Weekly review

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Sharecast News | 25 Oct, 2019

London's FTSE 100 ended the week 173.9 points higher at 7,324.47.

Equity view

Both Micro Focus and Open Text Corporation put the kibosh on reports that the Canada-based enterprise software giant was considering a takeover bid for its London-listed peer on Monday.

Third quarter revenue at online food delivery service Just Eat grew 25% to £248m despite as the group reaffirmed full year guidance and losses in its Latin American operations.

UK property firm Capital & Counties (Capco) said it had not received any potential bids for the business after weekend reports that luxury property developer Nicholas Candy was in early talks over a possible cash offer.

Premier Inn owner Whitbread on Tuesday reported a drop in interim profit and flat revenue after Brexit uncertainty impacted regional hotel demand.

UBS reported a fall in third quarter profit as earnings from all its operations except asset management declined, with the company blaming a "challenging environment".

Consumer goods giant Reckitt Benckiser cut its full-year sales growth forecast on Tuesday after a "disappointing" third quarter, amid slowing demand for some of its products in the US and China.

Online food delivery service Just Eat said it had rejected an unsolicited £4. 9bn cash offer from Prosus as it "significantly undervalues" the company.

Centamin on Wednesday reiterated full-year guidance despite a double-digit fall in third-quarter gold production from its Egyptian Sukari mine.

Boeing posted much weaker than expected third quarter profits on the back of massive delays in shipments of its 737 Max, but sales fell by less than anticipated and the company said it expected the 737 Max to return to air worthy status before the end of the year.

Tesla surprised the market with its third quarter net profit of $342.0m, which sent its stock flying over 18% in pre-market trading, though the manufacturer's top-line recorded its first decline for seven years.

Wealth manager Quilter saw a dip in gross sales in the third quarter despite reporting improved assets under management and administration.

Antofagasta maintained annual guidance as it reported a rise in third-quarter group copper production but warned that protests in Chile could interfere with its operations.

Precious metals miner Fresnillo posted a decline in third-quarter silver and gold production as it said annual production would be at the lower end of its target range.

AstraZeneca reported its year-to-date results following the end of its third quarter on Thursday, claiming that patients would benefit from further progress to its pipeline, while sales-growth momentum continued to drive its operating leverage.

Social media giant Twitter fell short of analysts' estimates for its third-quarter revenues and profits, citing advertising woes, bugs and an unexpectedly low level of demand throughout the summer.

Shares in Nokia plunged as the telecoms giant cut its full-year 2019 and 2020 outlook due to additional investment needs in 5G technology and margin pressure.

Refractory products and systems supplier RHI Magnesita reported that, since its interim results in August, the global steel market had weakened further, with global production declining quarter-on-quarter.

Royal Bank of Scotland said it swung to a third-quarter loss after making a £900m provision for payment protection insurance.

Kazakhstan-focused copper company Kaz Minerals saw record copper production in the third quarter as it scaled up operations at its biggest mines in Central Asia, leaving it firmly on track to meet its full-year copper output targets.

WeWork plans to axe 4,000 jobs in a turnaround proposal by its major shareholder SoftBank that includes a pullback in Asia.

Barclays reported a drop in third-quarter profit on Friday as it took a hit from a surge in payment protection insurance (PPI) claims and struck a cautious note on the outlook.

Jaguar Land Rover reported an 8% rise in revenues to £6.1bn over the second quarter and a return to profit.

WPP reported a jump in third-quarter like-for-like revenue but said it still expects to see a full-year decline.

Shares of Ascential slumped on Friday after it said the Money 20/20 China event had been deferred and would not take place this year.

Synthomer warned that its full-year underlying pre-tax profits would fall short of market expectations if depressed European industrial activity and increased political and economic uncertainties continued in the fourth quarter.

Essential components and solutions provider Essentra saw like-for-like revenues drop during the third quarter as a result of some short-term Brexit concerns and a tougher macroeconomic environment.

Investigators say failings from Boeing, Lion Air and the pilots onboard led to the crash of a Lion Air Boeing 737 MAX off the coast of Indonesia in October last year which resulted in the deaths of 189 people.

Economic news

UK house prices registered their smallest October bounce since a decade ago despite a large decline in the number of sellers due to sluggish prices and the imminent Brexit deadline, the results of a closely followed survey revealed on Monday.

The pound was unfazed by the Speaker of the House, John Bercow's, decision not to allow a "meaningful vote" on the Prime Minister's Brexit proposal to go ahead on Monday.

Public sector borrowing rose by a fifth in the first six months of the year, according to figures released by the Office for National Statistics on Tuesday.

Output in the UK manufacturing sector continued to decline in the three months to October, while the outlook for the sector deteriorated, according to the latest survey from the Confederation of British Industry.

Delays to the government’s plans for fracking across the UK have cost taxpayers at least £32. 0m since 2011, the National Audit Office has found.

UK Prime Minister Boris Johnson on Thursday confirmed his intention to dissolve Parliament under the Fixed Term Parliaments Act on 28 October and to push for a general election in mid-December.

International events

The International Monetary fund said in its latest World Economic Outlook that economic growth in China could slow to 5.8% in 2020 following an expansion of 6. 1% in 2019.

A proposal from German defence minister Annegret Kramp-Karrenbauer for an international coalition to stabilise Northern Syria was welcomed by the US and other NATO allies on Wednesday.

European leaders are set to decide on whether to grant the UK another Brexit extension until January, but there were doubts about whether Paris would agree.

The Chinese government is drawing up plans to replace Hong Kong leader Carrie Lam by March, according to a report by the Financial Times.

Beijing is aiming to return to the level of purchases of US agricultural products that preceded Washington's decision to impose tariffs, leaving the door open to a big increase once a final trade deal had been signed.

The European Central Bank kept all its main policy settings unchanged, with Thursday's governing council meeting set to be the last for its current chief, Mario Draghi.

Orders for US durable goods in September fell back at twice the pace expected by economists, amid lower order intakes for automobiles and parts, and for commercial aircraft.

Offshore wind sites could provide more than enough clean energy to satisfy the world's electricity needs, according to a report by the International Energy Agency.

German business confidence held steady in October, according to a widely-followed survey released on Friday.

German consumer confidence has fallen to its lowest level since 2016, according to a survey released by market research group GfK.

Rate-setters in Moscow surprised some analysts at the end of the week with a larger than expected reduction in short-term official interest rates.

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