LONDON MARKET PRE-OPEN: Thomas Cook Skips Dividend Amid Profit Warning

LONDON (Alliance News) - Stock prices in London are seen opening flat as optimism over a resolution of the trade dispute between the US and China faded.In early UK corporate news, Intertek issued a positive trading update, while Thomas Cook surprised the market with an unscheduled earnings announcement, suspending its annual dividend after warning on profit. IG futures indicate the FTSE 100 index is to open up 1.40 points at 7,037.40. The blue-chip index closed up 83.14 points, or 1.2%, at 7,036.00 on Monday.US President Donald Trump said he would likely go ahead to raise tariffs on Chinese goods. Trump said he expects to hike tariffs to 25% from the current 10% on USD200 billion of Chinese imports.Trump told the Wall Street Journal it was "highly unlikely" he would hold off on the increase. "The only deal would be China has to open up their country to competition from the US," Trump told the Journal. "As far as other countries are concerned, that's up to them."The comments come four days ahead of a planned meeting between Trump and Chinese President Xi Jinping at the G20 summit in Buenos Aires, Argentina. If negotiations between the two go badly, Trump said he would also put tariffs on Chinese imports not now subject to duties."If we don't make a deal, then I'm going to put the USD267 billion additional on," at a tariff rate of either 10 or 25%, Trump said, adding this could include 10% tariffs on Apple's iPhones and laptops imported from China.The Japanese Nikkei 225 index closed up 0.6% on Tuesday. In China, the Shanghai Composite closed flat, while the Hang Seng index in Hong Kong is down 0.4%.Product testing and inspecting services firm Intertek said it is on track to deliver its 2018 targets of organic revenue growth, with moderate margin progression and strong cash conversion.For the 10 months to October 31, revenue was up 4.8% at constant currency to GBP2.32 billion, and up 0.5% at actual exchange rates. Organic revenue growth at group level came in at 3.8%. In its Products and Trade units, organic revenue growth was 5.9% and 1.5%, respectively, over the same period. Intertek left its year-end net debt guidance unchanged at GBP800 to GBP850 million. "The group remains on track to deliver its 2018 target of good organic revenue growth with moderate margin progression at constant currency and strong cash conversion. We expect our Products related businesses to deliver robust organic revenue growth, our Trade related businesses to report solid organic revenue growth performance, and our Resources related businesses to deliver a stable organic revenue performance. We will continue to benefit from the acquisitions made since January 2017," Intertek said. Thomas Cook Group suspended its dividend for the 2018 financial year in light of a "disappointing" trading performance.The travel agent said it expects earnings before interest and tax of GBP250 million in the financial year to September 30. This is GBP58 million lower than the prior year on a like-for-like basis.Thomas Cook said that as a result of the heatwave in May, demand reduced sharply with customers across European markets delaying holiday decisions as they enjoyed record temperatures at home. This delay in bookings restricted the travel company's ability to achieve the planned margins in the 'lates' booking period, it said. Thomas Cook said its earnings also were hit by legacy costs and non-recurring charges which included a write-down of historic hotel receivables, flight disruption costs, and further restructuring costs.The company said its UK business particularly suffered as the slowdown in bookings came on top of an already competitive market for Spanish holidays."2018 was a disappointing year for Thomas Cook, despite achieving some important milestones in our strategy for transforming the business. After a good start to the year, we experienced a larger-than-anticipated decline in gross margin following the prolonged period of hot weather in our key summer trading period. Our final result is expected to be around GBP30 million lower than previously guided, due to a number of legacy and non-recurring charges to underlying EBIT," Chief Executive Peter Fankhauser said. BHP Group said it has identified a new potential system of iron oxide, copper and gold on one of its licences nearby to one of its operations in South Australia. The new mineral system is located about 65 kilometres south-east of its Olympic Dam operations on its 5941 licence.The pound was flat quoted early Tuesday at USD1.2800 against USD1.2814 at the London equities close MondayIn the US on Monday, Wall Street ended sharply higher, with the Dow Jones Industrial Average up 1.5%, S&P 500 up 1.6% and Nasdaq Composite up 2.1%.The strong close on Wall Street came as investors looked to pick up stocks at reduced levels following a period of recent weakness.In Tuesday's economic calendar French consumer confidence is at 0900 GMT and the CBI distributive trades survey is at 1100 GMT. In the US, the S&P/Case-Shiller house price index is at 1400 GMT.