(Alliance News) - Stocks were called higher on Monday morning as investors digest news of greater-than-expected acceleration in China's manufacturing sector, while Japan's saw a softer deterioration than forecast.
Meanwhile, the impact of Friday's White House meeting which saw US President Donald Trump shouting at Ukraine's Volodymyr Zelensky - followed by European leaders lining up to reaffirm their support for the latter - continues to unfold.
"[UK Prime Minister Keir] Starmer urged European companies to form a 'coalition of the willing' to support Ukraine with military aid and security guarantees. Later, Macron announced plans to pursue a one-month truce," recounted Swissquote's Ipek Ozkardeskaya.
"Overall, tensions between the two continents have worsened. Oil prices initially rose in early Asian trading amid concerns that the Trump-Zelensky conflict could delay any path to lasting peace."
However, she continued: "The European will to stand with Ukraine means more military spending. Increased defence spending from the 'coalition of the willing' should provide a short-term economic boost but also accelerate technological advancements in the medium to long run. The whole situation is a wake-up alarm for the sleeping European beauty."
In corporate news, Bunzl reported decreased statutory earnings but hiked up its annual dividend.
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 42.6 points, 0.5% at 8,852.34
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Hang Seng: up 0.4% at 23,027.88
Nikkei 225: up 1.7% at 37,785.47
S&P/ASX 200: up 0.9% at 8,245.70
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DJIA: closed up 601.41 points, 1.4%, at 43,840.91
S&P 500: closed up 1.6% at 5,954.50
Nasdaq Composite: closed up 1.6% at 18,847.28
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EUR: flat at USD1.0406 (USD1.0406)
GBP: higher at USD1.2593 (USD1.2588)
USD: lower at JPY150.34 (JPY150.38)
GOLD: higher at USD2,863.11 per ounce (USD2,848.92)
OIL (Brent): higher at USD72.97 a barrel (USD72.62)
(changes since previous London equities close)
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ECONOMICS
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Monday's key economic events still to come:
10:00 CET eurozone manufacturing PMI
09:55 CET Germany manufacturing PMI
09:30 GMT UK manufacturing PMI
09:45 EST US manufacturing PMI
10:00 EST US ISM manufacturing PMI
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China's manufacturing sector expanded at a greater rate in February driven by higher output and new orders, S&P Global reported Monday. The Caixin China general manufacturing purchasing managers' index rose to 50.8 in February, up from 50.1 in January, surpassing the FXStreet-cited consensus forecast of 50.3. A reading above the 50.0 neutral mark indicates an overall increase in business activity from the previous month and an overall decrease when below. February was the fifth consecutive month to post a figure above 50.0, with the reading also marking a three-month high for the world's second-largest economy. S&P Global explained that the improved PMI was supported by growth in both output and new orders across the sector. Wang Zhe, senior economist at Caixin Insight, added: "Both supply and demand grew... However, employment remained under pressure. While some companies increased hiring, cost-cutting and efficiency remained the priority for many, particularly among consumer goods and intermediate goods producers." The PMI is compiled monthly by S&P Global using responses to a survey sent to purchasing managers in a panel of around 650 private and state-owned manufacturers.
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Japan's manufacturing sector saw a softer deterioration in February, data showed Monday. The au Jibun Bank Japan manufacturing purchasing managers' index posted 49.0 in February, up from 48.7 in January, surpassing the FXStreet-cited consensus forecast of 48.9. A reading above the 50.0 neutral mark indicates an overall increase in business activity from the previous month and an overall decrease when below. Usamah Bhatti from S&P Global Market Intelligence said: "Output and new orders fell modestly, but rates of decline eased from those seen at the start of the year. Firms often mentioned weakness in domestic and global manufacturing demand and confidence, with notable emphasis placed on muted conditions in key markets such as the US, Europe and mainland China." The PMI is compiled monthly by S&P Global using responses to a survey sent to purchasing managers in a panel of around 400 manufacturers.
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Manufacturing conditions in Ireland continued to improve in February, numbers showed Monday. The AIB Ireland manufacturing purchasing managers' index rose to 51.9 in February, up from 51.3 in January. A reading above the 50.0 neutral mark indicates an overall increase in business activity from the previous month and an overall decrease when below. David McNamara, AIB chief economist, said: "This marks the fastest pace of growth in 12 months. The rise in February was due to stronger growth in output and new orders, and a renewed upturn in purchasing activity." The PMI is compiled monthly by S&P Global using responses to a survey sent to purchasing managers in a panel of around 250 manufacturers.
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BROKER RATING CHANGES
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Jefferies cuts Howden Joinery group to 'hold' (buy) - price target 854 (1,020) pence
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Barclays raises Rathbones to 'equal weight' (underweight) - price target 1,830 (1,880) pence
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JPMorgan raises Bank of Ireland target to 10.10 (8.20) EUR - 'underweight'
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COMPANIES - FTSE 100
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Bunzl released its annual results. Revenue for 2024 edged down 0.2% to GBP11.78 billion from GBP11.80 billion in 2023, while pretax profit decreased 3.6% to GBP673.6 million from GBP698.6 million. Adjusted pretax profit however rose 2.2% to GBP872.9 million from GBP853.7 million. The international distribution company also increased its dividend by 8.2% to 73.9 pence, including a final dividend of 53.8p per share, from 68.3p. Bunzl also announced that it has completed the first GBP50 million tranche of its 2025 buyback programme, launched in January, and has agreed to repurchase further shares of up to GBP150 million. Looking ahead, Bunzl is maintaining its guidance for robust group revenue growth and an operating margin in line with 2024.
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AstraZeneca and Amgen's asthma drug has shown positive results when used to treat nasal polyps, researchers have said. Tezepelumab, being produced by both firms, was first approved for treating asthma in 2021, but new research led by a University of Dundee professor has found it also reduces the size of nasal polyps and nasal blockages. Other outcomes were reported, including improved smell and quality of life, and underlying sinus problems were also alleviated in some individuals. Also, AstraZeneca on Monday announced that its drug Imfinzi or durvalumab, in combination with chemotherapy, has been recommended for approval in the EU for adults with resectable non-small cell lung cancer. The decision was based on results from the "pivotal" Aegean trial, which "showed a statistically significant and clinically meaningful 32% reduction in the risk of recurrence, progression events or death versus neoadjuvant chemotherapy alone".
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COMPANIES - FTSE 250
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Senior also reported its results for 2024. Revenue rose 1% on-year to GBP977.1 million from GBP963.5 million, while pretax profit jumped 22% to GBP27.8 million from GBP22.8 million. The total dividend is 2.40p per share including a final payout of 1.65p, up 4% from 2.30p the year before. The Rickmansworth, England-based engineering firm said it expects "good growth...in line with its expectations" for 2025. "For 2024, Senior delivered results in line with revised expectations, enhanced by a strong cash performance," commented Chief Executive Officer David Squires. He added: "Looking ahead, our strategy of positioning Senior as a pure play fluid conveyance and thermal management business in attractive and structurally resilient core markets; active portfolio management; combined with our highly relevant technical capabilities...provides confidence of continuing performance improvements for the group. We have today announced new and improved medium-term financial targets which will deliver strong value creation for all of our stakeholders."
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OTHER COMPANIES
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Ebiquity named Kayte Herrity as its new chief financial officer, with effect from next Monday, March 10. "Kayte is a highly experienced finance director within the Media and Information sectors with a proven track record of delivering strong financial performance and creating high performing finance teams to support commercial success," the London-based media and marketing consultancy said. Chair Robert Woodward commented: "Kayte has proven experience of delivering strong financial performance and building high functioning teams and processes within both listed and private entities. She brings strategic and operational expertise to her role and will be a strong addition to the executive team."
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Symphony Environmental Technologies was "pleased to announce a historic decision" by Brazil's Supreme Federal Court. The Hertfordshire, England-based biodegradable plastic technology developer said the "landmark ruling" mandates the use of reusable or biodegradable plastic bags in commercial establishments in Piracicaba, a city in Sao Paulo state, "marking a significant victory for environmental sustainability and municipal legislative autonomy" according to Symphony. It added: "This ruling has national implications, confirming the validity of similar laws across Brazil."
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By Emma Curzon, Alliance News reporter
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