The FTSE opened positively this morning, up 30 points in early trading.
The UK’s premier index was boosted by Insurer, Direct Line which posted a 9.5% jump in first-half operating profit and an increased dividend of 39% to lift the share price by 7% and Rolls Royce, which reported a first half underlying profit of 150% to lift its shares by more than 6%.
In addition, Inspection, product testing and certification company, Intertek, announced a strong first half of earnings growth and cash generation, lifting their interim dividend by 21% and boosting shares by 6% in early trading.
Meanwhile, investors have reacted positively to Centrica’s announcement that electricity prices will be increased by 12.5% from mid-September while Taylor Wimpey’s special dividend has seen the share price boosted by 2%, despite a 24% First half drop in pre-tax profit.
“BP also had a more stock-specific reason to rise this Tuesday. The company managed to eke out a $144 net profit in its second quarter, a vast improvement on the $1.4 billion loss this time last year. Combine that with an interim dividend of 10 cents per share and investors barrelled into the stock, sending BP 2.5% higher to a one month peak.” added Spreadex Analyst, Connor Campbell.
Investors will be looking to the latest UK manufacturing PMI this morning. ADS Securities Analyst, Konstantinos Anthis commented “Today we have the Manufacturing PMI reading and data will come out through the week culminating in the release of the Services sector report and BoE Rate Decision on Thursday. A strong reading in the PMIs, especially from the key Services’ sector, will build expectations for a bullish BoE meeting which will of course be positive for Sterling.”
Over in the Eurozone, the spotlight will remain on the Euro with the release of the German employment data and the Eurozone GDP figures. Konstantinos Anthis added “A strong printing in both reports will allow the euro to consolidate above the 1.1800 level [against the dollar] and look to the upside.”
“Dollar bulls will hope that the ISM Manufacturing and Personal Income/Spending reports scheduled for release later in the day will help support the weakened US currency, but the reality is that there’s more risk for a miss than a surprise higher.”
Over in the US, equity markets once again finished mixed with the Dow Jones outperforming its peers, to close at another record closing high. Accendo Markets Analyst, Mike van Dulken noted “Strong performances from Goldman Sachs, Home Depot and 3M offset losses for DuPont, lifting the 30 stock index by 60 points, while Tech names again weighed on both the Nasdaq and S&P500, the former underperforming as result lift the latter to close just shy of breakeven.”