LONDON BRIEFING: Stocks called down; attention on UK's spring budget

(Alliance News) - Stocks in London are called to open lower, ahead of a busy week of economic ...

Alliance News 4 March, 2024 | 7:41AM
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(Alliance News) - Stocks in London are called to open lower, ahead of a busy week of economic news.

Focus this week will be on key Chinese policy meetings, a UK budget announcement, and the latest output cuts from oil-producing nations.

Moscow, Riyadh and several other OPEC+ members on Sunday announced extensions to oil production cuts first announced in 2023 as part of an agreement among oil producers to boost prices following economic uncertainty. The plan to extend cuts to mid-2024 comes on top of previous cuts to both oil output and exports as some of the world's largest energy producers drive to push up market rates.

In early corporate news, FTSE 100 companies were buying. Aviva said it has bought Probitas, whilst Halma has acquired Rovers Medical Devices.

Elsewhere, airlines Wizz Air and Ryanair reported that air traffic was up for both in February but Wizz's load factor was down.

Here is what you need to know at the London market open:

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MARKETS

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FTSE 100: called down 0.2% at 7,669.40

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Hang Seng: down 0.3% at 16,546.51

Nikkei 225: closed up 0.5% at 40,109.23

S&P/ASX 200: closed down 0.1% at 7,735.80

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DJIA: closed up 90.99 points, 0.2%, at 39,087.38

S&P 500: closed up 40.81 points, 0.8%, to 5,137.08

Nasdaq Composite: closed up 183.02 points, 1.1%, to 16,274.94

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EUR: up at USD1.0847 (USD1.0827)

GBP: up at USD1.2665 (USD1.2641)

USD: up at JPY150.35 (JPY150.25)

Gold: up at USD2,083.01 per ounce (USD2,075.33)

(Brent): down up at USD83.61 a barrel (USD84.08)

(changes since previous London equities close)

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ECONOMICS

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Monday's key economic events still to come:

08:45 CET France budget balance

11:00 CET France new car registrations

09:00 CET Spain unemployment

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The UK is not moving fast enough on the energy transition, the boss of the British arm of Siemens Energy AG has said. Darren Davidson, who runs a company employing 6,000 people in the UK, said that the country is not on track to meet its targets on offshore wind. Siemens Energy runs a factory in Hull making blades for the turbines which are popping up off the British coast. "Siemens Energy employs 6,000 people in the UK, across transmission, power generation, wind, hydrogen-enabled gas turbines, so we're across all the energy landscape," Davidson said. "I think what we need to do is be at the front end, leading and helping our customers and the government to come up with plans as to what we can to achieve because, if I'm brutally honest, we're not fast enough."

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BROKER RATING CHANGES

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Berenberg raises BT Group to 'buy' (hold) - price target 135 pence

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Jefferies raises BP to 'buy' (hold) - price target 570 (520) pence

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UBS raises Compass Group to 'buy' (neutral) - price target 2,475 (2,350) pence

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COMPANIES - FTSE 100

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Aviva said it has bought Probitas for GBP242 million. The transaction includes the acquisition of Probitas's fully-integrated Lloyd's platform, encompassing its Corporate Member, Managing Agent, international distribution entities and tenancy rights to Syndicate 1492. The London-headquartered provider of insurance, wealth and retirement products explained that the acquisition allows Aviva to enter Lloyd's market. Aviva CEO Amanda Blanc said: "This acquisition is another step in our strategy to invest in Aviva's future profitable growth. Aviva's presence in the Lloyd's market opens up new opportunities to accelerate growth in our capital-light General Insurance business." The transaction is subject to customary closing conditions including regulatory approvals and is expected to close in mid-2024.

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Halma said it has acquired Rovers Medical Devices. Headquartered in Oss in the Netherlands, Rovers designs and manufactures sample collection devices used in the prevention and diagnostics of cervical cancer. The Buckinghamshire, England-based safety equipment company said the initial consideration for Rovers is EUR85 million, on a cash- and debt-free basis. An additional consideration of up to EUR6 million is payable in cash, based on Rovers' performance in the period to March 31, 2025. Halma CEO Marc Ronchetti said: "Rovers will broaden the range of markets we serve in women's health and further strengthen our Healthcare sector's position in cancer diagnosis products. We are excited by the opportunities we see to increase Rovers' positive impact on public health. We expect its future growth to be driven by increasing global cervical screening rates, supporting the World Health Organization's strategy to accelerate the early detection of cervical cancer."

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COMPANIES - FTSE 250

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Budapest-based Wizz Air said that in February it carried 4.4 million passengers, up 16% annually from 3.8 million. The airline's capacity increased by 30% to 4.9 million seats from 4.1 million seats. However, is load factor fell to 90.0% from 93.3%. "The February load factor continued to be impacted by reallocated Israel capacity and more flown capacity than anticipated, as some of the aircraft groundings related to the mandatory GTF engine inspections occurred later than expected," Wizz explained. On a rolling 12 month basis, capcity increased 21% to 68.2 million seats from 56.4 million seats. Passengers increased by 25% to 61.5 million from 49.3 million. Load factor edged up to 90.2% from 87.3%.

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Clarkson reported its results for 2023. In the year, the shipping services firm reported that revenue increased to GBP639.4 million from GBP603.8 million a year earlier. Underlying pretax profit increased by 8.2% to GBP109.2 million from GBP100.9 million. On the back of the results, Clarkson upped its dividend to 102p per share from 93p per share. "2023 was a year of disruption in the maritime markets and I am enormously proud we have achieved another record year," CEO Andi Case said. "We are optimistic for Clarksons in the near, medium and long-term future."

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OTHER COMPANIES

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Dublin-based budget airline Ryanair said its number of guests improved to 11.1 million in February, up from 10.6 million a year earlier. Its load factor remained at 92%. It said it operated over 63,000 flights in February, however 800 flights were cancelled due to the Israel-Gaza conflict. On a rolling basis, the number of guests increased to 182.6 million from 167.2 million. Ryanair's load factor improved to 94% from 93%.

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By Sophie Rose, Alliance News senior reporter

Comments and questions to newsroom@alliancenews.com

Copyright 2024 Alliance News Ltd. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
Clarkson PLC 4,035.00 GBX -0.25 -
Wizz Air Holdings PLC 2,146.00 GBX 1.32 -
Aviva PLC 459.70 GBX 0.55
BT Group PLC 105.40 GBX 0.67
BP PLC 514.90 GBX 0.49
Halma PLC 2,183.00 GBX -0.77
Compass Group PLC 2,203.00 GBX 1.57
Ryanair Holdings PLC 20.43 EUR -0.58 -

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