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| | London Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | London open: Markets edge lower after long weekend Stocks fell on Tuesday morning after a three-day weekend as markets attempted to play catch-up following negative sessions in the US and Asia overnight.
Concerns over Syria are likely to weigh on sentiment after US Secretary of State John Kerry said last night that Syria would be held accountable for the "moral obscenity" of the chemical weapons attack that has killed well over a thousand. "By any standard it is inexcusable," he said.
Senior Market Analyst Michael Hewson from CMC Markets said that the comments "raised concerns that some form of confrontation could be being considered".
Renewed worries about US debt was also hitting stocks after US Treasury Secretary Jacob Lew said the government would reach the debt ceiling by mid-October unless Congress agrees to raise the limit. "Operating the government with no borrowing authority, and with only the cash on hand on a given day, would place the US in an unacceptable position," Lew said.
The German IFO survey will be in focus for European markets this morning. The closely-watched business climate index is expected to edge higher in August, from 106.2 to 107. Both the current assessment and expectations sub-indices are also forecast to show improvement on July.
This afternoon will see the release of a number of economic indicators in the States, including the S&P/Case-Shiller home price index, consumer confidence figures and the Richmond Fed regional manufacturing survey.
Antofagasta leads miners lower
Mining and banking stocks were under pressure this morning as risk appetite is scaled back. ENRC, Rio Tinto and Vedanta were being joined lower by RBS and Lloyds. However, previous metals peers Randgold and Fresnillo were bucking the trend, issuing small gains.
Antofagasta was also a heavy faller after reporting that revenues in the first half dropped 12.1% to $2.7bn, reflecting a decline in copper prices and increased costs.
Oilfield services group Petrofac gained after saying it remains on track to deliver growth this year despite both revenues and profits slipping in the first half. The company reiterated that the full year would be significantly weighted to the second half.
Bank of America Merrill Lynch was weighing on the share prices of retail peers Debenhams and SuperGroup after downgrading both stocks to 'neutral'. The broker however raised its rating for Next to 'buy'.
Meanwhile, Marks & Spencer was given a lift after Citigroup upgraded the stock to 'buy', saying: "The combination of recent, material upgrades to UK economic growth forecasts, and M&S management initiatives have markedly improved the credibility of double-digit FY15 and FY16 M&S EPS growth forecasts".
Security solutions group G4S rose after weekend reports that activist investment fund Cevian Capital - its second-biggest investor - is to double its stake in the firm to 10% |
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| | UK Event Calendar | | Tuesday August 27
INTERIMS
British Polythene Industries, Bunzl, FBD Holdings, Jelf Group, John Laing Infrastructure Fund Ltd, Petrofac Ltd., Plus500 Ltd (DI), Regus, UTV Media
INTERIM DIVIDEND PAYMENT DATE
Dewhurst
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Consumer Confidence (US) (15:00)
IFO Business Climate (GER) (09:00)
IFO Current Assessment (GER) (09:00)
IFO Expectations (GER) (09:00)
GMS
SQS Software Quality Systems AG
AGMS
Livermore Investments Group Ltd.
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Capital at Risk. |
| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks slide as US mulls Syrian involvement - China's Zhu warns of spill-over effect of Fed tapering
- US considers action in Syrian crisis
- US house prices, German business confidence reports
FTSE: -0.22%
DAX: -0.50%
CAC 40: -0.47%
FTSE MIB: -0.11%
IBEX 35: -0.66%
Stoxx 600: -0.50%
European equities fell as uncertainty surrounding the tapering of Federal Reserve stimulus continued as the potential US involvement in the Syrian crisis pushed oil prices higher.
The Fed is weighing up whether to begin scaling back its $85bn per month in bond purchases this year. Economists expect the central bank to start in September amid mixed messages from Fed members and market commentators.
"There are three Fed meetings left this year and as such, should we not see a September taper, October or December would be their remaining options," according to Alpari Research.
"Given a relative lack of strong data, it could be the case that the Fed delay until the October meeting should the figures show continued weaknesses between now and September 17th."
China's Vice Finance Minister Zhu Guangyao said the Fed must consider when and how fast it unwinds its economic stimulus to avoid harming emerging market conditions. He warned of the spill-over effect, "especially the opportunity and rhythm of its exit from the ultra-loose monetary policy", in a briefing ahead of the G20 summit in Russia next week.
Meanwhile as the tension in Syria mounted, Obama spoke with Australian Prime Minister Kevin Rudd on Monday about possible international responses to the turmoil.
The White House said the two leaders expressed their grave concern about the reported use of chemical weapons by the Syrian regime against civilians near Damascus on Wednesday.
Obama administration officials said there was little doubt the Syrian government was responsible for an attack that claimed the lives of hundreds of men, women and children.
US officials said they would want to win international support before taking action.
US and German economic data
A report on Germany's business confidence is expected to show a rise for the fourth consecutive month in August when released at 10:00 in Berlin. The Ifo institute's business-climate index, based on a survey of 7,000 executives, rose to 107.0 from 106.2 in July, economists predict.
In the US, the S&P/Case-Shiller index of house prices in 20 cities is anticipated to jump 12.1% in June compared to the prior year when unveiled at 9:00 in New York.
Petrofac, Aker
Petrofac's shares surged after the oilfield services company said it remains on track to deliver growth for the full year.
Aker Solutions declined after second-quarter earnings fell short of analysts' estimates.
ThyssenKrupp AG plunged after Nomura downgraded the steelmaker to 'neutral' from 'buy'.
PSA Peugeot Citroen advanced after UBS raised its recommendation on the shares to 'buy' from 'neutral'.
Other asset classes climb
The euro/dollar rose 0.04% to the 1.3373 dollar mark.
Brent crude futures were up $0.108 to $110.850 per barrel on the ICE. |
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| | US Market Report | | Stocks fall on concerns over Syria, debt ceiling - John Kerry says Syrian attack 'inexcusable'
- US to hit debt ceiling by mid-October
- Durable goods disappoint
Dow Jones: -0.43%
Nasdaq: -0.01%
S&P 500: -0.40%
Wall Street stocks finished with moderate losses on Monday, erasing gains by the close of trade, as concerns over Syria and the US debt ceiling weighed on sentiment.
US Secretary of State John Kerry said last night that Syria would be held accountable for the "moral obscenity" of the chemical weapons attack that has killed well over a thousand. “By any standard it is inexcusable,” he said.
Senior Market Analyst Michael Hewson from CMC Markets said that the comments "raised concerns that some form of confrontation could be being considered".
Meanwhile, Treasury Secretary Jacob Lew was reported saying that the US government would reach the debt ceiling by mid-October unless Congress agrees to raise the limit. “Operating the government with no borrowing authority, and with only the cash on hand on a given day, would place the US in an unacceptable position,” Lew said.
In other news, durable goods orders came in much worse than estimated, dropping by 7.3% in July following a revised 3.9% gain the month before. Analysts had expected a decline of just 4%.
"Overall, given the renewed strength in the surveys the fall in orders could just be a temporary blip, particularly as orders have been fairly robust over the preceding few months," said Paul Ashworth, the Chief US Economist at Capital Economics.
"Nevertheless, at the very least it is a reminder that the expected pick-up in economic growth in the second half of the year will be gradual."
Drug manufacturer Amgen was a high riser after agreeing to buy Onyx for $10.4bn.
Facebook was making gains, rising 2% to $41.34. This means that the social network's market cap surpassed $100bn for the first time.
Meat processor Tyson Foods slid after Bank of America downgraded the stock from 'buy' to 'neutral' following a recent strong run.
S&P 500 - Risers
Amgen Inc. (AMGN) $113.75 +7.72%
Big Lots Inc. (BIG) $34.02 +5.49%
CH Robinson Worldwide Inc (CHRW) $58.83 +2.85%
Peabody Energy Corp. (BTU) $18.25 +2.24%
Celgene Corp. (CELG) $141.16 +2.09%
Home Depot Inc. (HD) $75.43 +2.08%
Best Buy Co. Inc. (BBY) $35.81 +2.08%
Owens-Illinois Inc. (OI) $30.31 +1.78%
Apollo Group Inc. (APOL) $18.82 +1.73%
Alexion Pharmaceuticals Inc. (ALXN) $107.19 +1.64%
S&P 500 - Fallers
Tyson Foods Inc. (TSN) $29.17 -7.34%
Archer-Daniels-Midland Co. (ADM) $34.50 -4.91%
Expedia Inc. (EXPE) $47.20 -3.36%
Autodesk Inc. (ADSK) $37.89 -2.62%
Abercrombie & Fitch Co. (ANF) $37.78 -2.33%
Visa Inc. (V) $175.00 -2.29%
Hershey Foods Corp. (HSY) $93.36 -2.21%
Tesoro Corp. (TSO) $47.96 -2.14%
Campbell Soup Co. (CPB) $45.40 -2.13%
McCormick & Co. (MKC) $68.77 -1.98%
Dow Jones I.A - Risers
Home Depot Inc. (HD) $75.43 +2.08%
McDonald's Corp. (MCD) $95.31 +0.19%
Alcoa Inc. (AA) $8.06 +0.12%
Boeing Co. (BA) $105.53 +0.05%
Dow Jones I.A - Fallers
Procter & Gamble Co. (PG) $78.54 -1.84%
Microsoft Corp. (MSFT) $34.15 -1.73%
Verizon Communications Inc. (VZ) $46.94 -1.41%
AT&T Inc. (T) $33.82 -1.37%
Pfizer Inc. (PFE) $28.02 -1.13%
Coca-Cola Co. (KO) $38.12 -1.04%
Johnson & Johnson (JNJ) $87.53 -1.00%
JP Morgan Chase & Co. (JPM) $51.80 -0.99%
Intel Corp. (INTC) $22.27 -0.74%
General Electric Co. (GE) $23.61 -0.71%
Nasdaq 100 - Risers
Amgen Inc. (AMGN) $113.75 +7.72%
CH Robinson Worldwide Inc (CHRW) $58.83 +2.85%
Regeneron Pharmaceuticals Inc. (REGN) $245.01 +2.58%
Celgene Corp. (CELG) $141.16 +2.09%
Avago Technologies Ltd. (AVGO) $37.48 +2.01%
Facebook Inc. (FB) $41.34 +1.95%
Alexion Pharmaceuticals Inc. (ALXN) $107.19 +1.64%
Dollar Tree Inc (DLTR) $54.12 +1.56%
Altera Corp. (ALTR) $35.15 +1.41%
Gilead Sciences Inc. (GILD) $60.42 +1.31%
Nasdaq 100 - Fallers
Expedia Inc. (EXPE) $47.20 -3.36%
Autodesk Inc. (ADSK) $37.89 -2.62%
Mondelez International Inc. (MDLZ) $30.72 -1.93%
Microsoft Corp. (MSFT) $34.15 -1.73%
Nuance Communications Inc. (NUAN) $19.01 -1.55%
Catamaran Corp (CTRX) $55.33 -1.51%
Check Point Software Technologies Ltd. (CHKP) $56.89 -1.44%
F5 Networks Inc. (FFIV) $85.86 -1.42%
Kraft Foods Group, Inc. (KRFT) $52.08 -1.40%
Amazon.Com Inc. (AMZN) $286.21 -1.31% |
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| | Newspaper Round Up | | Tuesday newspaper round-up: Saudi Arabia, Russian, Services Saudi Arabia has secretly offered Russia a sweeping deal to control the global oil market and safeguard Russia's gas contracts, if the Kremlin backs away from the Assad regime in Syria. The revelations come amid high tension in the Middle East, with US, British, and French warship poised for missile strikes in Syria. Iran has threatened to retaliate, The Daily Telegraph writes.
Brazil's emergency intervention to shore up the real has already begun to unravel, prompting fears of fresh capital flight unless the government takes more radical action. Investors appear to have been shaken by warnings from US Federal Reserve governors that the bank will not back away from monetary tightening because of emerging market woes, according to The Daily Telegraph.
Telefónica appears to have sealed its deal to buy KPN's German mobile unit, E-Plus, after winning approval from major KPN shareholder Carlos Slim by raising the value of its offer from €8.1bn to €8.55bn. The agreement wraps up one chapter of a complicated three-way saga that has unfolded this summer between KPN, Telefónica, and Mr Slim's telecoms group América Móvil, the FT says.
An attempt by Donald Tusk to strengthen his position at the head of Poland's ruling Civic Platform party has backfired, leaving the Polish premier gravely weakened when he has already lost support because of the lacklustre economy, the FT explains.
Business volumes and boardroom confidence are picking up in services industries ranging from accounting and law to hotels and leisure, according to the latest quarterly services snapshot from the CBI. Adding to the sense of an economy in recovery, the EEF, the manufacturers' organisation, has reported that the lending drought suffered by small businesses appears to be easing, The Times reports.
Russia slashed its economic growth forecast yesterday after suffering its worst second quarter since the peak of the financial crisis. The rouble fell to a four-year low after the Russian Economic Ministry cut its growth forecast for this year to 1.8% from 2.4%, and for next year from 3.7% to 2.8% to 3.2%, according to The Times.
AstraZeneca, the UK's second-largest drug maker, has taken a further step towards boosting its pipeline of new cancer treatments by agreeing to buy privately-owned US biotech company Amplimmune for up to $500 million (£320.9m). The deal came the day after US rival Amgen unveiled the $10.4 billion acquisition of Onyx Pharmaceuticals, which also specialises in cancer drugs, The Scotsman says. | | |
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