10.57am: Burberry rises after strong Richemont numbers
Burberry Group PLC (LSE:BRBY) outperformed the market on Friday, rising 3.4%, given a double boost with strong results from Swiss luxury brand Richemont and news that one of its biggest markets China was relaxing some of its Covid rules.
Victoria Scholar, head of Investment, interactive investor pointed out shares rose after Richemont first half adjusted EBIT and sales beat analysts’ estimates.
“Investors are enjoying a more than 20% boost to its share price this morning thanks to the recovery in Asia and strong sales and earnings in its jewellery business” she said.
“Looking ahead, the company is likely to enjoy a strong tailwind from the removal of some of China’s covid lockdown measures, particularly if Beijing continues to ease its restrictions.”
“Plus, the luxury group is relatively well placed to navigate the macroeconomic challenges by passing on additional cost pressures to customers through higher prices with a minimal downside impact on demand” Scholar felt.
10.55am: GSK tumbles after UBS downgrade
Shares in GSK PLC (LSE:GSK, NYSE:GSK) fell 4.77% to 1,341p as broker UBS downgraded the stock to sell and cut its price target to 1,300p from 1,820p.
The broker pointed to two factors posing risks to the earnings base longer term - blockbuster vaccine Shingrix will exhaust its catch-up patient pool in the US around '27 and HIV product dolutegravir faces patent expiry at the same time which it forecast could erode around 20% of revenues.
GSK has received a couple of set-backs already this week with the failure of a key clinical trial for a new bone marrow cancer drug and news today that the second-line applications of its cancer drug will be limited in scope following a request by the US FDA.
10.50am: Prospect Energy falls after singalling Spanish exit
Prospex Energy PLC (AIM:PXEN) fell 7% after announcing the potential sale of Warrego Energy's interests in Spanish assets.
Warrego is a co-owner of Tarba and the coventurer in the assets that Prospex holds in Spain, the investment company said in a statement.
"Should any deal be struck by Warrego the focus by any potential new owner is most likely to be on the asset base in Western Australia,” said chief executive Mark Routh.
“This may result in the disposal of Warrego's Spanish portfolio, which is in no way a reflection of the quality of the assets.”