UK shares rally in early trade on Wednesday ahead of Chancellor George Osborne’s joint Spending Review and Autumn Statement. Osborne is widely expected to announce deep cuts to public sector spending when he kicks off the Autumn Statement at 11.30 this morning. He could also unveil tax changes to pensions, motoring, savings and housing.
The UK housing market is anticipated to be sharply in focus and sector stocks put in the biggest gains across the blue-chips, led by Persimmon (PSN), up 5.6% at £18.82. Taylor Wimpey (TW.), Barratt Developments (BDEV) and Berkeley (BRK) have all also jumped this morning.
Travel agent Thomas Cook (TCG) surges 9.8% to 108p after swinging to a profit after tax of £19 million in the 12 months to 30 September from a loss of £115 million the previous year. The group expects to pay a dividend in early 2017 after strengthening its balance sheet with extended maturities and enlarged banking facilities. Current winter trading is encouraging with selling prices up 3% and bookings up by 1%.
Publisher Daily Mail & General Trust (DMGT) sinks 3.8% to 678p despite in-line results. The market instead focusing - as Shares suggested it might - on a weak outlook for 2016. The company noting it is unlikely to hit its £100 million revenue target for online operation MailOnline next year and warning challenging market conditions in the UK print advertising market and those facing 70%-owned Euromoney (ERM) in the investment banking and commodities sectors are also likely to have an adverse impact.
Oil services minnow SeaEnergy (SEA:AIM) falls 11% to 4p as it warns of a substantial loss in 2015 thanks to the downturn in industry spending.
Indian unconventional gas play Oilex (OEX:AIM) is reeling - down 12.9% to 0.68p - after shareholders rejected all resolutions at its AGM in Australia. The vote means Jeffrey Auld is not re-elected as an independent director, nor is Sundeep Bhandari who withdraws his nomination. Resolutions relating to director remuneration and changes to the company’s constitution are also rejected. 'The remaining board members recognise the dissatisfaction demonstrated by these votes,' says chairman Max Cozijn.
Internet betting exchange Betfair (BET) climbs 2.5% to £35.67 on a 15% rise in revenue to £247.4 million despite tough comparatives from last year's Football World Cup. EBITDA (earnings before interest, tax, depreciation and amortisation) is 9% higher to £80.5 million notwithstanding the £26.8 million hit from the Point of Consumption Tax. Betfair says its merger with Paddy Power is on track for completion in the first quarter of 2016.
Rigid plastic packaging company RPC (RPC) gains 1% to 687.5p on a 38% rise in adjusted pre-tax profit to £75.8 million in the six months to 30 September with revenue 36% higher at £799.8 million. The group has already realised £9.4 million of synergies from its acquisition of Promens and Ace and it is now targeting total syngergies of £36 million by the end of 2016/17, up from the previous estimate of £21.6 million.
Carpets manufacturer and distributor Victoria (VCP:AIM) weaves a 10p gain to £13.03 on stellar interims, showing an acquisitions-driven sales surge, record pre-tax profit from continuing businesses and containing a bright outlook statement from chairman Geoff Wilding.
Robinsons-to-Fruit Shoot maker Britvic (BVIC) edges 8.5p (1.2%) higher to 718.5p on encouraging finals, showing profit significantly ahead year-on-year as well as a 10% dividend hike, although CEO Simon Litherland does flag a slow start to the new fiscal year reflecting challenging market conditions.
Home shopping-to-education supplies business Findel (FDL) falls 4% to 218.5p as investors give the thumbs down to flat interim pre-tax profits, not helped by a second quarter sales slowdown at biggest business Express Gifts.
Cake, bread and muffin maker Finsbury Food's (FIF:AIM) fantastic run continues, the shares rising 2.9% to 108p on another positive trading update. CEO John Duffy reports strong trading in the opening four months of the financial year, with organic sales 10.1% higher and total sales 78% higher at £102 million following recent acquisitions.
Jordanian drug-maker Hikma (HIK) advances 1.6% to £21.33 on selling the dormant manufacturing assets of Ben Venue Laboratories for an undisclosed sum.
Life sciences services provider Horizon Discovery (HZD:AIM) trades 2.1% higher at 144.5p on signing a contract worth an initial $3.3 million to develop a companion diagnostic test.
Crop enhancement specialist Plant Impact (PIM:AIM) is 4.7% higher at 62p after the £50.7 million cap posted a positive update which points to a strong start to full year 2016 trading across all its geographies.
