Sector movers: REITs pace gains, Unilever boosts Personal Goods
(ShareCast News) - The ebb and flow of broker recommendations and news was the main driver of share prices on Thursday, as investors waited with baited breath for the first headlines from the meetings between China and the America's leaders, as well as the all-important US jobs report due out the next day.
Against that backdrop, interest rate sensitive issues are pacing gains, amid company-specific commentary from brokers.
Among REITS, British Land is higher after Exane BNP Paribas upped the stock to 'Outperform' from 'Neutral'.
Segro is the other standout gainer in that group after receiving a positive endorsement from analyst Chris Spearing at Canaccord Genuity. Spearing trimmed his target price on the shares from 525p to 515p but told clients the stock continued to be at a discount to its main industrial-focused UK-REIT peers LondonMetric and Tritax BigBox.
"In our view, SEGRO is well positioned to deliver above sector average rental and NAV growth over the next few years with organic growth supplemented by gains from the development pipeline," he said.
Unilever and PZ Cussons buoyed the Personal Goods sector, with the former unveiling new plans to "go faster and further" with its restructuring programme, upping its annual dividend guidance and launching a €5bn share buyback, as well as confirming it will sell off its spreads business.
Aerospace and Defence stocks were right behind, with shares in Rolls Royce benefiting from an upwards target price revision from Credit Suisse from 595p to 655p after revising higher its earnings per share estimates for 2017 and 2018 by 4% and 2%, respectively.
Driving those revisions is an expected rebound in order intake levels for the company's Civil and Power Systems units, but a cut to Defence following the broker's own Pentagon conference.
Electronic & Electrical Equipment shares are also on the up after HSBC sounded an optimistic note on UK engineers, upgrading its view on Spectris from 'Reduce' to 'Hold' in the process.
"Valuations appear somewhat stretched and need to normalise as the threat of interest rate rises looms," HSBC cautioned.
However, it added that "we expect a return to organic growth and modest margin expansion through 2017, while FX should also continue to provide positive tailwinds - for the first half of 2017 at least."
Top performing sectors so far today
Real Estate Investment Trusts 2,974.36 +1.03%
Personal Goods 34,893.45 +0.76%
Real Estate Investment & Services 2,650.47 +0.65%
Electronic & Electrical Equipment 5,553.08 +0.52%
Aerospace and Defence 4,991.57 +0.46%
Bottom performing sectors so far today
Automobiles & Parts 8,229.99 -1.37%
Banks 4,157.26 -1.18%
Mobile Telecommunications 4,641.49 -1.18%
Pharmaceuticals & Biotechnology 14,092.05 -1.17%
General Industrials 5,763.44 -1.11%