Weekly review

Oliver Haill WebFG News | 29 Sep, 2017 18:04 - Updated: 18:04 | | |

The FTSE 100 finished up 62.12 points, or 0.85%, over the week to close at 7,372.76 on Friday.

Equity view

Unilever on Monday said it had agreed to buy skincare business, Carver Korea, from Bain Capital and Goldman Sachs for €2.27bn.

NMC Health, the United Arab Emirates hospital operator, has won regulatory approval from authorities in Saudi Arabia to open a freshly built medical centre in the kingdom, where it has also agreed acquire two hospitals for a total of $40m.

Pennon, the water and waste group, said half year results remained "on track to deliver in line" for both businesses and it felt well placed for the rest of the year.

Indivior has struck an out-of-court settlement to resolve litigation over its Suboxone opiate addiction treatment with Mylan Pharmaceuticals.

Decision making for larger properties in London's West End is being hit by the lack of political and macroeconomic certainty, Shaftesbury reported, though demand for smaller spaces is good.

Shares in Imagination Technologies surged in early trade after the company agreed late on Friday to be taken over by US-based, Chinese-backed private equity firm Canyon Bridge Partners for £550m.

As well as hitting half-year targets, the AA has appointed former Expedia and Uber executive Simon Breakwell its permanent chief executive to "sharpen focus" on the parts of the businesses where there are "most value and future profit opportunity".

It was calm seas for Carnival during the third quarter as stronger demand drove a five per cent improvement in cruise tiket pricing and the company guided towards the upper end of its previous guidance for profits.

United Utilities reported that current trading remained in line with the group's expectations for the six months to 30 September.

RSA Insurance said late on Monday that trading results in the third quarter to date have been positive, with the exception of the UK business segment, which was hit by weather events.

Events and publishing company Informa announced the acquisition of Dove Medical Press in a deal with undisclosed financial information.

Retailer Card Factory reported a jump in revenue for the first half as it declared a special dividend, but profit declined on the back of foreign exchange movements, the national living wage and investments.

Merchant bank Close Brothers said on Tuesday that profit for the year rose 13% as profits rose across all three of its divisions, although it warned over the impact of the longer-term economic outlook and Brexit on its customers.

Soft drinks maker AG Barr posted a rise in interim revenue on Tuesday and said it was on track to meet its expectations for the year, but profit fell due to higher cost inflation and brand investment.

Thomas Cook said it was confident of hitting full-year targets after a good summer season and agreed a deal with Swiss hotel investors to buy a stake in a German resort operator and jointly invest in growing the UK company's own-brand hotels.

SSE said on Wednesday that it continues to expect first-half and full-year earnings for fiscal 2018 to be hit by a reduction in the contribution from the Networks division.

Entertainment One, the television and film producer and distributor, said its operating performance since March was on track with its full year targets, despite revenues from the reshaped film business being lower than last year.

PZ Cussons said it remains on track to deliver full-year growth in operating profits despite tough trading conditions in most markets.

Diploma chief executive Bruce Thompson has revealed he plans to retire from his role at the industrial and technical products group within the coming 12 months, 21 years after taking the job.

Safety, health and environmental technology group Halma said it made “good progress” in line with board expectations in its scheduled trading update for the period from 2 April.

Buffeted by pilot roster problems, Ryanair confirmed on Wednesday it was cancelling 18,000 more flights between November and March, with 400,000 passengers affected in addition to the hundreds of thousands it announced last week.

Carillion shares surged on Wednesday following a report that a Middle Eastern suitor is waiting to see what the construction firm has to say in its update at the end of the week before it makes an offer.

Shareholders in Boohoo.com were crying despite the fashion e-retailer doubling first-half sales, beating profit forecasts and upgrading full year guidance, with investors miffed as investment in the business is leading to slightly lower margins.

Residential landlord group Grainger generated strong sales and kept a lid on costs in the second half of the year, leading to much improved full year profits, though triple net asset value is flat.

On Thursday, cigarette firm Imperial Brands on Thursday confirmed it was in talks to help rescue UK tobacco supplier Palmer & Harvey as it said it expected to deliver strong growth in full year revenues and earnings at actual currency rates.

Tour operator Tui cruised towards its full year targets and said, with two new ships launching and five year-round resorts opening in the coming year, that trading for future seasons was "overall" in line with expectations despite a dip in demand for Caribbean and Florida holiday post hurricane season.

Plastics packaging specialist RPC Group said first-half sales are likely to be "well ahead" of the corresponding period last year, with profit margins also ahead of management expectations.

Stagecoach Group updated the market on its current trading on Thursday, confirming its earnings expectations for the year to 28 April 2018 remained unchanged.

Food outlet operator SSP Group said it expected full-year revenue to increase 11. 4% after a rise in fourth quarter passenger numbers at airports.

CMC Markets said on Thursday that profitability in the first half of 2018 was "significantly higher" than a year ago, but the spreadbetting firm sounded a cautious note on the outlook on the back of regulatory uncertainty.

On Friday, insurer Beazley said early estimates of the net cost of Atlantic hurricanes Harvey, Irma and Maria and earthquakes in Mexico was $175m - $275m (£130m - £205m) and would cut 2017 earnings by about $150m.

Glencore was chewing over a potential bid for some of Chevron's South African assets, according to reports on Friday afternoon.

Irish budget airline Ryanair agreed to comply with demands made by regulators to inform customers of their full compensation rights after it cancelled thousands of flights in recent weeks.

Carillion unveiled a £1.2bn first-half loss and warned full year results would be worse than expected, although stand-in management say they have a "firm handle" on the construction group's problems and have put in place "a clear plan to address them".

Aviva agreed to sell its stake in Italian joint venture Avipop Assicurazioni to Banco BPM for a consideration of €265m (£233m) in cash.

QinetiQ issues a trading update on Friday, before entering its closed period for the half year ending 30 September.

Sirius Minerals remains on time and on budget as it develops its massive Woodsmith polyhalite fertiliser mine under the Yorkshire Moors.

Economic news

The Bank of England will call for banks to increase the amount of capital buffers they hold by £10bn as it warned that risks from rising debt are building in the UK and overseas based on overconfidence that recent benign conditions will continue.

Labour's John McDonnell vowed yesterday to introduce law that would help cut credit card debt after the Financial Conduct Authority found that "more than three million people are in persistent debt".

London mayor Sadiq Khan has put further doubt around the Brexit policy of the Labour party after suggesting that the party may back a second referendum on the EU’s departure.

UK mortgage lending remained largely unchanged but consumer credit eased lower last month, according to the latest figures from the banking industry, while businesses began to hold onto more cash in the face of political and economic uncertainty.

Retail sales volumes bounced back this month are are expected to continue growing but at a slower pace in October, according to the CBI's survey of the sector published on Wednesday.

UK Defence Secretary Michael Fallon late on Wednesday warned aircraft manufacturer Boeing that it "could jeopardise" its British defence contracts as a result of its feud with Bombardier.

Prime Minister Theresa May and Bank of England governor Mark Carney separately warned about the effects of continues low interest rates and that Brexit was the biggest risk the UK faces, as both spoke at an event to celebrate the 20th anniversary of the Bank's independence.

The number of vehicles produced in the UK fell for the fourth month in a row in August, as both domestic and international interest lessened.

European Commission president Jean-Claude Juncker has said that there would have to be ‘miracles’ for Brexit talks to progress to trade issues in October.

UK interest rates could rise in the "relatively near term", said Bank of England Governor Mark Carney.

UK economic growth slowed to a four-year low in the second quarter of the year, part of a deluge of official figures on Friday that send the pound tumbling, also including a soft start to the third quarter for the services sector and a widening of the current account deficit.

UK consumers are ignoring concerns about their personal finances and taking confidence from the wider economy's resilience, research revealed on Friday.

House price growth in the UK remained broadly stable in September, but prices in London fell for the first time in eight years, according to the latest survey from Nationwide.

International events

German chancellor Angela Merkel has been re-elected for a fourth term as the country’s leader, with her CDU/CSU joint effort remaining the largest in the parliament after Sunday’s election.

North Korea on Monday accused the United States of declaring war against the country after Donald Trump’s comments directed towards Kim Jong-un in recent days.

Japanese Prime Minister Shinzo Abe called early elections, citing the need for a new mandate in order to deal with the crisis on the Korean peninsula and for constitutional reform to strengthen the country's military.

The head of the European Central Bank appeared to dampen speculation regarding the prospects for tapering its quantitative asset purchase programme somewhat at the start of the week.

The head of the US central bank argued against waiting until inflation had returned to its 2. 0% target before tightening policy.

Activity in America's housing sector cooled last month, possibly due in part to the impact of hurricanes Harvey and Irma.

US consumer confidence dipped in September in the face of hurricanes Harvey and Irma, data released on Tuesday showed.

Business confidence in the euro area's second-largest economy was steady in September, even as optimism in the services sector continued to edge higher.

US pending home sales fell more than expected in August, according to figures from the National Association of Realtors.

Kurds in Iraq overwhelmingly voted for independence, the Kurdish election commission confirmed on Wednesday.

US crude oil stockpiles shrank as refinery activity continued to recover following recent hurricanes.

German Finance Minister Wolfgang Schäuble, long seen as an influential figure in the Eurozone and a leading advocate of austerity measures, was said to be preparing to resign from his post in order to give Chancellor Angela Merkel room to establish a coalition government after Sunday's election.

Republicans in the US Congress and President Donald Trump set out their major plans for tax reform in the country, including a proposal to slash taxes for corporations but an increase in the lowest rate of personal income tax.

The number of Americans filing for unemployment benefits rose a little more than expected last week, according to figures released by the Labor Department on Thursday.

The US economy grew a little more than initially estimated in the second quarter, according to data released by the Commerce Department on Thursday.

Beijing warned North Korean companies trading within Chinese borders on Thursday that it was time to wrap-up operations, as it took the first steps in implementing the most recent set of United Nations sanctions against Pyongyang.

After years of talking about it, Sunday will finally see action in Catalonia as the region turns out to vote in a referendum on independence from Spain, even though it has been branded illegal by the government in Madrid.

Inflation in the eurozone was unchanged in September, according to a flash estimate released by Eurostat on Friday.

US consumer sentiment deteriorated more than expected in September, according to a reading from the University of Michigan .

More news

17 Nov Europe close: Stocks slip going into the weekend

Stocks reversed early gains as investors opted to play it safe going into the weekend and the euro edged a tad higher on the back of the political gyrations on Capitol Hill.

17 Nov Europe open: Stocks start slightly higher, analysts wary

Stocks have started the morning trading slightly higher, tracking overnight gains on Wall Street but analysts are worried about buying into Thursday's bounce.

17 Nov London close: Stocks finish week on down note

London's top flight index slipped on Friday, but managed to finish well-off its lows of the session despite renewed Brexit angst as the pound gave back early gains.

17 Nov Kingfisher gets RBC upgrade as 'reasons to be cheerful' in France

DIY retailer Kingfisher has more "reasons to be cheerful" thanks to an improving French outlook, analysts at RBC Capital Markets said on Friday, while clothes seller Supergroup remains "compelling" but its shares have gained a lot in recent weeks.

17 Nov NAV on the rise as Alpha Real Estate Trust turns focus to build-to-rent market

Real estate investment group Alpha Real Trust saw its net asset value (NAV) rise in its first half of trading as it moved to make further investments in build-to-rent projects.

17 Nov Pacific Industrial & Logistics completes sale of Bedford asset

Industrial and logistics-focussed real estate investment trust Pacific Industrial & Logistics has completed the sale of an asset located at Hammond Road, Bedford, for a total consideration of £5.8m, it announced on Friday.

17 Nov DP Poland cuts ribbon on 50th Polish Domino's store

DP Poland, which holds the exclusive master franchise for the Domino’s Pizza brand in Poland, celebrated the opening of its 50th location in the country on Friday.

17 Nov Mercia Technologies makes new investment into Aston EyeTech

National investment group Mercia Technologies has made a new direct investment into Aston EyeTech - a spinout from Aston University, Birmingham - which has developed a range of proprietary hardware and software products in ocular care, it announced on Friday.

17 Nov SimiGon receives final approval for $2m Israeli Air Force order

Modelling, simulation and training solutions provider SimiGon has now received final regulatory approval for a $2m purchase order received from the Israeli Air Force, initially announced on 20 June 2016, it confirmed on Friday.

17 Nov Agriterra losses grow after 'subdued' interest in corn products

Agricultural investment group Agriterra saw losses widen in the first half of its trading year as subdued demand for its maize flour products slashed revenues by more than a third.