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(Alliance News) - The following is a summary of top news stories Monday.
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COMPANIES
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Brewer and distiller Diageo said its starting the third phase of its GBP4.5 billion capital return program. The third phase will be worth up to GBP1.7 billion, having complete GBP2.25 billion in returns in the first two phases. The third phase will be run by UBS and the bulk of the purchases will be completed by June 30.
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Anglo American announced the restarting of its Grosvenor metallurgical coal mining operation in Queensland, Australia. Anglo American said it had received confirmation from regulator Resources Safety & Health Queensland on Wednesday last week that longwall mining operations could now start up once more, following a gas incident which led to an explosion on a longwall face in May 2020. Looking ahead, while export metallurgical coal production guidance for 2022 remains between 20 million and 22 million tonnes, the effect of Covid-19 early in the year and a later-than-expected resumption of operations at Grosvenor, means that output is expected to be at the lower end of guidance.
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John Menzies said it has agreed to a fourth and final takeover offer from its persistent Kuwaiti suitor. The Edinburgh-based aviation services and cargo handling firm had rejected three previous offers from air services peer Agility Public Warehousing, but on Monday the board said it was willing to unanimously recommend a new cash offer of 608 pence per share to Menzies shareholders. The new offer, made via Agility subsidiary National Aviation Services, was up from 460p, 510p and 605p previously. Menzies said Agility has confirmed that the offer is final and won't be raised. It values all of Menzies at GBP558.8 million.
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Veterinary products firm Dechra Pharmaceuticals said it delivered strong interim results amid increased consumer spending on pets during Covid-19 restrictions. For the six months that ended December 31, Dechra posted pretax profit of GBP53.4 million, up 51% from GBP35.4 million a year before. This was on revenue of GBP322.4 million, up 7.5% from GBP299.8 million. The Northwich, Cheshire-based firm declared an interim dividend of 12.00 pence, up 8.1% from 11.11p. Looking ahead, Dechra said trading at the start of the second half remains strong, especially in major markets which are returning to "historic levels" of growth.
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AstraZeneca said phase three trials for Enhertu showed positive outcomes in metastatic breast cancer patients and could "redefine how the disease is classified and treated". The pharmaceutical company said Destiny-Breast04 phase three trials had shown Enhertu showed a "statistically significant and clinically meaningful improvement" when compared to chemotherapy in both progress-free survival and overall survival in patients with low human epidermal growth factor receptor 2 unresectable and, or metastatic breast cancer, regardless of their hormone receptor status. Enhertu, or generically trastuzumab deruxtecan, is a HER2-directed antibody drug conjugate under joint development by Astra and Daiichi Sankyo.
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Credit Suisse has allegedly accepted autocrats and drug dealers, as well as suspected war criminals and human traffickers as clients for years, a massive data leak revealed on Sunday. According to research by a consortium of newspapers who were privy to the leak - including the Suddeutsche Zeitung, The Guardian, Le Monde and the New York Times - the documents expose the banking secrets of more than 30,000 Credit Suisse clients from around the world. The leak showed that criminals were able to open accounts or kept accounts even "when the bank could have known long ago that it was dealing with offenders", the Suddeutsche Zeitung wrote. The bank vehemently denied the accusations on Sunday: "The account...is based on incomplete, inaccurate or selective information taken out of context, leading to tendentious interpretations of the bank's business conduct," the bank said, adding that 90% of the accounts cited had already been closed.
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The owners of Purdue Pharma, maker of OxyContin, have offered to pay up to USD6 billion to victims of the US opioid crisis to settle an avalanche of litigation, according to a report filed Friday by a federal mediator. The Sackler family's new offer would raise by at least a billion dollars a USD4.5 billion bankruptcy settlement thrown out by a US judge in December over language that would have shielded the family from further lawsuits involving the highly addictive prescription painkiller. Under the new proposal, the Sacklers "would be paying, in total, not less than USD5.5 billion and up to USD6 billion", according to Friday's filing to the US Bankruptcy Court in the Southern District of New York.
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MARKETS
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European stock markets were reversing early gains, amid conflicting statements about plans for a US-Russia summit to discuss Ukraine. Trade was thin with US markets closed on Monday for a holiday.
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CAC 40: down 0.4% at 6,900.36
DAX 40: down 2.97 points at 15,039.54
FTSE 100: up 0.2% at 7,528.13
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Hang Seng: closed down 0.7% at 24,170.07
Nikkei 225: closed down 0.8% at 26,910.87
S&P/ASX 200: closed up 0.2% at 7,233.60
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New York market closed for Presidents Day holiday.
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EUR: up at USD1.1362 (USD1.1334)
GBP: up at USD1.3633 (USD1.3584)
USD: down at JPY114.83 (JPY115.11)
GOLD: down at USD1,837.55 per ounce (USD1,893.40)
OIL (Brent): up at USD94.02 a barrel (USD92.85)
(currency and commodities changes since previous London equities close)
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ECONOMICS AND GENERAL
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The Kremlin warned there are no concrete plans for a summit between the Russian and US leaders, as diplomats scrambled to head off the threat of a Russian invasion of Ukraine. The idea of a meeting between presidents Vladimir Putin and Joe Biden has been championed by France and cautiously welcomed by Ukraine as a way to avert a catastrophic war in Europe. But Putin's spokesman Dmitry Peskov said: "It's premature to talk about any specific plans for organising any kind of summits" adding that no "concrete plans" had been put in place. France's President Emmanuel Macron called Putin on Sunday and afterwards his office said that both the Russian and Biden were open to the idea. The summit would go ahead, however, only "on the condition that Russia does not invade Ukraine."
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Business activity in the eurozone is in line for bumper growth in February, as the region benefited from eased Covid restrictions, data from IHS Markit showed. The flash IHS Markit eurozone composite purchasing managers' index surged 3.5 points in February to 55.8, up from January's final reading of 52.3. IHS Markit noted this is the largest monthly gain since March of last year. A figure above 50.0 indicates growth in business activity. The flash services PMI activity index rose to 55.8 from 51.5 in January, while the manufacturing reading inched higher to 55.6 from 55.4.
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IHS Markit said business activity rebounded most sharply in France, while growth in Germany also picked up to the fastest since last August. The headline flash Germany PMI composite output index was 56.2 in February, rising from 53.8 in January - representing a six-month high. The flash services PMI rose to 55.6 from 55.2, while the manufacturing PMI dropped to 55.4 from 57.0. The flash France composite output index rose to 57.4 in February, its highest mark since last June and a considerable improvement from January's nine-month low of 52.7. The flash services PMI for France improved to 57.9 from 53.1 in January, while the manufacturing output index rose to 55.0 from 50.9.
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German producer prices surged in January, hitting a record increase, data from statistical body Destatis showed. Annually, producer prices rose by 25%, which was the highest increase ever, and slightly accelerated on the 24% annual growth in December. Compared to December, the overall index rose by 2.2% in January, easing from the 5% month-on-month increase recorded a month ago. Stripping out energy prices, the overall index was up 12% year on year, and up 2.5% versus December.
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UK private sector activity picked up in February driven by a recovery in economic conditions after disruptions due to the Omicron variant at the turn of the year, according to IHS Markit. The flash UK services purchasing managers' index reading was 60.8 points in February, up sharply from 54.1 in January. The score beat the market forecast, cited by FXStreet, of 55.5. The flash UK manufacturing PMI was 57.3 points in February, unchanged from January, but slightly above market expectations of 57.2. The flash composite PMI score increased to 60.2 points in February from 54.2 in January. The latest reading was the highest since June 2021.
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UK Prime Minister Boris Johnson said his "living with Covid" plan will bring the country "towards a return to normality" as he intends to scrap the requirement to self-isolate in England. Johnson will meet with his Cabinet on Monday morning before updating members of Parliament in the afternoon on his blueprint for moving out of the pandemic. He said the proposal would be about "finally giving people back their freedom" after "one of the most difficult periods in our country's history". Johnson's announcement will come just over 24 hours after it was confirmed the Queen had tested positive for coronavirus. As announced on Saturday, the UK government is planning to scrap the legal duty for those who test positive for coronavirus to have to self-isolate by the end of the week. According to the Mail On Sunday, the requirement will be lifted by Thursday.
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The Queen is experiencing "mild cold like symptoms" after testing positive for Covid but expects to be at her desk carrying out "light duties", Buckingham Palace has said. Concerns for the Queen, 95, will be heightened given her age and recent health scare but it appears the head of state is determined to carry out what tasks she can despite contracting the virus. The diagnosis follows a string of Covid cases among the royal family and the Queen's Windsor Castle team, with the Prince of Wales meeting the monarch the week he tested positive, and the Duchess of Cornwall also isolating after contracting the virus. The shock announcement was made just a few weeks after the nation's longest-reigning monarch reached her historic Platinum Jubilee of 70 years on the throne on February 6.
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Johnson has handed in to police his legal questionnaire regarding claims that lockdown-busting parties were held in Downing Street. No 10 confirmed the prime minister has complied with a Metropolitan Police request for his answers to be submitted within a week of receiving the form last Friday. Downing Street has previously said his responses will not be made public.
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The UK property market continued to go from strength to strength, with prices continuing to achieve record highs in February, figures from Rightmove showed. UK house prices rose 2.3% monthly to GBP348,804 in February, marking the largest monthly jump in more than twenty years. Meanwhile, on an annual basis, prices were 9.5% higher, the largest yearly rate of growth since September 2014. "The pandemic continues to influence many home moves, with this month's price growth driven primarily by the 'second stepper' sector those who may find themselves in need of more space and are now ready to move on from their first homes," Rightmove noted. The city of London had recorded the largest jump in the number of buyers sending enquiries of any region, as well as highest annual rate of growth since 2016 at 7.3%, as ending pandemic restrictions and a gradual return to offices foster renewed demand in the capital.
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Nearly 30,000 homes and businesses are without power after Storm Franklin hit the island of Ireland. It is the third storm to pass over the country in recent days, after Storm Dudley and Storm Eunice wreaked havoc. Status orange wind warnings issued for parts of the north and north-west have now expired, but Met Eireann has warned that people can expect high winds and strong gusts over the course of the morning. Met Eireann said gusts of more than 130kph were recorded in Co Galway and Co Donegal. ESB confirmed on Monday morning that just over 29,000 customers were without power in the wake of the storm.
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Japan's private sector is on track for a further decline in February, as a record number of Covid-19 cases and renewed restrictions tighten the stranglehold on output and new orders, data from IHS Markit showed Monday. The au Jibun Bank flash Japan composite purchasing managers' index dropped to 44.6 points in February from the final figure of 49.9 in January. The flash manufacturing PMI dropped to 52.9 in February from 55.4 in January, as manufacturing firms were hit by a reduction in output for the first time in five months, while new order growth slowed to its softest rate in the current sequence of expansion. The flash services business activity index fell to 42.7 points from 47.6 in January, marking the steepest drop since May 2020, with new business dropping at the quickest rate of reduction in six months.
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International tourists and business travellers are arriving in Australia with few restrictions for the first time in almost two years after some of the strictest pandemic measures of any democracy were lifted. Vaccinated travellers were greeted at Sydney's airport by jubilant well-wishers waving toy koalas and favourite Australian foods including Tim Tam chocolate biscuits and jars of Vegemite spread. Federal Tourism Minister Dan Tehan was on hand to welcome the first arrivals on a Qantas flight from Los Angeles which landed at 6.20 am local time.
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By Tom Waite; thomaslwaite@alliancenews.com
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