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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: Stocks jump ahead of Fed, Syria concerns ease Markets opened strongly on Monday morning as eyes begin to turn to the Federal Reserve ahead of its all-important policy meeting this week while concerns about Syria eased.
The Federal Open Market Committee's two-day meeting is due to come to a close on Wednesday and will likely be one of the most closely-watched policy decisions in recent years, given rising expectations that the Fed will begin to scale back its quantitative easing (QE) programme.
"The ability of the economy to show sufficient signs of improvement within the jobs markets has been a core driver of expectations and the trends appear to point towards the economy being just about accommodative to such a move," said Market Analyst Craig Erlam from Alpari.
Meanwhile, concerns over a potential military attack on Syria receded over the weekend after the US and Russia agreed that Bashar al-Assad's regime must hand over details of its stockpile within a week; the weapons will then be removed and destroyed before mid-2014.
Asian markets performed well overnight after former Treasury Secretary Larry Summers pulled out of the running to replace Ben Bernanke as Fed Chairman when he steps down in January. The removal of Summers - widely viewed as a hawkish candidate in the running for the position - also positive reaction on markets on Monday on the back of hopes that current Fed Vice Chair and well-known dove Janet Yellen may now by the firm favourite. She is expected to favour a slower reduction of stimulus.
"Larry Summers was seen as more concerned about the unintended consequences of quantitative easing than the current Chairman and also the other contender in the race, current Vice-Chair Janet Yellen. So the Fed was seen reducing QE and raising rates earlier with him at the helm," said Chief Economist Simon Smith from FxPro.
Insurers, airlines provide a lift
Insurers were performing well this morning with Standard Life, Prudential and Legal & General among the highest risers. Airlines were also providing a lift as falling crude prices eased fears about rising jet fuel costs; easyJet and IAG were in demand.
Miners on the other hand were putting in a mixed performance with Fresnillo a standout faller, dropping over 10% early on. ENRC was also lower, while Anglo American and Antofagasta headed higher.
Plumbers merchant Wolseley was in the red after Credit Suisse downgraded the stock to 'neutral'.
Oil and gas services provider Petrofac was higher on the news that it is to operate and manage two training facilities for Malaysian oil major PETRONAS in a contract worth $120m.
Petra Diamonds jumped after swinging to an annual profit driven by a rise in revenue and production along with tight cost control and operational expansion. Net profit after tax came to $27.9m from the prior year's loss of $2.1m as revenue jumped 27% to $402.7m from $316.9m.
Aim listed water purification and dispensing systems group Waterlogic however fell despite seeing a strong increase in profits in the first half of 2012. |
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| | FTSE 100 - Risers
Reckitt Benckiser Group (RB.) 4,554.00p +2.29%
ITV (ITV) 183.40p +2.12%
Land Securities Group (LAND) 922.00p +1.49%
British Land Co (BLND) 582.50p +1.48%
Capita (CPI) 1,003.00p +1.47%
Tate & Lyle (TATE) 793.00p +1.34%
RSA Insurance Group (RSA) 123.10p +1.15%
Serco Group (SRP) 574.50p +1.14%
Marks & Spencer Group (MKS) 511.50p +1.09%
Babcock International Group (BAB) 1,203.00p +1.09%
FTSE 100 - Fallers
Anglo American (AAL) 1,568.50p -3.21%
Morrison (Wm) Supermarkets (MRW) 295.30p -2.38%
BHP Billiton (BLT) 1,885.00p -1.98%
Wood Group (John) (WG.) 807.00p -1.94%
Vedanta Resources (VED) 1,160.00p -1.86%
Antofagasta (ANTO) 849.50p -1.68%
easyJet (EZJ) 1,300.00p -1.59%
Petrofac Ltd. (PFC) 1,390.00p -1.56%
ARM Holdings (ARM) 972.00p -1.47%
Barclays (BARC) 301.60p -1.41%
FTSE 250 - Risers
Imagination Technologies Group (IMG) 339.70p +10.51%
Fenner (FENR) 407.40p +5.19%
Barratt Developments (BDEV) 330.90p +5.05%
Bwin party Digital Entertainment (BPTY) 115.00p +4.64%
Crest Nicholson Holdings (CRST) 337.20p +3.75%
TalkTalk Telecom Group (TALK) 257.50p +3.41%
Brewin Dolphin Holdings (BRW) 278.10p +3.00%
Bodycote (BOY) 680.50p +2.79%
Ashtead Group (AHT) 652.50p +2.76%
Wetherspoon (J.D.) (JDW) 752.00p +2.31%
FTSE 250 - Fallers
Pennon Group (PNN) 699.50p -3.72%
Polymetal International (POLY) 709.50p -3.47%
Kenmare Resources (KMR) 27.50p -2.55%
Lonmin (LMI) 335.10p -2.45%
esure Group (ESUR) 227.70p -2.27%
African Barrick Gold (ABG) 164.20p -2.03%
Diploma (DPLM) 633.00p -2.01%
Dairy Crest Group (DCG) 483.40p -1.99%
AZ Electronic Materials SA (DI) (AZEM) 311.00p -1.89%
ICAP (IAP) 405.80p -1.81% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks rise as Summers bows out of Fed race - Lawrence Summers drops out of running for Fed Chairman
- Syria to hand over details of stockpile
- Fed policy meeting begins Tuesday
FTSE 100: 0.65%
DAX: 0.81%
CAC 40: 0.66%
FTSE MIB: 0.62%
IBEX 35: 0.94%
Stoxx 600: 0.59%
European equities climbed after Lawrence Summers bowed out of the race as Federal Reserve Chairman and as fears over Syria subsided.
Summers' withdrawal from consideration to take over from Ben Bernanke as the head of the central bank, paves the way for Fed Vice Chair Janet Yellen to take over.
Yellen is a firm favourite among investors who expect she will lean towards a slower reduction of stimulus.
The Fed is tipped to announce a scaling back of its $85bn per month in bond purchases at its two-day policy meeting which kicks off on Tuesday.
The central bank has said it will begin tapering some time this year so long as it feels the US economy and jobs market has recovered sufficiently.
"The ability of the economy to show sufficient signs of improvement within the jobs markets has been a core driver of expectations and the trends appear to point towards the economy being just about accommodative to such a move," said Market Analyst Craig Erlam from Alpari.
Meanwhile, concerns over a potential military attack on Syria abated over the weekend after the US and Russia agreed that President Bashar al-Assad's regime must submit details of its stockpile of chemical weapons within a week. The weapons will then be removed and destroyed before mid-2014.
US President Barack Obama has insisted that if diplomacy failed he will push for military force against Assad's government which was accused of using chemical weapons against civilians last month.
"With the prospects of an imminent military conflagration on Syria diminishing into the distance after the weekend agreement between the US and Russia on Syria's chemical weapons, the markets would appear to have one less thing to worry about as markets begin a new week, with all eyes on this week's Federal Reserve meeting, and whether or not we will see the beginning of the long anticipated tapering programme", said Senior Market Analyst Michael Hewson from CMC Markets.
Deutsche Lufthansa, Kaba, Petra Diamonds
Deutsche Lufthansa AG's shares rose after saying Chief Executive Officer Christoph Franz would not extend his contract.
Kaba Holding rallied after the Swiss maker of high-security locks reported an increase in full-year sales.
Petra Diamonds jumped after saying it swung to an annual profit driven by a rise in revenue and production along with tight cost control and operational expansion.
Other asset classes mixed
The euro edged up 0.48% to the 1.3358 US dollar.
Brent crude futures fell $0.576 to $111.060 per barrel on the ICE. |
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| | US Market Report | | US close: Stocks rise after poor data ahead of FOMC - Talks over Syria 'constructive', says Kerry
- Confidence, retail data misses forecasts
- Dow has best week since January
Dow Jones: 0.49%
S&P 500: 0.27%
Nasdaq: 0.17%
US stocks edged higher on Friday after disappointing economic data sparked hopes that if the Federal Reserve scales back stimulus this month, the 'taper' might not be as severe as expected.
The Dow Jones Industrial Average has gained 3% over the last five days, the index's best weekly performance since January, while the S&P 500 and Nasdaq finished the week up 2% and 1.7%, respectively.
Talks between Russia and the US to try to find a diplomatic solution to the conflict in Syria continued on Friday without any major surprises. US Secretary of State John Kerry said that discussions with Russian counterpart Sergei Lavrov in Geneva have been "constructive" as they talk about the handing over and destruction of Syrian chemical weapons.
Kerry said: "It is too early to tell whether these efforts will succeed, but the technical challenges of trying to do this in the context of the civil war are obviously immense. But despite how difficult this is, with the collaboration of our experts, and only with the compliance of the Assad regime, we do believe there is a way to get this done."
Data in focus ahead of FOMC
The focus was back on domestic economic data on Friday ahead of the all-important Federal Open Market Committee two-day meeting which concludes next Wednesday. The near-term outlook for monetary policy remains very much uncertain given the worse-than-expected non-farm payrolls in August. Meanwhile, jobless claims revealed yesterday - which dropped to a seven-year low - were affected by one-off factors.
As for Friday's data, the Thomson Reuters/University of Michigan's preliminary reading of its consumer sentiment index fell to 76.8 in September from 82.1 in August, its lowest reading since April.
Meanwhile, the Commerce Department revealed that the rate of growth in US retail sales slowed in August to a 0.2% increase from a 0.4% rise in July. The was the smallest rise in four months.
David Madden, Market Analyst at IG, said that the data "left traders in two minds about whether to expect tapering by the US Federal Reserve.
"The dud jobless claims report from yesterday has clouded trader's judgement as to what the Fed is going to do at next week's meeting. The longer [Chairman] Ben Bernanke avoids tapering, the more the market will demand it."
Intel jumps after upgrade
Intel advanced as Jefferies raised its recommendation on the chipmaker from 'hold' to 'buy' and lifted its target from $27 to $30. Analyst Mark Lipacis said there are "60 billion reasons to buy".
Supermarket group Safeway also rallied as Credit Suisse upgraded the US supermarket chain from 'underperform' to 'outperform'.
Peabody Energy was a heavy faller after the government restricted new coal plants without certain emission controls.
Tech giant Apple was extending losses in the aftermath of its underwhelming new iPhone launch this week. The stock has dropped 6.7% over the past five days.
S&P 500 - Risers
GameStop Corp. (GME) $52.45 +6.07%
Safeway Inc. (SWY) $28.20 +6.05%
Regeneron Pharmaceuticals Inc. (REGN) $289.97 +5.98%
Tenet Healthcare Corp. (THC) $40.22 +5.21%
Helmerich & Payne Inc. (HP) $68.99 +3.65%
Mosaic Company (MOS) $45.99 +3.63%
Intel Corp. (INTC) $23.44 +3.58%
Janus Capital Group Inc. (JNS) $8.85 +3.15%
Xerox Corp. (XRX) $10.45 +3.06%
SAIC Inc. (SAI) $15.41 +3.01%
S&P 500 - Fallers
Peabody Energy Corp. (BTU) $17.98 -3.18%
QEP Resources Inc (QEP) $28.12 -2.29%
TripAdvisor Inc. (TRIP) $72.82 -2.24%
CONSOL Energy Inc. (CNX) $33.80 -2.20%
Ensco Plc. (ESV) $55.48 -2.17%
Occidental Petroleum Corp. (OXY) $89.49 -1.67%
Apple Inc. (AAPL) $464.90 -1.65%
Cliffs Natural Resources Inc. (CLF) $22.07 -1.56%
Covidien Plc (COV) $60.45 -1.55%
United States Steel Corp. (X) $19.87 -1.54%
Dow Jones I.A - Risers
Intel Corp. (INTC) $23.44 +3.58%
Walt Disney Co. (DIS) $66.69 +1.83%
E.I. du Pont de Nemours and Co. (DD) $58.88 +1.41%
Boeing Co. (BA) $111.33 +1.39%
Microsoft Corp. (MSFT) $33.03 +1.04%
Procter & Gamble Co. (PG) $79.05 +1.01%
Verizon Communications Inc. (VZ) $47.76 +0.87%
International Business Machines Corp. (IBM) $192.17 +0.75%
Pfizer Inc. (PFE) $28.51 +0.71%
JP Morgan Chase & Co. (JPM) $52.59 +0.67%
Dow Jones I.A - Fallers
Alcoa Inc. (AA) $8.08 -0.98%
Johnson & Johnson (JNJ) $88.57 -0.49%
Home Depot Inc. (HD) $75.11 -0.38%
Unitedhealth Group Inc. (UNH) $74.48 -0.35%
General Electric Co. (GE) $23.78 -0.29%
AT&T Inc. (T) $34.32 -0.16%
Merck & Co. Inc. (MRK) $47.79 -0.13%
Nasdaq 100 - Risers
Regeneron Pharmaceuticals Inc. (REGN) $289.97 +5.98%
Intel Corp. (INTC) $23.44 +3.58%
Sears Holdings Corp. (SHLD) $60.42 +2.70%
Randgold Resources Ltd. Ads (GOLD) $71.54 +2.32%
Bed Bath & Beyond Inc. (BBBY) $73.63 +2.12%
Kraft Foods Group, Inc. (KRFT) $54.24 +1.57%
F5 Networks Inc. (FFIV) $92.01 +1.52%
Amgen Inc. (AMGN) $115.06 +1.41%
Netflix Inc. (NFLX) $305.65 +1.41%
Akamai Technologies Inc. (AKAM) $51.27 +1.38%
Nasdaq 100 - Fallers
Vertex Pharmaceuticals Inc. (VRTX) $78.25 -3.87%
Apple Inc. (AAPL) $464.90 -1.65%
Yahoo! Inc. (YHOO) $29.26 -1.32%
Baidu Inc. (BIDU) $142.64 -1.29%
Maxim Integrated Products Inc. (MXIM) $28.97 -1.16%
Facebook Inc. (FB) $44.31 -0.98%
Costco Wholesale Corp. (COST) $117.03 -0.98%
Nuance Communications Inc. (NUAN) $19.31 -0.97%
Staples Inc. (SPLS) $14.43 -0.96%
Sba Communications Corp. (SBAC) $76.50 -0.96% |
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| | Newspaper Round Up | | Monday newspaper round-up: Fed, Royal Mail, House prices Lawrence Summers has taken himself out of the running to be the next chair of the Federal Reserve after a bloc of key Democratic senators indicated they would oppose his nomination. Janet Yellen, the Fed vice-chair, is now the frontrunner to replace Ben Bernanke in January, in an appointment that would make her the first woman to hold the post. Mr Summers, a former Treasury Secretary and senior economic adviser to Barack Obama in his first term, galvanised opposition among left-of-centre Democrats who painted him as a symbol of the wrongs of financial deregulation, the Financial Times writes.
Plans to privatise the Royal Mail faced potential disruption on Sunday after First Minister Alex Salmond said the move should be put on hold until after the Scottish independence referendum. Mr. Salmond demanded the moratorium so people in Scotland can have their own say on what do with the 'public asset' in the event of a Yes vote next September. 'The Scottish Government is firmly opposed to the privatisation of Royal Mail and this proposed sell-off of an essential public service should be subject to a moratorium until the result of Scotland's referendum is known,' he said, according to The Daily Mail.
The Sultan of Brunei has secretly spent £500m buying most of Queensway, the scruffy west London thoroughfare, with the ambition of creating an estate in the image of historic landowners such as Grosvenor. In an extraordinary series of off-market swoops, Brunei's royal family has amassed about 75% of the property on the road, which runs north from Kensington Gardens. The deals were arranged by Siahaf, a development company run by the British investor Johnny Sandelson and Mohamad Shuif Hussain, an entrepreneur from Brunei, The Times reports.
A crash in the soaring London housing market could derail the tentative recovery of the entire British economy, one of the world's leading economists has warned. As fears rise of a new bubble in house prices, Paul Ballew, global chief economist for credit-rating group Dun & Bradstreet, said: 'A London crash could stall the economy. It's a big enough asset class to matter. The ripple effects of a key sector go throughout the economy in so many ways.' Houses in the capital's ten most expensive boroughs are now worth as much as the property markets of Wales, Scotland and Northern Ireland combined, The Daily Mail writes.
In a survey of business leaders carried out with KPMG, the Confederation of British Industry [CBI] today tells the Government to do more to develop the nation's railway links, roads and airports, and to move faster to tie up projects and spending plans. John Cridland, the CBI's director-general, said transport and energy should be immediate priorities, according to The Times.
Britain's biggest listed companies run the risk of shareholder rebellions or extra taxes from the UK government if they continue to sit on their £166bn cash pile, according to a report out today. Figures show that the combined amount of gross cash amassed by FTSE 100 businesses has grown by £42.2bn, or 34%, since the financial crash of 2008 to reach a record £166bn. The increase alone is enough to pay for the HS2 rail project or meet more than a third of Whitehall's annual fiscal deficit, The Scotsman explains. | | |
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