Despite a lack of progress both on US-China trade talks and the Brexit process, UK stocks edged ahead on Tuesday with the FTSE 100 index of leading stocks up 18 points or 0.2% to 7,216.
The best-performing sectors were Basic Materials, such as Mining and Paper & Pulp, and Industrial Goods & Services.
HK WALKS AWAY
The biggest loser on the FTSE was London Stock Exchange (LSE) which fell 6% to £69.84 after Hong Kong Exchanges & Clearing Ltd (HKEX) pulled its £29.6bn takeover bid due to lack of support from the UK exchange’s management and top shareholders.
HKEX said it was ‘disappointed that it has been unable to engage with the management of LSEG in realizing this vision, and as a consequence has decided it is not in the best interests of HKEX shareholders to pursue this proposal’.
RAYS OF LIGHT
There was better news for shareholders in industrial kit-supplier Electrocomponents (ECM), which reported group turnover up 5% in the first half to 30 September driven by market share gains in Europe and the US. Having fallen sharply in the last week, Electrocomponents shares added 5% to 631p.
Thanks to ‘robust customer demand’ and the firm’s own self-help strategy, full year pre-tax profits are now seen in the upper half of the previous guidance range at £420m to £430m. However, after their recent strong run the shares eased back by 5% to £11.17.
Shares in leisure firm Hollywood Bowl (BOWL) added 5% to a new three-month high of 240p after it reported like-for-like full year sales up 5.5% and raised its forecast for pre-tax profit growth to over 10%, above market expectations.
The results were above the 'ambitious' targets the company set itself five years ago. Current trading is also positive and ‘the outlook for the business remains strong’ according to chief executive Stephan Shakespeare. Shares added 0.5% to 540p.
PageGroup lowered its operating profit guidance for the full year to £140m to £150m against market expectations of £150m to £160m as it has ‘limited forward visibility’ in its business.
In the third quarter it saw a sharp downturn in revenues in Asia, especially Greater China, while the UK continued to struggle as firms delay hiring in the run-up to Brexit.
Meanwhile Robert Walters lowered its guidance for full year pre-tax profits to flat on last year instead of a 6% increase, also blaming weaker revenues in China due to the trade war and in the UK due to Brexit.