Surprised to see such a limp start to the week from the FTSE following a steadying close to US markets on Friday but then again the US markets will be closed today for Martin Luther King jr day.
In the US, markets were helped by JP Morgan (America's second largest lender) reporting better than forecast earnings. And, with other major US banks reporting this week there appears to be some optimism for the US banking sector.
Elsewhere, influential US companies also reporting include: General Electric; Apple; Google; and eBay.
Closer to home:
BP @ 506.3p, +6.8 (11:00), just can't keep out of the news with its statement release on Fri announcing an arctic exploration license and share swap/ tie up with Rosneft, the Russian state oil company. This quite rightly has raised concerns (environmental, political, and continuity of supply) amongst many keenly interested parties including the US.
Seems a risky strategy to me, based upon Bob Dudley's (New BP CEO) experience with the TNK-BP joint venture which saw him in hiding, and fearful for his life before fleeing the country. It should be noted that the Russian state has a long history of interference leading to the appropriation of valuable assets.
Generally though, there are many market watchers suggesting that this could be very positive to profits (as was TNK-BP) and that the company may have had few other options for growth open to them, given the extent of its castigation by the US and resulting likelihood that it has little chance of winning new exploration rights there in the immediate future.
Although BP is up on early trade in London today, this is likely to rumble on and we should be able to guage any initial backlash from the company's 40% US shareholdings tomorrow.
On a different front, BP has been awarded licenses to explore 4 deepwater blocks of the South coast of Australia.
National Grid @ 535p, +4 (11:00am). Not exactly a bouyant recovery in the share price and with further news that US regulators have rejected NG's requests for price increases it is expected that Steve Holliday (Chief Executive), will come under renewed pressure from shareholders to address performance in th US. As mentioned in an earlier comment, the US divisions accounted for 61% of revenue but only 39% of profits in the last full financial year.
R-R @ 655.5p, +1 (11:00am), has announced its latest contract: to supply MT30 gas turbines to the US Navy's Littoral Combat Ships. At 2 per ship (plus 4 waterjets), and for 10 craft in total this is the "company's biggest ever marine naval surface ship contract".
It is an endorsement of the MT30 which, "at 36 megawatts, is the World's most powerful marine gas turbine" but looking beyond the headline, the statement goes on to qualify that the order, although an addition to 2 existing vessels, consists of 1 firm order and 9 options.
As a matter of interest the MT30 is also the selected power source for "the UK Royal Navy's new Queen Elizabeth class aircraft carriers and the U.S. Navy's DDG-1000 Zumwalt class destroyer programme"
Link to Sharecast - BP Rosneft tie-up / Australian deepwater licenses
Link to Sharecast - R-R MT30 contract
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