Shares in London shrugged off the Italian referendum result, which cost PM Renzi his job and cracked on in early trading suggesting any major concerns were either priced in last week or are too far down the road to trouble traders today. For The Trader Nicole Elliott's latest thoughts, click here.
IC TIP UPDATES:
Regeneration specialist St Modwen Properties (SMP) confirmed that it has received firm levels of interest for the development of its 10-acre Nine Elms site, while regional occupier demand means that the group’s performance in the second half will be broadly similar to the first half. St Modwen Homes has started work on three new sites, bringing the total up to 18, with sales volumes and profits expected to be higher in the second half from the first. Buy.
Debt plagued Cambian (CMBN) has at last found a solution for its financial difficulties and managed to sell its adult services division for £377m, the majority of which will be used to wipe £250m of debt. This certainly a relief for investors who have stayed true to the group while the share price has plummeted and they have been rewarded with a 7 per cent share price rise today. Plus the company has also announced today that £40m from the sale will be returned to shareholders in due course. We remain unconvinced about the group’s long term recovery potential however; the remaining children's division is the substantially less profitable part of the group and the market for care homes in the UK is currently tough. Sell.
AstraZeneca (AZN) has completed the sale of the ex-US rights to Rhinocourt Aqua, a nasal spray treatment which reduces irritation and allergic reactions in the nose, to a division of Johnson & Johnson for $330m. Buy.
Shares in online estate agency Purplebricks (PURP) have surged by almost 20 per cent on the back of decent interim results which showed revenues rising to £18.7m and losses narrowing from £6m last year to £2.2m this year. We retain our buy recommendation.
KEY STORIES:
Royal Bank of Scotland (RBS) has settled with three out of the five shareholder groups over its 2008 rights issue, covering 77 per cent of the claims by value. Investors claimed they had been misled into believing the bank was in satisfactory financial health. Management said it is willing to pay up to £800m in settlements, which it has already taken provision against.
