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(Alliance News) - Global financial markets were nervy early Monday as warnings grow that Russia could invade Ukraine imminently, with Downing Street saying the crisis is at "a critical juncture".
US President Joe Biden briefed Ukrainian leader Volodymyr Zelensky about an hour-long conversation with Russia's Vladimir Putin he had on Saturday that brought made no breakthrough.
Zelensky's office said the Ukrainian leader had invited Biden to visit Kyiv "in the coming days" to show his moral support and deliver "a powerful signal" to Russia. Washington made no mention of an invitation in its readout of the 50-minute call.
But US national security advisor Jake Sullivan issued a grim assessment that an invasion that could begin "any day now" would likely start with "a significant barrage of missiles and bomb attacks".
Downing Street conceded Moscow could be planning to invade "at any moment" but UK Prime Minister Boris Johnson will hold talks with world leaders before a trip to Europe during this week's "window of opportunity" for de-escalation.
Johnson, who is receiving daily intelligence briefings from security chiefs, was understood to be working with allies to provide further defensive and economic support to Kyiv, with an announcement touted for the coming days.
A key juncture in western diplomatic efforts this week is German Chancellor Olaf Scholz's Moscow meeting with Putin on Tuesday.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: down 1.3% at 7,565.14
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Hang Seng: down 1.4% at 24,563.93
Nikkei 225: closed down 2.2% at 27,079.59
S&P/ASX 200: closed up 0.4% at 7,243.90
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DJIA: closed down 503.53 points, 1.4%, at 34,738.06
S&P 500: closed down 1.9% at 4,418.64
Nasdaq Composite: closed down 2.8% at 13,791.15
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EUR: down at USD1.1332 (USD1.1406)
GBP: down at USD1.3525 (USD1.3601)
USD: down at JPY115.38 (JPY115.89)
Gold: up at USD1,853.04 per ounce (USD1,834.21)
Oil (Brent): up at USD95.71 a barrel (USD93.16)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Boris Johnson was facing a possible fine for breaching coronavirus laws after police formally demanded answers from the UK prime minister over partygate allegations. Downing Street confirmed on Friday night that Johnson had received a legal questionnaire from Metropolitan Police officers investigating events in No 10. The prime minister now has seven days to adequately explain his attendance or face a fine for breaking his own Covid regulations, which would deepen this crisis surrounding his leadership. Scotland Yard says the questionnaires ask for an "account and explanation of the recipient's participation in an event" and have "formal legal status and must be answered truthfully". A No 10 spokeswoman said: "We can confirm the prime minister has received a questionnaire from the Metropolitan Police. He will respond as required." Johnson has denied any wrongdoing, but he is alleged to have been at up to six of the 12 events being investigated as part of Operation Hillman.
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David Frost is among a group of senior Tory members of Parliament and peers urging Johnson to reverse the government's ban on fracking as the UK faces an energy crisis. In a joint letter to the prime minister, the former Cabinet minister and around 29 other Conservatives said it is "time to reverse this moratorium". The shale gas mining ban which came into effect in 2019 comes after the energy company Cuadrilla was ordered to seal up two of England's only viable shale gas wells. Frost said reversing the fracking ban would herald a "British energy renaissance".He told the Telegraph: "If our economy is to boom after Brexit, British industry needs a competitive and reliable source of energy which we hold in our own hands and brings investment into this country. Shale gas production achieves all this and more."
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BROKER RATING CHANGES
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GOLDMAN REINITIATES PRUDENTIAL WITH 'BUY' - PRICE TARGET 1761 PENCE
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COMPANIES - FTSE 100
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JD Sports and Footasylum have been fined nearly GBP4.7 million after breaching the rules around a merger blocked by the UK competition regulator. The Competition & Markets Authority issued an interim order in May last year during its in-depth phase 2 merger investigation, preventing the companies from integrating further. The order prohibited JD Sports and Footasylum from exchanging commercially sensitive information without prior consent. But the CMA said during two meetings, JD Sports Chief Executive Peter Cowgill and Footasylum CEO Barry Brown shared information such as Footasylum's financial performance and planned store closures. "Had there been proper safeguards in place, we would have been alerted to these breaches in good time and would have had the necessary information to tackle them head on," said Kip Meek, chair of the inquiry group investigating the merger.
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COMPANIES - FTSE 250
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Synthomer said it saw "strong trading across all divisions" during 2021. It expects annual earnings before interest, tax, depreciation and amortisation to roughly double to GBP518.4 million from GBP259.4 million in 2020. The figure would be in line with current market expectations. Synthomer said that in its nitrile butadiene rubber business, margins have normalised to pre-virus levels. However, demand at the unit remains "subdued" due to high inventory levels of medical gloves. NBR is frequently used in latex and surgical gloves. "Trading conditions in NBR are expected to normalise by the end of H1 with market growth returning to 2019 levels in the second half," Synthomer said. "All other divisions have had an encouraging start to the year."
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COMPANIES - SMALL CAP
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John Menzies suitor Agility Public Warehouse backed its 510 pence per share offer for the company. The Kuwaiti logistics company had made a cash offer for the aviation services firm via its holding subsidiary, National Aviation Services Holding, on February 2. "NAS sees no reason to change its view on valuation and continues to view its improved possible cash offer of 510 pence per share as a full and fair price relative to the information Menzies has provided to the market on its current business and prospects," Agility said. The offer, which Menzies has labelled as "entirely opportunistic", followed a 460p approach in January. Agility on Monday said the 510p offer reflects the assumption that Menzies will see revenue recover to pre-virus levels by "early 2023". It also takes into account margin forecasts and the benefit of cost savings at the Main Market listed company, as well as government support received under Covid-19 schemes.
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COMPANIES - GLOBAL
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The World Health Organization said Friday that it had pre-qualified the tocilizumab arthritis treatment developed by Roche Holding for use in patients hospitalised with severe Covid-19, in a bid to increase access to the pricey drug. The monoclonal antibody, used in anti-inflammatory drugs, has been shown to reduce the risk of death and also hospitalisation time in certain patients suffering from severe Covid. WHO has, like the US and the EU, already recommended its use to treat severe Covid in hospital settings. But it remains in short supply and is very expensive a single dose reportedly goes for up to USD600 in lower-income countries, WHO said, adding though that its pre-qualification should help make it more accessible. The UN health agency said it had added three different compositions of the monoclonal antibody to its list of prequalified treatments for the pandemic disease, in a move aimed to spur more the production of more cheaper generic versions.
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Exxon Mobil Corp on Friday said it has kicked off production at an offshore asset in Guyana. Liza Phase 2, a second asset in the Stabroek Block development, brings with it 120,000 barrels per day of capacity to the Liza Unity floating, production, storage and offloading vessel. The wider Stabroek Block has a recoverable resource base of more than 10 billion oil equivalent barrels. Exxon added: "The current resource has the potential to support up to 10 projects. ExxonMobil anticipates that four FPSOs with a capacity of more than 800,000 barrels per day will be in operation on the Stabroek Block by year-end 2025. Payara, the third project in the Stabroek Block, is expected to produce approximately 220,000 barrels of oil per day using the Prosperity FPSO vessel, which is currently under construction. The field development plan and application for environmental authorization for the Yellowtail project, the fourth project in the block, have been submitted for government and regulatory approval."
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Monday's shareholder meetings
Digital 9 Infrastructure PLC - GM re new investment policy
GCP Infrastructure Investments Ltd - AGM
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By Lucy Heming; lucyheming@alliancenews.com
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