Global stock markets started the new month in positive spirits following a strong performance on the US Nasdaq technology index which closed up over 3%, capping its biggest two-day gain since 2020.
Sterling gained against the dollar to sit at $1.35 once again, while Brent crude traded sideways at $89.16 per barrel as OPEC and its allies were expected to approve a modest increase in production this week to alleviate the strong rise in prices.
At midday the FTSE 100 index of leading shares was up 73 points or 1% at 7,537 points led by gains in mining and financial stocks which more than offset weakness in defensive sectors.
CORPORATE NEWS
Virgin Money UK (VMUK) increased its 2022 full year net interest margin expectations to 1.75% as it benefits from the latest rise in base rates and higher unsecured lending.
The company said first quarter trading to 31 December was in line with expectations with deposits down 2% £65.5 billion, mortgages fell 0.5% to £57.8 billion and business lending dropped 2.2% to £8.3 billion impacted by weak demand. The shares added 2% to 193.6p.
Infrastructure investor 3i Infrastructure (3IN) said total income and non-income cash increased 8% to £26 million in the third quarter through December and it was on track to meet its 2022 dividend target of 10.45p per share, an increase of 6.6%.
In December the company increased its revolving credit facilities by £200 million to £600 million and in January it obtained an additional credit facility of £400 million, taking the total facilities to £1 billion. The shares nudged up 0.3% to 346.9p.
Gene and cell therapy group Oxford Biomedica (OXB) said Sio Gene Therapies intended to return the global rights for AXO-Lenti-PD and cease work on this gene therapy programme in Parkinson's Disease.
The impact on revenues will be ‘negligible’ over the next two years as no financial milestones were expected to be achieved.
The company said it does not plan to invest in the development of the non-core legacy asset and plans to out-license it again in due course to a suitable partner with resource capabilities and funding to further develop this asset. The shares dropped 1% to 835p.
Cinema operator Cineworld (CINE) said it had started talks with former Regal shareholders to reach an agreement over rescheduling payment obligations.
In September last year, Cineworld said it would pay $170 million to shareholders who were unhappy with the price they received when the company bought Regal in 2017.
To facilitate the talks, Cineworld has obtained waivers for any events of default arising from non-payment of the unsecured facility agreement - to be used to pay former Regal shareholders - from various other creditors.
The creditors included certain holders of Cineworld’s guaranteed convertible bond due 2025 as well as the lenders under certain of its existing debt facilities. The shares nudged up 0.2% to 39p.
OTHER NEWS
Shares in specialist supplier of colour cosmetics Warpaint (W7L:AIM) leapt 7% higher to 165p after saying it expected full-year results to be ahead of market expectations.
Adjusted pre-tax profit to 31 December is expected to be £6.6 million compared with £2.2 million in 2020 and £4.9 million in 2019 while year end cash is expected to be £4.1 million.
Gross margins were maintained ahead of both 2020 and 2019 levels despite increased supply chain costs.
Shares in premium British lifestyle group Joules (JOUL:AIM) crashed 41% to 69.6p after the company said trading for the nine weeks to 30 January was behind the board’s expectations.
The company blamed the shortfall on Omicron, supply chain challenges and lower than expected wholesale revenues due to delayed stock and customer cancellations.
Distribution costs for December were around £1.2 million higher than expected and double the prior year costs. The company said it has taken actions to ‘simplify the business, reduce costs and improve margins’.
Alternative capital solutions provider Duke Royalty (DUKE:AIM) said it achieved record third quarter cash revenues to 31 December of £3.9 million.
The company said it deployed a record amount of capital in excess of £38 million during the quarter, more than double any prior period.
Duke said based on current trading it expected to achieve another record normalised cash revenue in the fourth quarter of £4.3 million. The shares gained 4% to 40.7p.
A list of FTSE 100 index movers can be seen here.
