Global Markets React to Middle East Tensions: Oil Giants Rise, Tech Stocks Falter

Share gains cut following new missile attack on Israel, oil giants rise By Proactive Investors

Markets slip after more missiles fired into Israel In the past few minutes the FTSE 100 has given up almost all its early gains, with the FTSE 250 also diving further into the red. The London blue-chip gauge is up just under 11 points at 8,287, having been up over 40 earlier, while the mid-cap index has dropped 77 points. This follows Hezbollah saying it targeted areas north of Israeli city Haifa with a large missile salvo, while Iran's president said if any further "mistakes" are committed by Israel they will "receive a stronger and more destructive response". The Iranian leader also warned that if America and European countries "leave the region, wars will end and the countries of the region will be able to live in peace" There's not been much big economic data apart from European unemployment, which remained at 6.4% as expected. Elsewhere, Iceland's central bank unexpectedly cut rates by 25 basis points, container shipping giant Maersk said it continued to serve its customers in Lebanon with two weekly callings in Beirut, and Citibank's economic surprise index for the US continues to drift higher. UBS suggests strategies to reduce the impact of market swings UBS is another investment bank to state this it believes the Middle East conflict poses risks of market volatility but its 'base case' is to expect is that the conflict stops short of an all-out war between Israel and Iran, and their allies. "We also assume that energy flows from the Middle East will continue without sustained interruptions. "Meanwhile, we believe the outlook for equities will be supported by a soft economic landing in the US, combined with Fed rate cuts, strong earnings, and optimism over the commercialization of artificial intelligence. "At the same, we do think investors should consider strategies to reduce the impact of market swings on their portfolios." Gold is noted as continuing to have appeal as a hedge against geopolitical risks and potential US political shifts following the election. Gold should also benefit from further Fed rate cuts, robust central bank demand, and rising investor appetite via exchange traded funds, UBS said, with the Swiss bank expecting gold to reach $2,750 an ounce by the end of the year and $2,900 by the final quarter of 2025, up from just over $2,650 now. Celadon Pharmaceuticals PLC (LON:CEL) has jumped 12% on the back of saying it has signed a new five-year sales contract with "a newly established healthcare company for the supply of its medicinal cannabis product from its UK facility", with a minimum order of up to £10.5 million. Among the fallers, One Heritage Group PLC (LON:OHG) dropped 25% after announcing a major restructuring and strategic pivot, including rebranding to Zentra Group and a shift away from in-house construction and co-living services due to rising costs and market challenges. Technology Minerals (LON:TM1) has slid 19% after saying a fire broke out at its 48.35% owned battery recycling business, Recyclus Group's LiBatt plant in Wolverhampton. The fire was separate from the recycling plant and was quickly contained, it says, with the plant building unaffected and expected to reopen today Inspiration Healthcare Group PLC (LON:IHC) is down 12% after its interim results reflected a challenging period with "encouraging signs of recovery" from its neonatal business, plus a warning that the sales mix in the second half will continue to hit gross margins and therefore full-year earnings expectations. Wynnstay Group PLC fell 9.4% as the agricultural supplies group warned that "more challenging conditions" had been experienced in seasonally important months, meaning results for the financial year will be materially lower than last year and current market expectations. Topps Tiles PLC (LON:TPT) saw 2.2% chipped off its share price as it reported a 5.7% fall in sales, as persistently weak demand in the repair, maintenance and improvement sector set the stage for "very challenging" trading conditions. JD numbers 'solid' Shares in JD Sports are down 3.1% after reporting first half results. Analysts at Panmure Liberum felt the numbers were "solid", with flat profits and flat adjusted operating margins, "despite slower like-for-likes and continued investments in its supply chain, people and IT as it corrects past underinvestment". In trading too, they say it is "worth acknowledging" the 3.3% LfL growth in North America despite its biggest brand partner Nike (NYSE:NKE) reporting double digit declines. While guidance range for full year adjusted PBT has been maintained, currency headwinds are greater than previously expected at £25 million versus £15 million previously, which implies a 1% cut to underlying consensus expectations. 'Little impact' unless Middle East conflict widens The financial market impact of the Iranian missile attack on Israel should "remain limited", JP Morgan said, as long as it does not broaden to include countries like Saudi Arabia or UAE directly, other countries outside the region, nor blocks the Straits of Hormuz. Iran's missiles plus the incursion of Israeli troops into Lebanon "indicate to us a greater risk of a wider regional conflict than any point we have seen since the 7 October attacks by Hamas", strategists at the investment bank say in a note written last night. "MENA stock markets, oil and more generally global equities have been little impacted by the growing conflict in Israel and its neighbors, even the April missile attacks by Iran on Israel had little lasting market impact." Looking at data from the previous spikes in geopolitical risk around the 7 October attacks and the 14 April bombing of Israel by Iran, the JP Morgan team noted a small impact each time. Wizz and easyJet down, China funds up Wizz Air Holdings PLC (LON:WIZZ) shares are flying lower after the airline reported emptier planes over the course of September, while its shares have also been hit by wider concerns about the impact of the Middle East fighting and other geopolitical tensions. Passenger numbers ticked up 3.9% to 5.76 million during the month, but load factors fell by 0.7% to 91.7% as flights were more empty. Risers among the mid caps are led by Fidelity China Special Situations (LON:FCSS), one of several China-aimed stocks on the front foot as they extend gains from the past week. Schroder Oriental Income Fund Ltd and Schroder AsiaPacific Fund PLC are also near the top of the 250 leaderboard. The FTSE 100 is maintaining its early level, up 30 points at 8,307, a gain of 0.4%. The FTSE 100 has opened higher as it rolls with the punches of Middle Eastern geopolitics, rising 31 points to 8,308 in the opening minutes of trading. AO World PLC (LON:AO) has agreed a £10 million cash takeover of AIM-listed musicMagpie PLC, which and resells second hand CDs, games and electronics. The offer is priced at 9.07p per share, representing a premium of 58% to yesterday's closing price of 5.75p, which has been the average level for the past month. Directors of musicMagpie, with advice from Shore Capital, consider the terms fair and reasonable and said they intend to unanimously recommend the deal to shareholders.

Stocks go red but FTSE 100 up on oil exposure

(Alliance News) - Stock prices in London were predominantly lower at midday on Wednesday, though the FTSE 100 continued in the green, thanks to its exposure to the oil and defence sectors. The FTSE 100 index was up 6.31 points, or 0.1%, at 8,282.58. The FTSE 250 was down 147.04 points, or 0.7%, at 20,767.66, and the AIM All-Share was down 2.58 points, or 0.4%, at 734.22. The Cboe UK 100 was up slightly at 828.88, the Cboe UK 250 was down 1.0% at 18,234.25, and the Cboe Small Companies was up 0.1% at 16,809.54. "The FTSE 100's large exposure to the oil and defence sectors meant the index moved higher in response to increased tensions in the Middle East," said AJ Bell's Russ Mould. "Brent Crude oil prices jumped 2.2% to USD75.19 per barrel as traders worried about potential disruptions to supply from the region. That pushed up shares in BP and Shell...It's times like these that investors also gravitate towards supposed safe-haven assets, namely companies that might be in demand in both good and bad times. That explains why drugs group AstraZeneca and British Gas owner Centrica were in demand." AstraZeneca was up 0.8% in London at midday, while Centrica gained 0.5%. BP and Shell were both up 2.6%. In European equities on Wednesday, the CAC 40 in Paris was up 0.1%, while the DAX 40 in Frankfurt was down 0.4%. The eurozone unemployment rate was stable in August, according to official data on Wednesday. The jobless rate remained at 6.4% in August on a seasonally adjusted basis, unchanged from July, Eurostat said. The reading was in line with market consensus, as cited by FXStreet. August's reading was lower than 6.6% a year before. Across the single-currency bloc, Eurostat estimates 10.925 million people were unemployed in August. This was a 94,000 decrease from July, and a 233,000 drop from the year before. The pound was quoted at USD1.3279 at midday on Wednesday in London, up compared to USD1.3276 at the equities close on Tuesday. The euro stood at USD1.1070, up against USD1.1064. Against the yen, the dollar was trading at JPY144.69, up compared to JPY143.87. The retailer reported pretax profit for the half ended June 30 of GBP126.3 million, down from GBP353.7 million a year prior. Adjusted pretax profit however grew to GBP405.6 million from GBP397.8 million. JD Sports said its adjusting items, which are what it deems to be one-off costs, include spending related to its acquisition of US rival sportswear brand Hibbett earlier this year, costs related to the closure of a distribution centre in Derby and an updated Genesis put and call option valuation. Revenue rose to GBP5.03 billion from GBP4.78 billion the year before, and JD Sports declared a dividend per share of 0.33 pence, up from 0.30p. Additionally, the firm reiterated its previous pretax profit and adjusting items guidance range of GBP955 million to GBP1.04 billion. Chief Executive Officer Regis Schultz said : "Our acquisition of Hibbett, Inc, which completed just before the period end, is a key milestone in our international development and advances the global nature of the group through our strengthened position in the US. I remain confident in the delivery of our exciting growth plans for North America and that the group is well positioned to continue growing share in the world's largest sportswear market." AO World and musicMagpie have agreed the terms of a recommended cash acquisition of the entire issued and to be issued share capital of musicMagpie by AO Ltd. According to the terms of the acquisition, each musicMagpie shareholder will be entitled to receive 9.07 pence per share in cash for each musicMagpie share. The buy values musicMagpie at just under GBP10.0 million. musicMagpie directors recommend the acquisition, and are to support it with 12.3% shareholdings, while AO World's offer respectively has support from other investors for 54% in total. Shares in musicMagpie were up 49% following the news. Elsewhere, GenIP, a technology business operating within the generative artificial intelligence space, announced the admission of its entire issued share capital to trading on AIM at 0800 BST Wednesday under the ticker 'GNIP'. The news follows a placing by Novum Securities, as well as a company subscription, for a combined total of 4.5 million ordinary shares at 39p per ordinary share, raising gross proceeds of GBP1.8 million. GenIP lost 26% around midday, trading at 29p each. Tekcapital, which holds a 63% stake in the company, fell 12%. For the six months ended July 31, the London-based investment vehicle reported a pretax loss of GBP677,049, narrowed from GBP1.2 million a year prior. However, directors are currently considering a variety of funding options to balance the immediate cash flow needs of the business, and to accelerate the project development timeframe. As successful execution of these fundraising options cannot be assured, the firm said there is a a "material uncertainty exists" which may cast significant doubt on the ability of the group continue as a going concern. Directors nevertheless "have a reasonable expectation" that the company will continue in operational existence for the next 12 months. Stocks in New York were called lower. The Dow Jones Industrial Average was called 0.3% lower, the S&P 500 index 0.2% lower, and the Nasdaq Composite 0.1% lower. US vice presidential contenders JD Vance and Tim Walz faced off in a surprisingly civil debate Tuesday, despite tense moments on the hot topics of migration, abortion and the threat of war in the Middle East, reported AFP. Republican Vance and Democrat Walz dug into policy and avoided the bitter personal attacks that presidential candidates Donald Trump and Kamala Harris exchanged during an often heated clash in September. But the shadow of their bosses hung over the CBS debate, with Walz attacking Trump as a threat to democracy and unfit to lead America on the world stage, and Vance slamming Harris's record on the economy and illegal migration as part of President Joe Biden's administration. A key moment came near the end, when Vance refused to say whether he backed Trump's false claims to have won the 2020 election against Biden. Minnesota Governor Walz accused him of a "damning non-answer" and blasted Trump over the January 6, 2021 attacks on the US Capitol by pro-Trump supporters. There was also a fiery moment when Vance, who mostly restrained his persona as Trump's attack dog, had his microphone briefly muted when the moderators tried to factcheck him on migration. After the debate, Trump cancelled a television interview on the US channel CBS, the programme "60 Minutes". Trump's campaign spokesman Steven Cheung denied that the former president had agreed to participate in the interview, writing on X that "there were initial discussions, but nothing was ever scheduled or locked in." The programme said the Democratic candidate Kamala Harris will appear as planned in Monday's broadcast and that the original invitation to Trump stands. Brent oil was quoted at USD75.79 a barrel at midday in London on Wednesday, up from USD74.51 late Tuesday. President Joe Biden said that the US was "fully supportive" of Israel after Iran's ballistic missile attacks, describing Tehran's assault as "defeated and ineffective". "The attack appears to have been defeated and ineffective, and this is a testament to Israeli military capability and the US military," Biden told reporters at the White House. "Make no mistake, the US is fully, fully, fully supportive of Israel." Asked by reporters what the response towards Iran would be, Biden replied: "That's in active discussion right now. That remains to be seen." According to Swissquote Bank's Ipek Ozkardeskaya said: "The first months of the war pushed oil prices higher, yet the conflict had little sustainable impact beyond April, when traders started giving more weight to the slowing Chinese and world economy than the supply disruptions - considering that the world was fed enough oil from the Middle East and elsewhere to worry about the Middle East disruptions. But if Iran - which produces around 3 million barrels per day - gets seriously involved in the conflict, we could see the price of a barrel remain under positive pressure for a prolonged period." "This being said, the geopolitical tensions have a limited impact in the medium to long run price trends, and the gains on the back of tensions should be given back with de-escalation and/or as the market gets used to the headlines and divert focus to something else." Still to come on Wednesday's economic calendar, there is unemployment and EIA crude oil stocks data from the US. By Holly Beveridge, Alliance News senior reporter Comments and questions to [email protected] Copyright 2024 Alliance News Ltd. All Rights Reserved.

Stocks green but caution prevails on Middle East

(Alliance News) - The FTSE 100 in London opened higher on Wednesday, while the FTSE 250 gave back some ground, as the market braced to see what the repercussions of further conflict in the Middle East might be. The FTSE 100 index opened up 28.91 points, or 0.3%, at 8,305.56. The FTSE 250 was down just 0.13 points at 20,914.57, and the AIM All-Share was up 0.60 points, or 0.1%, at 737.40. The Cboe UK 100 was up 0.4% at 831.60, the Cboe UK 250 was down 0.2% at 18,378.91, and the Cboe Small Companies was up slightly at 16,799.65. In European equities on Wednesday, the CAC 40 in Paris was up 0.3%, while the DAX 40 in Frankfurt was down slightly. The pound was quoted at USD1.3293 early on Wednesday in London, up compared to USD1.3276 at the equities close on Tuesday. The euro stood at USD1.1068, up against USD1.1064. Against the yen, the dollar was trading at JPY144.07, up compared to JPY143.87. The retailer reported pretax profit for the half ended June 30 of GBP126.3 million, down from GBP353.7 million a year prior. Adjusted pretax profit however grew to GBP405.6 million from GBP397.8 million. JD Sports said its adjusting items, which are what it deems to be one-off costs, include spending related to its acquisition of US rival sportswear brand Hibbett earlier this year, costs related to the closure of a distribution centre in Derby and an updated Genesis put and call option valuation. Revenue rose to GBP5.03 billion from GBP4.78 billion the year before, and JD Sports declared a dividend per share of 0.33 pence, up from 0.30p. Additionally, the firm reiterated its previous pretax profit and adjusting items guidance range of GBP955 million to GBP1.04 billion. Chief Executive Officer Regis Schultz said : "Our acquisition of Hibbett, Inc, which completed just before the period end, is a key milestone in our international development and advances the global nature of the group through our strengthened position in the US. I remain confident in the delivery of our exciting growth plans for North America and that the group is well positioned to continue growing share in the world's largest sportswear market." AO World and musicMagpie have agreed the terms of a recommended cash acquisition of the entire issued and to be issued share capital of musicMagpie by AO Ltd. According to the terms of the acquisition, each musicMagpie shareholder will be entitled to receive 9.07 pence per share in cash for each musicMagpie share. The buy values musicMagpie at just under GBP10.0 million. musicMagpie directors recommend the acquisition, and are to support it with 12.3% shareholdings, while AO World's offer respectively has support from other investors for 54% in total. Shares in musicMagpie were up 48% following the news. Elsewhere, GenIP, a technology business operating within the generative artificial intelligence space, announced the admission of its entire issued share capital to trading on AIM at 0800 BST Wednesday under the ticker 'GNIP'. The news follows a placing by Novum Securities, as well as a company subscription, for a combined total of 4.5 million ordinary shares at 39p per ordinary share, raising gross proceeds of GBP1.8 million. In Asia on Wednesday, the Nikkei 225 index in Tokyo was down 2.2%. The Hang Seng index in Hong Kong was up 5.6%. The S&P/ASX 200 in Sydney closed down 0.1%. In the US on Tuesday, Wall Street ended lower, with the Dow Jones Industrial Average down 0.4%, the S&P 500 down 0.9% and the Nasdaq Composite down 1.5%. US vice presidential contenders JD Vance and Tim Walz faced off in a surprisingly civil debate Tuesday, despite tense moments on the hot topics of migration, abortion and the threat of war in the Middle East, reported AFP. Republican Vance and Democrat Walz dug into policy and avoided the bitter personal attacks that presidential candidates Donald Trump and Kamala Harris exchanged during an often heated clash in September. But the shadow of their bosses hung over the CBS debate, with Walz attacking Trump as a threat to democracy and unfit to lead America on the world stage, and Vance slamming Harris's record on the economy and illegal migration as part of President Joe Biden's administration. A key moment came near the end, when Vance refused to say whether he backed Trump's false claims to have won the 2020 election against Biden. Minnesota Governor Walz accused him of a "damning non-answer" and blasted Trump over the January 6, 2021 attacks on the US Capitol by pro-Trump supporters. There was also a fiery moment when Vance, who mostly restrained his persona as Trump's attack dog, had his microphone briefly muted when the moderators tried to factcheck him on migration. Brent oil was quoted at USD75.08 a barrel early in London on Wednesday, up from USD74.51 late Tuesday. President Joe Biden said that the US was "fully supportive" of Israel after Iran's ballistic missile attacks, describing Tehran's assault as "defeated and ineffective". "The attack appears to have been defeated and ineffective, and this is a testament to Israeli military capability and the US military," Biden told reporters at the White House. "Make no mistake, the US is fully, fully, fully supportive of Israel." Asked by reporters what the response towards Iran would be, Biden replied: "That's in active discussion right now. That remains to be seen." According to Swissquote Bank's Ipek Ozkardeskaya said: "The first months of the war pushed oil prices higher, yet the conflict had little sustainable impact beyond April, when traders started giving more weight to the slowing Chinese and world economy than the supply disruptions - considering that the world was fed enough oil from the Middle East and elsewhere to worry about the Middle East disruptions. But if Iran - which produces around 3 million barrels per day - gets seriously involved in the conflict, we could see the price of a barrel remain under positive pressure for a prolonged period." "This being said, the geopolitical tensions have a limited impact in the medium to long run price trends, and the gains on the back of tensions should be given back with de-escalation and/or as the market gets used to the headlines and divert focus to something else." Still to come on Wednesday's economic calendar, there are a number of speeches from European Central Bank members, followed by unemployment and EIA crude oil stocks data from the US. By Holly Beveridge, Alliance News senior reporter Comments and questions to [email protected] Copyright 2024 Alliance News Ltd. All Rights Reserved.

Stocks green as market reacts to Middle East turmoil

(Alliance News) - Stocks were higher in London on Wednesday morning, as the market processed Iran attacks on Israel, and ahead of a number of speeches from European Central Bank members later in the day. In early corporate news, JD Sports Fashion remained confident in its strategy, as the firm upped its interim dividend amid growth in adjusted pretax profit. Here is what you need to know at the London market open: China National Day. Financial markets in Shanghai closed. Hong Kong open. 09:30 CEST eurozone European Central Bank Vice President Luis de Guindos speaks 11:30 CEST eurozone European Central Bank Governor Philip Lane speaks 11:00 CEST eurozone unemployment 13:00 CEST eurozone European Central Bank executive board member Frank Elderson speaks 18:45 CEST eurozone European Central Bank executive board member Isabel Schnabel speaks President Joe Biden said that the US was "fully supportive" of Israel after Iran's ballistic missile attacks, describing Tehran's assault as "defeated and ineffective". "The attack appears to have been defeated and ineffective, and this is a testament to Israeli military capability and the US military," Biden told reporters at the White House. "Make no mistake, the US is fully, fully, fully supportive of Israel." Asked by reporters what the response towards Iran would be, Biden replied: "That's in active discussion right now. That remains to be seen." Biden said his team had been in contact throughout the attacks with Netanyahu's and that he would be speaking to the Israeli prime minister himself. "I'll be talking to him and my message will depend on what we finally conclude is needed," he said. Vice President Kamala Harris meanwhile has said the US will take "whatever action is necessary" to protect its interests against Iran. "I am clear-eyed: Iran is a destabilising, dangerous force in the Middle East and today's attack on Israel only further demonstrates that fact," she said. Oil prices surged on Tuesday following the missile attack, rising by up to 5% to USD75.40 per barrel, but are currently about the same as at the London close. ---------- US vice presidential contenders JD Vance and Tim Walz faced off in a surprisingly civil debate Tuesday, despite tense moments on the hot topics of migration, abortion and the threat of war in the Middle East. Republican Vance and Democrat Walz dug into policy and avoided the bitter personal attacks that presidential candidates Donald Trump and Kamala Harris exchanged during an often heated clash in September. But the shadow of their bosses hung over the CBS debate, with Walz attacking Trump as a threat to democracy and unfit to lead America on the world stage, and Vance slamming Harris's record on the economy and illegal migration as part of President Joe Biden's administration. A key moment came near the end, when Vance refused to say whether he backed Trump's false claims to have won the 2020 election against Biden. Minnesota governor Walz accused him of a "damning non-answer" and blasted Trump over the January 6, 2021 attacks on the US Capitol by pro-Trump supporters. There was also a fiery moment when Vance had his microphone briefly muted when the moderators tried to fact-check him on migration. ---------- UK Prime Minister Keir Starmer heads to Brussels on Wednesday for the first time as prime minister, looking to build on a promised "reset" of relations with the EU that were strained by Brexit. Starmer will hold his first formal meeting with European Commission President Ursula von der Leyen since his Labour party ousted the Conservatives from power in a general election in July. It is a further sign of new British goodwill towards European neighbours following the UK's rancorous 2020 departure from the bloc under Brexit champion Boris Johnson. But Starmer is also under pressure to be more precise about what exactly he wants for Britain from the EU - and what he is willing to give in return. Downing Street said Starmer will use the Brussels trip to discuss "his ambitions for the next few months" with von der Leyen and other EU leaders. Ahead of the visit, he said he was "so determined to put the Brexit years behind us and establish a more pragmatic and mature relationship" with the EU. Berenberg raises Rio Tinto to 'buy' (hold) - price target 6,200 (5,600) pence JD Sports Fashion reports pretax profit for the half ended June 30 of GBP126.3 million, down from GBP353.7 million a year prior. Adjusted pretax profit however grows to GBP405.6 million from GBP397.8 million. Revenue rises to GBP5.03 billion from GBP4.78 billion the year before. Declares a dividend per share of 0.33 pence, up from 0.30p. Additionally, reiterates its previous pretax profit and adjusting items guidance range of GBP955 million to GBP1.04 billion. Chief Executive Officer Regis Schultz says: "Our acquisition of Hibbett, Inc, which completed just before the period end, is a key milestone in our international development and advances the global nature of the Group through our strengthened position in the US. I remain confident in the delivery of our exciting growth plans for North America and that the group is well positioned to continue growing share in the world's largest sportswear market." AO World and musicMagpie confirm that they have agreed the terms of a recommended cash acquisition of the entire issued and to be issued share capital of musicMagpie by AO Ltd. According to the terms of the acquisition, each musicMagpie shareholder will be entitled to receive 9.07 pence per share in cash for each musicMagpie share. The buy values musicMagpie at just under GBP10.0 million. musicMagpie directors recommend the acquisition, and are to support it with 12.3% shareholdings, while AO World's offer respectively has support from other investors for 54% in total. AO World says musicMagpie has a "highly complementary business model" to its own. GenIP, a technology business operating within the generative artificial intelligence space, announces the admission of its entire issued share capital to trading on AIM, a market operated by London Stock Exchange, at 0800 BST Wednesday under the ticker 'GNIP'. Follows a placing by Novum Securities, as well as a company subscription, for a combined total of 4.5 million ordinary shares at 39p per ordinary share, raising gross proceeds of GBP1.8 million. ---------- By Holly Beveridge, Alliance News senior reporter Comments and questions to [email protected] Copyright 2024 Alliance News Ltd. All Rights Reserved.