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Today’s market overview

Equities have steadied in early trading this morning but the gains are minor and the sense of drift continues with eyes on the continued US shutdown, which The Trader Dominic Picarda assesses in detail in his weekly column.

IC TIP UPDATES:

Sell recommendation. William Hill (WMH) has announced another period of solid growth across most of its business but adverse results and quiet trading in July mean group operating profit reversed by 24 per cent in the 13 weeks to 1 October and is down 4 per cent year to date.

Carillion (CLLN) has announced two new contract wins, one worth £100 with Sussex County Council for energy saving initiatives and the other a £92 contract to build the Kempinski Wave Hotel in Muscat, Oman. The company also issued a trading update which was in line with expectations but contained news of a streamlining of the energy services business due to slower uptake of the Green Deal and a delay to the start of the Energy Company Obligation market, this will cost up to £40m this year. We keep our buy rating.

Development Securities (DSC) has signed an option to develop an office complex adjacent to Southwark tube station in London for which it is paying £8m over the next 18 months. Buy.

Bathrooms specialist Norcross (NXR) says revenues for the six months to 30 September are likely to be 9 per cent ahead of last year at £115m although reported revenues fell when the contribution from the Valdo acquisition is taken out. Profits are expected to be flat at £6m. Management expects this year to be more heavily weighted towards the second half. Buy.

Simon Thompson recommendation. Inland Homes (INL) has posted record annual results with revenues soaring from £6.1m to £31.1m and pre-tax profits more than trebling to £5.2m. The dividend is also increased fourfold to 0.27p. The group has benefited from the sale of 55 homes, compared with nine last year, and the sale of 375 plots against none last year.

KEY STORIES:

The Falklands oil scene has sparked back into life with the proposed combination of Falkland Oil & Gas (FOGL) and Desire Petroleum (DES) in which FOGL will acquire Desire in return for shares. At the same time FOGL has agreed a farm in deal with Rockhopper (RKH) and Premier Oil (PMO) for its PL004a and PL004c licences. The combined group will have funds of $170m and today’s activity means that a fully funded five well drilling campaign is now confirmed with two wells to be drilled in the South Falkland Basin and three in the North Falkland Basin.

Aviva (AV.) has completed the sale of its US operations for $2.6bn to Athene Holding, which will mean cash proceeds of $2.3bn to Aviva.

Ted Baker (TED) continues to trade strongly, posting 30.9 per cent growth in group revenues in the 28 weeks to 10 August and pre-tax profits 49.7 per cent higher at £11.6m. The group posted strong growth across all regions with Asia sales the standout, up by 78.6 per cent from a low base and online sales 51.6 per cent higher.

EasyJet (EZJ) has tightened its profit guidance towards the upper end of its previously indicated range at £470m-£480m for the full year after 3.3 per cent capacity growth and an increase in revenue per seat of more than 6 per cent.

OTHER COMPANY NEWS:

Healthcare specialist BTG (BTG) has increased its revenue guidance following the impact of recent acquisitions from £235m-£245m to £275m-£285m. The company also indicates that it is preparing for commercial launch in the US of its Varisolve varicose veins treatment in the first half of next year assuming it continues its progress through the regulatory process.

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