Stocks get off to a decent start on Wednesday with the FTSE100 and the 250 rising by half a percent. European markets are also firmer although it’s worth noting that US futures are pointing to a lower open.
Defensive heavyweights Astrazeneca (AZN), Reckitt Benckiser (RB.) and Unilever (ULVR) are lending the market support along with the utility sector.
Investors seem relaxed about Barclays' (BARC) third-quarter update with shares trading better by 1% to 167p. Profit before tax excluding litigation and PPI charges is up 23% for the nine-months to end-September while return on tangible equity hit 11.1%, above the bank’s 10% target for 2020.
Challenger Metro Bank (MTRO) reported a much sharper increase in nine-month earnings with pre-tax profits up 197% on last year driven by a 52% increase in lending.
The bank has also increased customer accounts by over 300,000 to reach 1.5 million and increased deposits by 38% to over £14 billion. Investors seem unimpressed however sending the shares down 7% to £23.80, perhaps reflecting margin pressure from competition in the mortgage market.
On the other hand Photo-Me International (PHTM) issued a trading update ahead of today's AGM which clearly pleased, sending the shares up 9% to 109p.
The operator of photo booths and launderettes sees first-half results flat on last year, excluding exceptionals, and keeps its guidance for the full year.
ROCKY ROAD FOR SMALL CAPS
Shares in Infrastructure group Stobart (STOB) fall 10% to 198p as it reveals it had fallen into the red in the first half of the year despite a big increase in turnover.
Revenues for the six months to the end of August were up 21% to £151 million yet the company posted a loss for the period of £17.5 million on marketing expenses and Southend Airport.
Angling Direct (ANG:AIM), the UK’s biggest specialist fishing tackle and equipment retailer, announces it has netted £20 million through a placing of new shares with institutions.
The funds will be used to roll out new stores, upgrade the website and ‘facilitate the exploration of potential strategic M&A opportunities’. Shares sink 3% to 97p as the market adjusts for the increase in the number of shares.
The worst-performing stock this morning is independent energy provider Yu Group (YU.: AIM) which has uncovered what it calls ‘areas of significant concern’ relating to its accounts.
After adjusting for lower than expected accrued income and higher than expected trade debtors the company estimates that profits will be £10 million short of market expectations, pushing it into a loss for the year.
The shares drop 72% to 165p, their lowest level since the company floated in 2016.
