UK and European stocks started the week on a down note following weakness in US stocks on Friday, although futures prices indicated a bounce of close to 1% for the benchmark S&P 500 at the open.

Asian trading saw a volatile session with Japan’s Nikkei 225 closing 0.25% higher and China’s SE Composite up slightly. Oil prices continued their rise with Brent Crude gaining 0.5% to $87.70 per barrel.

Investors are bracing themselves ahead of an update from the US central bank this week where the Fed is expected to signal the timing of its first rate rise since 2018.

This week will also see several US technology results with IBM kicking off later today.

In early trading the FTSE 100 index of leading shares was down 0.24% to 7,476 points, with investors retreating to the perceived safety of staples and supermarkets.

COMPANY NEWS

Shares in consumer goliath Unilever (ULVR) were top of the FTSE 100 leader board on Monday after gaining 5% to £38.65 on reports that US activist investor Nelson Peltz had build a stake in the company through his fund Trian Partners.

Precious metals miner Polymetal International (POLY) said it had made an initial mineral resource estimate for the Novopet project in Bashkortostan, Russia.

The estimate amounted to 9.2 million ounces of mineralised material with an average GE grade of 8.0 g/t. The composition was 37% copper, 35% gold, 23% zinc and 6% silver.

Polymetal's current share in the Novopet joint venture is 75%. The company owns a seven-year call option to buy out the remaining 25% stake in the project from joint venture partner Rosgeo, based on JORC-compliant Ore Reserve estimates. The shares dropped 0.8% to £12.10.

INCREASED EXPECTATIONS

Shares in computer services provider Computacenter (CCC) gained 2.2% to £27.56 after it increased its earnings guidance after reporting better-than-expected fourth-quarter trading despite ongoing supply-chain disruptions.

The company said its product order backlog is at an all-time high and considerably larger than a year ago. Adjusted pre-tax profit for the year is now expected to slightly in excess of £250 million while revenues grew by 23% including acquisitions.

The firm experienced the highest growth in Services revenues for the last 20 years along with continued strength in Technology Sourcing product sales.

Thermal energy and niche pumping specialist Spirax-Sarco Engineering (SPX) said it had agreed to acquire Cotopaxi from Business Intelligence of Oriental Nations Corporation for £13.3 million.

Cotopaxi ias a global energy consulting and optimisation specialist and comprises a team of 38 energy engineers and software specialists.

It provides customers with consulting, digital connectivity and monitoring of energy intensive processes, including steam. Spirax shares dropped 0.2% to £130.

PROFIT WARNING

Shares in bank note printer De La Rue (DLAR) sank 28% to 107.9p after the company lowered its profit expectations following cost and supply chain challenges as well as increased staff absences due to increased virus infections.

The company now expects adjusted full-year operating profit to be in the range of £36 million-to-£40 million which is around 17% shy of market expectations of £45 million-to-£47 million.

Management said external factors beyond its control had pushed its turnaround plan back by around a year.

HgCapital Trust (HGT) said it would invest roughly £31.8 million in Waystone, an institutional governance, risk and compliance services business in the asset management industry.

The company will announce its full year results to 31st December on 7 March 2022. The shares edged up 0.2% to 395.6p.

Student accommodation developer Unite (UTG) said it had acquired a consented 270-bed development site in Nottingham's city centre.

Total development costs for the scheme, which would open for the 2024/25 academic year, were estimated to be £34 million, the company said.

Unite said the direct-let development was expected to deliver a yield on cost of 7%, reflecting the fact that planning approval already was secured. The shares dipped 0.5% to £10.34,

Shares in medical devices developer Belluscura (BELL:AIM) gained 5% to 140p after the company said demand and sales for its portable oxygen concentrator had exceed expectations.

Since the launch of X-PLO2R in September 2021, the group had sold 377 units, 25% above current consensus forecasts and 150% above initial forecasts for 2021.

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Issue Date: 24 Jan 2022