LONDON MARKET PRE-OPEN: Stocks Seen Down; Greek Bailout Talks Delayed

LONDON (Alliance News) - UK stock futures point to a lower open Monday, with investors turning their attention to economic data from Germany and the US as Greece's new bailout talks are delayed until Tuesday for "technical reasons".

IG says futures indicate the FTSE 100 to open 11 points lower at 6,568.50 points. The index closed down 1.1% at 6,579.81 on Friday.

On the UK corporate front, Ryanair Holdings said its pretax profit in the first quarter of its financial year rose by 25% on the back of more passengers, higher revenue and better margins for the Irish budget carrier, prompting it to hike its pretax profit guidance for the full year.

Ryanair said its pretax profit for the three months to the end of June was up to EUR245 million, from EUR197 million a year earlier, on the back of a 10% rise in revenue to EUR1.65 billion from EUR1.50 billion. The group's net margin in the quarter improved to 15% from 13%.

It said its pretax profit for the full year will be towards the upper-end of its previously-guided range of EUR940 million to EUR970 million.

Meanwhile, pharmaceutical giant AstraZeneca said it has signed an agreement with Genzyme to sell Astra's Caprelsa rare disease medicine. AstraZeneca said Genzyme will pay it up to USD300 million, including a USD165 million upfront payment, to acquire the global rights to sell and develop Caprelsa.

Reckitt Benckiser said it has upgraded its like-for-like revenue growth target for the full year after its pretax profit rose in the first half thanks to a solid performance across the business.

The FTSE 100-listed consumer goods company, which makes products including cleaning spray Cillit Bang, Nurofen painkillers and Durex condoms, said its pretax profit for the six months to the end of June was GBP921 million, up from GBP838 million a year earlier.

UBS raises its easyJet price target to 1,950 pence from 1,880p, keeping a Buy stance, while Jefferies lifts its Barclays price target to 357p from 340p, reiterating a Buy recommendation. Societe Generale upgrades Drax Group to Hold from Sell, and Goldman Sachs cuts Britvic price target to 810p from 838p, keeping the stock in its 'Conviction Buy List'.

On the European economic front, CESifo Group business sentiment survey results from Germany and eurozone money supply data are both expected at 0900 BST.

"The German IFO survey will provide further indications of economic activity in the euro area at the start of the third quarter," says Lloyds Bank. "Coming after the expected pickup in the second quarter, recent survey evidence has been mixed."

"Overall, the broad picture of strengthening activity compared with last year still remains intact and we have pencilled in a rise in the headline IFO index to 107.6 from 107.4, firmer than the market consensus of a slight dip to 107.2," writes the bank.

Greece's talks with its creditors over a new bailout package will be delayed until Tuesday "for technical reasons" and are "neither political nor diplomatic" in nature, a finance ministry official says.

The meetings with representatives from the European Commission, European Central Bank, International Monetary Fund, and possibly the European Stability Mechanism, were supposed to have started on Monday. The finance ministry official, who spoke on condition of anonymity, said negotiations at the technical level will start on Tuesday, adding that the mission chiefs will arrive in Athens with a delay of "one or two days" due to technical reasons."

In Asia on Monday, the Japanese Nikkei 225 closed down 1.0%. In China, the Hang Seng is down 2.6% and the Shanghai Composite is down 3.8%.

Profits earned by Chinese industrial enterprises increased in June, figures from the National Bureau of Statistics showed. Industrial profits rose 0.3% year-over-year to CNY588.57 billion in June following a 0.6% rise in the preceding month.

The agency said the slowdown in industrial profit growth for the month was impacted by a decline in industrial producer prices, higher unit costs and tough comparisons with the year-ago period, when profits surged up 17.9%. During the first six months of the year, total industrial profits declined by 0.7% as compared to the corresponding period last year.

Wall Street ended lower Friday. The DJIA closed down 0.9%, the S&P 500 ended down 1.1% and the Nasdaq Composite finished down 1.1%. US investors will focus Monday on the release of US durable goods orders data, which are expected at 1330 BST.

"US core durable goods are expected to come in slightly better than the previous month, with a rise of 0.5% expected, while including transportation a rise of 3.2% is expected due to orders placed during the recent Paris Air show," says CMC Markets chief market analyst Michael Hewson.

By Daniel Ruiz; danielruiz@alliancenews.com

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