Category: Stock Markets

Rolls-Royce Wins US Marine Corps V-22 Engine Services Contract
MarketsStock Markets

Rolls-Royce Wins US Marine Corps V-22 Engine Services Contract

Rolls-Royce has been awarded a new, two-year contract to provide aftermarket engine support for the US Marine Corps and Air Force V-22 fleets, which provides a more than 30 percent reduction in support costs.

The contract, through the company’s innovative MissionCare™ model, is valued at up to $287 million and will cover all V-22 aircraft across the Marine and Air Force fleets. Rolls-Royce is the sole engine provider for V-22 aircraft and has delivered 750 AE 1107C engines to the program.

The reduced maintenance costs result from a significant improvement in engine time on wing since 2009 when the original MissionCare contract was signed. Rolls-Royce has invested $90 million in capability and reliability improvements for the AE 1107C engine. Rolls-Royce has designed a series of upgrades that boost “hot and high” performance and add 17 percent more power to the engine over the original specification.

MissionCare, a Rolls-Royce developed package of services, incentivizes the company to design, develop and implement technology and affordability improvements to benefit the customer.

Tom Hartmann, Rolls-Royce, Senior Vice President Customer Business, said, “This new contract demonstrates confidence from V-22 operators that Rolls-Royce will continue to provide outstanding service and capability to the V-22 fleets. Operators know they can count on Rolls-Royce to provide the power and support they need to succeed in their missions – while also focusing on increased affordability.”

The Rolls-Royce AE 1107C engine is robust and battle-proven, demonstrating reliability during deployments across the Mideast, Africa and the Pacific. V-22 operators have never cancelled a mission due to engine availability.

The AE 1107C engine shares a common core with the Rolls-Royce AE family of engines, which totals more than 62 million flight hours of service and includes nearly 6,000 total engines in military and commercial service.

Hargreaves Lansdown Appoints New  Equity Research Head
MarketsStock Markets

Hargreaves Lansdown Appoints New Equity Research Head

Steve Clayton has joined Hargreaves Lansdown as Head of Equity Research. Steve joins Hargreaves Lansdown from Mirabaud Securities where he was a sell side analyst. Prior to Mirabaud almost all of Steve’s career was managing money at various fund management companies including Halifax fund managers, Dresdner RCM Global Investors and Liverpool Victoria (LV) Asset Management. Steve started his career in finance in 1987 after completing a degree in Economics at Cambridge University.

Hargreaves Lansdown is broadening its share research as part of an expansion of its stockbroking service, and in his new role Steve will be working to improve the firm’s equity research as part of this expansion.

Ian Gorham, CEO, Hargreaves Lansdown, said, “Extending our share research is a natural development of our stockbroking service. We have seen from the popularity of IPOs and share dealing generally that there is a growing appetite for share research. As the largest investment supermarket in the UK and largest retail stockbrokers we aim to provide all our clients with the best information whether shares, funds, passives, ETFs, or investment trusts. Clients value our expertise as well as our service.”

 

Clayton said, “The opportunity to join the largest retail stockbroker in the UK to help develop and expand their range of services was not one to miss.”

UK Business Confidence Cools
MarketsStock Markets

UK Business Confidence Cools

The Q4 2014 ICAEW/Grant Thornton UK Business Confidence Monitor, published today, shows that business confidence in the UK cooled further in the fourth quarter and currently stands at +28.6. Although lower than the +32.3 level of the past three months, the Confidence Index remains high compared with most of the past 10 years. Three areas of concern highlighted by the index, which is a leading indictor for growth, are slowing export increases, skills shortages, and levels of staff turnover.

Considering increasing global economic uncertainty and low inflation, Thursday’s Bank of England rate decision is expected to leave the base rate unchanged at the current 0.5% level. Also out on Thursday is the November rate decision from the ECB, which is expected to keep the currency area’s benchmark interest rate at 0.05%.

Consensus expectations regarding US non-farm payroll is that 235,000 new jobs were created in October. While this is below the 248,000 jobs created in September, with non-farm payrolls averaging 227,000 in the first nine months of this year, the US is set for the highest annual job creation figure since 1999.

AEC 2015 Set to Further Boost Bullish ASEAN Markets
MarketsStock Markets

AEC 2015 Set to Further Boost Bullish ASEAN Markets

The roll-out of the ASEAN Economic Community (AEC) in 2015 will boost economic activity across the ASEAN region and support already strong growth in markets such as Indonesia, Vietnam and the Philippines. The AEC, whose aims include a single market for trade as well as full integration into the global economy, will form a bloc of 600 million consumers and help the ASEAN region deliver superior risk-adjusted returns for investors compared to other emerging markets, believes Baring Asset Management (“Barings”).

The ASEAN region has recovered sharply from the macro and political turbulence seen in 2013 and widespread structural reforms have heightened the medium term growth outlook. In particular, macro headwinds are past their worst, believes Barings, and corporate earnings are expected to re-accelerate after demonstrating strong resilience. In an indication of this strength, Foreign Direct Investment (FDI) into the ASEAN-5 (Indonesia, Singapore, Thailand, Malaysia and the Philippines) has surpassed FDI into China for the past two years1.

SooHai Lim, Investment Manager of the Baring ASEAN Frontiers Fund, comments: “The ASEAN market’s cyclical recovery from the 2013 and early 2014 volatility has had a tangible impact on investor sentiment across the region, with momentum fully supported by the start of the AEC in 2015. The continued rise of a consumer class is having a very positive influence on economic development and growth: for instance, the percentage of middle class households in Indonesia is forecast to grow from 27% in 2014 to 45% by 20202.”

In terms of sectors, the Barings ASEAN Frontiers Fund is currently overweight Consumer Discretionaries and Financials, reflecting the rise and impact of consumer spending across the region. In terms of markets, the Fund is overweight Vietnam, Indonesia and the Philippines. Barings believes Vietnam will continue to attract FDI due to its attractive demographics and competitive labour force which has helped diversify its export base from being focused on agriculture and textiles five to ten years ago, to now having electronics and communications as one of the country’s biggest export drivers. Samsung’s second plant in Vietnam, for instance, will be its largest globally and account for half its smartphone capacity when ready in 2015.

Indonesia is also a favoured market, particularly in light of the election of Joko Widodo as President in July. A significant increase in government infrastructure spending, forecast to rise from 1.6% of GDP in 2014 to 3.7% in 20173, will have a positive impact on the country’s economic growth, believes Barings, while the rise of the country’s middle class will also play a central role. Indonesia’s GDP is forecast to increase from 5.8% in 2013 to 6% in 2015, with EPS growth up from 7.5% in 2013 to 13.5% in 20154.

SooHai Lim comments: “One of the main risks to the ASEAN region has been political risk, but this has subsided over the past six months in the two most affected countries, Indonesia and Thailand. We are encouraged by the political developments in Thailand and the stated aims to restore the country to a stable government quickly and efficiently, and have continued to see Thailand as a core constituent in the Baring ASEAN Frontiers Fund. The country not only has a strong relationship with neighbouring Myanmar, which has become a major participant in the ASEAN region, Thailand is also at the centre of the exciting new AEC trade bloc.”

Alibaba Shares Surge on Debut
MarketsStock Markets

Alibaba Shares Surge on Debut

NYSE festooned in Alibaba’s colours – Courtesy of Shutterstock

A clear indication of the appetite for the flotation, shares in the firm took the starting bell trading at $92.70 (£57). They were priced at $68 per share late on Thursday night.

At the end of trading, the shares had achieved a price per share of $93.89. The NYSE ticker name for the firm is BABA.

Closing at 38% above the initial launch price when the IPO was announced by the Chinese internet giant, over 100 million shares were being traded within minutes of the stock launch.

Raising nearly $21.8bn in in the share offer, Alibaba now has a company value of $231.4bn. That makes it significantly larger than either Amazon or Facebook. It is also just short of the market capitalisation of retail giant Walmart.

With an option for traders to buy another 48 illion shares in the firm a possibility, then the Chinese firm could realise a riasing war chest of little short of $25bn.

Responsible for over 80% of all e-commerce in China, the unequivocal backing of Alibaba is seen as a clear sign that investors are turning their attention to online sales in the country. Already huge, China has the highest number of internet users in the world, despite just half of their number being signed up to the internet.

Despite the strong performance there are some concerns from investors however.

Alibaba as a company is not being invested in directly but rather a Cayman Islands holding company is. A profits contract is in place between the two entities but is a significant factor in why the firm did not float on the Hong Kong Stock Exchange.

It is like that the offer will see a number of new millionaires created, though much of the stock is hekd by corporates. Japan’s Softbank is the latest sngle shareholder, holding a 32% stake in the internet firm. Yahoo has also been confirmed as having a significant stake.

Alibaba founder Jack Ma rang the opening NYSE bell on Friday morning.

Scottish No Vote Sees Sterling Surge
MarketsStock Markets

Scottish No Vote Sees Sterling Surge

Courtesy of Shutterstock

Jumping to 78.12 pence against the euro, its highest point for two years, 1.6525 against the US dollar, a two-week high and a six-year high against the yen of 180.16 yen, analysts expect the FTSE to follow suit and open high.

It is a return to confidence in the pound after the last few weeks has seen it sliding on the world’s markets. Fears that Scotland would break away from the union were heightened after influential polls revealed the referendum vote would be far closer than many had anticipated.

Those polls, one a YouGov poll for The Times newspaper and the other an ICM survey for the Guardian newspaper, put the unionist vote at 52% and 51% respectively.

The last pulse reading before the voting booths were opened showed this had increased back in favour of the unionists. That poll, also by YouGov, showed that Scottish unionists were likely to win by 54% to 46%.

The final result, confirmed just after 6am BST (GMT +1) after voting results were declared in the Fife area of Scotland, showed a winning margin of 10%. With a record turnout for an election in Scotland, and the highest in any democracy in the world for a significant time, unionists won out 55% to 45%.

The performance of the pound was an affirmation of the generally accepted opinion of market analysts.

As the votes were being counted, the head of G10 forex strategy for Deutsche Bank, Alan Ruskin, said that a vote against Scotland forming a new country:

“would remove uncertainty over some very big issues”

An economist at World First backed up this view as early results showed a trend for a No vote, with Jeremy Cook saying :

“The obvious risk to the currency markets was a yes and that would have caused a big sell off. Now the markets will go back to concentrating on the fundamentals of the UK economy.”

With the UK economy showing a steady recovery and indications from early trading today, suggestions are that the decisive win could see a continued spike to sterling for an extended period of time.



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Fiat Shares Up as Ferrari boss Di Montezemolo Steps Down
MarketsStock Markets

Fiat Shares Up as Ferrari boss Di Montezemolo Steps Down

It was a widely expected departure by Luca Cordero di Montezemolo, though he insisted only at the weekend’s Formula 1 Grand Prix in Monza, Italy, that he would be staying in charge.

Unacceptable F1 Performance

The announcement was expected after the Ferrari F1 team has had yet another disappointing season – its worst in two decades – on the circuit of the world’s biggest motor racing platform. He will be replaced by the chief executive of Fiat Sergio Marchionne.

Mr Marchionne recently came out in the press saying that the team’s showing in Formula 1 this year was:

“unacceptable”

After the race in Italy on Sunday, where Spanish driver Fernando Alonso retired after 28 laps and fellow Ferrari racer Kimi Raikkonen finished ninth, Mr Marchionne said that the need for Ferrari to win F1 races was:

“absolutely non-negotiable”

The departure sees Mr Montezemolo’s tenure as head of the luxury brand come to an end after 23 years. Now 67, he has been associated with Ferrari for most of his life, working under the founder of the firm, Enzo Ferrari, when he first joined as his assistant.

The Most Wonderful Company

As he announced his departure on Wednesday, which comes into effect on October 13, Mr Montezemolo said:

“It has been a great privilege and honour to have been [Ferrari’s] leader. I devoted all of my enthusiasm and commitment to it over the years. Together with my family, it was, and continues to be, the most important thing in my life.”

He had started the press briefing by announcing that Ferrari was:

“the most wonderful company in the world”.

Mr Montezemolo’s departure will come three days ahead of Fiat-Chrysler listing on the New York Stock Exchange.

Closer Integration

It is understood that Mr Marchionne will oversee his ambition of a closer integration between Fiat and Ferrari. He has sales of 10,000 cars targeted for each year.

This is something which Mr Montezemolo was expressly against, arguing that he wanted to maintain Ferrari’s exclusivity and independence.

Despite the relatively low sales of Ferrari, the high price tags actually saw them accounting for 12% of Fiat-Chrysler’s operating profits last year. With just under 7,000 cars sold last year, (near the sales target that Mr Montezemolo was happy with), the brand saw its net profit increase by 5.4% to 246 million euros.

Following the announcement Fiat’s stock rose 2.7% to trade at 7.91 euros.

At the time of writing it had fallen back to 7.82 euros, an increase of 1.7%.

France Falls Short of EU Deficit Target
MarketsStock Markets

France Falls Short of EU Deficit Target

Set at 3%, France will miss the target by over one percent, with its budget deficit set to be 4.4% for this year. The country is also predicting a deficit of 4.3% of GDP for 2015.

The minister, Michel Sapin, went on to say that the country will fall short of the target for the next three years, confirming that he has lowered France’s projections for growth accordingly.

An Economic Reality

M. Sapin went on say that despite France falling short, it was not requesting that the EU change its policy and rules. Addressing a press conference on Wednesday morning, the minister said that the lack of growth experience in France reflected the wider environment in Europe.

 

He went on to say that the lack of growth was an:

“economic reality”

It is not the first time the country has missed the budget deficit targets, while the country still struggles to tackle high rates of unemployment.

With arguments in the French government punctuating François Hollande’s presidency, a number of high profile ministers have resigned citing bitter rows over the French economic policy.

 

Lower Projections

Announcing the missed target, M. Sapin said that France was lowering its projections for growth from 0.7% to 0.4% for 2014. For next year, the minister said growth projections were being taken down from 1.7% to 1%.

The continuance of plans for cutting back on public spending were also confirmed, with the French government planning 21bn euros (£17bn) of savings for next year and making total savings of 50bn euros by 2017.

However, M. Sapin went on to say that despite the cutbacks, it would hold resolute on its stance of not increasing taxes.

MarketsStock Markets

Pound Falls on Scottish Independence Fears

The reaction was a response from investors as they continued to be concerned about the upcoming vote over Scottish independence.

The referendum, which takes place on 18 September, took a surprising turn at the weekend after two key polls suggested the appetite had shifted from union to independence.

Fall and Rise

At opening, the pound slumped by a further 0.04% against the US dollar, to hit £1.609 in early trading. It rose against the Euro however. Moving up by 0.06%, it was trading at 1.24970 euros shortly after the market opened.

The FTSE also saw an early rise, up by 4.5 points (0.07%) to 6,839.29.

Yes Vote Gains Momentum

The Scottish Yes campaign received a huge boost over the weekend after the results of the poll suggested a win.

Polls in the run up to the vote before have all pointed towards a No campaign win.

Many analysts are still predicting a narrow win for the No campaign however, with Citigroup among this group. However it, along with other financial service providers, have warned investors that close attention of the situation is needed.

There are also warnings that a ‘Yes’ vote could see the UKs economic recovery stall.

MarketsStock Markets

Euro Sinks to 14 Month Low After ECB Lowers Interest Rates

The fall came after the European Central Bank (ECB) surprised many commentators and analysts by cutting interest rates in the eurozone to a record low.

Euro Currency Slump

Following the decision by the central bank the euro tumbled to $1.30, a fall of 1.6%. That was the lowest point since last summer and, at the time of writing, was trading even lower at $1.29.

The slump came after the ECB cut 10 basis points off its deposit, marginal lending and refinancing rates. Its benchmark interest rate was cut to 0.05%

A round of new measures were announced to stimulate the economy too, including an asset purchase drive, which will focus on purchasing debt products from eurozone banks.

The action has also seen two-year government bond yields enter negativity in some countries in the economic zone. That is the first time that has happened, with the move from 0.02% to 0.07% experienced by the German Schatz indicative of this.

Equity Markets Jump

The news also had an impact on the European equity markets.

The FTSE Eurofirst 300 index grew by 1.1% – achieving its highest finishing point since 2008. However, the FTSE 100 did not jump in the same way – a result of the 6% drop by BP following the ongoing court action taking place in the US in response to the Deepwater Horizon incident in 2010.

Wall Street meanwhile saw its S&P 500 hit its own record.

Achieving an all-time record intraday high, the market rose to 2,011.17. This was tempered later in the day, a result of a decline in energy stocks and ahead of jobs information being released to the market, which showed a rising number of jobless people. 

No QE Pump – Yet

There was once again no mention of any quantitative easing (QE) package being put in place by the ECB.

The decision announced by President Mario Draghi to buy assets was a surprise, largely because industry analysts suggest not enough time was given to ascertain the effect of measure introduced in June.

Mr Draghi did admit, however, that the action being taken was not by virtue of a unanimous decision by the board, saying:

“Some of our governing council members were in favour of doing more than I’ve just presented, and some were in favour of doing less,”

This has raised questions over whether a round of QE would ever been seen in the Eurozone, with a chief credit strategist at LNG Capital, Gary Jenkins, telling the Financial Times:

“I think that today’s meeting will lower the market’s expectation of outright QE in the Eurozone.”

However, many feel that should the latest measures and those introduced earlier in the year not prove successful, QE could be the only option to generate sufficient stimulus.

MarketsStock Markets

US Markets Rally on Russia-Ukraine Ceasefire Talks

The morning’s trading saw the Standard & Poor 500 Index hit a record, adding 0.2% to climb to 2,006.79 at 9:31 a.m. New York time. The Dow Jones Industrial Average also performed well, climbing 0.3%, or 52.98, points to achieve 17,120.54.

Speaking to Bloomberg, the chief investment officer for McQueen, Ball & Associates in the US, Bill Schultz said that the removal of just one of the present geopolitical risks across the world would help confidence return to the market.

Responsible for a $1.2 billion portfolio of investments, Mr Schultz continued:

“The Fed is in that mid-range now where they’re contemplating what to do next but don’t necessarily have to push anything at this point. With one more geopolitical impediment out of the way, that puts a calmer, less volatile market environment in place in the near-term.”

A Wall between Nations

However, one of the largest news agencies in Russia, RIA Novosti, was reporting that no such ‘steps’ were agreed.

Later reports by RIA also said that Ukraine was planning to build a wall along its Russian border within the next six months.

The article, which appeared just after 14:00 London time (15:00 CET, 17:00 Moscow), also quoted Ukrainian Prime Minister Arseniy Yatsenyuk as saying it was imperative that a new military approach was taken against Russia.

Mr Yatsenyuk went on to say that the action, part of Kiev’s National Renewal plan, was necessary as Russia was threatening his country’s national security as an:

“aggressor nation,”

With the US and Europe recently joining calls to accuse Russia of providing personnel and hardware support to the pro-Russian rebels, the hope for an end to the tensions is eagerly hoped for by investors.

Talking to Bloomberg, German-based Deutsche Postbank AG strategist Heinz-Gerd Sonnenschein said that even these tentative reports of talks were acting as a ‘positive driver’.

He continued to explain that a full conclusion would be the only way investors could divert their attention away from the political problem and focus on economic indicators, financial policies and other factors.

For now though, he surmised, it was still very much a waiting game.

MarketsStock Markets

UK and Euro Manufacturing Output Slows

According to the Markit/CIPS UK Manufacturing Purchasing Managers’ Index (PMI) for the regions, the rate of output growth has slowed at a more rapid rate than recently.

 

UK Lowest for 14 Months

In the UK the PMI results for August showed a drop from 54.8 in July to 52.5. That is the lowest figure for 14 months. However, with a PMI reading above 50 showing growth it still reveals the market is expanding, all be it at a slower rate.

The slower rate was seen at every level though, according to Markit, who said that both the number of new jobs and new orders being seen in the market was weakening. It was still above average however, with senior economist Rob Dobson at Markit saying:

“Sustaining the upturn is still a positive in itself,”

The findings were backed up by another survey however.

According to the results of the study from manufacturing trade body EEF, growth was found to have slowed from July 30 to August 20.

Both Markit and EEF have said that this will affect the bottom line figure for growth through the year, with EEF adjusting its forecast down from 3.5% to 3.3%.

 

Eurozone Lowest for 13 Months

Many analysts and commentators have said that the slowdown in UK growth is largely a response to the conditions in global markets – with the sluggishness of Europe likely to be particularly influential.

This was a view backed up by the results of manufacturing growth in the eurozone, which posted its slowest rate in 13 months,

The Markit PMI for the region dropped from its July figure of 51.8 to an August reading of 50.7. This is still showing growth, but revealed stalling order numbers as the continuing political situation in Ukraine had an impact.

Markit’s Rob Dobson said:

“Although some growth is better than no growth at all, the braking effect of rising economic and geopolitical uncertainties on manufacturers is becoming more visible,”

The results of the PMI survey come ahead of the European Central Bank (ECB) meeting on Thursday. It is understood that with inflation at 0.3% and a real risk of deflation, the bank’s boss Mario Draghi could start a round of quantitative easing (QE).

Up until now, the eurozone has resisted taking any QE action, despite relative success by such schemes in the UK and the US.

 

The German and French Problem

Compounding the issue in the eurozone is the performance of the largest markets.

The German market for example slumped to an 11 month PMI low of 51.4. Meanwhile, in France, the PMI slumped to just 46.9, with Dobson saying it is a ‘real concern’.

It is not the only concern though, with the economist continuing to explain:

“Signs that growth impetus waned in the key industrial engine of Germany, and in Spain and the Netherlands too, is also less than reassuring,”

It was not all bad across the eurozone though, with the Republic of Ireland seeing its PMI reading hit its highest point in nearly 15 years, at 57.3.

With the overall results showing that key markets are still generally on the up however, there seems little need for outright panic. With the challenging political environment likely to continue for some time though, how the market and businesses respond in the last two quarters of the year will be closely watched.

In the UK this is certainly the case where, despite the less than assuring results this month, the manufacturing sector is still set to post its best year since 2010.

Russian rouble slumps to record low
MarketsStock Markets

Russian rouble slumps to record low

It is the worst valuation since the Russian currency was restructured in 1998, and follows the talks between Ukrainian President Petro Poroshenko and Russian leader Vladimir Putin, which are widely-considered to have failed.

Stocks in the country also fell, with the dollar-backed RTS index declining by 1.9% to 1,196 and the rouble-backed MICEX index dropping back 1.3% to 1,405.

According to American bank Morgan Stanley, it is all making an unattractive environment for investors. A research paper has said that are many questions that need to be answered before an investment can be made, stating:

“In our worst case scenario involving full sanctions, a material portion of the listed stock market in Russia could become uninvestible for many investors”.

The turmoil in the Russian market is expected to continue, with the war of words between Russia and the west not looking like ending any time soon.

Japan
MarketsStock Markets

Japan, China and Brazil Lose Momentum as India Grows

Official data in Japan has revealed an economic slowdown, with households spending less in July and factory output being scaled back.

Much the same is true in China, where the expected manufacturing output was down for August. According to the country’s purchasing managers index (PMI) target, activity is down from predictions.

Economists had expected the PMI to hit 52.2 but only achieved 51.1. In July, the figure was 51.7

India meanwhile is expecting to see its fastest economic growth in two-and-a-half years.

The country’s Ministry of Statistics has said that strong performance in utilities and the financial services has helped achieve growth of 5.7% in the twelve weeks to June this year.

India’s fellow BRIC country Brazil had a less favourable second quarter to the year however, with official figures confirming that the country has fallen back into recession.

Coming just a moth ahead of the South American’s country’s general election, commentators are expecting a rough showing in the polls for the government of President Dilma Rousseff.

According to the latest GDP figures for the country, output slumped by 0.6% in the up until June, significantly below the level analysts had been predicting.

The World Cup earlier in the year had been hoped to boost levels of spending throughout the country, but early data has suggested this is far from so, with no growth for the year now being forecast.

G4S Reports First Half Profits
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G4S Reports First Half Profits

Strong demand in the US, Canada and emerging economies have helped the firm.

However, with recent high profile scandals affecting G4S, the firm’s boss Ashley Almanza admits the firm still has a lot of work ahead.

At the London 2012 Olympics the firm came under heavy fire after its recruitment and training of security staff were found to be lacking. This led to the Army having to be drafted in at most of the Games venues’.

The firm is also subject to a present investigation being conducted by the Serious Fraud Office (SFO).

G4S was banned from being awarded any more government contracts here in the UK after the firm was found to be charging inflated prices for electronic tags for prisoners.

The SFO is investigating G4S and Serco over the relevant contracts.

That ban has now been lifted, after the security firm repaid the UK Government £109m to cover the losses.

It has also said it is undertaking a programme to strengthen its governance processes and overall performance in light of recent troubles.

The firm made the tagging payment in April and has subsequently been awarded public and private contracts amounting to £1.2bn for the year.

Among the contracts awarded in the UK is the lucrative Department for Work & Pensions contract managing long-term unemployed community work placements.

Revenue for G4S had grown by 4.1% in Q1 and Q2, amounting to £3.37bn, with growth in the North American market of 4.2%. It’s revenue in Latin America grew by 12.8%

At the time of writing, early trading on Wednesday had seen shares in G4S (GFS) rise by 1.81%.

World Cup Win Fails to Score for Ladbrokes
MarketsStock Markets

World Cup Win Fails to Score for Ladbrokes

The bookmaker, which despite the sharp fall reported strong business throughout the World Cup in Brazil, also said it was in a good position for growth.

Reporting the losses, Ladbrokes showed a pre-tax profit fall of 49.7% up to June 30, amounting to net revenues of £27.7 million.

Ladbrokes also reported that the focus for the start of the year had been on ‘operational improvements’ and that is was subsequently expecting its financials for the year to date to ‘lag behind’.

Reporting the news, the boss of the firm, Richard Glynn said:

“We have made substantial progress. We now have the products, the platforms, the people and the brand in place to deliver,”

The gambling company went on to admit that its recent partnership with Playtech, to deliver a new gaming system, had been problematic. The switch is now complete.

There was also the closure of 46 of its less-successful outlets, with the firm admitting that there are more closures to come. It went on to say compliance with the new voluntary industry code of conduct drawn up by the Association of British Bookmakers (ABB) had also been having:

“a clear impact on revenues”

Revenues were also affected by so called customer-friendly results it said; something the industry has been reporting on a number of instances this year for both football and horse racing.

A highlight for the year was the World Cup. With more than a 1,100% increase on mobile betting, the firm posted strong results as the home side favourites crashed out at the semi-final stage and England again disappointed.

Despite the poor results, the board said they were in line with forecasts and are confident on the outlook for the firm.

At the time of writing, early trading on Monday had seen shares in Ladbrokes (LON: LAD) rise 2.53%.

MarketsStock Markets

House! 888 reports bingo success in Q2

According to the firm the strongest growth was in its bingo and business-to-business divisions.

A 15% increase in sales from the same period last year saw the betting firm post total revenues of $111m (£65.8m) for the quarter. The announcement saw the FTSE 250 listed company’s share price increase by 0.21% to 121p.

Announcing the results last week, the firm’s CEO Brian Mattingley said:

“I am pleased to report that 888 has delivered another strong performance in the second quarter which, in combination with our very good start to the year, has once again resulted in record-breaking revenue for H1.”

Mattingley went on to highlight how the firm’s back-end systems are fundamental to recent success. With stringent systems, Software Test Design (STD) and increasing the interactive options likely to be more and more important to offer a difference from competitors, he continued:

“This outcome has been driven by strong performances across both our B2C and B2B lines of business and is testament to our exceptional brands, technology, marketing and CRM systems.”

It is not all about developing systems, ensuring robust tests, offering new lines and the exciting world of STD. Bingo is itself seeing excellent growth, showing classic games are still sought after. As well as 888, Foxy, Wink and Betway are all growing their online bingo offerings in the UK market for example.

Mattingley was quick to warn about over-excitement, explaining that how brightly the full year results shine will be very much dependant on trading. However, he went on to add that he is confident for the growth of the firm.

There is also confidence in 888 from elsewhere.

Analysts at London based global investment bank Daniel Stewart & Co backed up an earlier ‘buy’ rating for shares in the firm. Investec too took the chance to also reiterate their ‘buy’ rating.

Investec has since updated this to a ‘hold’ status, which has been matched by two other analysts. One analyst has a ‘sell’ rating.

Consensually though, 888 Holdings Public Limited Company has a ‘buy’ rating, while at the time of writing, the firm’s share price was priced at 124.75p.

Foreign Tourists Fuelling UK Growth
MarketsStock Markets

Foreign Tourists Fuelling UK Growth

Spend on retail, hospitality and leisure is set to rocket as overseas visitors flock to the UK over the next few years, according to a new report from Barclays.

The research, independently commissioned for Barclays’ Retail and Hospitality & Leisure banking teams, reveals that spending from foreign tourists is predicted to reach over £27 billion by 2017, an increase of 34% on 2013. Rapid growth in spend among tourists from emerging economies will be further boosted by loosening visa restrictions, and overseas visitors will deliver a significant boost to the economy this year and beyond.

Visitors from the US currently spend the most in the UK, followed by France and Germany and this spending pattern will continue through to 2017. However, emerging economies such as China, the UAE and Russia are set to outstrip them in growth terms owing to the increasing wealth of consumers in these countries, in particular their growing middle-classes. The UAE and Russia are set to break into the top ten nationalities to visit the UK by 2017 and tourists from China alone will spend over £1 billion in 2017, up by 84% from 2013.

Richard Lowe, Head of Retail & Wholesale, Barclays, said: “Opportunities abound for both retailers and the leisure industry to capitalise on these growing tourist numbers and spend. Businesses putting in the time and effort to understand their client demographic and to talk to their audience through whatever channels they use, be it social media or more traditional, will carve out an advantage that will enable them to offer something more tailored for each nationality that visits our shores.

“For our retailers, it is also worth considering that British-made goods remain popular amongst overseas consumers, so it would be time well-spent evaluating how they market their products to audiences from overseas eager to snap up ‘Brand Britain’.”

The sectors that will benefit extensively from this rise in tourist spending are the retail, leisure and hospitality sectors, with both expected to boom. The retail sector is set to generate £9.3 billion from tourists in 2017, an increase of 36% from 2013. Expenditure within the fashion retail sector will increase by 38% alone, to £5.8 billion.

Spending on hotels, eating out and attractions will rise by 33% to £14.7 billion in 2017. Overseas visitors are set to spend £5.3 billion on eating out by 2017, up by 34%, with spend on leisure attractions increasing by 32% to £2 billion by 2017, and hotel accommodation attracting £7.3 billion in spend by 2017, an increase of 33%.

Genomic Vision Celebrates Euronext Paris Listing
MarketsStock Markets

Genomic Vision Celebrates Euronext Paris Listing

EnterNext, the Euronext subsidiary designed to promote and grow its market for SMEs, has congratulated Genomic Vision, a biotechnology company specialising in molecular diagnostics for genetic diseases, on its successful listing in compartment C of Euronext’s regulated market in Paris.

Genomic Vision is a molecular diagnostics company that develops and markets diagnostic tests and research tools based on analysing individual DNA molecules. To do so, it uses the “molecular combing” technology discovered by Aaron Bensimon, Chairman of the Executive Board and co-founder of Genomic Vision, who was working at the time at the Institut Pasteur’s Unité de Stabilité des Génomes unit in collaboration with a research team from Ecole Normale Supérieure. This cutting-edge technology detects quantitative and qualitative variations in the genome and establishes their role in a given pathology. The company focuses primarily on oncogenetics, the main market for genetic testing.

Genomic Vision was listed through a Global Offering. Given very strong demand — a total €93.9m — the company decided to fully exercise the extension option. The admission and issue price of Genomic Vision shares was set at €15.00, in the middle of the indicative price range.

Altogether 1,533,332 shares were issued, raising a total of €23m before any exercise of the over-allotment option. Based on a total 4,266,907 shares admitted to trading at €15 per share, Genomic Vision’s market capitalisation stands at €64m.

The settlement and delivery of the Offering occurred on 4 April 2014. From April 2 through April 4, Genomic Vision shares were traded on an “as-if-and-when-issued” basis.

“We would like to extend a warm welcome to Genomic Vision, and are proud to help raise capital for a growth company specialised in diagnostics for genetic diseases and cancer. Its listing testifies to the very dynamic market for IPOs.

Genomic Vision will be able to draw on EnterNext’s advice and services as it makes the most of its presence on the stock market,” said Eric Forest, Chairman and CEO of EnterNext.

Aaron Bensimon, Genomic Vision’s co-founder and CEO, added “We are delighted to join Euronext’s Paris market. We would like to thank all of our shareholders, old and new, who helped us achieve this milestone — and who will now be accompanying us as we roll out our technology in Europe and expand its scope to new pathologies.”

To celebrate the continuous trading in its shares that started today, Aaron Bensimon and his team rang the bell marking the opening of Euronext’s financial markets.

LSE Sees Increase in Retail IPO Activity
MarketsStock Markets

LSE Sees Increase in Retail IPO Activity


The market has seen a diverse range of retail companies come to London, from well known domestic brands such as Poundland, Boohoo.com, Pets At Home, McColls and AO World, to international companies such as the Russian hypermarket chain, Lenta and the Indian online fashion retailer, Koovs.

The boost in retail listings this year has helped raise overall IPO activity to pre-2007 levels. Notably, the IPO market is providing viable exit opportunities for private equity and venture capital firms, with six private equity-backed listings on London’s markets year to date.

Key statistics:

– Five retail Main Market IPOs raise £1.78bn and two retail AIM IPOs raise £322m
– 70 retail companies currently listed on our markets – 23 AIM & 47 Main Market
– Six private equity-backed IPOs to date in 2014

Alastair Walmsley, Head of Primary Markets, London Stock Exchange Group, said: “The surge in retail IPO activity over the last few months can be attributed in part to a reawakening of investor appetite for equity.

“2014 looks set to be a strong year for London’s equity market, with a healthy number of UK and international companies seeing the opportunity offered by our markets as a platform for their future growth.

“The strength of our pipeline underlines the power of equity to enable companies to achieve their strategic ambitions and we look forward to welcoming more high quality and well known businesses to our markets in the coming months.”