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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 flat ahead of economic data Stocks opened flat on Tuesday morning as ongoing uncertainty over Federal Reserve monetary policy and concerns over the US debt ceiling continue to dominate market sentiment.
Investors were also choosing a cautious approach ahead of business confidence data from Germany this morning, as well as American home prices and consumer confidence figures later on.
Markets across the globe declined on Monday as traders continued to digest the surprise decision by the Fed last week not to begin scaling back stimulus. While St Louis Fed President James Bullard admitted that the central bank could still trim asset purchases at its next meeting, fellow official William Dudley (New York Fed) said the US has yet to show "any meaningful pickup" in momentum.
He said the Fed must push hard against headwinds and he would only feel comfortable with a 'taper' as long as there is a "continued improvement in the labour market".
"With no less than 12 Fed speakers due to speak in the next five days investors will be looking for clues as to where each member stands vis--vis the taper question," said Senior Market Analyst Michael Hewson from CMC Markets.
As the 'no-taper' rally begins to fade, the focus has turned to talks over the debt ceiling in recent days after President Barack Obama urged Congress to approve a budget to prevent a government shutdown by October 1st.
Market Analyst Craig Erlam from Alpari said that slow progress in negotiating is "nothing new" and the debate is likely to go down to the wire, as has been the case before.
"Despite being fully aware of this and the majority not believing for a second that Congress will allow a shutdown of government, traders continue to act with caution which truly highlights the lack of confidence in the people who run the world's largest economy," he said.
Miners track metal prices lower
Mining stocks were under the weather this morning as gold, silver and copper prices edged lower. Randgold, Fresnilllo, Vedanta, Anglo American and Rio Tinto were in the red early on.
Power systems firm Rolls-Royce was a high riser this morning after Jefferies raised its target for the stock from 1,250p to 1,400p and kept a 'buy' rating, showing optimism with its 'TotalCare' services.
Continued growth in the US and a return to growth for advertising revenues enabled publisher Euromoney Institutional Investor to signal strong trading for the fourth quarter, causing shares to advance this morning.
Finance house Close Bros also gained after it reported a strong set of full-year results as Asset Management returned to profit while Banking and Securities improved. |
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| | UK Event Calendar | | Tuesday September 24
INTERIMS
1Spatial, Augean, Blur (Group), Cupid, DDD Group, Dillistone Group, Dolphin Capital Investors Ltd, RapidCloud International , ReThink Group
INTERIM DIVIDEND PAYMENT DATE
Rentokil Initial
QUARTERLY EX-DIVIDEND DATE
Total SA
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Consumer Confidence (US) (15:00)
House Price Index (US) (15:00)
IFO Business Climate (GER) (09:00)
IFO Current Assessment (GER) (09:00)
IFO Expectations (GER) (09:00)
FINALS
Albemarle & Bond Holdings, Close Brothers Group, CVS Group, Hargreaves Services, Netcall
AGMS
Anglesey Mining, Ashcourt Rowan, City of London Group, Fastnet Oil & Gas, Sirius Minerals, Surface Transforms, Tricorn Group, Victoria
TRADING ANNOUNCEMENTS
Dolphin Capital Investors Ltd, Euromoney Institutional Investor
UK ECONOMIC ANNOUNCEMENTS
BBA Mortgage Lending Figures (09:30)
FINAL DIVIDEND PAYMENT DATE
Bloomsbury Publishing
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks rise ahead of German, US data - German business confidence report
- US consumer confidence figures
- Federal Reserve officials speak
FTSE 100: 0.13%
DAX: 0.23%
CAC 40: 0.35%
FTSE MIB 0.25%
IBEX 35: 0.03%
Stoxx 600: 0.14%
European equities advanced ahead of the release of German and US data and speeches from two Federal Reserve officials.
In Germany, a report from the Ifo Institute is expected to show business confidence rose for a fifth month in September. The business climax index, based on a survey of 7,000 executives, increased to 108 from 107.5 in August, according to forecasts.
The report comes as Germany's federal election remains inconclusive.
Angela Merkel's Christian Democratic Union party won 41.5% of votes at the country's federal election on Sunday - which was not enough to secure a majority required to secure her third term as leader of Europe's largest economy.
She will need to find a coalition partner with either the Social Democrats which won 25.7% or the Green party which won 8.4%.
In the US, consumer confidence figures will be released later amid concerns over the government budget debate and the possibility of stimulus cut next month.
The index for consumer sentiment in the world's biggest economy is expected to fall to 80.3 in September from 81.5 in August.
Separately, data will show the US house price index rose 0.9% in July from 0.7% the prior month.
Policymakers are turning to economic indicators as the Federal Reserve continues to weigh up when to begin scaling back its $85bn per month in bond purchases.
The Fed shocked markets last week when it announced it would keep its stimulus unchanged.
Federal Reserve officials have been dishing out their thoughts following the decision.
New York Fed President on Monday defended the central bank's move, saying the US economy was not ready for tapering as the economy had not picked up forward momentum.
On Friday James Bullard, head of the St Louis Fed, said that a tapering could come in October and admitted that this month's decision to maintain quantitative easing was a close call.
Investors will now turn to speeches from Fed Bank of Cleveland President Sandra Pianalto and Fed Bank of Kansas President Esther George today.
Debt ceiling talks are also high on the agenda after President Barack Obama urged Congress to approve a budget to prevent a government shutdown by October 1st.
If the government fails to reach an agreement to raise the borrowing authority, which is currently limited to $16.7tn, it could lead to the first default by the US on its debt obligations.
In the UK, data will include the release of a British Bankers Association report which is anticipated to show loans for house purchase jumped to 38,950 in August from 37,200 in July.
Telefonica increases stake in Telecom Italia
Telecom Italia rallied after Telefonica SA agreed to increase its stake in the Italian phone company.
Total SA rose after Barclays raised its rating on the oil producer to 'equal weight' from 'underweight'.
Burckhardt Compression Holding declined after saying fiscal first-half net income will drop from a year ago.
Euro/dollar edges higher
The euro rose 0.12% to the 1.3509 US dollar.
Brent crude futures fell $0.334 to $107.800 per barrel on the ICE. |
| | This major London estate agent is listing on the LSE. | | Your free report on the Foxtons IPO includes: - IPO parameters (price range/market cap etc)
- Full breakdown of dates, including grey-market period.
- Performance of peers and recent similar IPOs.
Click here for your free Foxtons IPO report Losses can exceed deposits. |
| | US Market Report | | US close: Banks drag markets lower, but Apple jumps - Fed speakers in focus after 'no taper' decision
- Chicago data improves, US manufacturing PMI falls
- Apple jumps on record weekend iPhone sales
Dow Jones: -0.32%
Nasdaq: -0.25%
S&P 500: -0.47%
Heavy falls in the banking sector weighed on US markets on Monday as uncertainty over Federal Reserve monetary policy and an ongoing debate over the debt ceiling prompted investors to scale back risk appetite.
"With no less than 12 Fed speakers due to speak in the next five days investors will be looking for clues as to where each member stands vis--vis the taper question," said Senior Market Analyst Michael Hewson from CMC Markets.
Traders were still digesting last Wednesday's surprise decision by the Federal Reserve not to begin scaling back stimulus. After an initial surge, gains on markets were mostly erased by the end of last week after James Bullard, head of the St Louis Fed, admitted that the decision was a close call and that the central bank could still trim asset purchases at its next meeting.
Comments from other Fed officials dampened sentiment further on Monday, including New York Fed President William Dudley who said that the US has yet to show "any meaningful pickup" in momentum. He said that the central bank must push hard against headwinds and he would only feel comfortable with a 'taper' as long as there is a "continued improvement in the labour market".
Meanwhile, talks surrounding the US debt ceiling were also catching the attention of investors today after President Barack Obama this weekend urged Congress to approve a budget to prevent a government shutdown by October 1st.
"While most people in the markets would agree that the odds of a government shutdown are extremely slim, they are clearly not willing to put their money where their mouth is," said Craig Erlam, a Market Analyst at Alpari .
Chicago Fed national activity index turns up
The Federal Reserve bank of Chicagos national activity index for the month of August has come in at 0.14, after a reading of -0.43 for the month before (consensus: -0.05).
The Markit US manufacturing sector purchasing managers' index (PMI) for the month of September has come in at 52.8, versus 53.1 for the month before (consensus: 54.0).
Apple jumps on new iPhone sales
Following the underwhelming launch of the iPhone 5S and iPhone 5C earlier this month, confidence in tech giant Apple returned on Monday after figures from the first weekend of sales impressed. Some 9m new models were sold over the weekend, well ahead of the 5m in opening sales for the previous device. According to Bloomberg, analysts were expecting sales of 6-7.75m.
Chief Executive Tim Cook said: "This is our best iPhone launch yet - more than nine million new iPhones sold - a new record for first weekend sales."
Apple also said that over 11m users have listened to its iTunes Radio services since its launch earlier this year, prompting a sharp fall in the share price of fellow online radio company Pandora Media.
Meanwhile, smartphone maker BlackBerry edged higher after saying that it could go private through a $4.7bn takeover from its largest shareholder, Fairfax Financial.
Banking stocks were providing a drag with JPMorgan Chase & Co and Bank of America among the worst performers on the Dow. Citigroup, Wells Fargo and Goldman Sachs were also in the red.
Citi was making headlines on concerns that it has suffered a significant decline in trading revenues. The lender seems ready to join the other powerhouses of bond trading following the sharper-than-expected slowdown in its markets businesses. Some believe the bank may show revenues having fallen by significantly more than 10%, according to the Financial Times.
S&P 500 - Risers
Apple Inc. (AAPL) $490.64 +4.97%
FirstEnergy Corp. (FE) $37.64 +2.67%
Frontier Communications Co. (FTR) $4.28 +2.37%
Actavis Inc (ACT) $138.60 +2.29%
Edison International (EIX) $47.05 +2.24%
Unitedhealth Group Inc. (UNH) $71.82 +1.77%
TECO Energy Inc. (TE) $17.00 +1.74%
Jabil Circuit Inc. (JBL) $23.51 +1.73%
PPL Corp. (PPL) $30.63 +1.73%
Washington Post Co. (WPO) $590.12 +1.68%
S&P 500 - Fallers
Sealed Air Corp. (SEE) $27.01 -5.43%
F5 Networks Inc. (FFIV) $89.17 -4.75%
J.C. Penney Co. Inc. (JCP) $12.36 -4.63%
Netflix Inc. (NFLX) $302.04 -3.76%
Morgan Stanley (MS) $27.22 -3.44%
Citigroup Inc. (C) $49.57 -3.20%
Goldman Sachs Group Inc. (GS) $165.25 -2.65%
JP Morgan Chase & Co. (JPM) $51.46 -2.54%
Cameron International Corp. (CAM) $58.72 -2.47%
BB&T Corp. (BBT) $34.19 -2.45%
Dow Jones I.A - Risers
Unitedhealth Group Inc. (UNH) $71.82 +1.77%
General Electric Co. (GE) $24.28 +1.12%
3M Co. (MMM) $121.11 +0.92%
Wal-Mart Stores Inc. (WMT) $76.42 +0.78%
Boeing Co. (BA) $117.51 +0.75%
International Business Machines Corp. (IBM) $190.99 +0.51%
Chevron Corp. (CVX) $125.52 +0.48%
Verizon Communications Inc. (VZ) $47.98 +0.42%
McDonald's Corp. (MCD) $97.28 +0.39%
Travelers Company Inc. (TRV) $86.38 +0.37%
Dow Jones I.A - Fallers
JP Morgan Chase & Co. (JPM) $51.46 -2.54%
Bank of America Corp. (BAC) $14.14 -2.08%
Coca-Cola Co. (KO) $38.63 -1.95%
Home Depot Inc. (HD) $75.91 -1.42%
American Express Co. (AXP) $76.44 -1.14%
Exxon Mobil Corp. (XOM) $87.75 -1.03%
Cisco Systems Inc. (CSCO) $24.27 -0.96%
Merck & Co. Inc. (MRK) $47.68 -0.69%
Johnson & Johnson (JNJ) $89.09 -0.66%
Intel Corp. (INTC) $23.62 -0.63%
Nasdaq 100 - Risers
Apple Inc. (AAPL) $490.64 +4.97%
Baidu Inc. (BIDU) $149.26 +2.06%
Maxim Integrated Products Inc. (MXIM) $30.04 +1.21%
Whole Foods Market Inc. (WFM) $58.24 +0.67%
Avago Technologies Ltd. (AVGO) $41.87 +0.60%
Vodafone Group Plc ADS (VOD) $33.72 +0.43%
Applied Materials Inc. (AMAT) $15.99 +0.38%
Express Scripts Holding Co (ESRX) $62.28 +0.37%
Viacom Inc. Class B (VIAB) $83.38 +0.29%
Microchip Technology Inc. (MCHP) $40.33 +0.22%
Nasdaq 100 - Fallers
Green Mountain Coffee Roasters Inc. (GMCR) $79.43 -5.62%
F5 Networks Inc. (FFIV) $89.17 -4.75%
Netflix Inc. (NFLX) $302.04 -3.76%
Catamaran Corp (CTRX) $47.91 -3.25%
Citrix Systems Inc. (CTXS) $74.38 -2.23%
Biogen Idec Inc. (BIIB) $242.67 -2.20%
Yahoo! Inc. (YHOO) $30.26 -2.15%
Celgene Corp. (CELG) $146.78 -2.05%
Gilead Sciences Inc. (GILD) $62.58 -2.00%
Liberty Interactive Corp (LINTA) $24.05 -1.96% |
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| | Newspaper Round Up | | Tuesday newspaper roundup: MPC, Fed, Household spending A Bank of England policymaker has admitted the widely-held belief that interest rates have been set in response to changes in growth rather than the official inflation mandate. Ben Broadbent, an external member of the Monetary Policy Committee (MPC), made the revelation as part of an attempt to explain the Bank's new 7 per cent unemployment target, which he claimed was now more relevant than growth due to productivity bottlenecks in the economy, The Daily Telegraph says.
One of the US Federal Reserve's most senior officials talked down the health of theworld's largest economyon Monday, saying it does not have enough momentum to justify slowing down thecentral bank's $85bn monthly asset purchases. "The economy has not picked up forward momentum and a 2% growth rate even if sustained might not be sufficient to generate further improvement in labour market conditions," said William Dudley, president of the New York Fed and vice-chair of therate-setting Federal Open Market Committee, the Financial Times says.
BlackBerry was thrown a lifeline yesterday after its biggest shareholder offered $4.7bn to take the Canadian company private. A consortium led by Fairfax Financial, the Canadian private equity company owned by Prem Watsa, its billionaire founder, has offered to pay $9 for each share in the ailing smartphone maker a small premium on Friday's closing price of $8.23, but a drop in the ocean compared with the $147.55 that marked BlackBerry's peak in June 2008, The Times reports.
The US Justice Department is preparing to sue JP Morgan Chase over mortgage bonds it sold in the run-up to the financial crisis, according to reports. A lawsuit, first reported by Reuters, could come as early as Tuesday, people familiar with the matter said. JP Morgan spokesman Brian Marchiony and Justice Department spokeswoman Adora Andy Jenkins declined to comment. The bank disclosed in August that federal prosecutors in California were conducting criminal and civil investigations into the bank's mortgage securities, The Daily Telegraph says.
The Government is to plough on with re-privatising the East Coast Main Line before the election in a competition that could attract the most international cast of railway bidders yet. The Department for Transport will begin the tendering process for a sell-off of the Kings Cross-to-Edinburgh line next month. It is understood that the invitation to tender for the franchise will go out by the end of October, with the aim of having it in private hands by the first quarter of 2015. The line has twice been taken back into state hands after the failures of franchises run by Sea Containers/GNER and by National Express, The Times explains.
British families are yet to feel the full benefits of the economic recovery as household spending power fell again last month. Yet strains on domestic budgets have begun to recede and confidence about job security is gradually beginning to improve consumers' perceptions. Asda's Income Tracker revealed that household disposable income was down by 2 a week from the same month last year and 6 a week from its February 2010 peak, The Daily Mail writes. | | |
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