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Reports UK

UK stock market morning note (December 03, 2013)

December 3, 2013, Tuesday, 08:44 GMT | 03:44 EST | 13:14 IST | 15:44 SGT
Contributed by SVS Securities

The FTSE 100 is called to open lower this morning following the performances on Wall Street and in Asia over concerns that the US Federal Reserve may begin tapering its bond buying programme this month. Overnight we had domestic economic data out from the BRC showing that total UK retail sales rose 2.3% in November with lfl sales ahead 0.6%, both down slightly on the month but above the corresponding period a year ago. The economic diary for today also focuses on domestic figures with the release of the construction PMI data. Commodity prices are mixed and on the foreign exchanges, the pound is stronger against both the dollar and euro.

Company Announcements

Rio Tinto Seminar Update reports forecast total capex for 2013 of less than USD14bn, a reduction of over 20% on 2012 with total capex for next year forecast to be cut to USD11bn and to around USD8bn in 2015, a 20% year-on-year reduction. Operating costs are down USD1.8bn year to date compared to the prior period a year ago with exploration and evaluation costs over USD800m lower. It noted that it was seeing market fragility and volatility but over the longer term remains optimistic about product demand. It cited China's urbanisation and the development of India, Vietnam, Indonesia, the Philippines, Middle East, the former Soviet Union, South America and Africa contributing to ongoing demand.

Micro Focus Interim Results see underlying adjusted EBITDA rise 8.3% on a constant currency basis to USD93m on revenue ahead 2.4% at USD207.5m, the latter in line with guidance. The dividend is raised 17.6% to 14 cents a share and it returned 60p a share on 12 November to shareholders. It reiterated that in the absence of a significant acquisition, share buy-back opportunity or unforeseen circumstances, it intends to make a similar return of value next November. It added that whilst markets remain challenging, it is seeing a strong pipeline of opportunities and is revising its full year revenue guidance from 0%-5% to growth of 3%-6% on a constant currency basis.

Greene King Interim Results see PBT ahead 5.7% at GBP85.6m on revenue up 5.2% at GBP595.4m. The dividend is raised 6.3% to 7.6p. It added that whilst trading through H1 and since the period end has been strong, and the economic outlook appears to be improving, customers remain careful with their money particularly outside London and the South East.