Wednesday’s Master Investor Market Report

– The FTSE 100 closed the day at 6,752.41, a rise of 65.84 points.
– The FTSE 250 climbed 40.65 points to finish at 17,775.08.
– The FTSE All Share rose by 30.46 points to 3,681.21.
– The FTSE AIM All Share finished at 756.14, a rise of 1.05 points.

London shares rallied after US ISM Services figures surged to a 10-year high in July. The figures showed the index rose to 60.3% from a 56% reading in the previous month, which was comfortably ahead of analysts’ expectations for a 56.5% reading. This has obviously raised hopes for a strong reading in tomorrow’s all-important non-farm payrolls, which will be accompanied by a raft of economic news here in the UK.

London Stock Exchange (LSE) shares climbed 42p to 2,620p as it all but doubled first-half revenues, to £1.16 billion, on the back of the contribution from the December acquisition Russell Investments, with underlying growth of a more modest 9% due to a decent performance from markets and data. The dividend was lifted 11% to 10.8p per share, with chief executive Xavier Rolet iterating the company’s confidence in its prospects as it continues to invest in growth initiatives.

Insurer Legal & General (LGEN) shook off changes to pension regulation to report a 6% rise in first-half pre-tax profits to £672 million. The firm said it continues to deliver strong organic growth in the UK and the US from both its developing and established, market leading businesses. In addition it is disposing of, or closing non-core businesses and reducing costs in real and nominal terms. Broker Nomura reiterated its ‘buy’ stance on the stock and said L&G’s dividend growth story is intact. Shares in the company finished 7.3p higher at 270.7p.

Shares in Standard Chartered (STAN) climbed 2.1p to 954.7p, despite news that incoming CEO Bill Winters has slashed the bank’s dividend in half after admitting the “very real challenges” facing the bank. However, analysts cheered the move, saying that it will improve the bank’s capital position and should help mitigate a key concern of shareholders. Profit before tax slumped 44% to $1.42 billion, as the firm’s core Asian markets weakened.

Shares in pump specialist Spirax-Sarco (SPX) tumbled 160p to 3,229p as first half pre-tax profit declined 10% to £57.3 million on the back of exceptional costs from the start-up of a new business in India. In addition, strong currency headwinds wiped out its 3% growth in organic sales, which was driven by a strong performance in its Watson-Marlow fluid technology arm. Although the firm expects its markets to remain challenging, it continues to envisage modest improvements in Europe and North America during the second half of the year.

Intellectual property specialist IP Group (IPO) reported a 50% increase in the value of its portfolio, to £478.2 million, for the first half of 2015. “Having strengthened the group’s balance sheet with more than £200 million of available capital, IP Group is well placed to continue its strategy of supporting compelling opportunities both in the UK and the US,” commented CEO Alan Aubrey. Shares in IP Group moved 2.8p higher to 212.3p.

Inhaled medicine specialist Synairgen (SNG) saw its shares jump 2.5p to 36p after it announced that it has entered into a research collaboration deal with Australian pharmaceutical company Pharmaxis. The partners will develop a selective inhibitor to the lysyl oxidase type 2 enzyme to treat the fatal lung disease idiopathic pulmonary fibrosis, which affects around 100,000 people in the US. Current products are expected to produce global revenues in excess of $1.1 billion by 2017.

Shares in wireless outfit Filtronic (FTC) soared 2.25p to 9.75p after it revealed it had resolved a technical issue with its integrated wireless antenna product which has led to a follow-up order. “The receipt of production tooling orders will enable Filtronic to bring the product into a volume manufacturing ready state and it is anticipated that production orders will follow the completion of the tooling orders,” Filtronic commented.

Tomorrow’s news today

Aggreko (AGK), Cobham (COB), Inmarsat (ISAT), Mondi (MON), RSA Insurance (RSA), and Rio Tinto (RIO) are among the firms that will publish interim results tomorrow.

On the economic front, we are expecting a raft of economic data from the UK, with the Bank of England’s ‘Super Thursday’, and Friday’s non-farm payrolls (NFPs) in the US.

Quote of the day

“A constant in my approach to investing: You should think politically but unconventionally.”
– Ken Fisher