LONDON (Alliance News) - London share prices are lower at the open Tuesday, as Greek debt negotiations appear close to unravelling and ahead of UK inflation data due at 0930 BST.
Greek Prime Minister Alexis Tsipras on Monday urged the country's creditors to get "realistic", a day after weekend negotiations failed to bridge major differences, setting the stage for eurozone finance ministers to make a final push to reach a deal to avert a default.
Royal Mail leads blue-chip losers, down 2.1%, after the UK's communications and postal regulator Ofcom widened its review of the regulation of the company in light of the decision by competitor Whistl to pull its plans to launch its own direct delivery services in the UK.
British American Tobacco, Imperial Tobacco and National Grid are the top FTSE 100 gainers, on positive analyst ratings.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 0.3% at 6,692.69
FTSE 250: down 0.3% at 17,673.94
AIM ALL-SHARE: down 0.2% at 769.08
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Hang Seng: down 0.9% at 26,615.69
Nikkei 225: closed down 0.6% at 20,257.94
DJIA: closed down 0.6% at 17,791.17
S&P 500: closed down 0.5% at 2,084.43
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GBP: up at USD1.5625
EUR: up at USD1.1318
GOLD: up at USD1,187.20 per ounce
OIL (Brent): up at USD64.14 a barrel
(changes since end of previous GMT day)
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ECONOMICS AND GENERAL
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Tuesday's Key Economic Events still to come
(all times in BST)
09:30 UK Consumer, Retail and Producer Price indices
09:30 UK DCLG House Price Index
10:00 Germany ZEW Survey
10:00 EU ZEW Survey
10:00 EU Employment Change
13:30 US Housing Starts and Building Permits
13:55 US Redbook index
14:30 UK CB Leading Economic Index
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GERMANY MAY HICP RISES 0.1% M-O-M: FINAL; UP UNREV 0.7% ON YEAR: FINAL
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Passenger car sales in the EU grew at a slower pace in May, the European Automobile Manufacturers Association reported. New car registrations increased 1.3% year-on-year in May, slower than the 6.9% growth seen in April. Although the sales logged its twenty-first consecutive month of expansion, it was the slowest since the beginning of this period of growth.
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Syrian Kurdish forces dealt a strategic blow to the Islamic State jihadist group, seizing a key border town that provided the extremists with one of their main supply routes from Turkey. Video recorded from the Turkish side of the border showed fighters waving the flag of the Kurdish People's Protection Units near the spot where, only 24 hours earlier, Islamic State members had pushed fleeing civilians back from the border fence. The green, white and black tricolour adopted by Syrian rebels was seen draped over the border crossing itself in the footage published by the Turkish DHA news agency.
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The leader of al-Qaeda in the Arabian Peninsula (AQAP) has been killed in Yemen, local sources close to al-Qaeda told dpa Monday. Nasir al-Wuhayshi was killed in a drone strike Friday in Mukalla, a source there told dpa. The US military has not confirmed the report and did not respond to a request for comment from dpa. AQAP did not make any immediate statement. Al-Wuhayshi was second-in-command of global terrorist network al-Qaeda after Ayman al-Zawahiri and was on a US list of most-wanted fugitives for planning attacks on US soil.
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United Nations Secretary-General Ban Ki-moon called for action involving a renewed humanitarian pause to commence in time for the holy month of Ramadan. The UN Chief stressed an agreement for local ceasefires could be a pathway towards a lasting nationwide ceasefire and called on all Yemeni stakeholders to resume "a peaceful and orderly political transition."
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The outbreak of Middle East Respiratory Syndrome, or MERS, in South Korea has claimed three more lives in the last 24 hours, bringing the number of deaths to 19, according to the latest government figures. One of the latest victims was 49 years old, the youngest person to die in what has become the biggest outbreak of MERS outside the Middle East, Yonhap News Agency reported. The coronavirus has infected over 150 people, and over 5,500 people are under quarantine, Yonhap reported.
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China's land reclamation in the South China Sea will "be completed in the upcoming days," state-run media said Tuesday, as the project has increased tensions in disputed areas. China will now start to build facilities, Foreign Ministry spokesman Lu Kang was quoted as saying by Xinhua news agency.
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BROKER RATING CHANGES
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CREDIT SUISSE REINITIATES BRITISH AMERICAN TOBACCO WITH 'OUTPERFORM'
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CREDIT SUISSE RESUMES IMPERIAL TOBACCO WITH 'OUTPERFORM' - TARGET 3600 PENCE
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TRADERS: MORGAN STANLEY RAISES NATIONAL GRID TO 'OVERWEIGHT' ('EQUAL-WEIGHT')
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TRADERS: GOLDMAN CUTS FOXTONS TO 'SELL' ('NEUTRAL')
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TRADERS: MORGAN STANLEY RAISES LADBROKES TO 'OVERWEIGHT' ('EQUAL-WEIGHT')
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COMPANIES - FTSE 100
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Whitbread reported a rise in total revenue in the first quarter of its financial year as it continued to grow sales at both its Premier Inn and Costa Coffee chains. The hotel and coffee shop chain operator reported a 12.5% rise in total sales in the 13 weeks to May 28, with Premier Inn revenue up 14.3% and Costa Coffee up 17.2%. On a like-for-like basis, sales grew 6.3% and 5.0%, respectively.
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Industrial equipment rental company Ashtead Group reported strong growth in profit and revenue for its recently-ended financial year as it achieved growth in both the UK and US, hiked its dividend, and gave a positive outlook. The company reported a pretax profit of GBP473.8 million for the year to April 30, up from GBP365.5 million a year earlier, as revenue grew to GBP2.04 billion from GBP1.63 billion. It said it will pay a final dividend of 12.25 pence, meaning a total of 15.25p for the whole year, up by a third from 11.5p a year earlier.
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The UK's communications and postal regulator Ofcom widened its review of the regulation of Royal Mail in light of the decision by competitor Whistl to pull its plans to launch its own direct delivery services in the UK. Ofcom said it wanted to look at what changes to the overall postal framework might be appropriate to secure the so-called universal postal service - Royal Mail's obligation to deliver to every address in the UK. It also wants to look at how best to ensure Royal Mail continues to become more efficient in the absence of any competitor in the direct delivery market, and whether the company's wholesale and retail prices are affordable while being sufficient to cover the costs of the universal service.
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COMPANIES - FTSE 250
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Kier Group said it has won new construction contracts worth GBP247 million in total through the National Health Service's ProCure21+ publicly-funded procurement programme.
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Crest Nicholson Holdings struck a bullish tone about its prospects, as the homebuilder reported that first-half pretax profit rose by about 52%. Chief Executive Stephen Stone said the business has the longer-term opportunity to achieve a "natural scale" approaching 4,000 units and GBP1.4 billion of revenue. The company said it is on track with a three-year plan to grow revenue towards GBP1 billion by October 2016.
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Dignity said it is spending GBP38 million in cash on expanding its funeral network. Dignity said it is acquiring 38 of 83 locations currently served by Laurel Funerals. Separately, Dignity said it has arranged a GBP26.25 million debt facility with Royal Bank of Scotland PLC, part of Royal Bank of Scotland Group PLC, which will be secured against assets including those being acquired. Dignity said the debt wasn't required to fund the acquisition. Dignity said it is only acquiring funeral locations in parts of the UK that "complement its own geographic spread" so as to avoid any concerns about competition.
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COMPANIES - LONDON MAIN MARKET AND AIM
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XLMedia said it has agreed to acquire 54% of Tel Aviv-based web and mobile media company Marmar Media for up to USD7.4 million. It will pay an initial USD5.3 million in cash and an additional up to USD2 million based on the company's earnings performance in the year to end-March 2016. The acquisition is expected to add to earnings immediately, XLMedia said, and is "highly complementary" to its established media division.
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Health and wearable technology company Fitbug Holdings said it has appointed James Ward As its interim chief financial officer, effective immediately. Ward was previously founder and chief executive officer of Whale Rock Accounting, which was sold to Capital PLC in 2012. He was also finance director of International Mining and Infrastructure Corporation PLC.
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COMPANIES - INTERNATIONAL
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Health insurer UnitedHealth Group has approached Aetna about a takeover deal that would likely be valued at more than USD40 billion, the Wall Street Journal reported, citing people familiar with the matter. According to the WSJ report, Minnetonka, Minnesota-based UnitedHealth made the approach to Aetna in the form of a letter. Hartford, Connecticut-based Aetna has a market capitalization of more than USD42 billion, while UnitedHealth, the largest US health insurer, has a market capitalization of USD113 billion. The approach by UnitedHealth came after another health insurer, Anthem, reportedly offered to acquire smaller rival Cigna for about USD45 billion, but was rejected by Cigna. Anthem is also said to be weighing another bid for Humana.
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Perfume maker Coty has won auctions to buy three businesses - hair-care, fragrant and cosmetics - from Procter & Gamble Co for about USD12 billion, reports said. Consumer products giant Procter & Gamble plans to sell several of its non-core assets to cut costs. German detergent maker Henkel and Coty had submitted binding offers to buy separate parts of the beauty business of Procter & Gamble.
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Verizon Communications has no desire to sell the Huffington Post or buy Dish Network, the Wall Street Journal quoted Chief Financial Officer Fran Shammo as saying at a Wall Street Journal conference. Verizon agreed last month to buy AOL, which owns several media properties including the Huffington Post and TechCrunch, for USD4.4 billion. According to the report, Verizon said its main interest in the deal was AOL's digital advertising technology, which it plans to incorporate into a mobile-first video service launching later this year.
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Sigma-Aldrich said the European Commission has conditionally cleared the planned acquisition of the company by German drug maker Merck KGaA. Sigma-Aldrich also has obtained full clearance of the merger from the Chinese Ministry of Commerce. To satisfy the conditions imposed by the EC for clearance of the merger, both Sigma-Aldrich, and Merck KGaA have agreed to sell parts of Sigma-Aldrich's solvents and inorganics chemicals business in the European Economic Area as a fully integrated, stand-alone business. This includes the rights to all solvents and inorganics sold globally under the Fluka brand. The closing of the merger remains subject to certain other conditions including clearance by antitrust authorities in Brazil, Israel and South Korea. Both companies continue to work toward a closing date of mid-2015.
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Italy's Monte dei Paschi di Siena, the worst performer in last year's European Central Bank stress tests, said it had paid back its state loans well ahead of schedule. Founded in 1472, MPS is considered the world's oldest operating bank. Its most recent troubles came in 2012, after buying a rival at an inflated price and losing money on Italian bonds and risky derivative trades allegedly used to massage accounts. It was propped up by government loans worth more than EUR4 billion. MPS "has fully repaid the state aids received in 2013 well in advance of the deadline of 2017" set by the Italian Economy Ministry and the EU supervisors, the bank said in a statement.
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Tuesday's Scheduled AGMs/EGMs
Plant Health Care
Servoca
Cyan Holdings
StratMin Global Resources
Inspired Energy
Huntsworth
HSS Hire Group
Premier Farnell
NMC Health
Christie Group
Whitbread
UK Commercial Property Trust
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By Tom Waite; thomaslwaite@alliancenews.com; @thomaslwaite
Copyright 2015 Alliance News Limited. All Rights Reserved.
