Markets Overview:

UK 100 called to open -30 points at 7230; This comes on the back of news that The U.S. president is expected to sign legislation passed by Congress supporting Hong Kong protesters, setting up a confrontation with China that could imperil the long-awaited trade deal. Although is this already priced in? The impact of this may have been the catalyst for yesterday’s sell off, could we see investors attempting to bottom pick stocks? The potential impact that this could have on the US-China trade deal saw the Nikkei close -101 points, and the Hang Seng also sold off, closing -448 points. During US sessions the Dow Jones pilled back from record highs to close the session -112 points, the S&P closed -11 points and the Nasdaq also lost ground, closing -44 points. Although crude pulled back from overnight highs, it still sits at $62.4 per barrel, $2 higher than yesterday, after EIA oil inventories came in, in line. Gold opens flat at $1417 per Troy ounce.

In corporate news this morning:

Centrica announced that their FY 2019 cash flow and earnings outlook are unchanged. Customer account holdings increased by 528,0000 in 10 months until Oct 19. Adjusted operating cash flow to be in the lower half of the targeted £1.8-2bn range, net debt to be within £3-3.5bn range. Capital investment of £800m and in-year efficiency savings of £300m. 

Countryside Properties announced that Ian Sutcliffe group Chief Executive is to retire from the group on 31st March 2020. He will be succeeded by Iain McPherson. Completions +33%; Adj Rev +16%; Adj Op Profit +11%; Earnings per share +13%; Dividend per share +51%.

Dart Group delivered results for H1 2019 this morning, a satisfactory first half of the financial year, Group operating profit increased by 3% to £365.0m (2018: £354.4m) and Group profit before foreign exchange revaluation and taxation  increased by 3% to £349.8m (2018: £340.2m). Revvenue +16%; Operating profit +3%; Pre tax profit +2%; Earnings per share +2%; Interim dividend per share +7%.

Johnson Matthey delivered good sales growth and confident in delivering our strategy.  Revenue +37%; Operating profit -2%; Profit before tax -8%; Earnings per share -13%; Interim dividend per share +5%

Mitie’s half year results showed revenue from continuing operations +11%; Operating profit +5%; Secure order book +1%; Average daily net debt -54.1m vs Half 1 18/19; Interim dividend maintained at 1.33p in line with policy.

Severn Trent announced half year results.  A strong first half, laying solid foundations for Asset management period.  Group turnover +3.2%; Underlying profit -4.3%; Underlying EPS -9.7%; Interim dividend declared +7.2%.

Royal Mail Group announce that their 1H profitability performance is inline with expectations. Group revenue +5.1% including their best UK revenue performance in 5 years. They expect to deliver adjusted operating profit of £300-400m in FY 2019-20, in line with guidance. 

William Hill posts higher revenue, boosted by an aggressive push in the US and more demand for online gambling. The company reiterated its full-year expectations and posted a 60% jump in revenue in the US. The company also expects international business to benefit from many product improvements that will be delivered over the coming quarters.

Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

Upgrades/Downgrades:

Aviva Downgraded to Hold by Deutsche Bank (Bloomberg: 15 buys/ 9 holds/ 0 sells)

Hays Downgraded to Hold by HSBC (Bloomberg: 3 buys/ 11 holds/ 0 sells)

Weir Group upgraded to buy by Morningstar (Bloomberg: 12 buys/ 9 holds/ 1 Sell)

In Focus Today:

Peoples Bank Of China Interest Rate Decision

UK inflation report

US FOMC Minutes

Companies reporting today:

Investec, Johnson Matthey, Mitie, Severn Trent, Close Brothers, Centrica

Companies reporting Next Week:

Cranswick, De la Rue, Pets at home, Pennon Group, Compass Group, Shaftesbury, Topps Tiles, UDG Healthcare, Intertek Group, Brewer Dophin, Britvic, Grainger, Marstons, Amigo Holdings, Greene King, Virgin Money, Go-Ahead.

(Full list available on Week in advance)

Today's Ex-Dividends:

Imperial Brands - 4.1%

Carnival - 1.2%

DCC - 0.7%

Tate & Lyle - 1.2%

(Full list available on Week in advance)

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