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UK stocks open 0.5% lower as tobacco companies weigh
StockMarketWire.com
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UK stocks opened lower on Wednesday after British American Tobacco posted a disappointing earnings update and local inflation rose by more than expected.
At 0815, the benchmark FTSE 100 index was down 31.2 points, or 0.5% at 6,717.66.
The UK consumer price index for January rose 0.7%, above expectations for a 0.6% increase.
British American Tobacco dropped 5.6% to £25.9399, even as it reported a rise in annual profit, citing strength at its vaping business.
The tobacco giant upped its dividend 2.5% to 215.6, while guiding for 3-5% constant-currency revenue growth in 2021 and mid-single-digit percentage earnings growth 'reflecting continued Covid-19 impacts'.
Fellow tobacco company Imperial Brands slipped 1.4% to £14.925 on announcing that chief financial officer Oliver Tant would stand down by no later than August.
Tant would be replaced by Lukas Paravicini, currently CFO of agricultural commodities and brokerage group ED&F Man.
Mining giant Rio Tinto added 0.2% to £62.73, having booked a 22% jump in annual profit after it benefited from higher iron ore prices, buoyed by Chinese demand for the key steelmaking ingredient.
The Anglo-Australian company also hiked its dividend by 21% to 464c per share, and added a special payout of 93c, bringing the total payout for 2020 to 557c.
Online contracts-for-difference broker Plus500 fell 2.6% to £13.435 even as it posted a large rise in annual profit that nevertheless fell short of investors' lofty expectations.
Plus500 declared a dividend of $0.5422 per share, up from $0.3767 in 2019, plus a special dividend of $0.2870.
Aviation services group Signature Aviation ascended 0.3% to 405p, having agreed to sell its engine repair and overhaul business to StandardAero for $230 million.
Fresh produce supplier Total Produce gained 3.1% to 135p following news that it agreed to be acquired by Dole Food in a share-based transaction that would create an entity with combined assets worth $4.5 billion.
The deal would see Total Produce shares exchanged for shares in Dole at a fixed exchange ratio, whereby Total Produce shareholders would receive 82.5% of the combined entity, to be named Dole.
Automotive fluid systems manufacturer TI Fluid Systems shed 1.6% to 277p on announcing that chief executive William L. Kozyra would retire in the fourth quarter of 2020.
Kozyra would be succeeded by current executive vice president Hans Dieltjens, who would take on the role of chief operating officer from 1 March as a transitional step.
Property investor Supermarket Income REIT added 0.3% to 108.8p after it had acquired Sainsbury's supermarket in Bangor, County Down, Northern Ireland, from John Morgan Estates for £24.8 million.
Story provided by StockMarketWire.com
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