London shares rebound in early trade on Thursday, reversing some of the losses built up earlier in the week despite mixed trading on Wall Street and across Asia overnight. The benchmark FTSE 100 index rallies 58 points, or a bout 1%, to 6,327, matching similar early progress on Europe's main stock markets.
Cambridge-based chip designs expert ARM (ARM) heads the Footsie leader board with a 5.2% rise to 981.5p, attracting buyers ahead of its widely anticipated third quarter trading update next week, as predicted by Shares in today's magazine. You can read our full analysis of what this business does here.
But dragging on the blue-chips is luxury goods leader Burberry (BRBY). It slumps 9.5% to £12.84, topping the Footsie loser board, after warning sales have been hit by the slowdown in China. In the first half, retail sales growth slowed to 2%, with the trench coats-to-cashmere scarves seller reporting a drop in demand from Chinese customers and deceleration in Hong Kong in the second quarter. CEO Christopher Bailey says Burberry still expects to meet the full-year consensus pre-tax profit estimate of £445 million with the help of cost-cutting.
Dove, PG Tips and Magnum ice cream maker Unilever (ULVR) rises 3.4% to £28.85 on a third quarter organic sales growth surprise, up 5.7% versus the 3.9% consensus estimate, driven by soft comparative metrics in China, a strong ice cream season in Europe and 'some advanced sales in Latin America'. Following the strong quarter, CEO Paul Polman is now guiding full-year organic sales growth 'towards the upper end of the 2-4% range'.
Books-to-stationery seller WH Smith (SMWH) skips 4.3% higher to £16.07 on better-than-expected finals with a travel division boost; a 13% final dividend hike and news of a further £50 million share buyback also entices buyers this morning.
Among the bigger movers, Kurdistan oil producers Genel Energy (GENL) and Gulf Keystone Petroleum (GKP) are marked higher – up 6.9% to 366.5p and 6.6% to 30.9p respectively – as the latter banks $12 million for crude exports from the Kurdistan Regional Government (KRG). Following a similar payment in September it suggests the KRG is delivering on its promise of regular payments.
Micro cap Nostra Terra (NTOG:AIM) is up 13.6% to 0.12p as it completes the acquisition of a 50% stake in the producing East Ghazalat concession in Egypt along with its partner Independent Resources (IRG:AIM) up 3.6% to 0.72p.
Rare books-to-decorative prints retailer Scholium (SCHO:AIM) rebounds 61.4% to 46p, putting recent disappointments behind it by flagging a return to first-half pre-tax profit on 'a substantial increase in turnover', as well as a net asset value in excess of £10 million or 73.5p per share.
Despite vigorous assurances to the contrary (See Shares 08 October) by its chief executive, speciality chemicals outfit Carclo (CAR) sees its shares plunging 13.6% to 126.8p on the back of an announcement from Volkswagen AG that its flagship luxury vehicle due for launch in 2017 will be launched as a fully-electric vehicle. The ramifications of this decision are still being assessed in terms of the effect this will have on the lighting requirements. It will almost certainly delay the vehicle's launch which will hit the timing of revenue for Carclo's Wipac unit in its LED Technologies division.
Newcastle-based displays manufacturer Zytronic (ZYT:AIM) is also popular, rallying 12% to 341p, as it reveals a sharp second revenues improvement over the first six months. This was particularly marked over the July to September last quarter, points out management of this running Shares Play of the Week.
Asset manager Man Group (EMG) gains 4.1% to 157p as inflows of client funds largely offset negative market movements in the period. Assets under management fall slightly to $76.8 billion from $78.8 billion three months earlier.
An upbeat third quarter update sends Secure Trust Bank’s (STB:AIM) shares 2.2% higher to £28.12. Deposits exceeded £900 million for the first time and lending was 93% higher than in the same period a year earlier. The bank is working to launch a cash ISA in the second half of 2016.
Investors welcome high street bank Virgin Money’s (VM.) proposed move into small business lending. Shares improved 2.8% to 413.9p as the Richard Branson-backed bank also recorded a 38% rise in gross mortgage lending in the nine months to 30 September.
Buy-to-let investor Mill Residential REIT (MRR:AIM) trades 5% higher on plans to liquidate its assets and return the cash to investors less than a year after it listed (23 Dec).