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FTSE 100 Closes Up at 20-Month High as Pound Slips

11/11/2021 | 12:02pm EST

The FTSE 100 closed up 0.6% on Thursday reaching a fresh 20-month high, leading European stocks higher with Auto Trader Group PLC at the top of the pile. U.K. investors have the Bank of England to thank, with last week's decision to push back a rate rise helping to drive the pound lower and stocks higher, IG Group PLC senior market analyst Joshua Mahony says. The international composition of the FTSE 100 provides a strong inverse correlation with the pound as foreign earnings increase in value, Mr. Mahony says. "The latest U.K. growth data has done little to help the pound at a time of weakness, with third-quarter growth coming in below estimates at 1.3%," he notes.

 
Companies News: 

FRP Advisory Says 1H Performance Was Strong, Revenue Expected to Rise

FRP Advisory Group PLC said Thursday that its performance was strong in the first half of fiscal 2022, with revenue and underlying adjusted Ebitda continuing to rise.

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Burberry Shares Fall on Lower Tourism Flows Despite 1H Profit, Revenue Growth -- Update

Shares in Burberry Group PLC fell Thursday after the company said performance dipped in China in August and in the EMEA region during the first half of fiscal 2022 due to significantly lower tourism flows.

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Bank of Georgia's 3Q Pretax Profit Rose

Bank of Georgia Group PLC reported on Thursday a rise in pretax profit for the third quarter of 2021, and said both its corporate and investment banking businesses delivered a strong quarterly performance in the period.

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Tremor International 3Q Pretax Profit Soars on Higher Revenue

Tremor International Ltd. on Thursday reported a sharp rise in pretax profit for the third quarter of the year on revenue that was boosted by a strong performance in connected TV services.

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Restore 10-Month Performance Was in Line With Views on Higher Revenue

Restore PLC said Thursday that its performance over the 10 months ended Oct. 31 has been in line with expectations as the company benefited from increased revenue ahead of pre-Covid levels.

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Beximco Pharmaceuticals 1Q Pretax Profit Rose

Beximco Pharmaceuticals Ltd. reported on Thursday a rise in pretax profit for the first quarter of fiscal 2022.

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Johnson Matthey Shares Fall as Profit Seen Toward Lower End of Consensus, Seeks to Exit Battery Materials -- 2nd Update

Shares in Johnson Matthey PLC fell Thursday after the company said full-year earnings will be toward the lower end of expectations and announced that it intends to sell its battery-materials business as it doesn't expect it to generate enough returns.

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Vatican Nears Sale of London Building Ensnared in Corruption Scandal

The Vatican is close to a deal with two private-equity firms to sell a London commercial building at the center of one of the major scandals of Pope Francis' reign.

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Polar Capital Holdings to Name Finance Director to Executive Board

Polar Capital Holdings PLC said Thursday that Group Finance Director Samir Ayub will join the executive board on Nov. 17.

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AstraZeneca Earnings Expected to Climb; Alexion, Covid Vaccine Revenue in Focus -- Earnings Preview

AstraZeneca PLC is scheduled to report results for the third quarter on Nov. 12. Here's what you need to know:

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Firering Raises GBP4 Mln in London IPO to Search for Lithium in Ivory Coast

Firering Strategic Minerals PLC has secured a 4.0 million-pound ($5.4 million) equity raise for its initial public offering on the AIM on Friday.

 
Market Talk: 

Auto Trader's Update on a Difficult Trading Period Was Needed

1332 GMT - Auto Trader's record 1H provided a much-needed update on its performance during a difficult trading period, Shore Capital says. The car-listing publisher reported strong trading during a period in which external dynamics such as supply chain issues in the new car market and very strong demand for used vehicles have been a feature, Shore says. The company's operational developments include an increased focus on online retailing, introducing a new higher level advertising package, as well as good penetration of premium retailer packages, the U.K. investment group says. "We continue to regard Auto Trader as a very well-managed company with a strong business model and an excellent competitive position and forecast a very attractive financial performance going forward," Shore says.

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Mediclinic's Strong Shares May Have Priced In 1H Cheer

1217 GMT - Shares in Mediclinic International fall 0.6% after the private-hospital operator reported higher first-half pretax profit and revenue and raised its full-year revenue guidance. "We expect a neutral to positive reaction today," UBS analyst Thando Skosana says. "On one hand, the guidance raise is likely to lift consensus earnings per share by 3-5% while the commentary around continued reductions in Covid patient levels and the return to more normalized activities should be well received. On the other hand, the shares have been strong since last month's update, so some of this positive news was likely priced in."

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Selloff in Long-Dated UK Debt, Sterling IG Credit Likely, Says Mizuho

1216 GMT - Less accommodative monetary policy in the U.K. is still not being priced in to longer-dated debt and sterling-denominated investment-grade corporate bonds, creating a trade opportunity to gain from a potential repricing, says Mizuho. "The structurally tighter monetary policy that the BOE is shifting to is still not being priced into longer-term rates and GDP investment-grade credit," analysts at the Japanese bank say. They expect this repricing to come sooner or later and cause dispersion and spread-widening in sterling in investment-grade credit. "A good way to benefit from the higher sterling term and credit-risk premia is via a short SLXX [iShares Core Corp Bond UCITS Exchanged-Traded Fund GBP] vs long IGLS ETF [iShares UK Gilts 0-5yr UCITS ETF]," they say.

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Auto Trader Results Show Business Model's Resilience

1131 GMT - Car-listing publisher Auto Trader performed better than expected in the 1H despite headwinds from the market's supply issues, Peel Hunt says. Because of its volume-base model there was uncertainty around its performance despite car deals prospering in the current car market, the U.K. brokerage says. Still, the company's results show not only how resilient its model is but just what an important partner to dealers the company is, it says. "Together with the potential of the new product development to aid dealers in the digital car buying journey, the road ahead looks good for Auto Trader," the brokerage says. Peel Hunt rates the stock buy and has a 715 pence target price. Shares are up 11% at 687 pence.

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Burberry 1H Profit Tops Hopes, But 2Q Sales Fall Short

1131 GMT - Shares in Burberry Group are among the biggest FTSE 100 fallers, down 5% after the luxury-goods retailer reported worse-than-expected second-quarter sales. The 6% rise in 2Q retail like-for-like sales was slightly below market expectations of 9%, though adjusted operating profit of GBP196 million in the 26 weeks to Sept. 25 was 8% ahead of consensus, RBC Capital Markets says. Citigroup described the results as mixed, with slowing Chinese like-for-like sales and lack of earnings per share momentum overshadowing better-than-expected cashflow and pretax earnings before interest. Citi says it expects consensus 2021/22 adjusted EBIT of GBP469 million to remain broadly unchanged, with the 1H22 profit beat partly offset by increased demand uncertainty.

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Burberry's Investors Concerns Over Chinese Customers Hit Share Price

1128 GMT - There have been two pressure points for Burberry during the pandemic, China and travel, which helps explain why its recovery has been so uneven, says AJ Bell investment director Russ Mould. The British luxury-goods company is highly dependant on Chinese customers, in particular on those buying items in Europe as part of its tourism trips. "This explains why sales are down on pre-pandemic levels in the Europe, Middle East, India and Africa region," Mould says. Shareholders will hope these are short-term issues and that there were more encouraging signs around the medium-term prospects for Burberry, as digital sales' contribution to the mix continues to build, Mould adds. Shares are down 6.3% at 1,842.50 pence.

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Taylor Wimpey's Inflation Comments Are Comforting

1119 GMT - Taylor Wimpey's overall solid trading statement noted that it is on track to deliver 2021 results in line with its previous expectations, but the comments on inflation are particularly reassuring, Goodbody says. The house builder also highlighted that demand remains strong, cost pressures are expected to gradually improve, and guidance for 2021 operating profit including joint ventures of GBP820 million remains unchanged, the Irish brokerage says. "Whilst it is fair to say that we didn't learn a lot new from this morning's update, it is comforting that house-price inflation continues to "fully offset" consumer price inflation and the group remains confident in delivering against its medium term targets," Goodbody says, retaining its buy rating. Shares are up 0.1% at 158.1 pence.

Contact: London NewsPlus, Dow Jones Newswires; Write to Sarka Halas at sarka.halas@wsj.com

(END) Dow Jones Newswires

11-11-21 1202ET

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