Markets: FTSE 100 in the black on Friday
Interactive Investor's Market Report brings you bite-sized news covering all the day's FTSE and AIM announcements, the latest on commodities, global and domestic economics, gold, oil and currencies as well as US markets. Updated throughout the day, it's the digest you can't afford to miss.
Last updated: 17:05
FTSE 100 stays positive
After almost dipping into negative territory, the FTSE 100 (UKX) turned its fortunes around, closing at 5478.81, 11.76 points higher.
Royal Bank of Scotland (RBS) held on to its top spot, gaining almost 8%, and was the most actively-traded stock by the users of Interactive Investor. Aggreko (AGK) was left holding the wooden spoon, falling more than 4.5%.
On the AIM front, shares in Media Corporation (MDC) soared 55%. United Carpets Group (UCG) shed 40%.
At a glance...
|GBP/USD: 1.5658||Gold: $1,626.62 |
|GBP/EUR: 1.2389||WTI crude oil: $84.09|
|EUR/USD: 1.2637||All changes from 09:00 BST.|
US market rally continues
Markets across the Pond climbed as Friday wore on, extending weekly gains on continued optimism about potential co-ordinated action by global central banks to stabilise markets after Greek elections.
The Dow Jones jumped 69 points to 12721. The Nasdaq added 21 points to 2858, while the S&P 500 saw a seven-point rise to 1337.
For every five stocks falling, nine gained on the New York Stock Exchange.
Fusion university project secures funding
Cardiff University's spin-out, Mesuro, in which Fusion IP (FIP) holds a 46.5% stake, has completed a £700,000 funding round to expand overseas sales of its radio frequency testing equipment.
Mesuro sells radio frequency-testing equipment and device measurement services to the semiconductor industry.
The funds will be used to increase the capacity of the business to deal with the enhanced levels of overseas sales activity that the company is seeing in both its consultancy services and its equipment sales.
African Medical Investments sheds aviation division
African Medical Investments (AMEI) has agreed the sale of its wholly-owned subsidiary, AMI Aviation Services, for $1.3 million (£840,000).
The company said the disposal is in accordance with its strategy of consolidating its portfolio of specialist private hospitals and improving its financial performance.
The proceeds will be invested in the AMI's current portfolio of hospitals and will facilitate the roll-out of further medical facilities in targeted markets in sub-Saharan Africa.
Sainsbury orders Clean Air system
Clean Air Power (CAP) has received an additional order from Sainsbury's (SBRY) for its dual diesel and natural gas-powered conversion of trucks.
The order is for an additional 25 units of Clean Air Power's Genesis EDGE Dual-Fuel retrofit system, which will be in service by the fourth quarter.
This latest order will see Sainsbury's expand its fleet of Dual-Fuel trucks to 50.
Premier Foods disposes of Middleton site
Premier Foods (PFD) has announced the sale of its Middleton site, which makes Sarsons vinegar and Haywards pickles, for £41 million.
Graham Jones, analyst at Panmure Gordon, calculated the disposal would have "little" impact on net debt, which he forecasts will stand at £1.2 billion as at December 2012.
"In a way this is the sort of stable, high-margin, cash-generative business that Premier should be keeping, but the need for cash is pressing and the strategy, we believe, is correct," commented Jones.
With the shares having fallen by about 25% over the past quarter, Jones believes that "the price now better reflects the risk/reward balance in the company". As such, he upgraded the stock from a 'sell' to a 'hold'.
FTSE 100 clings to gains
The FTSE 100 (UKX) gave up most of its gains as Friday wore on, but remained 17 points in positive territory at 5484.
Royal Bank of Scotland (RBS) and Aggreko (AGK) still held the top gainer and biggest faller spots respectively. RBS jumped 7%, while Aggreko fell almost 5%.
On the AIM front, shares in LSE:MDC:Media Corporation surged 64%. United Carpets Group (UCG) lingered in the doldrums, plunging 43%.
At a glance...
|GBP/USD: 1.5632||Gold: $1,625.74 |
|GBP/EUR: 1.2378||WTI crude oil: $83.92|
|EUR/USD: 1.2620||All changes from 09:00 BST.|
US stocks edge upwards
US stocks started higher Friday, extending the previous sessions gains on continued optimism about a report of potential action by global central banks to move to stabilise markets, if needed, after Greek elections on Sunday.
The Dow Jones jumped 52 points to 12704. The Nasdaq climbed six points to 2842, while the S&P 500 followed suit with a five-point rise to 1334.
Mattioli to operate RBS scheme
Wealth manager Mattioli Woods (MTW) has been appointed to operate a £140 million scheme by Royal Bank of Scotland (RBS).
The Pilgrim scheme will be operated through Mattioli Woods' subsidiary company, City Pensions, as new scheme administrator.
Ian Mattioli, chief executive of Mattioli Woods, commented: "Our technical expertise and reputation in the self-invested personal pension (SIPP) market has driven this opportunity."
Sweett to advise government on sustainability
Sweett Group (CSG), the international property and infrastructure consultancy, has been appointed to the new pan-government three-year environmental and sustainability consultancy agreement.
Government Procurement Service, the cabinet office's outsourcing body, has recruited Sweett Group to provide advice on mitigating and adapting to climate change, and on addressing sustainability.
The company's sustainability team has experience of advising public sector clients, including the Waste and Resources Action Programme, Zero Waste Scotland, Communities and Local Government and the Homes and Communities Agency.
Sage appoints new chairman
Sage (SGE) has appointed Donald Brydon as a non-executive director and chairman designate.
He will join the board on 6 July and succeed Tony Hobson as chairman on 1 September. He is currently chairman of Smiths Group (SMIN) and Royal Mail Group. He will stand down from the boards of AXA Investment Managers SA and AXA Rosenberg in June 2012.
"In choosing a new chairman, Sage has plumped for the 'one of us' category. We are reminded of (say) the chairman at LSE:LOG:Logica on his appointment who came from a similar hiring approach; our only grudge is that chairmen without an understanding of the end markets need to 'bone up' in a hurry," voiced George O'Connor, analyst at Panmure Gordon, adding that there was "no short term catalyst" for the shares. He rates the stock a 'hold'.
SSE to acquire Endesa Ireland
SSE (SSE) is to acquire the shares of Endesa Ireland for a total cash consideration of €320 million (£256 million) plus an estimated €43 million for working capital.
The acquisition is subject to approval by the Irish Competition Authority. SSE expects to complete the purchase later this summer.
Endesa Ireland's assets include the 620 megawatt (MW) fuel oil Tarbert Power Station in Kerry, the 240 MW fuel oil Great Island Power Station in Wexford, the 104 MW peaking gas/oil Tawnaghmore Power Station in Mayo and the 104 MW peaking gas/oil Rhode Power Station in Offaly.
Aggreko slumps after IMS release
Aggreko (AGK) led the blue chips down, falling more than 4.5% as it released its 2012 first-half pre-close interim management statement.
Underlying revenues in the first half were likely to be up about 15% and trading profit was expected to be up approximately 20%. In the IPP division, the group is to increase its fleet investment by between £50 million and £415 million in the light of a high first-half order intake and a healthy pipeline of enquiries.
In the local business division, the group expects first-half revenue growth of 13% and slightly better underlying margins than last year. In the second half, the weak macroeconomic backdrop will cause some weakness in the underlying rate of growth, but the London Olympics and the Brazilian acquisition will offset this factor.
"The group is usually cautious on guidance ahead of the key summer months, but the weak global economic backdrop (especially in Europe) complicates matters," acknowledged John Lawson, analyst at Investec.
But he pointed out that the group expected another year of good growth and margins at a similar level to last year. He rated the stock a 'buy'.
Diageo ups stake in Halico
Brewer Diageo (DGE) has successfully acquired an additional 10.62% stake in Hanoi Liquor Joint Stock Company (Halico) for approximately £14 million.
Diageo expects to complete the transaction on 24 June. Following completion, Diageo's total equity stake in Halico will be 45.52%.
"We are pleased to further participate in Halico's growth potential and success by increasing our equity investment, which is an expression of our long-term commitment both to Halico and to Vietnam," said Gilbert Ghostine, president of Diageo Asia Pacific.
FTSE 100 propelled higher by banking sector
The FTSE 100 (UKX) continued to trade in the black on Friday, with the banking sector propelling it higher.
London's top share index climbed 34 points to 5501.
Royal Bank of Scotland (RBS) and Barclays (BARC) showed gains of 4% or more to claim the top of the leaderboard, a reaction to last night's announcement of a plan by the government and the Bank of England to try and stimulate bank lending. Aggreko (AGK) shed 4%.
On the AIM front, Media Corporation (MDC) soared 40%, while shares in United Carpets Group (UCG) lost almost half their value.
Lloyds Banking Group (LLOY) was the most actively-traded stock by the users of Interactive Investor.
"Investors have broadly welcomed this [Bank of England] move as an effort to try and insulate at least some of the UK economy and banking sector from further fallout from the European debt crisis," commented David Jones, chief market strategist at IG Index.
"However, whether this will end up having a significant impact on the underlying UK economy is debatable - the reluctance of banks to lend is arguably just a small part of the overall economic malaise at the moment," he warned.
Looking ahead, Jones forecast the Dow to start around 70 points higher at 12,722.
At a glance...
|GBP/USD: 1.5538||Gold: $1,624.35|
|GBP/EUR: 1.2322||WTI crude oil: $84.55|
|EUR/USD: 1.2614||All changes from 09:00 BST.|
Facebook to consolidate lawsuits
Facebook (FB) is set to file a motion to consolidate all the shareholder lawsuits against the social network site, and is expected to place some blame on the Nasdaq for its botched IPO when it files the motion, the New York Times reported on Thursday.
For the full story, read: Facebook to file motion, discuss Nasdaq role in IPO - report.
Poor UK trade heightens GDP contraction risk
UK's overall trade deficit widened from £3 billion in March to £4.4 billion in April, with the goods deficit widening from £8.7 billion to £10.1 billion, the biggest in seven months.
The April trade data was very disappointing, increasing the risk that net trade will again be negative in the second quarter and that the economy will suffer further contraction, especially as it is handicapped by the extra day's public holiday that resulted from the Queen's Diamond Jubilee celebrations.
"Indeed, the April trade data reinforce doubts as to whether the UK can achieve a sustained improved export performance any time soon, which helps the economy become more balanced," stated Howard Archer, chief UK and European economist at IHS Global Insight. "In particular, concerns persist that UK exports will be limited in the near term at least by muted global growth."
Lamprell delivers rig
Oil and gas service provider Lamprell (LAM) has successfully delivered a new rig to Compañía Perforadora in the Gulf of Mexico.
Hull 108 was under construction by Maritime Industrial Services at the time of its acquisition by Lamprell in July 2011.
The delivery of the rig allows Lamprell to repay $70 million (£45 million) of debt which is outstanding under the Maritime acquisition term loan and the Hull 108 construction term loan.
The company also announced that John Kennedy has been appointed to the board of directors of the company as non-executive chairman with immediate effect.
MoU for Berkeley Mineral Resources
AIM-listed Berkeley Mineral Resources (BMR) has signed a memorandum of understanding with Yunnan Xiangyun Feilong Nonferrous Metal Company, while Empyrean Energy (EME) also reported to the market on Friday.
Read: Berkeley and Empyrean update investors, for more.
Stanford gets 11 years
Allen Stanford, the investment and cricket tycoon who operated one of the largest Ponzi schemes in the US that defrauded investors of more than $7 billion (£4.5 billion), has been jailed for 110 years.
However, Stanford pleaded his innocence, telling the court: "I'm not here to ask for sympathy or forgiveness or to throw myself at your mercy. I did not run a Ponzi scheme. I didn't defraud anybody."
His sentence is 40 years shorter than the jail term handed down to Bernard Madoff, who pleaded guilty in 2009 to a Ponzi scheme targeting wealthy investors.
John Lewis sales healthy
John Lewis's department store sales grew by a very healthy 18.1% year-on-year in the week to 9 June.
This was up from gains of 15.0% and 9.3% in the previous two weeks. It was also above the overall gain of 13.0% year-on-year in the 19 weeks trading to 9 June. It was hinted that sales had been boosted by products related to the Queen's Diamond Jubilee celebrations. In particular, John Lewis reported that there were increasing sales of large TVs, which were also likely helped by the start of the European Football Championships.
"It appears that consumers need a boost such as a major event or extended good weather (which lifts sales of outdoor products and summer clothing) to significantly step up their spending - which is hardly surprising given that the pressures that they are still facing, particularly in terms of squeezed purchasing power," commented Howard Archer, chief UK and European economist at IHS Global Insight.
"The uncertain and worrying economic outlook is also a cause for spending caution among consumers."
Bank announcement boosts FTSE 100
The FTSE 100 (UKX) started Friday on a strong footing after the Bank of England announced measures to lower borrowing costs and provide UK banks with access to short-term money.
London's leading share index jumped 34 points to 5501.
Royal Bank of Scotland (RBS), Lloyds Banking Group (LLOY) and Barclays (BARC) saw their share prices increase 6.5%, 4.2% and 3.6% respectively. Aggreko (AGK) was the biggest faller, down more than 3%.
Lloyds was the most actively-traded stock by the users of Interactive Investor.
"Central bankers worldwide are trying to stimulate a market that risks being overwhelmed with bad news - from rapidly expanding eurozone fears, to slowdowns in Asian markets and significant falls in US confidence," said Rebecca O'Keeffe, head of investment at Interactive Investor.
"It is a difficult balancing act for central bankers and investors globally will be hoping they get it right, as uncertainty is the most difficult commodity to work with."
She also pointed out that all eyes will be on the European elections this weekend, with the second round of French parliamentary elections as well as Greece's second attempt to form a government.
US markets: Thursday's close
US stocks on Thursday closed with strong gains amid reports of possible action by global central banks.
The Dow Jones jumped 156 points to 12652. The Nasdaq climbed 18 points to 2836, while the S&P 500 followed suit with a 14-point rise to 1329.
At a glance...
|Nikkei 225: 8569 ()||GBP/USD: 1.5533||Gold: $1,626.59|
|Hang Seng: 19216 ( 408)||GBP/EUR: 1.2271||WTI crude oil: $84.50|
|Shanghai Composite: 2306 ( 10)||EUR/USD: 1.2635|
08:00 - The FTSE 100 (UKX) opens at 5467.05.
|FTSE 100 INDEX||£6,654.34||-0.63%|
|EMPYREAN ORD 0.2P||5.88p||0.00%|
|BERKELEY MIN. ORD 1P||2.63p||3.96%|
|LAMPRELL ORD 5P||152.50p||-1.13%|
|FACEBOOK INC COM USD0.00000...||$24.31||-2.98%|
|LLOYDS GRP. ORD 10P||60.08p||-0.89%|
|BARCLAYS ORD 25P||317.00p||-1.38%|
|DIAGEO ORD 28 101/108P||2,019.50p||0.32%|
|SSE ORD 50P||1,606.00p||-1.11%|
|SMITHS GROUP ORD 37.5P||1,355.00p||1.50%|
|SAGE GRP. ORD 1P||362.20p||-0.55%|
|SWEETT GRP ORD 10P||22.50p||7.14%|
|MATTIOLI ORD 1P||289.50p||-1.19%|
|PREM FOODS ORD 10P||72.25p||-0.34%|
|SAINSBURY(J) ORD 28 4/7P||378.00p||-1.12%|
|CLEAN AIR COM SHS USD0.001||9.25p||-2.12%|
|ROYAL BANK SCOT ORD 100P||327.00p||-3.02%|
|AFRICAN MED ORD NPV||0.25p||0.00%|
|FUSION IP ORD 1P||60.50p||3.42%|
|MEDIA CORP ORD 0.1P||0.10p||-7.32%|
|UNITED CARPETS ORD 5P||1.75p||0.00%|
|All data 15min delayed as of: 01:21:33 25/05/13|