London’s FTSE 100 firms 66 points to 7,345 on Monday, with the surprise news overnight that China’s manufacturing sector returned to growth in March providing a boost for miners and global advertising group WPP (WPP) in demand due to a broker upgrade.
Budget airline EasyJet (EZJ) loses altitude, shares marked 7.25% lower to £10.37 as the low-cost carrier issues a more cautious outlook for the second half. Macroeconomic uncertainty and ‘many unanswered questions surrounding Brexit’ are driving weaker customer demand, laments EasyJet, expecting to post a first half pre-tax loss of ‘around £275m’ amid rising fuel costs and a currency headwind.
Mining behemoth Rio Tinto (RIO) improves 2% to £45.51 with a boost from the China data and on the reassuring news its iron ore operations in the Pilbara, Western Australia, are ‘progressively resuming’ following the passing of Tropical Cyclone Veronica.
‘Force majeure’ has been declared on ‘certain’ iron ore contracts and Rio Tinto’s Pilbara shipments in 2019 are now expected to be at the lower end of the previously guided 338-to-350m tonne range due to the cyclone-related production disruption to the Cape Lambert A port facility, following on from fire damage inflicted there in January.
Support services giant Serco (SRP) edges 1.1% higher to 129.4p after signing a £140m contract extension to continue operating and maintaining the Dubai Metro – ‘amongst the largest and most reliable rail services in the world’ according to CEO Rupert Soames – until September 2021.
Video games developer and publisher Codemasters (CDM:AIM), one of Shares’ running Great Ideas selections, accelerates 4.2% higher to 248p on news of strong second half trading. Revenue for the year to March 2019 was in line with consensus estimates at around £71m while adjusted EBITDA was ahead of market estimates at £18.5m, driven by a surge in digital sales following the release of DiRT Rally 2.0 and the earlier than anticipated delivery of technology and support for a project with Netease.
Industrial materials firm Low & Bonar (LWB) slumps 22.7% to 13.15p on a full year profit warning following a weak first quarter. Sales were both below prior year levels and management’s expectations due to a combination of subdued demand, intense competition and legacy supply issues.
IT solutions group Instem (INS:AIM) sparks up 6.2% to 325p after unveiling a surge in full year pre-tax profits, from £300,000 to £1.7m, driven by recent contract wins. ‘With increasing momentum in the business from recent contract wins and the growing pipeline, we are confident about the outlook for the group for 2019 and beyond’, enthuses CEO Phil Reason.