LONDON MARKET OPEN: IHG Leads FTSE 100 Gainers As Stocks Edge Higher

Tue, 20th Oct 2015 07:31

LONDON (Alliance News) - UK equities traded a touch higher just after the open Tuesday, with InterContinental Hotels Group leading the gainers in the FTSE 100 after its revenue per available room rose in the third quarter on a constant exchange rate basis.

However, the hotel operator, which owns brands including Holiday Inn, Crowne Plaza and InterContinental Hotels, said global RevPAR including currency effects fell 0.4% in the third quarter from the same period the year before due to the strengthening of the dollar. RevPAR grew 4.8% at constant exchange rates, led by a 3.6% rise in room rates.

Regionally, RevPAR grew 4.3% in the Americas at constant exchange rates, 7.8% in Europe and 7.1% in Asia, the Middle East and Africa, but was down 0.7% in Greater China.

IHG said is now expects a USD5 million hit on reported fee business operating profit for every one percentage point difference in full-year group RevPAR growth between constant and reported exchange rates.

IHG shares were up 2.8%.

Having been called lower before the open the FTSE 100 index traded up 0.1% at 6,360.73 points, the FTSE 250 was up 0.3% at 16,963.76, and the AIM All-Share index traded flat at 743.56.

In Europe, the French CAC 40 index was up 0.1% and the German DAX 30 was up 0.2%. Germany's producer prices declined at the fastest pace in seven months, and the fall was worse than the decrease economists had predicted, preliminary data from Destatis revealed.

The German industrial producer price index dropped 2.1% year-on-year following a 1.7% slump in August. Economists had expected a 1.8% fall. The latest decline was the biggest since February, when prices fell at a similar rate. Producer prices have been falling since August 2013.

In Asia, the Nikkei 225 index in Tokyo closed up 0.4%, the Hang Seng was down 0.6% and the Shanghai Composite was up 1.1%.

Whitbread shares were up 2.6% after it said its pretax profit increased in the first half on higher sales and said it will hike its interim dividend, as it remains on track to meet its growth plans.

The FTSE 100-listed owner of hotel and coffee chains Premier Inn and Costa Coffee said its pretax profit for the six months to August 27 was GBP254.9 million, up from GBP241.8 million a year earlier. The latest half was hit by the group booking GBP25.2 million in exceptional charges on onerous leases for sold business and accelerated amortisation costs on its IT systems.

Whitbread said trading in the second half so far has been in line with the first, and it is on track to hit its expectations for the full year.

Mining stocks continued to be amongst the worst performers in the FTSE 100, with BHP Billiton down 1.7%, Anglo American down 1.6% and Rio Tinto down 1.1%.

Engineering software company AVEVA Group was the best performer in the FTSE 250, up 5.8% after Berenberg upgraded it to Buy from Hold.

Al Noor Hospitals Group was up 2.5% after it confirmed it has received a "highly preliminary" indication of interest from Abu Dhabi-based VPS Healthcare Group, following its proposed reverse takeover of South Africa's Mediclinic International last week.

This brings the number of potential suitors for the FTSE 250 listed private hospital group to three, having also received a competing approach from its London-listed peer NMC Health, which traded up 3.3%.

SolGold was the best performer in the AIM All-Share, up 16%, after it said it has received the highest-grade assay results so far for its Cascabel copper-gold porphyry project in Ecuador. The company said drilling at Hole 12 showed intersects of up to 1.75% copper.

SolGold also said the Aguinaga prospect is maturing as a drill target and has a similar geophysical signature to the Alumbrera copper mine in Argentina.

Teathers Financial said that the first initial public offering has been offered through the Teathers App. The IPO is of Leni Gas Cuba Ltd, a company focused on developing projects or businesses with connections to or relationships in Cuba, via Shard Capital Partners LLP. Last week, Teathers invested GBP100,000 in Leni Gas Cuba.

The application is operated by Teathers' fully owned subsidiary, Teathers Financial Software Ltd. Teathers shares were up 15%.

Still ahead Tuesday is Kantar Worldpanel Supermarket UK market share report for the 12 weeks to October 11 at 0930 BST.

In the economic calendar, the eurozone current account is at 0900 BST and US housing starts and building permits are both at 1330 BST.

There also are key US central banker speeches ahead of the Federal Open Market Committee's monetary policy meeting next week. Starting the day is FOMC Governor Jerome Powell, speaking in New York at 1415 BST, then New York Fed President William Dudley is at 1430 BST. Fed Chair Janet Yellen will make a speech in Washington at 1600 BST

There is also a speech, at 1045 BST, from Bank of England hawk Ian McCafferty, who again voted for a rate hike in the central bank's most recent meeting. Governor Mark Carney will be speaking at 1100 BST.

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