Clarkson Share News (CKN)

LONDON (Alliance News) - UK stocks are trading a touch lower Monday with US stock futures also somewhat lifeless on a light day of economic and corporate news, while Greece awaits the approval from eurozone parliaments for its new bailout before its payment due to the European Central Bank this week.

Late Friday, Eurozone finance ministers approved the third bailout package in five years for Greece, which will commit to reforms and spending cuts in return for EUR86 billion in aid. Some of the countries in the eurozone, including Germany, require their parliaments to be consulted on the new bailout. Others that do so are Austria, Estonia, Portugal and Spain. Greece's Parliament approved it Friday.

The bailout package will be needed for Greece to make its EUR3.2 billion loan repayment to the European Central Bank on Thursday.

"Equity markets will be nervous until the deal gets the thumbs up from all members. Stock markets have been standing still this morning; we won’t see a move in either direction until we have clarity on Greece, and a lot of the positive sentiment has already been priced in," says David Madden, market analyst at IG.

Germany's parliament, which votes on Thursday, is widely expected to approve the bailout, and Chancellor Angela Merkel said on Sunday that there was some room for providing Greece with debt relief through longer maturities or lower interest rates, but excluded the option of a debt haircut, meaning a reduction in principal.

Merkel wants to head off the threat of a major revolt in the ranks of her conservative-led political bloc when the German parliament votes on Greece's rescue plan. The first test of the degree of opposition to the bailout among members of her Christian Democrats (CDU) and their Bavarian-based allies the (CSU) is likely to come on Tuesday when CDU-CSU lawmakers meet to consider the package.

Merkel's comments were echoed by German Finance Ministry official Jens Spahn, who told dpa: "At most, there is limited room for improvement in terms of the maturities for loans or the amount of interest charged. A haircut is and will remain excluded under the eurozone contract."

The German chancellor also said she is confident that the International Monetary Fund will participate in the Greek bailout. The IMF has made debt relief a condition for joining Greece's third bailout in five years, saying that its current debt level is unsustainable.

The FTSE 100 trades down 0.2% at 6,537.54, the FTSE 250 is down 0.1% at 17,602.84, and the AIM All-Share is flat at 749.99.

European stocks are trading higher, with the CAC 40 in Paris up 0.5% and the DAX 30 in Frankfurt up 0.4%.

US futures point the DJIA and Nasdaq 100 to a flat open and the S&P 500 to open down 0.1%.

Oil prices are rebounding slightly from their earlier lows. West Texas Intermediate trades at USD41.94 a barrel having touched a fresh six-and-a-half year low of USD41.61, slipping below the previous low of USD41.65 made last Thursday. Brent oil currently trades at USD49.11 a barrel.

On the London Stock Exchange, TUI Group is up 1.2%. The FTSE 100 travel group is considering spinning off non-core assets with revenue of about EUR3 billion, The Times reported Monday. The report said it understands that TUI Group could seek a separate listing for its non-mainstream operations, including brands such as hotelbeds.com, Crystal Ski Holidays and Hayes & Jarvis, while retaining a stake. It would retain core holiday brands such as Thomson and First Choice.

Wm Morrison Supermarkets is one of the worst blue-chip performers down 1.4%. The Telegraph reported Sunday that the supermarket is in advanced talks to sell its M Local convenience store chain to a group of industry executives backed by investment firm Greybull Capital.

The newspaper said it is understood that Greybull, which saved Monarch Airlines from bankruptcy last year, will provide tens of millions of pounds to fund the takeover and provide the stores with working capital.

Clarkson is the worst performer in the FTSE 250 down 7.0%. The shipping services company reported a fall in pretax profit in the first half, as an increase in revenue was more than offset by higher administrative expenses and costs connected to its acquisition of rival shipping broker RS Platou ASA, but it said it made a "solid" start to the year.

It said it made a GBP10.8 million pretax profit in the six months to the end of June, compared with GBP14.1 million in the corresponding period the prior year. Revenue increased to GBP145.3 million from GBP111.7 million, while administrative expenses were up to GBP127.8 million from GBP91.0 million.

Bovis Homes Group lifted its dividend, reported an 8.9% increase in pretax profit in the first half, and said it is on track to meet expected sales volumes in the year as a whole.

In a statement, the FTSE 250 housebuilder said it made a GBP53.8 million pretax profit in the six months to the end of June, compared with GBP49.4 million in the corresponding half the prior year, as revenue increased to GBP350.7 million from GBP322.1 million. Bovis Homes increased its interim dividend per share to 13.7 pence from 12.0p, and said it intends to increase the full-year dividend to 40p from 35p.

However, the company's shares trade down 5.1%, with its shares having traded at eight-year highs prior to the results.

In the AIM All-Share index, Red Emperor Resources is the biggest faller, down 64%. The company said the USD25 million Hawkeye-1 exploration well offshore the Palawan Basin in the Philippines failed to intersect a commercially viable amount of hydrocarbons.

The well was targeting two reservoirs and intersected both. The company said the first reservoir was of "variable quality" and contained hydrocarbons, but not enough to be deemed commercial, whilst the second reservoir may have contained hydrocarbons, but said the "poorer quality" of the reservoir meant it would also not be commercial.

Ascent Resources is down 39% after it said Chief Executive Len Reece has resigned from the company in light of the company's dire financial position caused by the ongoing delays in approvals for the Petišovci field in Slovenia. The company said it is unlikely to secure the already delayed permit for the field until 2016 and urged shareholders to approve its proposed resolutions at an upcoming meeting, so that it can raise short-term funds to keep the company afloat.

Still ahead in the economic calendar is US Empire State Manufacturing Survey at 1330 BST, and US National Association of Home Builders housing market index at 1500 BST.

By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1

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