London's top stocks have started with hefty losses as sentiment was hit by a weak manufacturing report in China and warning by Moody’s Investors Service that it may cut Spain’s credit rating.Asian stocks were hit after China’s purchasing managers’ index fell to 52.1 in June from 53.9 a month earlier, much lower than expected. Meanwhile, uncertainty about the health of the European economy surfaced again after Moody’s warned late yesterday it may downgrade Spain by as much as two levels.
In company news in the UK, Swiss power and automation technologies giant ABB said it will not match an offer by Emerson for electrical plugs and peripherals maker Chloride. The battle for ownership of Chloride burst into life on Tuesday as US giant Emerson trumped ABB's agreed offer with a bid worth 375p in cash or Ł1bn in total. ABB was offering 325p per Chloride share meaning Emerson pitched its new offer at a hefty 15% premium to its Swiss rival.
Tate & Lyle has sold the largest part of its sugars division to American Sugar Refining of the US for Ł211m - a deal that will see it lose its well known brand Lyle’s Golden Syrup . The group also said it planned to sell the remaining businesses within the Sugars division, principally Molasses and Vietnamese sugar. The sale excludes historic UK pension assets and liabilities and is expected to give rise to a book loss on disposal, before costs, of about Ł55m.
Cairn Energy has started its summer drill programme off the coast of West Greenland with the Alpha prospect (Alpha-1) in the Sigguk Block, about 175km offshore Disko Island. The Edinburgh-based oil company is targeting the Alpha and T8 exploration prospects which lie in water depths of between 300 and 500 metres. It will take 55 days to drill to 4,200m at Alpha and 38 days to get down to 3,250m at T8, the firm estimates. An update is due in August.
Telecoms giant BT has announced the pricing plans for the Sky Sports channels its BT Vision service will be offering from 1 August. BT Vision customers can add both Sky Sports 1 & 2 to the service for Ł16.99 a month, or either one for Ł11.99 a month, on a month by month basis. BT says the Ł11.99 bundle works out Ł205 cheaper than Sky's current equivalent deal and Ł281 cheaper than Virgin Media over a year.
Guinness brewer and spirits distiller Diageo has reached agreement with its pension fund trustees on a 10-year funding arrangement for the UK pension scheme. It has been agreed that Ł197m which was agreed under the 2006 funding plan will be transferred to the UK scheme, which was Ł862m in deficit at the beginning of April 2009.
Barclays has signed a joint venture agreement with Sumitomo Mitsui Banking Corporation (SMBC) and Nikko Cordial Securities, a wholly-owned subsidiary of SMBC, to provide wealth management services to high net worth individuals in Japan.
Brewer Greene King saw profits rise for the year and said current year’s trading is ahead of expectations. Pre-tax profit rose to Ł101.9m from Ł54.3m on revenue that increased 3.1% to Ł984.1m, helped in particular by the 3.5% growth in its retail business.
Department store Debenhams said like-for-like sales decreased by 0.4% over the 42 weeks and added that it remains cautious about consumer confidence. The group said like-for-like sales were impacted by the strategy of improving gross margins by increasing the penetration of own bought trading space and by stronger comparatives in the third quarter of 2009.
Energy services group John Wood Group said fall-out from the oil spill in the Gulf of Mexico is not expected to materially affect the company’s performance this year. About 4% of annual revenue is related to new deep water developments in the Gulf. In an update covering the first half of the year the group said overall performance has been in line with expectations.
Five-a-side football pitch operator Goals Soccer sees overall sales for the six months ended 30 June slightly ahead of 2009, but shares fell after it said full-year figures might come in towards the lower end of current market expectations.
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