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Today’s market overview
Equities are on form again this morning as hopes crystalise that the US debt deal is going to be resolved, or at least kicked further down the road, before the nominal midnight Wednesday deadline. The Trader Dominic Picarda remains positive on the markets.
IC TIP UPDATES:
Rio Tinto (RIO) has turned in a strong operational performance in the third quarter of the year as its copper production was boosted by 23 per cent against the previous year due to volumes ramping up at Oyu Tolgoi in Mongolia and the Kennecot operations recovering strongly. New facilities in the Pilbara region of Western Australia also helped drive iron ore production to record levels. The company is also on track to reduce exploration and evaluation spending by $750m this year as it adjusts to a weaker pricing environment. We maintain our buy rating.
Telford Homes (TEF) continues to benefit from the booming conditions in London property, having sold 430 properties since 1 April. It has raised extra funds to expand its pipeline to capitalise on the exceptional conditions. The company has sold 100 per cent of its expected properties for the year to March 2014, pre-sold 70 per cent of the year to March 2015 and 55 per cent of the year to March 2016. Buy.
Ithaca Energy (IAE) reports production of 12,000 barrels of oil equivalent per day for the third quarter after being impacted by shutdowns during the quarter. The Cook field has recommenced production but the Causeway Area fields should come out of shutdown by mid-October, slightly later than expected. We keep our buy recommendation.
Asset tracking technology specialist Ubisense (UBI) has been appointed preferred supplier to a global original equipment manufacturer in the automotive space. Its systems will be installed at factories in the US to begin with as part of a ‘multi-million dollar’ deal spread over three years. Buy.
Royal Mail (RMG) shares have risen yet further on the commencement of unconditional trading this morning, hitting 488p a share.
Burberry (BRBY) chief executive Angela Ahrendts has announced her intention to quit in the middle of next year, to be replaced by existing chief creative officer Christopher Bailey. Meanwhile, a first half trading update showed a 14 per cent increase in total revenues to £1.03bn, driven primarily by a strong showing from the retail business, which grew sales by 17 per cent.
Hargreaves Lansdown (HL.) enjoyed a strong trading performance during the past three months, traditionally its quietest period of the year. Assets under management rose by £2.9bn to a new record of £39.3bn as active client numbers rose by 20,000.
Housebuilder Bellway (BWY) has posted predictably strong results with revenues up by 10.6 per cent and profits 33.8 per cent higher at £140.9m for the year to 31 July. The full year dividend is increased by 50 per cent to 30p a share and the outlook is promising with a forward order book of £644m, up from £438m last year.
Premier Oil (PMO) has sealed a farm-in deal for 55 per cent of Taipan Resources’ Block 2B in Kenya which could end up costing up to $14.275m.
OTHER COMPANY NEWS:
Shanks Group (SKS) has sold the majority of its UK solid waste business to Biffa as it looks to complete its exit from this area of business.
Translation software and intelligence and analytics specialist SDL (SDL) says trading in its third quarter was below expectations and will result in full year profits coming in around £8m, against £35.5m last year.
Pawnbroker H&T (HAT) says trading remains in line with expectations after the company refocused on retail sales in the wake of the slump in the gold price and gold trading opportunities.
- FTSE climbs on US debt hopes, Royal Mail soars, but Burberry and Severn Trent slide (theguardian.com)
- Goodbye humans, hello automation: Rio Tinto ditching $225k/year drivers in Pilbara (mining.com)
- VIDEO: Rio Tinto’s robot army (mining.com)
- Rio Tinto Third-Quarter Iron Ore Output Meets Analyst Estimates (bloomberg.com)
- 240k-a-year train drivers axed (smh.com.au)
- Rio Replacing Train Drivers Paid Like U.S. Surgeons (bloomberg.com)
- MP S.Ganbaatar requests investigation of Oyu Tolgoi project (ubpost.mongolnews.mn)
- European Stocks Climb Amid Optimism Over U.S. Debt Deal (bloomberg.com)
- Aust share market gains 1% on US hopes (skynews.com.au)
- Qld govt to hold on to coal royalties (skynews.com.au)