the first quarter of 2020.

"We continue to see significant opportunities for acquisitions across our core markets, and this transaction will allow us to recycle capital to capitalise on those opportunities," explained Chief Executive Fredrik Widlund.

Elsewhere, Indus Gas reported its half-year results, with profit for the six months to the end of September advancing by 11% to USD26.1 million from USD23.6 million a year before. The improvement was helped by a reduction in administrative expenses and cost of sales.

Revenue, meanwhile, declined slightly year-on-year to USD27.7 million from USD27.8 million.

The company also suffered a USD245,732 loss on foreign exchange, swinging from a USD142,884 gain a year earlier.

Mobile commerce company Bango reported continued growth in end-user spend, which is expected to achieve GBP1.1 billion in 2019, resulting in revenue growth for the year of 40% to "at least" GBP9.3 million.

Adjusted earnings before interest, taxes, depreciation, and amortization for the full year is positive and in excess of GBP400,000. Last year, the company recorded an adjusted Ebitda loss of GBP870,000.

However, this strong results will be still below market forecasts primarily due to a Customer Data Platform license and Marketplace supply deal not concluding in December as expected. These deals are now expected to close in early 2020, Bango said.

The company said operating costs remain stable and in line with expectations. Bango said it continues to invest in research & development, growing the data monetisation business and boosting the Bango platform.

Sterling was quoted at USD1.3109 early Tuesday, lower than USD1.3136 at the London equities close on Monday.

In other currencies, the euro was trading at USD1.1204 early Tuesday, soft versus USD1.1216 late Monday. Against the yen, the dollar was at JPY108.64, down slightly from JPY108.83.

Gold was quoted at USD1,524.30 early Tuesday, up from USD1,515.03 at the London equities close on Monday.

Brent oil was trading at USD66.48 early Tuesday, firm on USD66.14 at the London equities close on Monday.

The economic events calendar on Tuesday has only US data. The Johnson Redbook retail sales index is at 1355 GMT, with the monthly house price index at 1400 GMT and the US consumer confidence index at 1500 GMT.

By Evelina Grecenko; evelinagrecenko@alliancenews.com

Copyright 2019 Alliance News Limited. All Rights Reserved.

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