Today's market overview
Equities are up in early trading and The Trader Dominic Picarda believes that the short term weakness at the end of last week was merely a pause in the longer term uptrend.
IC TIP UPDATES:
Engineer Weir Group (WEIR) says that its third quarter saw a continuation of positive order trends with aftermarket orders in particularly showing a 15 per cent rise, or 10 per cent on a like for like basis. But third quarter revenues and profits were slightly below expectations due to project delays in the minerals business and a slower than anticipated pick up in the upstream oil and gas sector. Full year adjusted profits will be in the £425m-£435m range with reported profits a further £8m-£12m lower due to currency fluctuations. Our recommendation is under review.
Sell recommendation Hiscox (HSX) reports a 10 per cent rise in gross written premiums for the first nine months of the year but says that premium rates in reinsurance are under pressure after a benign claims period.
Co-Operative Group has announced the details of its recapitalisation plan which will see the group retain 30 per cent of the recapitalised business with institutional bond holders being given shares in the new entity, which will look to float next year. Retail bond holders are being offered two options, either a lower coupon over 12 years with a capital sum at the end of that period or their existing annual payment maintained over the next 12 years with no capital sum at the end.
Merlin Entertainment has revised its Initial Public Offering timetable and the deadline for applications is now 5pm on Thursday 7 November.
Renewable Energy business Infinis, which is being floated by Guy Hands’ Terra Firma vehicle, expects to be floated at 260p-330p a share, which will give it a market capitalisation of up to £930m. Up to 44 per cent of the company will be sold dependant on over-allotment arrangements.
Luxury Gulf developer DAMAC Real Estate Development, which is primarily concerned with building residential property in Dubai, has announced its intention to sell up to $500m worth of global depository receipts in London.
Ryanair (RYA) grew first half profits by 1 per cent to €602m after a 2 per cent rise in traffic but the company reiterated that yields have softened in the third quarter of the year due to the company responding to softer market conditions with aggressive price cuts. This means full year profit forecasts are cut further from €570m-€600m to €500m-€520m.
Half year results from E2V Technologies (E2V) showed a rise in revenues from £90.7m to £98.1m but a dip in adjusted pre-tax profits from £13.1m to £11.4m. The order book has risen from £138m this time last year to £189m, leading the company to ramp up staffing for a second half uplift.
Soco International (SIA) has announced a farm in for a 60 per cent interest in the Mer Profonde Sud offshore prospect in Congo Brazzaville.
OTHER COMPANY NEWS:
Conviviality Retail (CVR) reports a 0.6 per cent rise in like for like sales in the six months to 27 October, which is described as a ‘marked improvement’ on last year’s showing.
Sirius Minerals (SXX) says that tests on its POLY4 polyhalite product from the York Potash Project proved that it passed all product characterisation tests.
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