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Today’s market overview

Markets have opened up flat after yesterday’s sell off as investors consider the implications of the shutdown of government agencies in the US due to the political stand-off over the budget. But The Trader Dominic Picarda is unconcerned about this development, seeing as it has happened many times before, and thinks equities will get over it in time.

IC TIP UPDATES:

Oil explorer Parkmead Group (PMG) says that its Pharos exploration well in the UK Southern North Sea has commenced drilling. The prospect is adjacent to Parkmead’s Platypus field and could hold up to 500bn cubic feet of gas. We keep our buy rating.

Construction and support services specialist Renew Holdings (RNWH) reports that trading in the second half of its year to end-September continued to be encouraging across all areas of its business. We maintain our buy recommendation.

Avingtrans (AVG) announces that its Sigma Precision Components business has signed a 10 year agreement with Rolls Royce (RR.) worth £55m to supply self-locking nuts. This is the second such long term contract with Rolls Royce that Avingtrans has announced within the past year. Buy.

Juridica Investment (JIL) has updated investors on its Antitrust portfolio, which has a carrying value of $139m. The company, which invests in legal cases primarily in the US, says two of its price-fixing cartel cases will come to court next year and a third could also be heard in 2014, furthermore a monopoly case will also be heard next year but another monopoly case has been dismissed on appeal although there could be more appeals. Management believes that the next 18 months could see the investments in this portfolio begin to bear fruit. We keep our buy rating.

KEY STORIES:

Builders merchants Wolseley (WOS) continues to enjoy a decent turnaround in performance with like for like revenues in its ongoing businesses up 2.9 per cent in the year to 31 July and trading profits rising from £655m to £725m. The ordinary dividend is raised by 10 per cent to 66p and the company is also proposing a special dividend to return £300m to investors before the end of the year.

Stockbroker Charles Stanley (CAY) says results for the six months to September should be in line with expectations after a strong opening quarter to the year was followed by a more muted second quarter as trading calmed down over the traditionally quieter summer months.

Home shopping specialist Findel (FDL) reported a 5.2 per cent improvement in group sales in the first half of its financial year, driven primarily by its Express Gifts and Education Supplies businesses with the Kleeneze and Kitbag businesses both posted negative growth.

St Modwen Properties (SMP) says the recovering sentiment in the regional property markets alongside government support and improving consumer confidence bode well for its business.

Walker Greenbank’s (WGB) half year results confirmed further solid progress for the supplier of luxury interior furnishing with overall sales up from £38.3m to £39.1m and adjusted profits up 13 per cent to £3.06m. Licensing income rose by 26 per cent and manufacturing produced a record performance with sales up 4 per cent to £15.9m.

OTHER COMPANY NEWS:

Pure Wafer (PUR) has enjoyed a strong second half performance which helped produce a full year pre-tax profit of $3m, compared with a loss of $700,000 last year. Wafer sales rose by 21 per cent compared with last year with a strong sequential performance from the first half to the second reported. The group ended the year with net debt of $1.6m, down 87 per cent from last year.

Ceres Power (CWR) reported full year results with revenues down from £18.1m to £10.1m. The company has reduced operating costs by 44 per cent to £10.2m and had net cash of £15.4m at the end of June.

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