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London open: FTSE creeps higher, driven by Sage Group

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The FTSE inched higher in early trading, as expected, ignoring declines in both the US and Asia.

Sage Group drove the top tier index higher with a 7.5% rise in its share price on the back of a dividend raise and predicted revenue growth of six per cent for 2015.

However, gains were limited by a raft of stocks going ex-dividend, including the London Stock Exchange, National Grid, Severn Trent and Tate&Lyle, and the fact eyes remain firmly fixed on the US November jobs report due Friday, with investors wary that a stronger-than-expected increase in non-farm payrolls could prompt the Federal Reserve to begin scaling back stimulus at its next meeting on December 17-18th. These fears were renewed Monday after data showed that US manufacturing activity jumped to a two-and-a-half-year high last month.

Data wise, figures will today be released on the UK’s official reserves, along with both the services and composite PMIs.

In other macro news, the government is set to later today unveil its two-year infrastructure spending plan, which is expected to include £375bn-worth of investment in energy, transport, communications, and water projects. The insurance sector is also widely predicted to be planning an investment of £25bn.

The government is also due to significantly alter its policy of renewable energy subsidising, according to the BBC, with plans to scale back its contributions to both onshire wind and solar energy, while increasing its support to offshore wind power. Overall spending is not expected to differ.

Sage Group races to the top of the leaderboard

Although Sage Group’s annual pre-tax profit was broadly flat at £164.1m, this was a reflection of the cost of non-core disposals, with revenue for the period rising 4% to £1.26bn, driven by growth in premium support contract upselling and renewals, software subscriptions and payment services. The firm proposed a final ordinary dividend of 7.44p per share, bringing the total ordinary dividend to 11.32p per share, up 6% on the prior year.

Tesco shares were also higher despite the company posting a disappointing result for the third quarter. The supermarket chain said like-for-like sales in the period had fallen 1.5% due to a grocery market that had become more difficult since the summer due to pressure on consumer finances. The company’s total UK sales lifted 0.9%. Group sales for the thirteen weeks ending November 23rd increased 0.6% at actual exchange rates and 0.2% at constant rates, excluding petrol. Including petrol, group sales decreased 0.8% at actual exchange rates and 1.2% at constant rates.

Randgold Resources ignored a declining gold price to rise strongly after Investec upgraded the stocks to ‘buy’ with a 5,095p target price.

Meanwhile, Standard Chartered fell heavily after saying a “challenging year” has resulted in a “significant impact” on its performance in the second half and as such income for the full year is expected to be broadly flat on 2012.

FTSE 100 – Risers

Sage Group (SGE) 378.90p +9.07%
easyJet (EZJ) 1,422.00p +2.60%
Randgold Resources Ltd. (RRS) 4,114.00p +2.41%
Fresnillo (FRES) 759.00p +2.02%
Rio Tinto (RIO) 3,250.00p +1.56%
Tesco (TSCO) 346.80p +1.52%
BHP Billiton (BLT) 1,826.50p +1.39%
Glencore Xstrata (GLEN) 307.70p +1.12%
Vedanta Resources (VED) 856.50p +1.06%
BAE Systems (BA.) 420.10p +0.91%

FTSE 100 – Fallers

Standard Chartered (STAN) 1,351.50p -5.56%
Aberdeen Asset Management (ADN) 464.90p -3.89%
Tate & Lyle (TATE) 761.50p -3.18%
Severn Trent (SVT) 1,677.00p -1.53%
National Grid (NG.) 752.50p -1.51%
Barclays (BARC) 262.60p -1.35%
HSBC Holdings (HSBA) 659.50p -1.33%
Reckitt Benckiser Group (RB.) 4,806.00p -1.21%
Associated British Foods (ABF) 2,266.00p -0.87%
Land Securities Group (LAND) 934.50p -0.74%

Source: ShareCast