- FTSE 100 index up 5 points
- Pearson rallies 7%
- WH Smith to weather cash burn
11.35am: Pearson top riser after returning to sales growth
The Footsie held its gains before lunch, adding 5 points to 6,718.
The education giant experienced strong demand for online learning which offset continued declines in North American course materials.
New boss Andy Bird, who replaced chief executive John Fallon in October, said the group made several key appointments to accelerate its digital growth and that his broader goal is for the company to become “more consumer-focused”.
The group is one of the most shorted stocks in London, at 8.7% by eight funds, but these may rethink their moves now that a recovery path is in sight.
Short selling is a trading strategy that bets on the share price – investors borrow a stock from a fund in order to sell it, then buy the stock back once the price has dropped and return it to the lender. It means the market isn’t confident in a company’s prospects.
10.40am: WH Smith a bright spot in mid-caps after reassuring on cash position
FTSE 100 was back in the green in the late morning, adding 6 points to 6,719, while sterling rose 0.4% to US$1.3693.
The newsagent estimates a monthly cash burn of £15-20mln between January and March if restrictions continue, but can count on £340mln of cash and committed facilities.
The FTSE 250 group is currently trading from most of its high street stores, including over 200 stores with Post Offices and over 200 UK Travel stores, as well as 130 hospital stores serving NHS workers.
However, revenue tumbled 41% in the 20 weeks to January 16 though Christmas and new ‘work from home’ ranges performed well.
9.45am: UK house prices touch record high in November but stamp duty holiday to end soon
FTSE 100 hit the flatline in mid-morning and moved by exactly 0 points to 6,713.
The average house prices in the UK increased by 7.6% over the year to November 2020, up from 5.9% in October, to stand at a record high of £250,000.
It is the highest annual growth rate the UK has seen since June 2016, the Office for National Statistics said, with London’s average house price surpassed £500,000 for the first time in November.
Average house prices increased over the year in England to £267,000, Wales to £180,000, Scotland to £166,000 and Northern Ireland to £143,000.
The increases were due to pent-up demand, people looking to move in larger houses with gardens after experiencing lockdown as well as the stamp duty holiday which is expiring on March 31.
However, experts are concerned the end of this tax break will puncture the recent housing market boom, with some fellow Conservatives pressuring Chancellor of the Exchequer Rishi Sunak to extend it.
Rightmove suggested on Monday that some sellers are cutting prices in the hope of getting the deal done before the March deadline.
8.50am: All eyes on Washington
The FTSE 100 made a subdued start to trading on Wednesday ahead of the changing of the guard at the White House.
The UK blue-chip index opened just 8 points higher at 6,721.34.
The market will be hoping that the inauguration of new US president Joe Biden will usher in a new stimulus programme that will help jump-start the American economy.
Preparations in Washington have been made to head off the violent protests seen at the US Capitol on January 6.
The headlines, meanwhile, have once again been hijacked by the departing Donald Trump – this time with his list of pardoned felons, which included former aide Steve Bannon.
Here at home, UK consumer price inflation rose at a faster rate than predicted of 0.6% in November, pushed higher by the rising cost of transport and clothing.
On the market, Pearson (LON:PSON) starred with the educational publisher posting a near 6% gain after a robust trading update.
The same went for fashion group Burberry (LON:BRBY), up 5%, after its third-quarter numbers.
Finally, pubs group Wetherspoons (LON:JDW) nudged 2.7% higher after it said it had secured financial support from the market worth almost £94mln.
Proactive news headlines:
Faron Pharmaceuticals Oy (LON:FARN) (First North:FARON) has shared observations of its precision cancer drug, bexmarilimab, that suggest its immune-stimulating effects may be broader than first thought. Researchers assessed data from the phase I/II MATINS clinical trial of the treatment, which targets Clever-1, a receptor known to be expressed on immunosuppressive macrophages. They did so working with Kaiku Health, a data science company that uses an artificial intelligence platform to analyse patient results following treatment with cancer immunotherapies. Faron said the latest scientific observations from the trial included the identification of a new role for soluble Clever-1 related to its capacity to control T-cell activation.
ANGLE PLC (LON:AGL) (OTCQX:ANPCY) has shared research that shows its Parsortix liquid biopsy is able to identify a certain type of cancer cell that is indicative of the spread of the disease throughout the body – a process called metastasis. It was also better in a head-to-head in this regard than the current antibody-based gold standard for isolating circulating tumour cells (CTC). The two systems were on a par in identifying an epithelial breast cancer line; however, Parsortix harvested “significantly more” mesenchymal prostate CTCs than the traditional method.
CMC Markets PLC (LON:CMCX) said it is confident that full-year profits will be at the upper end of market forecasts after trading remained strong in its third quarter. The group continued to perform “very well” as a whole in the three months to end-December, 2020, the FTSE 250 firm said in a trading statement on Wednesday, with active client numbers staying “high” and resulting in client trading activity being “strong”, although at lower levels than earlier in the financial year. CMC put the strong performance down to its ability to attract and retain “premium clients”, with a strong flow of newcomers showing similar qualities to prior cohorts of customers.
Bango PLC (LON:BGO) said it has formed a strategic partnership with TPAY MOBILE, a digital payments platform for the Middle East, Africa and Turkey, to increase access to digital commerce and accelerate its entry into new markets. The AIM-listed firm said the collaboration with TPAY will allow its merchant partners to “more quickly” gain access to around 1.5bn people thanks to TPAY’s “massive footprint of carrier billing and wallet providers” which are now available through Bango’s platform.
Open Orphan PLC (LON:ORPH) has opened two new walk-in recruitment centres to screen potential volunteers for challenge trials in East London and central Manchester. The new sites, which are part of a planned expansion of trials in 2021, include a repurposed former coffee shop at the street level of Queen Mary BioEnterprise Innovation Centre (QMB) in Whitechapel, East London. The QMB centre currently houses subsidiary hVIVO’s current 24-bedroom quarantine clinic, but the new site is the first to be located at street level where volunteers can walk straight in for screening. With the new site, the QMB facility can offer 520 volunteer recruitment visit slots per week. The central Manchester site will have the capacity for 100 visits per week.
Synairgen PLC (LON:SNG) said it has completed recruitment of 120 coronavirus (COVID-19) patients for its Phase II trial evaluating the performance of its inhaled formulation of interferon-beta-1a (SNG001) treatment in the home. Results from the trial are expected in the second quarter of 2021. Synairgen is undertaking a two-part trial of SNG001 on 101 patients in hospital and 120 at home.
Tirupati Graphite PLC (LON:TGR) has highlighted progress being made at the Tirupati Graphene and Mintech Research Centre (TGMRC) in India. The facility is focused on the development of graphene manufacturing and applications, and it is seen in the overall business model as a stand-alone, revenue generative part of the company. “The model is designed to catalyse the commercialisation of graphene applications by developing commercial/bulk scale manufacturing of consistent, high-quality graphene at affordable costs,” said Shishir Poddar, Tirupati chief executive in a statement. “With the global market for graphene forecast to reach over US$1 billion by 2023 as techno commercial bottlenecks are overcome, we intend to be a significant contributor to this growth.”
Amryt Pharma PLC (LON:AMYT) (NASDAQ:AMYT) noted that support groups for people suffering from eating disorder leptin deficiency said they were ‘ecstatic’ after its treatment for the condition, Myalepta, was approved for the use by the NHS. NICE, the UK’s pharma regulator, has approved Myalepta for reimbursement as an adjunct to diet as replacement therapy for two forms of the condition, generalised (GL) and partial lipodystrophy (PL). In a statement, Joe Wiley, Amryt Pharma’s chief executive, said: “We are very excited to report NICE’s approval which will now give all England and Wales based patients suffering from lipodystrophy the opportunity to access Myalepta.”
Alliance Pharma PLC (LON:APH) has said its underlying pre-tax profit for 2020 is expected to be “marginally ahead of market expectations” as its consumer healthcare brands continued to perform strongly despite the impact of the coronavirus (COVID-19) pandemic. In a trading update for the year to December 31, 2020, the AIM-listed group said its see-through revenues for the year were down 5% at £137.5mln as a result of the pandemic. One bright spot were revenues for consumer products, which rose 1% to £93mln year-on-year, although this was offset by a 14% decline in prescription medicines to £44.5mln as COVID-19 impacted the delivery of routine treatments.
MaxCyte Inc (LON:MXCT) (LON:MXCL) has said its 2021 revenue growth is likely to accelerate after it weighed in with a better than expected performance for the year just gone. The cell engineering specialist said turnover for the 12 months ended December 31, 2020, advanced by 21% to US$26.2mln – a rise it attributed to the “increasing adoption and use” of its technology. The numbers were also buoyed by the launch of an expanded ExPERT range of disposables. Cash and equivalents at the year-end were a very healthy US$34.8mln following the company’s successful US$30.5mln financing last May.
Capital Limited (LON:CAPD) has appointed Giles Everist as the company’s new chief financial officer (CFO, commencing March 1, 2021. Everist replaces André Koekemoer who is leaving the company and returning to South Africa for personal reasons. The company noted that the majority of Everist’s career of over 30 years has been spent in CFO, executive and non-executive roles across the international mining sector.
Sensyne Health PLC (LON:SENS), the UK Clinical AI company, said it has signed a five-year non-exclusive Strategic Research Agreement (SRA) with The Royal Wolverhampton NHS Trust. The agreement will enable the ethical application of clinical AI research to improve patient care and accelerate research into new medicines. The RWT dataset covers 700,000 unique patient records from a patient population of approximately 470,000 people. The new SRA brings the combined total of anonymised data available for analysis by Sensyne to 6.8 million patients.
Learning Technologies Group PLC (LON:LTG) said it has agreed to acquire San Francisco-based performance management software provider Reflektive Inc for US$14.2mln (£10.4mln) in cash. The digital learning group said Reflektive, which specialises in engagement and analytics tools used by corporate teams to boost productivity, will be incorporated into LTG’s PeopleFluent talent management portfolio and provide what the firm said will be cross and up-selling growth opportunities.
Shanta Gold Limited (LON:SHG) has confirmed 625,000 ounces of group-wide gold reserves and 3.2mln ounces of resources. The reserves are defined across two projects in Tanzania whilst the resource inventory is made up across all three projects in Tanzania and Kenya. Last year’s exploration drilling at the NLGM project contributed some 173,000 ounces to reserves whilst the Porcupine South deposit contributed during the year with a 64,000 maiden resource.
[email protected] Capital PLC (LON:SYME), the innovative fintech platform which provides a unique, market-leading Inventory Monetisation service to European manufacturing and trading companies, has said the authorisation process for its Shariah-compliant Inventory Monetisation Platform has been successfully completed. Following the announcement the groups of November 3, 2020, the company said that with the support of the Shariah Funding Specialist and iMASS, it was told that “an official pronouncement has been released by Sheikh Dr Mohamed Elgari and Sheikh Yusuf Talal DeLorenzo in their capacity as members of the Shariah scholar board in relation to the inventory monetisation service.”
IronRidge Resources Limited (LON:IRR) has announced a fully underwritten call for the exercise of warrants which will raise £3,793,019 in new capital, before costs, to assist the company’s ongoing project exploration and development efforts within Ghana, Cote d’Ivoire and Chad. The African-focused minerals exploration group said under approval granted by shareholders at the company’s General Meeting of June 25, 2020, it has remaining in issue 31,608,492 warrants issued to participants in the company’s capital raising announced on May 11, 2020. Each warrant is exercisable at a price of 12p into one Depositary Interest shares of no par value in the company. The company noted that it has the ability to call on the holders to exercise their warrants in the event that the company’s ordinary shares trade at a Volume Weighted Average Price at or above 16p per share for a period of five consecutive business days, which was achieved on August 12, 2020.
Tiziana Life Sciences PLC (NASADAQ:TLSA) (LON:TILS), a biotechnology company focused on innovative therapeutics for oncology, inflammation, and infectious diseases has said that, as previously announced, the last day of trading of the company’s ordinary shares on AIM will be Wednesday, January 20, 2021. and the AIM delisting will be effective from 7.00am on January 21m 2021. Admission of Tiziana’s shares to the Official List and commencement of dealing in the ordinary shares on the Main Market will be effective from 8.00am on January 21, 2021.
Albion Enterprise VCT PLC (LON:AAEV) has announced the appointment of Rhodri Whitlock as a non-executive director of the company with effect from January 19, 2021. On appointment, the trust said Whitlock will succeed Lord St John of Bletso as its Audit Committee chairman following his decision to step down from the board on November 30, 2020. Albion Enterprise noted that Whitlock, a chartered accountant, has over 25 years’ experience as a partner providing a range of assurance services and advice to listed and private companies. For 20 of those years, it added, Whitlock worked closely with the non-executive boards of a significant number of investment and infrastructure funds with aggregate assets under management of £1.5 billion. He has assisted with IPOs of companies and investment trusts and has experience of valuations. The group also announced that the Dowager Lady Balfour of Burleigh who has been on its board since 2006 has been appointed Senior Independent Director with effect from January 19, 2021.
6.50am: Biden bunting out
The FTSE 100 is expected to start Wednesday’s session on the front foot as traders await the inauguration of new US president Joe Biden and the formal end of the Trump era.
Spread-betters IG expect the blue-chip index to open up around 21 points after ending Tuesday’s session down 8 points at 6,713.
Markets have already seen early indications that the start of the Biden presidency will see a flurry of new spending through a US$1.9 trillion stimulus package, while longer-term commitments, particularly around infrastructure, education and green energy likely to emerge in the following 100 days.
The prospect of more US government spending, which was bolstered by Senate testimony from incoming Treasury Secretary and former Federal Reserve chair Janet Yellen, helped boost Wall Street overnight with the Dow Jones Industrial Average closing 0.38% higher at 30,930 while the S&P 500 climbed 0.81% to 3,798 and the Nasdaq Composite rose 1.53% to 13,197.
Markets in Asia were more mixed early on Wednesday as optimism over the incoming Biden administration were offset by concerns over rising cases of coronavirus (COVID-19), with Japan’s Nikkei 225 down 0.38% while Hong Kong’s Hang Seng was up 0.66%.
On currency markets, the pound was up 0.2% against the dollar at around US$1.366, with UK inflation data due later today potentially providing some catalysts for movement.
Around the markets:
- Sterling: US$1.366, UP 0.2%
- Brent crude: US$56.25 a barrel, up 0.6%
- Gold: US$1,852 an ounce, up 0.65%
- Bitcoin: US$35,529, down 3.2%
6.45am: Early Markets – Asia / Australia
Stocks in major Asia-Pacific markets were mostly higher on Wednesday.
Hong Kong’s benchmark Hang Seng index rose 0.81% with Alibaba shares surging 8.85% following the reappearance of founder Jack Ma for the first time after weeks.
Mainland Chinese stocks gained, with the Shanghai composite advancing 0.33% while South Korea’s Kospi was 0.68% higher.
Japan’s Nikkei 225 was an exception among its Asian peers by falling 0.38%.
Shares in Australia gained, with the S&P/ASX 200 closing 0.41% higher.
Proactive Australia news:
Venture Minerals Ltd (ASX:VMS) has received firm commitments from sophisticated, professional and institutional investors to raise A$10 million, fully funding the development of the Riley Iron Ore in northwest Tasmania and paving the way for the first iron ore shipment next quarter.
Archer Materials Ltd’s (ASX:AXE) (OTCMKTS:ARRXF) (FRA:38A) 12CQ quantum computing chip technology has achieved a major commercial milestone with the grant of a Japanese patent, the first granted patent protecting the 12CQ chip.
Lithium Australia NL (ASX:LIT) (FRA:3MW) shareholders have paid the balance of A$340,850 for a total of more than 6.83 million LITCF partly paid ordinary shares in the company, the latest in a series of similar transactions since mid-December 2020.
Theta Gold Mines Ltd (ASX:TGM) (OTCQB:TGMGF) has invested A$700,000 in Bullion Asset Management Services Pte Ltd (BAM), a Singapore-based technology company focused on financing, tokenisation of physical gold bullion and precious metals trading.
February Fenix Resources Limited (ASX:FEX) made significant progress in the December quarter on development of the Iron Ridge Iron Ore Project in WA’s Mid-West, with production underway and the first shipment of about 60,000 tonnes of combined lump and fines product scheduled for early February.
Moho Resources Ltd (ASX:MOH) has commenced its maiden reverse circulation (RC) drilling program at Crossroads Gold-Silver Prospect, part of its Burracoppin Gold Project, within E70/4688, which is subject to a 70:30 joint venture with IGO Ltd (ASX:IGO) (OTCMKTS:IPGDF) (FRA:IDZ).