The FTSE-100 finished Friday's session 0.63% lower at 7,443.43, whilst the FTSE AIM All-Share index was down 0.87% at 1,059.38. In continental Europe, the CAC-40 finished 1.64% lower at 5,364.98 whilst the DAX was down 1.68% at 12,785.16.
Last Friday in New York, the Dow Jones ended the week 665.75 points lower at 25,520.96, the S&P-500 fell 59.85 points to close at 2,762.13 and Nasdaq finished the session 144.92 points weaker at 7,240.95.
In Asian markets this morning,the Nikkei 225 was 568.14 points lower at 23,706.39 heading into the close. Meanwhile, the Hang Seng was down 369.61 points at 32,232.17 but the Shanghai Composite was up 19.26 points at 3,481.34.
In early trade today, WTI crude was 0.86% lower at $64.89 per barrel and Brent was down 0.9% at $67.96 per barrel.
Lloyds Bank bans Bitcoin purchases on its credit cards
Lloyds Banking Group has banned its customers from buying Bitcoin on their credit cards following a sharp fall in the value of the digital currency. The ban, starting on Monday, applies to Lloyds Bank, Bank of Scotland, Halifax and MBNA customers. It will not apply to debit cards, only to the banking group's eight million credit card customers. Lloyds fears people are buying Bitcoin to make a profit if its value rises but face debts if it falls. It is concerned it could end up footing the bill for unpaid debts should the price continue to fall. Explaining the ban, a Lloyds spokeswoman said: "We continually review our products and procedures and this is part of that." Bitcoin ended last week down 30% at $8,291.87 - its worst week since April 2013 and far below the $19,000 it reached last November. However, the cryptocurrency is still ahead of the $1,000 it was trading at this time last year. Police have warned that digital currencies remain popular among criminals as they can use them to evade traditional money laundering checks and other regulations. Prime Minister Theresa May recently said that action against digital currencies may be required "precisely because of the way they are used, particularly by criminals". She told Bloomberg: "In areas like cryptocurrencies, like Bitcoin, we should be looking at these very seriously." The Treasury said that it intends to update regulation to bring virtual currency platforms into anti-money laundering and counter-terrorist financing regulation. Facebook recently announced it would block any advertising that promotes cryptocurrency products and services.
Source: BBC News
Galileo Resources (LON:GLR) 1.55p – Speculative Buy
Galileo Resources has announced heads of terms have been signed between its 36% owned Glenover phosphate rare earth project with an unnamed major phosphate producer (MPP). The agreement is for the supply of a phosphate flotation concentrate from Glenover for 15 years. The heads of terms agreement expires end of April and is subject to pilot scale testing, although bench scale testwork has already proved successful. Note that the rare earths would go to tailings and remain the property of Galileo and its partner Ferminore. Also, the South African mining department (DMR) has just accepted Glenover’s mining license application - submitted in November last year.
Our view: Galileo investors have been waiting some time for a development at Glenover and this morning’s announcement is very positive news. Although only heads of terms, the fact that bench scale test work has been successfully completed already bodes well. Pilot scale testwork will involve processing 30 tonnes of rock and we should know the result sometime before April 30th.In the meantime, we maintain a speculative buy on the stock.
Beaufort Securities acts as corporate broker to Galileo Resources PLC
N4 Pharma (LON:N4P) 27.25p – Speculative Buy
N4 Pharma this morning announced that it has been awarded a grant from Innovate UK to co-fund a collaborative project with MedImmune UK to explore the manufacturing of a prototype nanomedicine using N4 Pharma’s Nuvec system. The grant will allow N4 Pharma to develop manufacturing methods for Nuvec particles loaded with therapeutic pDNA/mRNA encoding antigens. MedImmune will then conduct in-vitro and in-vivo study to demonstrate the capability of delivering such antigens to induce immune response. Under the terms of the agreement, MedImmune UK has the right to license exclusively anytime up to 3 months after the project conclusion. The project is expected to last for approximately 9 months. Innovate UK is funded through the UK Government’s £70m Industrial Strategy Challenge Fund to speed up the development of new medicines.
Our view: This is a positive announcement from N4 Pharma! MedImmune is a leading global biologics R&D company with 2,200 employees and a pipeline of over 120 research projects, including more than half of AstraZeneca’s overall R&D portfolio. In addition to its R&D capabilities, it also has strong relationships with many academics, researchers, foundations and companies, making it the ideal partner for N4 Pharma. Nuvec silica nanoparticles delivery system is a technology potentially enables effective delivery of large nucleic acids (e.g. pDNA and mRNA) into cells to generate an immune response. In its latest pre-clinical study result announced on 8 November 2017, the technology showed efficacy with no tolerability issues. The value of the global nanotechnology drug delivery market is forecast to grow to US$11.9bn in 2023, according to Transparency Market Research (July 2014), and we are encouraged by today’s announcement. We reiterate our Speculative Buy rating on the share with target price currently under review.
Beaufort Securities acts as corporate broker to N4 Pharma Plc
Unilever (LON:ULVR) 4,039.00p – Hold
Unilever on Thursday announced results for the full year ended 31 December 2017 (‘FY17’). During the period, on a reported basis, revenue advanced by +1.9% to €53.7bn, operating profit jumped +13.5% to €8.9bn, PBT rose +9.2% to €8.2bn and net profit increased by +16.9% to €6.5bn, against the comparative period (FY16). On an underlying basis, sales grew by +3.1% (+3.5% excluding spreads business) supported by +0.8% increase in volume and +2.3% rise in price, operating margin improved by +110bps to 17.5% and EPS rose +10.7% to €2.24. Free cash flow increased by €0.6bn to €5.4bn, while net debt rose €7.7bn to €20.3bn mainly due to share buybacks and the cost of acquisitions. On the operational front, the group completed 11 acquisitions and announced disposal of spreads business to KKR for €6.825bn (completion expected mid-2018). It delivered savings of €2bn during the year, while completed €5bn share buyback. The group said it expect to conclude the review of its dual-listed structure shortly. The group declared a Q4 dividend of 31.55p per share, up +14% (+12% in Euro term), to be paid on 21 March 2018.
Our view: Unilever’s Q4 trading was stronger than expected, delivered +4.0% growth in underlying sales growth (+4.3% excluding spreads), supported substantially by +3.2% recovery in volume, while price also rose by +0.7%. The volume growth was benefitted from weaker comparative period while also boosted by product innovation and reinvestment. For the full year, despite the reported revenue growth was impacted by FX, the underlying operating margin improved a touch ahead of management guidance and full year underlying sales growth within the guided range. Net debt increased to 1.9x net debt/EBITDA ration, within 2.0x target. Looking ahead, the management reiterated its target of 3%-5% underlying sales growth, better underlying operating margin and cash flow for the FY18. For the medium-term to 2020, the target of 20% operating margin, savings of €6bn and 100% cash conversion remain “well on track”. We are encouraged with the improving consumer confidence and early sign of volume growth in the emerging market. However, with milder commodity inflation outlook, we see limited positive surprises, at lease for the first half of FY18. The shares are valued at FY18E P/E multiple of 19.2x with dividend yield of 3.3%. We downgrade our rating to Hold (from Buy) while maintaining target price at 4,330p, considering potential for special dividend from the disposal of spread business, while it remains a potential takeover target.