Despite the US S&P500 index hitting a new all-time high of 2,954 yesterday on hopes of a cut in interest rates, UK stocks are fairly muted on Friday with the FTSE 100 index up just 0.1% to 7,429.

Lifting the main index are energy stocks, which were also the best performers on Wall Street overnight thanks to a 5% surge in US oil prices due to increased Middle East tensions. Brent crude prices rallied 4% yesterday to over $64.

Letting the side down are banks and healthcare stocks with HSBC (HSBA), Standard Chartered (STAN), AstraZeneca (AZN) and GlaxoSmithKline (GSK) weighing heaviest on the benchmark.

On a quiet news day, shares in online travel platform Trainline (TRN) are the main attraction, jumping 23% to 431p after being priced in the initial public offering (IPO) at 350p and giving the company a market value of over £2bn.

Assuming that all the shares offered in the float are taken up, the main shareholder, private equity behemoth KKR, will keep a 35% stake which is subject to a 180-day lock-up.

Safety and environmental equipment group Halma (HLMA) announces the A$135m (£74m) acquisition of Australia’s Ampac, a fire and evacuation systems supplier in the Australian and New Zealand markets.

The deal is on a debt-free and cash-free basis and is expected to close no later than mid-August. Halma shares gain 0.2% to £20.33.

Aerospace and defence equipment-supplier Meggitt (MGGT) has won a contract with US contractor General Dynamics to develop a cooling system for the firm’s next-generation tanks and armoured fighting vehicles.

Meggitt doesn’t specify the size of the contract but the US government recently gave General Dynamics an order to buy over 2,000 of these cooling systems worth over $250m. Investors seem unfazed, leaving the stock treading water at 525p..

Welsh silicon wafer-maker IQE (IQE:AIM) warns that first half revenues will miss estimates due to a weak smartphone handset market. Turnover is expected to be between £65m and $68m against consensus forecasts of £68m.

IQE also warns of weakness in laser revenues ‘due to a customer specific issue’ beyond its control, which is code for the US backlash against Chinese tech firm Huawei. IQE shares collapse by 38% to 44.7p in early trade.

Waste management firm Augean (AUG:AIM) announces that due to stronger than expected trading in its second quarter, group profit for the full year to 31 December will be ahead of market estimates.

Moreover improved trading has led to an increase in the firm’s net cash position which now stands at £20m. Shares gain 8% to a new 12-month high of 129p.

Shares in game software firm Codemasters (CDM:AIM) slide 5% to 235p after brokers Jefferies and Liberum Capital place 20m shares or 14.3% of the company on behalf of core stakeholder Reliance Big Entertainment of Singapore.

The shares were placed at 220p, an 11% discount to last night’s closing price of 247.5p. Codemasters was a running Great Idea but we locked in our gains last week at 251p feeling that the shares were already discounting much of the future earnings growth.

 

 

 


Issue Date: 21 Jun 2019