News Column

TOP NEWS: Mixed Fortunes For IPO DÉbutantes AA, River And Mercantile

June 23, 2014



LONDON (Alliance News) - The following is a summary of top news stories Monday.

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COMPANIES

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There were mixed fortunes for the latest stocks to list on the London main market, as roadside assistance and financial services company AA PLC saw its shares slide below its initial public offering price in early conditional dealings, while River and MercantileGroup PLC headed higher. The AA confirmed that it priced its IPO on the main market in London at 250 pence a share, giving it an initial market capitalisation of GBP1.39 billion. However, the stock was trading at 241 pence in early dealings. Meanwhile, River and Mercantile Group PLC said it priced its IPO on the main market at 183 pence a share, giving it an initial market capitalisation of about GBP150.2 million. The stock was trading at 189.3 pence in early dealings.

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British Airways, one of the airlines owned by International Consolidated AirlinesGroup PLC, is facing the threat of renewed strikes after cabin crew said they were prepared to take industrial action after their pay claims were rebuffed, The Guardian reported without citing any sources. In a consultative ballot last week among members of the mixed fleet, 95% of crew who voted said they would go on strike, the paper says, adding that about a third of the eligible crew voted in the ballot, taken to gauge feeling in a fleet which unionised rapidly under Unite in 2012.

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Online fashion retailer ASOS PLC said it has re-started taking orders from its website, after South Yorkshire police started a criminal investigation into a fire at the company's main distribution centre in Barnsley. In a statement early Monday morning, ASOS said it had GBP159 million worth of stock in total on May 31, about 70% of which was held at the Barnsley site. It said its initial estimate is that about 20% of the stock at Barnsley has been compromised by fire and sprinkler systems damage. The fire started at its Barnsley warehouse in the early hours of Saturday morning, and ASOS halted orders. However, it said it had re-started taking orders at 0200 BST.

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Ultra Electronics Holdings PLC said its EMS Development Corp business in the US has won a contract worth more than USD21 million over five years from General Dynamics Electric Boat Corp. Under the contract, the company will produce naval computer-controlled power supply systems.

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MARKETS

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Stock indices across the UK trade lower as manufacturing and services PMI data from across the region have failed to live up to expectations, while the mining stocks are the best performers after similar data from China was notably better.

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FTSE 100: down 0.2% at 6810.40

FTSE 250: down 0.5% at 15718.46

AIM ALL-SHARE: down 0.03% at 785.00

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The euro is down against the dollar after Eurozone PMI data came in lower than expected. The pound continues to hold strong against the dollar.

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GBP-USD: up at USD1.7017

EUR-USD: down at USD1.3576



GOLD: down at USD1312.54 per ounce

OIL (Brent): down at USD114.88 a barrel



(changes since end of previous GMT day)

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ECONOMICS AND GENERAL

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Britain's recovery has become entrenched and the Bank of England should start to raise interest rates in the coming months to reflect the stronger economy, Monetary Policy Committee member David Miles writes in The Daily Telegraph. David Miles, one of the nine members of the Bank's MPC that sets interest rates and one of its most dovish members, described the recovery as "resilient", ""firm" and "sustainable", and said it was increasingly likely he would vote to raise rates from a record low of 0.5% before leaving the committee next May.

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Eurozone economic growth slowed for a second month running in June, easing to the weakest since December, survey data from Markit Economics showed. The headline index covering output of both manufacturing and services fell to 52.8 from 53.5 in May. The score was above the neutral 50 mark, but below economists' forecast of 53.4

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Germany's private sector expanded at the slowest pace in eight months in June, flash survey data from Markit Economics revealed. The flash composite output index declined to 54.2 in June from 55.6 in May. Despite softening to the weakest in eight months, the pace of growth remained above the long-run series average. The services Purchasing Managers' Index dipped to 54.8 from 56 in May. The score was expected to drop moderately to 55.8. The manufacturing PMI, meanwhile, rose marginally to 52.4 from 52.3 in the preceding month. The expected reading was 52.5.

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Chinese manufacturing activity rebounded in June, flash estimates from a survey by Markit Economics and HSBC Bank showed. The HSBC flash China Manufacturing Purchasing Managers' Index rose to 50.8 in June from 49.4 in May, logging the highest reading in seven months. Economists had expected the index to come in at 49.7. According to the preliminary estimates, the manufacturing output index rose 2 points and rebounded to 51.8 in June, the highest in seven months.

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At least 57 people are killed in clashes between police forces and militants, who attacked a security convoy transporting prisoners in Iraq's Hilla city. The clashes, which took place 100 kilometres south of Baghdad, left 50 prisoners and seven militants dead and three police officers injured.

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Islamist-led insurgents have seized three towns in western Iraq, expanding their territorial gains in the restive area, Iraqi media reported. Fighters from the jihadist Islamic State in Iraq and the Levant (ISIL) took control of the towns of Ana and Rawa in the mostly Sunni western province of Anbar, independent Alsumaria TV reported online, citing an unnamed security official. The insurgents advanced into both towns after government forces abandoned their posts, according to the report.

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US Secretary of State John Kerry arrived in Baghdad for talks with Iraqi officials, after insurgents expanded their control in the western part of the country. Kerry will meet with several officials including Prime Minister Nuri al-Maliki and Parliament Speaker Usama al-Nujaifi, a Foreign Ministry official said. Kerry's unannounced visit comes after he visited Cairo and Jordan on Sunday.

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Israel's air force attacked nine targets in neighbouring Syria after the death of an Israeli teen on the Syrian border, a military spokesman said. The attacks came shortly after midnight (2100 GMT Sunday). Head of the opposition Syrian Observatory for Human Rights, Rami Abdel Rahman, said the strikes targeted the regime's artillery bases near the Syria-Israeli Golan Heights, without elaborating. Israeli tanks earlier also fired on the targets along the Golan Heights, which have been occupied by Israel since 1967. It was the first Israeli death in the region since the conflict began in Syria more than three years ago.

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An Egyptian court jails three Al Jazeera journalists for seven years for distorting the news and collaborating with the banned Muslim Brotherhood.

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Fighting and casualties were reported Saturday near the eastern separatist stronghold of Sloviansk and at border posts on the Russia-Ukraine border despite a government-declared ceasefire that began the previous night. Pro-Russian separatists in eastern Ukraine charged the government with not observing its unilaterally declared ceasefire. Shelling and airstrikes on Sloviansk continued, Alexander Borodai, prime minister of the self-proclaimed Donetsk People's Republic, told Russia's Interfax news agency. Russia's domestic spy agency, the FSB, which is responsible for border security, also said fighting continued Saturday without saying whether pro-Ukrainian forces had broken the ceasefire. Russian President Vladimir Putin welcomed the ceasefire declaration but said the Ukrainian government must use it not as an ultimatum to the separatists but as an opportunity to open a dialogue with them.

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British Prime Minister David Cameron will force fellow EU leaders to vote on who should lead the bloc's executive if they are unwilling to consider a candidate other than Jean-Claude Juncker. The move would mark a departure from the consensus-based approach to the appointment of the European Commission president and would further strain ties between London and the 28-member bloc. Cameron opposes Juncker, the centre-right former prime minister of Luxembourg, for his support of closer EU integration and has denounced the selection process for the head of commission as illegitimate.

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Source: Alliance News


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