(Alliance News) - Stocks in London are called to open higher, even after local data showed no growth for the UK economy in June, while industrial output edged down.
In early corporate news, Admiral Group upped its interim dividend following a strong start to the year.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: called up 0.3% at 8,277.70
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Hang Seng: down 0.3% at 17,056.00
Nikkei 225: closed up 0.8% at 36,726.64
S&P/ASX 200: closed up 0.2% at 7,865.50
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DJIA: closed up 242.75 points, 0.6%, at 40,008.39
S&P 500: closed up 0.4% at 5,455.21
Nasdaq Composite: closed up slightly at 17,192.60
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EUR: up at USD1.1663 (USD1.1029)
GBP: down at USD1.2846 (USD1.2847)
USD: up at JPY147.24 (JPY146.74)
Gold: up at USD2,457.30 per ounce (USD2,451.20)
(Brent): down at USD79.88 a barrel (USD80.27)
(changes since previous London equities close)
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ECONOMICS
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Thursday's key economic events still to come:
11:00 IST Ireland trade balance
08:30 EDT US New York empire state manufacturing index
08:30 EDT US export and import prices
08:30 EDT US initial jobless claims
08:30 EDT US Philadelphia Fed manufacturing index
08:30 EDT US retail sales
09:15 EDT US industrial production
10:30 EDT US EIA natural gas stocks
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The UK economy showed no growth in June while industrial output edged down, data published by the Office for National Statistics showed Thursday. UK GDP did not move monthly in June compared to unrevised growth of 0.4% in May. The ONS said: "Comments provided for June 2024 suggested some industries may have been affected by the general election held on 4 July 2024. In a range of industries across the economy, businesses stated that customers were delaying placing orders until the outcome of the election was known. These comments covered all of manufacturing, construction, and services." The GDP was however 0.7% higher than a year ago. In the second quarter, UK GDP growth slowed to 0.6% on-quarter from an increase of 0.7% in the first quarter. Year-on-year, second quarter UK GDP growth was 0.9%.
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In a separate release, the ONS said the UK's trade deficit for goods and services stood at GBP13.3 billion in the second quarter, widened by GBP7.1 billion from the first quarter. Exports increased by 2.1% to GBP214.7 billion, while imports increased by 5.4% to GBP228.0 billion. On top of that, the ONS announced that industrial production declined by 0.8% monthly in June, swung from a rise of 0.3% in May. In the second quarter, industrial output edged down 0.1% compared to the first quarter.
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Chinese retail sales rebounded in July while industrial production growth slowed, official data showed Thursday, highlighting an uneven recovery in the world's second-largest economy. In July, retail sales – a key indicator of consumer spending – grew 2.7% year-on-year, rebounding from June's 2.0% increase, according to the National Bureau of Statistics. The performance narrowly exceeded the expectations of analysts surveyed by Bloomberg, who had predicted a 2.6% increase. However, industrial production growth slowed, with July's 5.1% expansion inching down from 5.3% in June and short of the 5.2% forecast in the Bloomberg survey. This marks its weakest growth since March. Meanwhile, the unemployment rate rose to 5.2% in July, from 5% in June.
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Japan's economy has rebounded, government data showed Thursday, in welcome news for its next prime minister following Fumio Kishida's decision to quit. The 0.8% expansion in the second quarter came after the world number four economy slumped by 0.6% in the first three months of the year. The rise, supported by increased activity and increased capital and public investment, beat market expectations that output would grow 0.6%.
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More than a third of landlords raising rents in England have been motivated to match local properties on the market, as renters continue to be squeezed by a shortage of available homes, according to research. About 60% of landlords increased the rent on at least one of their properties over the past year, a survey by the TDS Charitable Foundation found. The primary reason for doing so was because of rising costs and fees, particularly maintenance and repairs, which 45% cited as their reasoning. This was followed by 38% who said they increased costs to align with local market rents, as demand for properties in the area continued to keep prices elevated. The report comes after new official data showed that average private rents across the UK increased by 8.6% in the year to July, the Office for National Statistics said on Wednesday.
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BROKER RATING CHANGES
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RBC raises DCC to 'outperform' (sector perform) - price target 5,800 (5,700) pence
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Deutsche Bank raises IG Group price target to 1,225 (1,065) pence - 'buy'
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Berenberg raises FRP Advisory price target to 220 (200) pence - 'buy'
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COMPANIES - FTSE 100
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Admiral Group emphasised "a strong set of results" in the first half, after posting pretax profit for the six months ended June 30 of GBP309.8 million, up 32% from GBP233.9 million a year prior. Group turnover of the financial services company was up 43% to GBP3.21 billion from GBP2.24 billion, while insurance revenue rose 38% to GBP2.21 billion from GBP1.61 billion. Return on equity came to 45% from 39% the previous year. Of note was Admiral's interim dividend, which enjoyed a 39% bump to 71.0 pence from 51.0p. Chief Executive Officer Milena Mondini de Focatiis said: "We continue to evolve our core technical competences leveraging new data and technology. Our focus now is on unlocking the benefit for our customers of scaled agile for faster delivery and enhancing our capabilities in AI application."
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AstraZeneca said its cancer drug Imfinzi has been granted priority review and breakthrough designation for patients with limited-stage small cell lung cancer in the US. The pharmaceutical firm said the decisions by the US Food & Drug Administration are based on phase 3 trial data which showed a statistically significant and clinical meaningful overall survival and progression free-survival benefit. The news came a day after AstraZeneca announced that the EU approved Imfinzi in combination with Lynparza for a form of cancer. Imfinzi plus chemotherapy as a first-line treatment, followed by Lynparza and Imfinzi, had been approved for patients with mismatch repair proficient disease, while Imfinzi plus chemotherapy followed by Imfinzi alone has been approved for patients with mismatch repair deficient disease.
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COMPANIES - FTSE 250
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3i Infrastructure announced that Future Biogas, a plant developer and biogas producer, has agreed to acquire 51% of a portfolio of six gas-to-grid anaerobic digestion facilities, with a combined gas output of 333 gigawatt hours, from JLEN Environmental Assets for GBP68.1 million. Of this, GBP30 million will be funded by 3i Infrastructure, with the balance funded by Future Biogas from committed debt facilities. Future Biogas CEO Philipp Lukas said: "We are very pleased to be acquiring a stake in this portfolio of anaerobic digestion plants from JLEN, who we will continue to work with constructively. We know the assets well having developed them and managed them for an average of eight years."
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OTHER COMPANIES
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Adriatic Metals said that an employee working at the Rupice Mine has died, following an accident at the site on Wednesday. A vehicle overturned near the rescue station at Rupice and the driver, an employee of a local Bosnian subcontractor, sustained fatal injuries. No other individuals were seriously injured in the accident. The incident did not occur in the area of mining operations; however, Adriatic Metals has elected to secure the area for a period of 24 hours.
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By Holly Beveridge, Alliance News senior reporter
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