UK MORNING BRIEFING: BT Earnings Give London Shares Positive Open

LONDON (Alliance News) - A strong earnings report from BT Group has helped lift UK shares at the open Friday. The FTSE 100 telecom stock is up 3.7% at 384.60 pence.

Brokers are providing their take on Thursday's corporate news makers, with Goldman Sach cutting Diageo to Neutral from Buy and HSBC raising National Grid to Overweight from Neutral, according to traders. Meanwhile, JPMorgan and Merrill Lynch have cut Serco to Neutral.

Here is what you need to know at the UK market open:

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MARKETS
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FTSE 100: up 1.77 at 6,540.22
FTSE 250: up 28.86 at 15,730.66
AIM ALL-SHARE: up 1.28 at 856.97
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DJIA: closed up 109.82 at 15,848.61
S&P 500: closed up 19.99 at 1,794.19
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GBP-USD: down at USD1.6458
EUR-USD: down at USD1.3545

GOLD: down at USD1,240.70 per ounce
OIL (Brent): down at USD107.62 a barrel

(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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Friday's Key Economic Events still to come

10:00 EU Consumer Price Index
10:00 EU Unemployment Rate
13:30 US Personal Spending
14:45 US Chicago Purchasing Managers' Index
14:55 US Reuters/Michigan Consumer Sentiment Index
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A survey of consumer confidence in the UK showed a better than expected improvement last month. The consumer confidence index from the GfK NOP research firm rose in December to a seasonally adjusted minus-7. The reading was up from the previous month's minus-13 reading and slightly better than the minus-12 expected by most economists.
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German retail turnover declined unexpectedly during Christmas season, provisional results from the Federal Statistical Office showed Friday. Retail turnover fell 2.5% in real terms from a month ago, reversing November's 0.9% rise. Sales were expected to increase by 0.2%. Similarly, retail sales, on a yearly basis, slipped 2.4% in December, in contrast to the 1.1% growth posted in November and 1.9% rise expected by economists.
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The European Central Bank cannot afford to be complacent, Executive Board member Benoit Coeure said at a dinner organized by the Centre for European Reform, in London. Coeure warned that the recovery is uneven. "Debt levels and unemployment are high and unevenly distributed, and the nascent recovery remains weak and uneven," he added. The currency bloc started to see the results of the actions taken during the crisis, he observed. The "decisive measures" taken by the ECB to ensure price stability helped to calm the crisis.
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Japanese housing starts growth accelerated unexpectedly in December, official data from the Ministry of Land, Infrastructure, Transport and Tourism showed. Housing starts grew 18% year-on-year, faster than the 14.1% rise seen in November. The rate was forecast to slow to 13.6%. Likewise, the number of annualized housing starts increased to 1.055 million from 1.037 a month ago. The expected level was 1 million.
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Australia pledged to keep turning boats back to Indonesia in defiance of Jakarta's wishes after confirming that no asylum seekers had breached its naval cordon in six weeks. "This January is the first January where there've been no boats since 2008," Immigration Minister Scott Morrison told national broadcaster ABC.
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Syrian government officials and the opposition will in February resume attempts to end the three-year-old conflict, UN chief Ban Ki-moon confirmed Thursday as negotiators from both sides argued over priorities - forming a transitional government or tackling the violence. While Ban welcomed advances in the Geneva talks and said both sides had made concessions, the international chemical weapons watchdog revealed negligible progress in ridding Syria of its stockpile, and a human rights group detailed massive demolitions of residential areas by Syrian regime forces.
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The US will pursue the death penalty against Boston bombing suspect Dzhokhar Tsarnaev, the Justice Department said Thursday. "After consideration of the relevant facts, the applicable regulations and the submissions made by the defendant's counsel, I have determined that the US will seek the death penalty in this matter," Attorney General Eric Holder said. Tsarnaev, 20, has pleaded not guilty to charges that he carried out the bombings along with his brother on April 15, 2013, at the finish line of the Boston Marathon, killing three people and wounding more than 250.
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US student Amanda Knox and her former Italian boyfriend Raffaele Sollecito are guilty of the 2007 murder of Briton Meredith Kercher, an Italian court ruled Thursday, in the latest twist in a six-year legal saga. Knox was sentenced to 28 years and a half - 18 months less than the prosecution had asked. Sollecito was to be imprisoned for 25 years, confirming the punishment inflicted at the end of the couple's first trial, in 2009. The prosecution had asked for 26 years.
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BROKER RATING CHANGES
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JPMORGAN CUTS SERCO TO 'NEUTRAL' ('OVERWEIGHT') - TARGET 463 (575) PENCE
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BARCLAYS CUTS BAE SYSTEMS TO UNDERWEIGHT (EQUAL W.) - TARGET 380 (370) PENCE
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TRADERS: MERRILL LYNCH CUTS SERCO TO 'NEUTRAL' ('BUY')
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TRADERS: SOCGEN CUTS SABMILLER TO 'HOLD' ('BUY')
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TRADERS: UBS REMOVES HOMESERVE FROM 'MOST PREFERRED LIST'
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BERENBERG RAISES SCHRODERS TO 'BUY' ('HOLD') - TARGET 3050 (2550) PENCE
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BERENBERG CUTS ASHMORE GROUP TO 'HOLD' ('BUY') - TARGET 375 (470) PENCE
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TRADERS: NUMIS INITIATES TYMAN WITH 'ADD'
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TRADERS: GOLDMAN CUTS DIAGEO TO 'NEUTRAL' ('BUY')
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TRADERS: GOLDMAN RAISES IMPERIAL TOBACCO TO 'CONVICTION BUY LIST' ('NEUTRAL')
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TRADERS: HSBC RAISES NATIONAL GRID TO 'OVERWEIGHT' ('NEUTRAL')
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COMPANIES - FTSE 100
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BT Group PLC raised its full-year expectations for earnings before interest, tax, depreciation and amortisation, as it saw revenue and pretax profit rise in its third quarter. BT now expects full-year EBITDA to meet the upper end of the GBP6.0 billion to GBP6.1 billion range. The company saw revenue rise 2% to GBP4.60 billion in the quarter ended December 31, 2013, up from GBP4.38 billion in the previous year. BT said growth had been boosted by growth in its BT Sport service.
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COMPANIES - FTSE 250
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Domino's Pizza Group PLC said David Wild, a senior non-executive director, will be appointed interim chief executive with immediate effect. Wild will serve in the role for a temporary period of two months after a new chief executive is appointed and will work with current CEO Lance Batchelor until Batchelor leaves March 16. Stephen Hemsley, non-executive chairman, also will work with Wild until a permanent chief executive is appointed.
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Vedanta Resources PLC reported higher production of refined zinc at its Zinc India unit, record oil and gas production and a 3% rise in operating profits for its fiscal third quarter, although mined metal production fell 5% and revenues fell. The oil and metals company said earnings before interest, tax, depreciation and amortisation were USD294.2 million in the three months to end-December, compared with USD276.3 million a year earlier, even though revenues declined to USD546.6 million, from USD574.8 million.
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Dairy Crest Says Q3 Broadly In Line With Expectations; Agrees Sale Of Nine Elms Residential And Middle-Ground Milk Depot; Expects FY Profit Ahead Of Expectations After Nine Elms Sale; Made GBP15M Profit On Nine Elms Sale To Battersea Project Phase 5 Residential Company; Says FY Spreads Profit To Be Below Previous Expectations
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Rank Group H1 Adjusted Pretax Profit GBP27.7M, Down 23% From Restated GBP36.1M Year Before; H1 Revenue GBP352.4M, Up 16% From Restated GBP304.4M; Interim Dividend 1.35p Per Share, Up 8% From 1.25p; Rank Group Says Expects Operating Profit In H2, Excluding Acquired Casinos, To Be Broadly In Line With Comparable Period; Says Trading In 1st 4 Weeks Of H2 In Line With Internal Expectations, Positive Trend
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Paragon Group Of Companies Expects To Launch Bank This Quarter; Says Banking Application Well Advanced; Pretax Profit GBP27.1M In Most Recent Quarter
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Premier Farnell Say Sales To Grow 3.5% In Second Half Excluding Raspberry Pi; Expects FY Operating Margin In Line With First Half, 0.4% Points Lower; Expects To Maintain Operation Margin At Similar Level In 2014/15 Year
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Cairn Energy Says Has Confirmed With Its Advisers That Is Has Been Tax Compliant In India; Says Approach From Indian Tax Authorities Relates To Retrospective 2012 Legislation
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KCOM Expects To Meet Full Year Expectations
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De La Rue Says Trading Since September 29 As Anticipated, Expects FY Operating Of About GBP90M
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John Wood Appoints Ian Marchant Chairman
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COMPANIES - ALL-SHARE AND AIM
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Drug company Skyepharma PLC said it expects to report 2013 revenues and operating profits that are materially ahead of market expectations. In a statement, the specialist in oral and inhaled drugs, said a number of items need to be finalised, including receipt of royalty statements for the fourth quarter, but it already expects to beat expectations.
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Top Level Domain Holdings Raises GBP21M From Placing; Proposes Name Change To Minds + Machines
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Sorbic International Says Current Year Has Started Well; Says Trading In Line With Expectations
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Belgravium Technologies Expects FY Before Exceptional Costs In Line With Expectations
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Avocet Mining 4Q Gold Production 25,730 Ounces At Cost Of USD1,209 Per Ounce, Vs 30,987 Ounces At USD1,195 In 3Q
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Good Energy Apppints Denise Cockrem As Chief Financial Officer
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TEG Group Says 2013 Trading Was Broadly In Line With Its Expectations
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Sinclair IS Pharma Buys Dermal Filler Atlean From GSK Stiefel For Undisclosed Sum
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China Rerun Chemical FY Pretax Profit CNY25.6M Vs CNY3.7M Loss
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Serviced Office Group In Lease Extension Deal On Covent Garden Centre; Lease Extended Until September 2023
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Norcros Says Has Dispute With WM Morrison Over Contract To Sell Land, Related To Planning Permission
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Air Partner Says Has Continued To Trade Profitably; Says FY Profit Expectations Remain Unchanged
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Friday's Scheduled AGMs/EGMs

Scottish Investment Trust
Schroder UK Mid Cap Fund
JPMorgan Asian Investment Trust
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By Tom Waite; thomaslwaite@alliancenews.com; @thomaslwaite

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