FTSE Seen Slightly Lower; Focus on Chancellor's Statement

London Stocks Seen Opening Slightly Lower; Focus on UK Fiscal Statement

0646 GMT - The FTSE 100 index is expected to open around 13 points lower, according to IG, having closed on Friday at 6858.79, with European markets set to be weak due to falls in Asian stocks and a lower close in U.S. equities. Focus will be firmly on events in the U.K. and the reaction in gilt yields as the U.K.'s fiscal statement was brought forward from October 31 to today. This follows the appointment of new Treasury chief Jeremy Hunt and the ripping up of Prime Minister Liz Truss's plans for unfunded tax cuts, with huge spending cuts now proposed. "Investors are craving more stability but given the flip flopping we've had so far...economic policy uncertainty remains," Susannah Streeter, analyst at Hargreaves Lansdown, says in a note. ([e-mail])

 
Companies News: 

ASOS to amend terms of GBP350 Mln Facility

ASOS PLC said on Saturday that it is in the final stages of agreeing with lenders to amend the terms of its 350 million pounds ($391.4 million) borrowing facility.

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Endeavour Mining Launches Construction of Lafigue Project in Ivory Coast

Endeavour Mining PLC said Monday that it has launched the construction of the Lafigue project in the Ivory Coast after the definitive feasibility study confirmed its potential to become a cornerstone asset.

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Hargreaves Lansdown CEO to Retire

Hargreaves Lansdown PLC said Monday that Chief Executive Chris Hill has decided to retire and that he will remain in the role until his successor joins.

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GSK Single-Vial Meningitis Treatment Approved by U.S. FDA

GSK PLC said Monday that the U.S. Food and Drug Administration has approved the single-vial presentation of its Menveo product to treat meningitis.

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Hargreaves Lansdown 1Q Assets Under Administration Fell; Raises FY 2023 Views

Hargreaves Lansdown PLC said Monday that assets under administration fell during the first quarter of fiscal 2023, and that it rose its revenue margin guidance to reflect an increase in net interest margins.

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Audioboom Outpaces Wider Market With 9-Month Revenue Up 44% on Year

Audioboom Group PLC said Monday that revenue in the first nine months of 2022 outpaced wider market growth, despite global economic headwinds hitting advertising demand in the third quarter.

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Eve Sleep Calls in Administrators

Eve Sleep PLC said Monday that it has appointed administrators to the company, as it has been unable to agree to a formal sale of the business or to any fundraising.

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City of London Investment Group 1Q Funds Under Management Fell on Weaker Conditions

City of London Investment Group PLC said Monday that funds under management declined in the first quarter of the fiscal year on wider discounts amid weak market conditions.

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Global Ports Holding Expects Strong Cruise Call Reservations for 2023

Global Ports Holding PLC said Monday that current cruise call reservations for 2023 stand at 4,538, implying it could see passenger volumes exceeding 11 million, assuming prepandemic occupancy rates.

 
Market Talk: 

UK Gilts Look to Be Prone to More Volatility

0631 GMT - More volatility is likely for U.K. gilts this week, assuming that the Bank of England's emergency support isn't extended, Sandra Holdsworth, head of rates at Aegon Asset Management, says in a note. "Whether this continues depends on the progress of restructuring within LDI pension schemes, which have been urgently raising cash for collateral stress-testing," she says. The gilt market is looking for a much more responsible and stable approach to government finances on Oct. 31, she says in a reference to the government's medium-term fiscal plan due to be announced on the last day of the month. ([e-mail])

UK Gilt Investors Need More Reassurance

0625 GMT - The reversal of yet further fiscal measures by the U.K. government from the mini-budget and a change of chancellor on Friday was short of what gilt investors were hoping for, Peter Goves, fixed income research analyst at MFS Investment Management, says in a note. The fact that long-end yields ended Friday higher, and also finished the week higher, signals that "clearly, the market was--and is--looking for more, with thin liquidity likely not helping," he says. Volatility cannot be ruled out given the upcoming calendar and ongoing fiscal and political uncertainties, he says. ([e-mail])

Investors Look Hesitant to Hold Gilts Despite Government's U-Turn

0615 GMT - The weakness of gilts into Friday's close supports Morgan Stanley's view that investors are hesitant to hold U.K. paper, strategist Theologis Chapsalis writes in a research note. U.K. duration is likely to trade weak therefore, he says, adding that Morgan Stanley maintains a bearish bias despite the government's U-turn. "Clearly the U-turn on tax cuts could be rates positive but the timing matters," he says. The other parameter to bear in mind is that a U-turn would make Bank of England intervention less likely, he says. "In short, we need to see more evidence of a clear change in fiscal policy," the strategist says, adding that prior to that, Morgan Stanley wants to have a short rates bias. ([e-mail])

Rio Tinto's 2022 Iron-Ore Production Target at Risk

0431 GMT - Rio Tinto could struggle to meet 2022 production guidance for its Australian iron-ore operations, Morgan Stanley analysts say, ahead of the miner's 3Q operational report Tuesday. The analysts say Rio Tinto's delayed Gudai-Darri mine, most recently disrupted by a train derailment, is key to meeting the miner's full-year output target. MS and market consensus estimates currently indicate the miner will reach the low end of Rio Tinto's predicted 320 million-335 million-ton range, they say in a note. "We also look for the proportion of low-grade fines in the production mix as SP10 shipments have been elevated recently due to delays in Gudai Darri ramp up," say the analysts. ([e-mail]; @RhiannonHoyle)

Contact: London NewsPlus; [e-mail]

(END) Dow Jones Newswires

10-17-22 0306ET