The FTSE 100 closed down 0.14% Monday amid raised tensions in Asia, with media reports suggesting that U.S. House Speaker Nancy Pelosi is expected to visit Taiwan in defiance of China's warnings. Melrose Industries was the index's biggest faller, down 5.5%, followed by Anglo American and Intertek Group, which closed 4% and 3.3% lower, respectively. On the bright side, Pearson was the session's biggest gainer, up 13% on bigger-than-expected 1H sales and profit, followed by HSBC, up 6.1% after resisting calls to spin off its Asian business.

 
Companies News: 

Ncondezi Energy's Loan Restructuring Progresses; Directors Contribute Funds

Ncondezi Energy Ltd. said Monday that the finalization of the restructuring of a term loan into a loan note is expected in the coming weeks, and two directors will provide additional funding to accelerate solar project development.

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Hutchmed (China) 1H Pretax Loss Widened After Costs Rise

Hutchmed (China) Ltd. said Monday that its pretax loss for the first half widened after a rise in expenses.

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XP Power Swung to 1H Pretax Loss on Logistic, Inflationary Pressures; Shares Fall

XP Power Ltd. reported a swing to pretax loss in the first half of 2022 driven by supply-chain disruptions and the inflationary backdrop, but maintained its dividend payout.

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NatWest Mulling Bid for Wealth Management Firm Quilter, This Is Money Reports

NatWest Group PLC is mulling a bid for the wealth management company Quilter PLC, This is Money reports, citing unnamed sources.

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Puma VCT 13 to Raise Up to GBP50 Mln in Offer for Subscription

Puma VCT 13 PLC said Monday that it intends to raise funds through a new offer for subscription in August.

 
Market Talk: 

BP Might Increase Its Buyback Plans at 1H

1132 ET - BP may increase share buybacks in the oil major's 2Q and 1H results Tuesday Aug. 2, RBC Capital Markets says. RBC's forecasts assume an 8% dividend-per-share increase alongside a planned $3B buyback for 3Q, up from the $2.5bn announced alongside 1Q results. "With Shell having decided to leave its dividend flat this quarter, we wonder whether BP may opt to simply ramp up the buyback program," RBC analyst Biraj Borkhataria says in a note. "However, we think the shareholder-returns framework announced by BP in 2020 wasn't built for the current extremely strong macro environment and BP's already approaching the top end of what it can do on the buyback front, leaving the questions on dividend growth open." (philip.waller@wsj.com)

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Fresnillo Investors Look Set to Eye Costs at 1H

1531 GMT - Fresnillo's costs are likely to be of particular interest to investors in the Mexican precious-metal miner's 1H results tomorrow, Citigroup says. In 2Q production numbers last week, Fresnillo reported better-than-expected gold and silver output, driven by stronger operational performance at the company's flagship Fresnillo and San Julian mines, Citi says. "The company has reiterated its full-year guidance at 50.5-56.5 moz for silver and 600-650 koz for gold," Citi analysts say in a note. "Cost inflation is likely to be a key focus for financial results scheduled for Aug. 2." (philip.waller@wsj.com)

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BOE Vote Split, Tone Could Determine Pound's Moves After Rate Decision

1345 GMT - Sterling's reaction to a possible larger interest-rate rise by the Bank of England on Thursday could depend on signals about future policy tightening, Ebury says. "As of Friday close, interest-rate markets were largely, though not fully, pricing in a 50 basis-point move, with some investors betting on a 25bp hike," Ebury strategist Matthew Ryan writes. BOE will struggle to buck the "hawkish trend" among G10 central banks so should deliver a 50bp rate rise, potentially boosting sterling, he says. Any sterling rally may, however, depend on the voting pattern among policy makers and the BOE's tone in the inflation report, he says. GBP/USD rises 0.6% to a one-month high of 1.2274. EUR/GBP falls 0.3% to 0.8369. (renae.dyer@wsj.com)

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Cranswick Shares Look Cheap After Strong 1Q

1226 GMT - Shares in Cranswick drop 1% after the U.K. sausage and meat-product maker reported higher first-quarter revenue and said its full-year outlook remained unchanged. Despite a robust comparative period, industry-wide pressures and a soft export market, Cranswick's 1Q update was strong, Berenberg says. "This performance underscores our attraction to Cranswick; its dominant market position is strengthening, cost-inflation pressures are being mitigated and U.K. demand remains healthy," Berenberg analysts say in a note. "While operating conditions remain tricky, we maintain confidence in Cranswick's ability to navigate challenges and at 12.5x EV/EBIT, it's trading below historical averages and our view of fair value." They hold a buy rating on the stock. (philip.waller@wsj.com)

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European Stocks Rise Ahead of Expected Flat US Open

1212 GMT - European markets rise after upbeat Asia trading and ahead of an expected broadly flat U.S. open. The Stoxx Europe 600 gains 0.3%, the FTSE 100 and DAX advance 0.6% and the CAC 40 climbs 0.5%, while Italy's FTSE MIB surges 1.6% amid reports that the Italian right faces pressure to say whether Russia was involved in the collapse of Mario Draghi's government. Brent crude drops 2.5% to $101.27 a barrel. Markets in Australia, China, Hong Kong and Japan all rise. IG futures data show the Dow opening at 32850, versus Friday's close of 32845. "A busy week ahead includes the Reserve Bank of Australia and Bank of England interest-rate decisions, culminating in the U.S. job report," IG analysts say in a note. (philip.waller@wsj.com)

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Vodafone's M&A Ambitions Looking Less Convincing

1157 GMT - Vodafone Group's progress on portfolio actions has been underwhelming and while a deal leading to the deconsolidation of Vantage Towers looks likely in the near term, the company's ambition to actively participate in mobile consolidation short term looks less convincing, Bernstein says. "We are starting to see a weaker organic-growth story. In addition, we see less upside potential from M&A. We still expect a deal leading to the deconsolidation of Vantage Towers (positive for the stock), but other portfolio actions are looking less likely in the near future," Bernstein Stan Noel and Ajay Soni say in a note. The U.S. brokerage has a market-perform rating on the stock, from outperform previously, and lowers target price to 135.00 pence from 155.00 pence. (kyle.morris@dowjones.com)

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Polestar's Key Strength Is Its Relationship With Volvo and Geely

1107 GMT - Unlike many other electric-vehicle startups, Polestar has already delivered more than 50,000 vehicles worldwide since its start of production last year and seems on track to deliver 50,000 units this year alone, Deutsche Bank analyst Emmanuel Rosner says in a note. "We believe Polestar's key strength is its intimate partnership with Geely and Volvo, creating an asset-light business model, speeding time to market, reducing manufacturing and supply risk, and ultimately allowing the company to focus on design, expansion and brand building," he says. Polestar was founded by Volvo Car and Zhejiang Geely Holding Group in 2017, and the two companies remain large shareholders. Deutsche Bank initiates coverage at hold with a $10 price target. (dominic.chopping@wsj.com)

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Belvoir's 1H Results Look Impressive Given Strong Comparator

1056 GMT - Belvoir's positive first-half results show an 11% rise in revenue, impressive given 2021 was an exceptionally strong year for the property sector, finnCap says. The U.K. property-letting company strong results were driven by management service fees and financial service revenue, and the number of mortgage advisers rose 24%, supporting continued growth prospects, finnCap analyst Guy Hewett says in a research note. Belvoir's cheap share price shows the market still significantly underestimates its above-average long-term growth prospects, supported by the potential to continue to reinvest the strong cash flows underlying the franchise-led model, the U.K. investment bank says. finnCap retains its 385.0 pence price target on the stock. Shares are down 1.1% at 235.0 pence. (joseph.hoppe@wsj.com)

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Speedy Hire's New CEO Appointment Looks Positive

1035 GMT - Speedy Hire's appointment of current chief operating officer Dan Evans as its next chief executive is a positive appointment and one that should ensure that the business's momentum can be sustained, Peel Hunt's Andrew Nussey says in a research note. What's more, shares in the U.K. tools, equipment and plant-hire services company look materially undervalued, he adds. Peel Hunt has a buy rating on the stock with a target price of 80 pence. Shares in Speedy Hire trade up 0.4% at 47.15 pence. (kyle.morris@dowjones.com)

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SSP Looks Well Placed to Accelerate Postpandemic Growth

1016 GMT - SSP Group is experiencing the return of prepandemic travel habits which in turn are increasing traffic in travel destinations and demand for concession units, with U.S. airline passengers reaching 98% of 2019's levels in early July, analysts at Jefferies say in a note. After recently outlining a capacity in the GBP425 million to GBP475 million range to invest by 2024, the food-and-beverage outlets operator is well-placed to accelerate growth postpandemic, analysts say. "With a high share of independents, we see likely consolidation in the travel concessions market driven by Covid-19 and inflation pressures," they say. Jefferies rates SSP Group buy and has a 350 pence target price on the stock. Shares are up 6.80 pence, or 2.7%, at 261.10 pence. (anthony.orunagoriainoff@dowjones.com)

 

Contact: London NewsPlus, Dow Jones Newswires;

 

(END) Dow Jones Newswires

August 01, 2022 12:59 ET (16:59 GMT)

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