UK MORNING BRIEFING: Old Mutual Buys Quilter Cheviot For Wealth Unit

LONDON (Alliance News) - Shares are staging a rebound for the second straight morning Friday, after a volatile session on Thursday left a similar morning rally in tatters by the close.

Petrofac is leading FTSE 100 gainers, up 3.2%, after saying it has received record awards for its engineering, construction, operations and management activities as it remains on track to hit profit targets for all of 2014.

Old Mutual said its wealth division is acquiring Quilter Cheviot, which is known for serving the affluent and high-net-worth segments of the UK private client market, for up to GBP585 million.

Here is what you need to know at the UK market open:
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MARKETS
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FTSE 100: up 0.1% at 6,203.22
FTSE 250: up 0.7% at 14,582.24
AIM ALL-SHARE: up 0.5% at 679.60
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Hang Seng: up 0.4% at 22,988.25
Nikkei 225: closed down 1.4% at 14,532.51
DJIA: closed down 0.2% at 16,117.24
S&P 500: closed marginally higher at 1,862.76
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GBP-USD: down at USD1.6034
EUR-USD: down at USD1.2786

GOLD: up at USD1,240.90 per ounce
OIL (Brent): down at USD85.87 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
(all times British Summer Time)

10:00 EU Construction Output
13:30 Canada Consumer Price Index
13:30 US Fed's Yellen Speech
13:30 US Housing Starts
13:30 US Building Permits
14:00 Russia Unemployment Rate
14:55 US Reuters/Michigan Consumer Sentiment Index Preliminary
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British households perceive that the value of their home increased in October, a survey from Knight Frank and Markit Economic showed. The house price sentiment index rose to 60.7 in October from 60.6 in September. This was the nineteenth consecutive month that the reading has been above 50. Any figure above 50 indicates that prices are rising and the higher the figure, the steeper the increase.
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The EU's cap on bankers' bonuses is the "wrong policy", according to Bank of England Deputy Governor Andrew Bailey, whose criticisms come just a day after European authorities moved to stop banks from getting around the rules. Speaking at the City Banquet in London on Thursday evening, Bailey said that so-called role-based allowances are a response to a bad policy.
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European car sales grew at a faster pace in September, a monthly report released by the European Automobile Manufacturers Association showed. New passenger car sales increased 6.4% in September from last year following a 2.1% rise in August. Sales expanded for the thirteenth consecutive month.
The UK reported an increase of 5.6%.
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Hong Kong police cleared another protest site early Friday after nearly three weeks of demonstrations for open elections in the semi-autonomous Chinese territory. Hundreds of officers removed barricades erected in the Mong Kok commercial and residential district, dispersing protesters within an hour and without significant resistance, local news reports said.
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Russian President Vladimir Putin and his Ukrainian counterpart Petro Poroshenko were due to meet early Friday with European leaders in a renewed push to resolve the conflict in eastern Ukraine.
The meeting is to take place on the sidelines of the Asia-Europe Meeting (ASEM) summit in the northern Italian city of Milan. It will be Putin and Poroshenko's third meeting since fighting broke out in eastern Ukraine earlier this year.
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The World Health Organization (WHO) is reviewing Ebola preparedness in 15 African countries, in order to prevent the disease from spreading across the continent, a senior WHO official said Thursday in Geneva. The UN health agency is focusing especially on countries bordering the three Ebola-affected countries of Guinea, Liberia and Sierra Leone, WHO's Isabelle Nuttall said. The number of Ebola cases in the three hardest-hit countries will surpass 9,000 this week, with the number expected to double every four weeks, Nuttall said. The number of deaths will climb above 4,500 this week, she added.
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BROKER RATING CHANGES
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TRADERS: MORGAN STANLEY LEAVES MARKS & SPENCER AT 'OVERWEIGHT'
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CREDIT SUISSE CUTS MARKS & SPENCER PRICE TARGET TO 360 (425) P. - 'UNDERPERF.'
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TRADERS: MORGAN STANLEY RAISES ROYAL MAIL TO 'EQUAL-WEIGHT' ('UNDERWEIGHT')
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SOCGEN RAISES TULLOW OIL TO 'BUY' ('HOLD')
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COMPANIES - FTSE 100
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A subsidiary of WPP has taken legal action to prevent the UK government from moving a GBP400 million contract to a competitor and has obtained a court order to block public access to information on the case, the Financial Times reported on Thursday. WPP's GroupM filed a claim in the High Court in London last month to challenge a decision by the government to award a contract, worth GBP100 million per year over four years, to Carat, an agency owned by rival Dentsu Aegis Network Ltd.
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Petrofac said it has received record awards for its engineering, construction, operations and management (ECOM) activities as it remains on track to hit profit targets for all of 2014. The company reported an order intake totalling USD9.4 billion for the year to date for its engineering, construction, operations and management sector. Its group backlog, unfinished work or customer orders that have been received but are either incomplete or in the process of completion, increased to USD21.2 billion at September 30, compared to USD20.3 billion at June 30, giving good revenue visibility for the remainder of 2014, it said in a statement.
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Old Mutual said its wealth division is acquiring Quilter Cheviot, which is known for serving the affluent and high-net-worth segments of the UK private client market, for up to GBP585 million, in a move to bolster its own discretionary investment management capabilities. Old Mutual expects the deal to meet the group's return on equity target of 12% to 15% and generate annual group synergies of GBP15 million by 2017. According to Old Mutual, Quilter Cheviot had GBP16.2 billion of funds under management at the end of September, as well as 38,000 clients.
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Travis Perkins said the encouraging momentum in its business reported in its half-year results has continued, with total sales and like-for-like sales growing in the third quarter and trading consistent with that seen in the first half. The FTSE 100-listed building merchant said total sales increased 6.9% in the quarter to September 30 year-on-year, with like-for-like sales increasing 5.7%.
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Rolls-Royce Holdings updated its guidance for the full year and next year, while providing medium-term guidance, as it said it now expects underlying revenue this year to be lower and said its outlook for 2015 has become more challenging. The FTSE 100 engineering and aerospace group said its expects underlying revenue for the full year to be 3.5% to 4% lower, compared to previous guidance of flat revenue against the comparable year. This includes adverse foreign exchange translation for the group estimated at GBP500 million, the same as it has previously announced.
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COMPANIES - FTSE 250
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Provident Financial said it is well positioned to deliver good quality growth for the whole of its current financial year as its Vanquis Bank reported growth in customers and average receivables. In a statement, Provident Financial said Vanquis Bank generated "strong growth and margins" in the UK through the third quarter of 2014, with year-on-year customer growth of 17% and average receivables growth of approximately 32%.
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Colt Group appointed Hugo Eales as its chief financial officer, with effect from November 1. Eales is the former CFO for BT Global Services, an arm of BT Group PLC. His appointment comes after Mark Ferrari decided to return to Fidelity Investments following his secondment from the US investment manager. He will step down from the Colt board as an executive director on October 31 and leave the company on December 31.
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COMPANIES - LONDON MAIN MARKET AND AIM
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Banana producer Chiquita Brands International Inc on Thursday rejected the sweetened USD14 per share offer from Brazilian companies Cutrale Group and Safra Group, saying that their sweetened offer is "inadequate and not in the best interests of Chiquita shareholders". The company said its board of directors has unanimously recommended that at the special meeting scheduled for October 24, its shareholders vote to approve its proposed merger with Irish food company Fyffes.
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Orange and Deutsche Telekom are understood to have restarted talks about the future of UK mobile operator EE, raising the prospect it will launch a flotation of the business next year in a deal which could be worth more than GBP12 billion, the Financial Times reported on Thursday.
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Jimmy Choo said it would price its upcoming initial public offering at 140 pence per share, the bottom of the indicative range for the deal. The luxury shoemaker said that, based on the 140 pence per share price, the total market capitalisation of the company when conditional dealings start will be GBP545.6 million. The pricing is at the low end of its indicative range. It had originally set an offer price range of 140-180p per share, before narrowing this to 140-160p this week.
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COMPANIES - INTERNATIONAL
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Google reported a net income of USD2.81 billion in the third quarter, down from USD2.97 billion a year earlier, the internet search company said Thursday. Sales increased by 20% to USD16.5 billion, according to the statement. Paid clicks rose 17% year over year, a much slower rise than in previous quarters.
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Apple on Thursday introduced its latest gadgets, including new iPads and a new iMac, and announced the launch date for Apple Pay during a media event at the company's headquarters in Cupertino, California. Apple Pay, the company's new mobile payments system will debut on Monday. Apple has signed up 500 banks and many more retailers to support Apple Pay.
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Oilfield services provider Schlumberger Ltd on Thursday reported a 13% increase in profit for the third quarter from last year, reflecting strong revenue growth in the company's North America operations. Both revenue and earnings per share for the latest quarter beat analysts' expectations.
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Fiat Chrysler Automobiles NV's Chrysler Group is voluntarily recalling about 470,000 cars and SUVs globally to resolve an alternator issue. The action will eliminate a condition that may potentially drain the battery, leading to loss of electrical power. This may increase steering effort, decrease brake effectiveness, cause stability-control deactivation and stalling. In the most severe case, this may initiate fire at the alternator. Chrysler said it is unaware of any related injuries or incidents involving fire.
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Friday's Scheduled AGMs/EGMs

John Swan & Sons
Bluefield Solar Income Fund
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By Tom Waite; thomaslwaite@alliancenews.com; @thomaslwaite

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