CLS takes on £13m Munich office property, Enquest says Kraken development on track
London open
The FTSE 100 is expected to open four points higher on Tuesday, after closing up 0.07% at 7,429.81 on Monday.
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CLS Holdings said it has exchanged contracts to buy a multi-let office property in Perlach, in the south-east of Munich, Germany, for €15.3m (£13m). The building comprises 9,449 square metres of office space which, with an occupancy rate of 88%, currently generates a rental income of €0.8m a year, reflecting a net initial yield of 5.1%, or 6.2% when fully let, CLS said. The property has a diversified tenant base that provides a stable income, with an estimated rental value of some €1.2m, reflecting an ERV yield of 7.4%, it added.
Enquest said the development of the Kraken field continued to be on track and is running under budget, while reiterating previous guidance for full-year 2017 production of between 45,000 and 51,000 barrels per day depending on the timing of first oil at Kraken. Last year production grew 8.7% to 39,751 b/d. At the end of 2016 the oil explorer's level of net debt stood at $1.796.5bn, up from $1,548bn in the year before, as expected by analysts. For 2016, the company said cash generated from operations rose from $221.7m in 2015 to $408.3m. Revenue and other operating income on the other hand slipped 6.3% to $849.6m.
Bellway hoisted its interim dividend 10% as the housebuilder enjoyed continued strong demand in the first half and maintained its targets for the full year. Revenue of £1.15bn for the six months to the end of January was a 5.9% improvement on the same period a year ago as the company completed 4,462 homes at an average selling price of £256,000.
Newspaper round-up
Britain’s high street banks processed nearly $740m from a vast money-laundering operation run by Russian criminals with links to the Russian government and the KGB, the Guardian can reveal. HSBC, the Royal Bank of Scotland, Lloyds, Barclays and Coutts are among 17 banks based in the UK, or with branches here, that are facing questions over what they knew about the international scheme and why they did not turn away suspicious money transfers. - Guardian
The first case settled under controversial new compensation rules for serious injuries has seen an NHS trust forced to nearly triple its payout to a 10-year-old girl left with cerebral palsy from £3.8m to £9.3m. The case, involving East Lancashire Hospitals NHS trust, will send fresh shockwaves through the NHS and insurance companies, which have been braced for big increases in claims since the new “Ogden” formula was announced last month. - Guardian
France’s main presidential candidates rounded on the far-right Front National’s Marine Le Pen in the first televised debate on Monday night, with the independent centrist Emmanuel Macron accusing her of lying and seeking to divide the country. The three-and-a-half-hour live debate between the top five candidates saw Le Pen and Macron repeatedly exchange verbal blows. - Guardian
A far-right millionaire with Ulster loyalist connections plans to use his international social media network, which backed Donald Trump, to support Scottish independence. Jim Dowson, a former financial backer of the British National party and former member of Britain First, confirmed on Monday that he will be deploying his “Patriotic News Agency” and other networks with their bases in Hungary and Serbia to promote Scottish separatism. - Guardian
Brexit-supporting cabinet ministers are demanding that the chancellor caps Britain’s EU “divorce bill” at £3 billion, The Times has learnt. The Brexiteers are concerned that Philip Hammond will not be sufficiently tough with the EU, which is set to demand up to €60 billion (£50 billion) from Britain once Theresa May triggers Article 50 on Wednesday next week. - The Times
US close
US stocks finished mixed on Monday as investors looked to speeches by US president Donald Trump and Federal Reserve policy maker Charles Evans, following last week's rate hike.
The Dow Jones Industrial Average ended down 0.04%% at 20,905.86 and the S&P 500 lost 0.2% to 2,373.47, while the Nasdaq 100 added 0.08% at 5,413.31.
President Trump was due to speak at 2330 GMT following a G20 meeting in which finance ministers dropped a commitment against fighting projectionist traded policies at the weekend after opposition from the US.
Michael Every, head of financial markets research Asia-Pacific at Rabobank said that “the idea that the US will aim to export as much as it imports is an infinitely more important global paradigm shift than that from a boot to a penguin”.
He said that “markets still don’t seem to be understanding that our entire global economic and financial – if not political - game is predicated on the US running a large trade deficit”.
“If it doesn’t, how are dollars to flow out into the global economy on a net basis? And if that doesn’t happen, then the current stock of dollars out there in other countries’ foreign exchange reserves are the sum total we will ever see.”