The FTSE 100 closed down 0.47% on Thursday as investors mulled over the latest round of sanctions against Russia, as well as minutes from the U.S. Federal Reserve which outlined plans to scale back asset purchases and hinted at rate hikes. The combination helped "to pour cold water on investor sentiment," AJ Mould said. Insurer Aviva PLC was the day's biggest faller, closing down 4.9%, with Barratt Developments PLC also falling by 4.3%.
Companies News:
Tate & Lyle to Return GBP500 Mln to Shareholders via Special Dividend
Tate & Lyle PLC said Thursday that it intends to return 500 million pounds ($653.4 million) to shareholders by declaring a special dividend to be paid in May.
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De La Rue Sees FY 2022 Adjusted Operating Profit in Line With Market Views
De La Rue PLC said Thursday that it expects to close its fiscal 2022 year with an adjusted operating profit in line with expectations.
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Entain Starts Year in Line With Expectations; Group Net Gaming Revenue Up
Entain PLC said Thursday that it has started the year strongly and is performing in line with expectations, as business benefits from the return of retail following last year's Covid-19-related store closures.
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Robert Walters 1Q Net Fee Income Rose; Boosted by Performance in Asia Pacific, Europe
Robert Walters PLC said Thursday that its net fee income rose in the first quarter of the year as recruitment activity levels continued to increase.
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Shell Warns of Up to $5 Billion Hit From Russia Exit
Shell PLC said Thursday it expects to book accounting charges of up to $5 billion in the first quarter related to its decision to exit its joint ventures with Russian energy giant Gazprom PJSC in the wake of Russia's invasion of Ukraine.
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Ashtead Technology Says It Is Confident in 2022 Views After Strong 1Q
Ashtead Technology Holdings PLC said Thursday that it performed strongly in the first quarter of 2022, underpinning the board's confidence in meeting its expectations for the full year.
Market Talk:
Oil, Gas Companies Look Set to Ride Higher-Price Wave
1233 GMT - Oil and gas companies look set to cash in on higher oil prices, though Energean may not benefit as much as others, Jefferies says. The brokerage is increasing company share-price targets by 33% on average, with buy ratings on 10 of 14 names, after applying its higher oil & gas price deck and rolling forward net-asset valuations to Jan. 1, 2023, it says. "We expect the current energy crisis to have long-term effects on gas markets, as European efforts to replace Russian volumes and delays in Russian LNG projects should extend market tightness to 2030," Jefferies says. Still, it cuts Energean to hold from buy due to the company's exposure to fixed gas prices.
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Countryside Partnerships' Outlook Is Unclear
1214 GMT - Countryside Partnerships' update highlights a number of issues within the business, including the challenges of executing a high-growth strategy and the poor performance of the Westleigh acquisition, Peel Hunt says. The house builder's new profit guidance for fiscal 2022 of an adjusted operating profit of GBP150 million is better than the brokerage had forecast. However, the lack of visibility on the outyears is unhelpful and little clarity on the likely cost of cladding remediation could muddy the waters further, Peel Hunt says. Countryside's shares are still at a somewhat inflated price and the risk appears skewed to the downside, Peel Hunt says, reiterating its hold rating and 330 pence price target on the stock. Shares are down 12% at 244.0 pence.
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UK's Energy Plan Condemns Thousands to Live in Cold, E.ON Says
1206 GMT - E.ON, one of the largest U.K. energy suppliers, has criticized the U.K. government's new energy security plan due to a lack of action on energy efficiency. "By abandoning any extra commitment to helping people to improve their homes, [Thursday's] announcement condemns thousands more customers to living in cold and draughty homes, wasting energy and paying more than they need to for their heating," Michael Lewis, CEO of E.ON UK, says. Energy bills could rise sharply again ahead of winter, and there is little in the announcement that will deliver a solution this decade, let alone this year, Lewis says. E.ON is a German energy group which supplies around 3.8 million customers in the U.K.
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Money Markets Pricing of UK Rates Signal Recession Risk
1145 GMT - Money markets are pricing in a much steeper course of U.K. interest-rate rises this year than Berenberg predicts. "We expect the bank rate to reach 2.25% by the end of 2024 and remain there through 2025," says Kallum Pickering, senior economist at Berenberg in a research note. By contrast, the market curve sees rates rising quickly to 2.2% by the end of 2022 before being cut somewhat thereafter," he says. "Worryingly, the market path may be a signal that the BoE will have no choice but to slam on the brakes in 2022 (risking a recession) in order to control inflation," he says. He expects policymakers to do their upmost to avoid triggering a recession and predicts a slower pace of rate rises than the market during the second half of 2022.
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TI Fluid Systems Faces Cost, Market Pressure
1137 GMT - TI Fluid Systems is facing potential short-term cost and market pressures, Jefferies says, downgrading the automotive fluid-systems manufacturer to hold from buy and its price target to 195 pence from 350p. Shares fall 11% to 162p. Jefferies says the company's ability to recover higher costs via pricing look lower than expected and market expectations regarding expansion of the electric-car market may need to be moderated. "The conditions TIFS faces are among the most difficult in our coverage," Jefferies analysts say. "While the longer-term equity story remains attractive, this will be another highly challenging year. Material EBITA downgrades and de-rating of the auto-supplier peer group lead us to cut our PT [price target] to 195p."
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Tullow Oil's Rising Asset Value Looks Set to Lift Stock
1136 GMT - Tullow Oil shares have further to go, says Jefferies, increasing its price target on the West Africa-focused oil producer and explorer to 90 pence from 65p. Tullow's net asset value is set to increase as higher oil prices boost the company's largely Ghana-weighted valuation, Jefferies says. "Tullow stock performance has dragged, despite its potential free cash-flow generation," Jefferies analysts say, reiterating their buy target on the stock. "We believe as the market restores faith in Tullow's assets, share-price performance should follow." Shares rise 1.9% to 59p.
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888's William Hill Deal Seen as Transformational
1115 GMT - 888 Holdings' takeover deal for William Hill will have a transformational impact on the online betting and gaming company with numerous positive benefits, Peel Hunt says. The U.K. brokerage says management has the ability to realize those benefits and will have a multiyear runway to work on synergy extraction and business optimization to drive growth. Any challenges that arise from integrating the businesses should be taken in management's stride, it says. Peel Hunt reiterates its buy recommendation on the stock and target price of 600 pence. 888 shares trade up 21% at 232 pence.
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Entain Delivers on 1Q Projections at Start of Challenging Year
1058 GMT - Entain's 1Q trading is consistent with previously indicated revenue growth, Davy Research says. At the start of what is set to be a challenging year for the sector, there are a myriad of headwinds to consider, particularly U.K. regulatory change. Group net gaming revenue rose by 31% as retail recovered to within 5%-10% of pre-Covid-19 levels after shops reopened following shutting for lockdowns in the comparable quarter of 2021.
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UK 10Y Gilt Yields Fall After Sharp Rise
1049 GMT - U.K. 10-year borrowing costs tick lower after a sharp rise the previous day, Tradeweb data show. The 10-year gilt yield trades last at 1.686%, down from Wednesday's close at 1.725% after jumping almost six basis points on the day, according to the trading platform. The decline followed a major selloff in U.S. Treasuries across maturities on Tuesday, triggered by comments from Federal Reserve Governor Lael Brainard saying that she anticipates a rapid central bank balance-sheet runoff. That selloff in Treasuries was echoed in Europe, driving up U.K. borrowing costs.
Contact: London NewsPlus, Dow Jones Newswires; Write to Sarka Halas at sarka.halas@wsj.com
(END) Dow Jones Newswires
04-07-22 1328ET
