UK MORNING BRIEFING: SABMiller And Royal Mail Bookend FTSE 100

LONDON (Alliance News) - UK shares have opened higher across the board Thursday, after latest indications from US Federal Reserve policy makers left little concern about an imminent rate increase.

A flurry of IPO plans were confirmed early Thursday, led by property site Zoopla and low-cost airline Wizz Air, both on the London main market.

Shore Capital has downgraded Royal Mail to Hold from Buy after the postal service posted strong profits but said it faces headwinds, including competitive trading environment in its parcels business.

Royal Mail is at the bottom of the FTSE 100, while SABMiller, which also released results Thursday, is at the top.

Among other broker rating changes Thursday, Goldman Sachs has raised AIM-market retailer ASOS to Buy from Neutral. Shore Capital has responded to the management reshuffled announced at Carpetright on Wednesday by raising the stock to Buy from Hold.

Here is what you need to know at the UK market open:
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MARKETS
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FTSE 100: up 0.4% at 6,845.76
FTSE 250: up 0.4% at 15,668.32
AIM ALL-SHARE: up 0.4% at 795.08
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Hang Seng: up 0.6% at 22,986.38
Nikkei 225: closed up 2.1% at 14,337.79
DJIA: closed up 1.0% at 16,533.06
S&P 500: closed up 0.8% at 1,888.03
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GBP-USD: down at USD1.6890
EUR-USD: down at USD1.3662

GOLD: up at USD1,295.05 per ounce
OIL (Brent): up at USD110.51 a barrel

(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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Thursday's Key Economic Events still to come
(all times British Summer Time)

09:00 EU Markit Manufacturing PMI
09:00 EU Markit Services PMI
09:30 UK BBA Mortgage Approvals
09:30 UK Gross Domestic Product
09:30 UK Public Sector Net Borrowing
11:00 UK CBI Industrial Trends Survey
13:30 US Chicago Fed National Activity Index
13:30 US Initial Jobless Claims
14:45 US Markit Manufacturing PMI P
15:00 US Existing Home Sales
15:30 US EIA Natural Gas Storage change
16:00 US Kansas Fed manufacturing activity
20:00 US American Petroleum Institute Monthly Report
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The Federal Reserve discussed plans to exit stimulus but gave no indication that a rate hike is imminent, the minutes of the most recent Federal Reserve meeting showed Wednesday. In April, the Fed kept its benchmark rate unchanged at historic low levels near zero and it tapered quantitative easing by another USD10 billion per month. Before voting on that action, policy makers examined "several approaches" for tightening but have not decided on the appropriate mix of tools to wind down its unprecedented support for the US economy.
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French business confidence weakened unexpectedly in May, a closely watched survey data revealed. The business confidence index fell slightly to 99 in May from 100 in April, the Insee reported. The score was forecast to remain unchanged at 100.
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An index monitoring manufacturing activity in China came in with a score of 49.7 in May, the latest flash estimate from HSBC and Markit Economics revealed. That topped forecasts for a score of 48.3 and was up sharply from 48.1 in April - and while it does remain below the line of 50 that separates expansion from contraction, the May reading represents a five-month high.
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The same index in Japan came in with a seasonally adjusted score of 49.9 in May, Markit Economics said - touching a two-month high. That's up from 49.4 in April, although it remains just below the mark of 50 that separates expansion from contraction.
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About 80 US military personnel have been sent to Chad to help locate and "support the safe return" of more than 200 schoolgirls abducted last month in neighbouring Nigeria by Islamist militants, the White House said Wednesday. The military deployment is meant to "support the operation of intelligence, surveillance and reconnaissance aircraft for missions over northern Nigeria and the surrounding area," US President Barack Obama told Congress in a letter. The US force will remain in Chad as long as needed to help resolve the abductions by Nigerian extremist group Boko Haram, Obama said in the formal notification. Earlier Wednesday, at least 30 people were killed by militants in a village in northern Nigeria, after twin blasts killed 118 people Tuesday in the central town of Jos.
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BROKER RATING CHANGES
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Shore Capital Downgrades Royal Mail To Hold From Buy
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Liberum Upgrades Go-Ahead To Buy From Hold - PT 2,120p
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TRADERS: SOCGEN RAISES BRITVIC TO 'BUY' ('HOLD') - TARGET 860 (690) PENCE
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S&P CAPITAL IQ CUTS MARKS & SPENCER TO 'HOLD' ('BUY') - TARGET 480 (510) PENCE
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GOLDMAN RAISES ASOS TO 'BUY' ('NEUTRAL') - TARGET 6250 (7300) PENCE
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SHORE CAPITAL RAISES CARPETRIGHT TO 'BUY' ('HOLD') - TARGET 550 PENCE
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CREDIT SUISSE INITIATES EXOVA WITH 'OUTPERFORM' - TARGET 255 PENCE
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COMPANIES - FTSE 100
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Brewing giant SABMiller PLC reported a higher pretax profit for its last financial year, despite a dip in revenues, supported by volume increases and demand driven by its emerging markets businesses, which continue to hold off weakness in North America and Europe. The brewer of brands including Peroni, Pilsner Urquell and Grolsch, said it continues to see good growth coming out of emerging markets, and reported a pretax profit of USD4.82 billion for the year ended March 31, a 3% increase on the USD4.68 billion reported a year earlier. The group declared a full year dividend per share for the year of 105.0 US cents, up 4% on the prior year.
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Unilever Agrees To Sell Ragu and Bertolli Pasta Sauce Brands For USD2.15B Cash To Mizkan Group; Says Deal One Of Final Steps In Reshaping North America Portfolio
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Royal Mail FY Reported Pretax Profit GBP1.7B Vs GBP283M; Revenue Up 2% To GBP9.5B Vs GBP9.1B; FY Dividend Of 13.3P; Performance In Line With Expectations
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BP PLC said it is appealing to the US Supreme Court over a ruling on Monday supporting compensation claims for certain businesses affected by the 2010 Gulf of Mexico oil spill. The Fifth Circuit appeals court in New Orleans on Monday rejected BP’s request for a full review of the company’s case regarding settlement to victims of the disaster, as it seeks to establish that the compensation settlement it agreed with plaintiffs’ lawyers in 2012 is being interpreted unfairly. The oil and gas major's final chance to limit the level of compensation it has to pay above its original estimate of USD7.8 billion, will be by the appeal at the Supreme Court. The company argues that the terms of its original compensation agreement are being misinterpreted and it is now expected to pay out to unwarranted claims over events that were not connected to the Deepwater Horizon incident.
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United Utilities Group PLC posted a 75% increase in pretax profit during its full year as the company benefited from expected revenue increases due to strong operational performance, before being paid out GBP157 million in deferred tax credit. The major water firm said its pretax profit increased to GBP544.7 million for the twelve months ended March 31 from GBP311.8 million the previous year as revenues increased 3.7% to GBP1.70 billion from GBP1.64 billion.
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COMPANIES - FTSE 250
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IG Group PLC said subdued trading since the middle of March means that it currently expects full-year revenue to be slightly below expectations, but said profit, earnings and cash generation remain on track as operating costs continue to run slightly below plan. In a statement, IG Group said the "relative weakness" was most evident in May.
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Halfords FY Pretax Profit After Items GBP72.6M, Up 2.3% From 71.0M; Revenue GBP939.7M, Up 7.9% From GBP871.3M; Up 6.5% Like For Like; Final Dividend Unchanged At 9.1p, Full-Year Dividend 14.3p, Down 16% From 17.1p
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Carillion Awarded Middle East Contracts Worth Over GBP400M
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Polymetal Enters Agreement To Acquire Kyzyl Gold Project For USD618.5M Initial Consideration; Says Kyzyl Gold Project Acquisition Will Increase its Gold Reserves By Roughly 50%
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Ferrexpo Says Operations Continue to Be Unaffected by Recent Events In Ukraine;Says It Should Qualify To Receive USD117M In Bonds From Ukraine Government Over Outstanding VAT
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Dairy Crest FY Pretax Profit GBP48.8M Vs GBP7.9M Loss; Revenues Of GBP1.39B Vs GBP1.38B; Full Year Dividend Up 3% To 21.3P Vs 20.7P
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Investec Pretax Profit GBP425.4M Vs GBP386.5M; CEO Says FY Results In Line With Expectations; NAV Per Share 375.7p Vs 384.2p
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Mitchells & Butlers H1 Pretax Profit Flat At GBP68M; Total Revenue GBP1.02Bn Vs GBP991M;
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QinetiQ FY Pretax Profit GBP4.1M Vs GBP137.0M Pretax Loss; Revenue GBP1.19B Vs GBP1.33B; FY Dividend GBP4.60p Vs 3.80p; Maintaining Expectations For Overall Performance In Current Year
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Booker Group FY Pretax Profit Of GBP122.1M Vs GBP101.4M; Revenues GBP4.68Bn Vs GBP3.99Bn; Total Dividend For Year Of 3.20 Pence; Up 22%; Proposed Return Of Capital Of 3.50 Pence Per Share
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Amlin Q1 Gross Written Premium GBP1.28B Vs GBP1.22B
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Electrocomponents FY Reported Pretax Profit Up 16.6% To GBP101.1M Vs GBP86.7M;FY Dividend Stays At 11.75P
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COMPANIES - ALL-SHARE AND AIM
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Daily Mail & General Trust H1 Pretax Profit GBP114M Vs GBP83M; Revenue GBP931M Vs GBP866M; H1 Dividend Per Share Increased To 6.2P Vs 5.9P; CEO: FY Outlook Remains In Line With Expectations; Agrees Disposal Of Job Board Business Jobsite
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Zoopla Property Group Confirms Plan To IPO On London Main Market; Daily Mail, Countrywide And LSL Property Services All To Sell Shares As Part Of Zoopla IPO; IPO Involves Sale By Existing Holders Only, No New Shares, To Have At Least 25% Free Float; Had Pretax Profit Of GBP22.3M On Revenue Of GBP64.5M In Year To Sept 2013
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Restore Acquires Cannon Confidential For GBP933,000; Restore Trading In Line With Expectations, Encouraging In First Four Months
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Manroy Awarded Further EUR2.2M Contract; Says Contract With Existing European Government Customer
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Darty FY Revenues Up 0.5% In Euros, Up 1.7% On Like-For-Like Basis; Q4 Revenue Up 0.1% In Euros, Down 0.8% On Like-For-Like Basis
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KBC Advanced Technologies Raises GBP24.0M From Placing Of 20.9M Shares At 115p; Placement Represents 25.9% Of Enlarged Share Capital; Says Oslo-Listed Kongsberg Gruppen Now 5.0% Holder
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Hogg Robinson H1 Reported Pretax Profit Down 18% To GBP25.3M Vs GBP30.9M; Revenue Down 1% To GBP340.8M Vs GBP343.2M; H1 Dividend Boosted 5% To 2.21P Vs 2.10P
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Mothercare FY Pretax Loss GBP26.3M Vs GBP23.9M; Total Group Sales GBP724.9M Vs GBP744.1M; Worldwide Network Sales GBP1.19Bn Vs GBP1.19Bn; Determined To Return UK Back To Profitability, Growing International Business
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Young & Co FY Pretax Profit Of GBP26.6M Vs GBP21.4M; Revenue GBP210.8M Vs GBP193.7M; Full Year Dividend Per Share Up 6.1% To 15.52P vs 14.63P;Positive Trading Since Year End
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Thursday's Scheduled AGMs/EGMs

Henry Boot
Keller Group
Hochschild Mining
Partnership Assurance
Ferrexpo
North Midland Construction
PV Crystalox Solar
SkyePharma
Amlin
Revolymer
Safestyle
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By Tom Waite; thomaslwaite@alliancenews.com; @thomaslwaite

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