FTSE 100 firmly in the red; SSE, Centrica lower on Ovo Energy”s job-cutting plan – Proactive Investors UK

The benchmark of main UK shares completed the afternoon session down over 46 factors at 6,002

  • FTSE 100 index closes decrease
  • OVO Power cites change in shopper behaviour for job cuts 
  • US shares blended

5.05pm: FTSE 100 closes down

FTSE 100 index completed within the drink on Tuesday with defensive shares taking a battering.

The benchmark of main UK shares completed the afternoon session down over 46 factors at 6,002.

On Wall Avenue, US shares have been blended with the Dow Jones down round 13 factors, however the S&P 500 index and Nasdaq forward. It comes as merchants stay optimistic after the Federal Reserve and US administration’s willingness to help the financial system.

Analyst Joshua Mahony, senior market analyst at on-line buying and selling group IG, stated of European buying and selling: “As soon as once more we now have seen the preliminary rally round a possible virus therapy breakthrough fail to take care of momentum given ongoing questions over how lengthy any therapy will take to make a tangible distinction to the battle in opposition to COVID-19.”

Among the many high laggards on Footsie was tobacco large (), which dropped practically 6% to 1,554p after it reduce its dividend for the primary time since 1996 because it tries to take care of its debt.

Centrica (), the British Fuel proprietor dropped 5.44% to face at 37.22p and SSE () additionally shed 4.7% following Ovo Power’s job reduce information amid the pandemic.

3.45pm: SSE, Centrica decrease on Ovo Power’s job-cutting plan

FTSE 100 was firmly within the purple heading to shut, down 75 factors to five,973.

Power corporations () and () have been each down 5%, to 37.35p and 1,224.5p respectively, after non-public peer Ovo Power introduced job cuts.

The Bristol-based vitality provider is to axe 2,600 posts after buying the retail enterprise of SSE in January, citing a change in shopper behaviour amid the coronavirus pandemic.

Ovo is planning to shut its workplaces in Selkirk, Studying and Glasgow Waterloo Avenue because the disaster has “completely diminished the demand for some capabilities and roles”.

Fuel engineers, electricians, meter readers, and name centre employees are additionally anticipated to be affected as Ovo stated the pandemic had resulted in a 69% drop in residence service engineering work and a 92% discount in Good Meter installations in April. Meter studying had additionally floor to a whole halt in March.

“We’re seeing a fast improve in clients utilizing digital channels to have interaction with us, and in our expertise, as soon as clients begin to have interaction in a different way they don’t return,” stated Ovo founder and chief government Stephen Fitzpatrick.

“Like all companies, we face a brand new actuality and have to adapt shortly to allow us to higher serve our clients and spend money on a zero-carbon future.”      

2.20pm: Walmart rallies on sturdy quarterly gross sales

The Footsie dipped once more simply as Wall Avenue opened within the purple.

London’s main index fell 61 factors to five,987, whereas on the opposite facet of the Atlantic the Dow Jones misplaced 101 factors to 24,495 and the S&P 500 shed 5 factors to 2,948.

Grocery large () superior 2% to US$130.28, an increase anticipated by analysts after posting its quarterly outcomes.

Income jumped 8.6% to US$134bn, although maintaining with sanitation and better wages got here on the further value of US$900mln.

“A robust e-commence presence makes a agency stand out within the present atmosphere,” stated David Madden, analyst at CMC Markets.

“Walmart proved that they have been in a position to thrive in troublesome circumstances, and so confidence within the agency is more likely to be stay excessive.”

1.45pm: US markets to open modestly decrease

US indices are anticipated to open modestly decrease at this time, mirroring actions in European markets.

The Dow Jones industrial common is anticipated to open round 42 factors decrease at 24,555 whereas the S&P 500 is seen opening 7 factors weaker at 2,954.

“Inventory markets are pulling again slightly on Tuesday after surging at the beginning of the week on some promising outcomes for a possible coronavirus vaccine,”2reported OANDA’s Craig Erlam.

“Traders’ new discovered optimism will likely be put to the take a look at shortly after the open on Wall Avenue as Jerome Powell makes a digital look earlier than lawmakers with Steve Mnuchin. Whereas Mnuchin will naturally discuss up the prospects for the financial system, Powell has beforehand been much less so and spooked markets final week together with his downbeat evaluation,” he famous.

In London, the FTSE 100 stays within the purple, down 31 factors at 6,017.

PLC (), up 13% at 473p, defied the development following its half-year report.

READ Renew Holdings says 80% of engineering actions have continued through the disaster

The infrastructure engineer stated roughly 80% of group actions have continued through the disaster, with chairman David Forbes saying that following the federal government’s coronavirus reopening statements this month, the enterprise was “addressing instant alternatives to remobilise” the remaining 20% of its operations.

12.15pm: easyJet says bank card particulars of two,208 clients have been accessed by hackers

Because the morning buying and selling session ended the Footsie was making an attempt a modest rally.

London’s index of main shares was down 33 factors (0.6%) at 6,015, having fallen beneath 6,000 at one stage this morning.

The index was being weighed down by contract caterer PLC (), which was 3.1% decrease at 1,075p after tapping the marketplace for a cool £2bn.

“Compass’s transfer to turn out to be the fourth FTSE 100 agency to boost contemporary fairness this 12 months, after Auto Dealer, Carnival and Informa, means that fund elevating is about to step up a gear,” speculated AJ Bell’s quote-smith, Russ Mould.

“The experiences of the London market after the 2000-03 and 2007-09 recessions and bear markets would recommend that new itemizing exercise could keep quiet as diminished danger urge for food and decrease fairness valuations deter would-be patrons and would-be sellers alike,” he added.

Low-cost airline easyjet PLC (), up 0.9% at 556.6p, was defying the development regardless of revealing it had succumbed to a cyber-attack.

E-mail addresses and journey particulars of round 9mln clients have been accessed and a pair of,208 of these had their bank card particulars stolen.

11.00am: UK productiveness suffers a relapse

London’s main shares stay within the doldrums after it was revealed UK productiveness hit the skids within the first quarter of 2020.

The FTSE 100 was down 39 factors (0.6%) at 6,010.

The Workplace for Nationwide Statistics (ONS) first stab at estimating the influence of the coronavirus (COVID-19) on productiveness within the UK indicated that labour productiveness, as measured by output per hour, fell by 0.4% year-on-year within the first quarter.

Output per employee fell by 2.9%, in contrast with the identical quarter within the earlier 12 months; the steeper fall than output per hour displays the influence of a authorities coverage that retains staff as workers with zero hours, however can also be drivONS stated.

Quarter-on-quarter, output per hour fell by 1.1%, whereas output per employee fell by 2.6%.

“Whereas the coronavirus influence magnified the issues within the first quarter, the UK’s productiveness efficiency has been weak for a while and a supply of concern. Certainly, the flat total productiveness efficiency over 2019 after an underwhelming 2018 extends the UK’s total poor productiveness document because the deep 2008/9 recession,” noticed Howard Archer, the chief financial advisor to the EY ITEM Membership.

“The UK’s ‘productiveness puzzle’ is a supply of a lot debate and evaluation. A part of the UK’s current poor labour productiveness efficiency has undoubtedly been that low wage progress has elevated the attractiveness of employment for corporations. This helped employment to carry up properly through the 2008/9 downturn and to select up markedly as progress returned.

“Employment could have been lifted in current occasions by some UK corporations being eager to tackle staff – or not less than maintain on to them – given rising issues over labour shortages in some sectors.

“It additionally is clear that many corporations have taken on labour fairly than committing to expensive funding, given the extremely unsure financial and political outlook. The low value and adaptability of labour relative to capital has actually supported employment over funding,” Archer advised.

9.50am: Brilliant begin shortly fades

The Footsie has turned south after a vivid begin, led by two corporations – PLC () and () – which have reduce dividends.

The FTSE 100 was down 27 factors (0.2%) at 6,037.

IMPS, a long-time favorite of revenue traders, was down 6.4% at 1,548p after it reduce its dividend by a 3rd.

“Cigarette maker is likely one of the final excessive yielding FTSE 100 corporations to lastly collapse and slash its dividend, in its case to scale back debt pressures. Previous to the information it was buying and selling on a potential yield of 11.5% which appeared too good to be true. Having slashed the fee by a 3rd, traders can now anticipate an 8.7% yield after adjusting for at this time’s share worth motion,” defined Russ Mould, AJ Bell’s funding director.

“ was a preferred inventory amongst retail traders as a result of the shares have been low-cost and the dividends have been beneficiant; nonetheless, it was much less in style amongst revenue funds with solely 21 funds and funding trusts having it as a high 10 holding.

“Fund managers could have been postpone by the enterprise disappointing with earnings lately because of tighter regulation hurting its efforts to promote vaping merchandise.

“The enterprise has additionally misplaced favour with many traders who now want extra moral investments. The concept of proudly owning shares in an organization whose merchandise create vital well being issues and are addictive is unthinkable for lots of people,” he added.

Antofagasta fell 3.8% to 822.6p after it responded to a rise in new coronavirus infections in Chile, the place the corporate has its main copper operations, by belatedly binning the ultimate dividend in respect of fiscal 2019.

READ Antofagasta modifications its thoughts and cuts dividend funds by a complete of US$160.7mln

https://www.proactiveinvestors.co.uk/companies/news/919911/antofagasta-changes-its-mind-and-cuts-dividend-payments-by-a-total-of-us1607mln-919911.html
 

8.45am: Additional advance for Footsie

The FTSE 100 constructed on Monday’s 249-point acquire and pushed larger in early commerce on Tuesday as merchants digested higher than anticipated UK jobs knowledge.

London’s blue-chip benchmark opened 29 factors higher at 6,077.36.

Okay, the March jobless replace is one thing of a lagging indicator of the well being of UK PLC; nonetheless, the print got here in considerably higher than anticipated. Towards expectations of an increase in unemployment to 4.4%, the read-out was 3.9%.

“It should be harassed that these numbers are for March, which for the UK solely noticed lockdown start on the 23rd of the month,” identified James Hughes of Scope Markets.

On the oil market, Brent crude and WTI each continued their ascent. Tuesday sees the expiry of the June futures contract. Keep in mind the enjoyable and video games a month in the past because the Might contract lapsed and oil costs dived into damaging territory?

“We expect basic proper steps have been taken to get us on sounder footing,” Helima Croft, head of worldwide commodities technique at RBC, instructed CNBC.

She stated the “inexperienced shoots of restoration in place,” as Chinese language and US demand are enhancing, and OPEC plus ended its feuding and agreed to sharply reduce output.

Turning to the inventory movers, it was a second day airborne for British Airways proprietor IAG (), which climbed 7.8% amid hopes the potential discovery of a coronavirus vaccine may pave the way in which to a restoration in worldwide journey.

Price range rival easyJet () adopted in IAG’s vapour trails, rising 5.7%.

Cigarette maker () led the fallers with a 7.6% drop after it reduce the dividend by a 3rd to avoid wasting money through the coronavirus pandemic.

Proactive information headlines:

() has instructed traders it’s now set to finish its pivotal farm-out transaction because the Tanzanian authorities have now issued a Tax Clearance Certificates, following the fee of a capital good points tax invoice. It signifies that Aminex and new companion ARA Petroleum have glad all necessities for the federal government to approve the switch of a 50% curiosity within the Ruvuma PSA. “It is a main milestone. With the receipt of the Tax Clearance Certificates from the TRA and with the onward submission to the TPDC, Aminex has now completed the entire circumstances inside our management in an effort to full the Ruvuma farm-out,” Robert Ambrose, Aminex chief government stated in an announcement.

() has instructed traders it’s advancing plans for its groups to return to their workplaces in the direction of the top of Might. In an announcement, the group stated key groups within the AFC enterprise – science, engineering and manufacturing – have seen no decelerate because of the coronavirus (COVID-19) pandemic and they’re actively responding to new mission growth alternatives. No AFC employees have been furloughed. It famous that it beforehand made preparations in order that sure employees members who have been unable to work at home may entry their workplaces and labs. The continued efforts of many employees members have ensured the continuity of validation work in AFC’s labs and manufacturing actions over these previous few months, the group stated.

() stated it has acquired US$200,000 in funding from a US authorities programme designed to assist companies preserve their workforce employed through the coronavirus (COVID-19) disaster. The corporate stated it acquired the utmost quantity allowed beneath the programme based mostly on its payroll and should qualify for partial forgiveness beneath the phrases of the mortgage if sure payroll circumstances are met. If these circumstances will not be met or the board chooses to not search forgiveness, the mortgage is repayable in equal instalments over eighteen months commencing in December 2020.

FastForward Improvements Ltd’s () has famous that its portfolio agency, , has turn out to be the primary European hashish firm licensed to fabricate medical hashish extracts as lively pharmaceutical elements containing delta 9-tetrahydrocannabinol (THC) for business functions at its Medalchemy manufacturing website in Spain. EMMAC stated Medalchemy will instantly start manufacturing and distribution of a variety of medical hashish merchandise throughout a number of jurisdictions in Europe and past in addition to supplying white-label medical hashish merchandise. FastForward holds a 2.3% curiosity in EMMAC.

() has unveiled a strategic partnership with 8×8, a world supplier of pure cloud options. The 2 corporations will collectively deal with the unified communications as a service (UCaaS) and speak to centre as a service (CCaaS) markets. AdEPT stated the partnership would enable it to win extra unified communications (UC) enterprise, with an preliminary concentrate on public sector organisations and healthcare suppliers.

() has up to date on its enterprise actions as a number of international locations started to ease their coronavirus pandemic lockdown restrictions. In an announcement, the media group and proprietor of the BRICKLIVE model stated the primary zoos have been starting to open in Germany, offering it with a chance to develop gross sales within the nation, and added that additionally it is working with the JB Zoo in Michigan within the US to put in its Animal Paradise tour forward of a deliberate reopening on the finish of Might. The agency additionally confirmed that regardless of round a 3rd of its occasions being postponed to the second half of 2020 and the primary half of 2021, none have been cancelled right now.

Rainbow Uncommon Earths Ltd (LON:RBW) has accomplished a structural and lithological assessment of the Gakara uncommon earths mission in Burundi which has confirmed excessive precedence areas for the group’s ongoing exploration programme. The outcomes of the structural assessment and different historic mining and exploration knowledge are being integrated into 3D fashions of mineral sources and exploration targets in compliance with the requirements outlined within the JORC Code, the corporate stated. Trial mining and processing continues to display that top whole uncommon earth oxide (TREO) grade ore sourced from throughout the licence space has comparable metallurgical and mineralogical traits

() famous that  (), an organization by which it holds a 19.99% curiosity, has revealed plans to drill 6,000 metres on the Perrinvale mission in Western Australia. Cobre’s upcoming drill programme contains 3,400 metres of reverse circulation drilling and a pair of,600 metres of diamond drilling (DD). The sphere crews have begun mobilising to website in preparation for the arrival of drill rigs later this month. Individually, Metallic Tiger additionally introduced the loss of life of Terry Grammer, a non-executive director of the corporate.

Seeing Machines Restricted () stated it has made the “troublesome however vital” choice to chop the fee base by A$12mln because it seems to navigate the “challenges” created by the worldwide coronavirus pandemic. Among the many initiatives being enacted by the corporate, the developer of in-vehicle eye-tracking know-how, is the implementation of a four-day working week. Alongside this, chief government Paul McGlone is taking a 20% pay reduce and deferring his bonus for the 12 months, whereas the chairman’s charges will likely be diminished by 30%. Operationally, Seeing Machines stated it has restructured its enterprise to “enhance the concentrate on earnings” for its three predominant items – automotive, fleet/off-road and aviation.

Arc Minerals Ltd () has acquired an extra 20% curiosity in Zaco Investments Ltd, rising Arc’s curiosity to 72.5% from 52.5%. The extra curiosity has been acquired from Mumena Mushinge, a non-executive director of Arc and founding father of the Zamsort mission in Zambia, by way of an all-equity deal for 10 million new peculiar shares of no par worth within the firm. Mumena’s stake within the Arc will improve to six.87% of the corporate.  The remaining curiosity in Zaco will likely be held by Kopara Investments, Arc’s companion on the Zamsort mission.

(), a number one esports and gaming options supplier, introduced that it has acquired warrant train notices over an combination of 14,650,000 new peculiar within the firm with an train worth of 1p per share, offering it with proceeds of £146,500.

Faron Prescribed drugs Oy () (NASDAQFIRSTNORTH:FARON) stated its annual basic assembly, which came about in Turku, Finland on Monday, Might 18, accredited all of the proposals of the board of administrators and its committees as set out within the discover of the AGM revealed on April 14. It added that the minutes of the AGM will likely be obtainable on the corporate’s web site from June 1 on the newest.

(), the AIM-quoted exploration firm targeted on West Africa, has posted on its web site a pre-recorded shareholder presentation and query and reply session forward of the corporate’s annual basic assembly on Might 26 which will be considered by way of the following hyperlink: https://orioleresources.com/investors/reports-presentations/

Bluebird Service provider Ventures PLC (), the Korean targeted gold growth group, introduced that Align Analysis Restricted has initiated protection on the corporate.  The analysis notice is obtainable from Align’s web site: http://www.alignresearch.co.uk/cpt-company/bluebird-merchant-ventures/

(), the aquaculture well being, superior vitamin, and genetics enterprise, has stated it’ll announce its Q2 and Interim outcomes for the three and 6 month durations ended March 31, 2020, on Friday Might 29.  It added that Peter George, its government chairman, Septima Maguire, chief monetary officer, and Trond Williksen, incoming CEO, will host a webcast for analysts on that day at 9.30am. To register your curiosity, please contact [email protected].

(), a commercial-stage pharmaceutical firm with a concentrate on addressing iron deficiency with its lead product Feraccru/Accrufer (ferric maltol), a novel oral iron therapy, has stated it’ll announce its preliminary outcomes for the 12 months ended December 31, 2019, on Thursday, Might 21.

6.45 am: Additional good points anticipated 

The FTSE 100 is predicted to proceed climbing on Tuesday as merchants are optimistic a couple of potential restoration from the coronavirus (COVID-19) pandemic. 

London’s blue-chip benchmark was referred to as 22 factors larger by spread-betters, after a stonking 249-point, 4.3% acquire on Monday to complete at 6,048.59.

Positivity in Europe prolonged to Wall Avenue, with the Dow Jones Industrials Common including 912 factors or 3.9% to shut at 24,597.4, whereas the S&P 500 rose 3.2% and the Nasdaq Composite completed 2.4% larger. 

Asian inventory indices have been all within the inexperienced on Tuesday, with the Nikkei 225 up 2%, the Grasp Seng up 1.9% and the Shanghai Composite up 0.6%.

“A mix of optimism in relation to economies being opened up once more, upbeat commentary from Fed Chair Jerome Powell, and optimistic leads to relation to progress on a possible COVID-19 vaccine [is all helping],” stated market analyst David Madden at CMC Markets.

Tuesday will carry extra feedback from Powell as he offers additional congressional testimony, having expressed his confidence that the US financial system will see a strong restoration within the second half of 2020 and declared there may be “no restrict” to what the US central financial institution is prepared to do when it comes to lending.

UK unemployment figures will likely be revealed at 7am this morning, protecting the three months to the top of March, so they may solely catch a small impact of the coronavirus lockdown.

There will likely be extra well timed knowledge within the type of the claimant rely fee for April, exhibiting the form of joblessness through the pandemic. 

In among the many company bulletins, there are half-year outcomes from tobacco large  PLC (), the final numbers earlier than new boss Stefan Bomhard takes over in July.

It has not been a smooth-smoking time for the maker of Lambert & Butler and Gauloises, having over the previous 12 months stubbed out its goal of 10% dividend progress and altered each its chief government and chairman within the wake of a giant revenue warning final September associated to its vaping enterprise.

In its newest updates, the FTSE 100 group maintained that there had been no materials influence from the coronavirus pandemic on its enterprise to date, guiding to first-half adjusted earnings per share down 10% because of round £85mln of writedowns and provisions in vaping.

With Imperial being one of many few dividend-payers amongst London’s blue chips, any modifications within the payout could be a shock, although an unchanged dividend for this 12 months would indicate a dividend yield of practically 13%, the third-highest stage within the FTSE 100.

Interim outcomes from  PLC () include analysts at Jefferies pointing to trade knowledge for the three weeks to 30 April that confirmed sandwich gross sales by way of supermarkets, Greencore’s predominant market, dropped 60% – means worse than the 30% drop anticipated.

“[In March] we anticipated a brief, sharp, shock that the stability sheet could be sufficiently big to take,” analysts commented.

“Now, with extra perception post-lockdown, we anticipate a deeper and longer shock — one which the stability sheet continues to be sufficiently big to take, however which is more likely to require a extra basic re-positioning and adjustment of expectations.”

Across the markets:

  • Pound up 0.1% to US$1.2204
  • Oil flat, with Brent at US$32.50
  • Gold nonetheless rising, up 1.3% to US$1756.90

Important bulletins anticipated on Tuesday:

Finals:  (),  (),  ()

Interims:  PLC (),  PLC (),  (),  (),  PLC (),  PLC (),  (),  PLC (),  ()

Buying and selling statements:  ()

AGMs:  PLC ()

Financial knowledge: UK unemployment

Metropolis headlines:

Monetary Occasions

  • US to again away from WHO transfer on Covid-19 drug patents as African states help name for medication makers to share mental property
  • Personal fairness misses out on bailout loans as losses fall foul of EU guidelines
  • – Portfolio corporations have been rejected due to a monetary mannequin that has additionally diminished taxes
  • Bond traders balk at use of ‘ebitdac’ to skirt debt restrictions – traders warn corporations to not make coronavirus-related changes to spice up earnings

The Occasions

  • Britons got contemporary hope of a summer season vacation overseas yesterday after the transport secretary introduced plans for “air bridges” between international locations with low coronavirus an infection charges
  • Nearly two thirds of fund managers and merchants assume that they may work at home for not less than sooner or later per week after the pandemic, in accordance with a survey by that implies a dramatic shift in Metropolis working patterns
  • Hurricanes, typhoons and cyclones are rising stronger in each area of the world due to local weather change, new analysis suggests

Telegraph

  • France and Germany again €500bn fund to assist save EU – new fund will supply grants as an alternative of loans to hardest hit member states
  • Monetary districts attempt to turn out to be extra household pleasant – calls mount for brand spanking new methods of working to turn out to be everlasting because the Metropolis prepares for 1000’s of employees to come back again to work
  • Al fresco eating ‘is not going to save eating places’ – permissions for eating places to make use of public squares or pedestrianised streets to seat clients are amongst plans being thought-about by ministers

Guardian

  • companions with for 30-minute grocery supply service – grocery store to initially promote 150 necessities as on-line demand rises in lockdown
  • Renewable vitality traders more and more look to UK, says report, with choice to raise blocks on wind and photo voltaic initiatives having boosted ‘attractiveness’ rating
  • UK playing habit a lot worse than thought, says YouGov, with analysis additionally warning that half of these with an issue will not be getting assist

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