Trump threat can’t dent foreign fund firm shares
EMERGING market investors don’t seem to have been put off despite the advent of Donald Trump’s presidency. Investment firm Ashmore, which specialises in these regions, surprised shareholders with a strong update for the six months to December 31.
The business, which manages £42.5bn of assets, saw net revenue shoot up 24pc to £144.1m over the period, boosted by a strong dollar. Ashmore netted £21.6m in performance fees and said pre-tax profits had almost doubled to £121.5m.
In a bullish update, the firm said it expected strong performance in 2017. After years of savers pulling money out of emerging markets, Ashmore expects sentiment to continue improving.
Stockbroker Numis said it was more cautious about how quickly funds would flow back into the region over the short-term and said the investment case was not strong enough to rate the stock a ‘buy’.
However, Ashmore shares advanced 5pc, or 16p, to 335p.
The FTSE 100 climbed 0.6pc, or
40.68 points, to 7229.50 – the first time it has finished above 7200 in three weeks.
Mediclinic International was the highest riser of the day, gaining 2.5pc, or 20p, to 825.5p after Investec increased its target price.
St Ives continued its fall after announcing the previous day that Harper Collins would not renew its contract with the business when it ends in June.
The marketing and printing company was down another 4.4pc, or 2.75p, to 59.75p.
Meanwhile, Carpetright carried on climbing after revealing earlier this week it had returned to growth. Shares soared 8pc, or 16.5p, to 224.75p. Smith & Nephew promised stronger performance in 2017 after revenue grew just 1pc last year. The medical equipment firm, which makes wound care and hip implant products, reported full-year revenue of £4.67bn and operating profit of £801m.
Weaker sales in China and the Gulf states had hampered growth, although there was an improvement in emerging markets at the end of the year.
Bank of America Merrill Lynch said Smith & Nephew had slightly missed expectations but product launches and robotics were likely to drive growth. The firm has already completed its first total knee procedures using a robotics surgical product that it acquired in 2015. Shares were off 0.3pc, or 3p, at 1198p. BHP Billiton’s board has approved £1.8bn of spending for its share in the Mad Dog oil field in the Gulf of Mexico.
BHP holds a 23.9pc interest in the field, while BP holds 60.5pc and Union Oil Company of California the remaining 15.6pc.
Phase two of the project will see the existing field extended to include a new production facility, which is expected to produce up to 140,000 barrels a day when output begins in 2022. BHP shares lost 0.3pc, or 3.5p, to 1338p, while BP edged up 0.6pc, or 2.75p, to 458.7p.
Pennon Group said it was on track to deliver a decent set of results for the year. The environmental infrastructure firm provides water and waste management services to 150 councils.
George Salmon, equity analyst at Hargreaves Lansdown, said: ‘The investment case for Pennon is a simple one: the water business churns out regular growth and its waste management division, Viridor, adds the potential for a bit extra.’ Austerity and lower prices have been a challenge for Viridor this year, but the division is still on track to bring in £100m of profit for the year. Shares surged 3.5pc, or 28.5p, to 845p. Water Intelligence soared as it revealed revenue growth exceeded expectations, including at its newly acquired UK-based business NRW Utilities. The US firm, which provides leak detection services, said revenue for the year was £9.7m, up from £7m the previous year.
Shares leapt 8pc, or 10p, to 135p.