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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 lifted by Chinese GDP, US stimulus hopes A pick-up in Chinese growth and speculation over a delayed tapering of US stimulus gave UK markets a boost on Friday morning with the FTSE 100 nearing a one-month high.
The London index was trading near 6,600 in early trading today; it has not closed above this mark since September 19th when it ended at 6,625.39.
Chinese gross domestic product grew at a year-on-year rate of 7.8% in the third quarter, rebounding after the 7.5% growth seen in the second quarter. This was bang in line with consensus estimates, though a slowdown in growth of industrial production, retail sales and fixed asset investment in September could mean that there will be some weakness in upcoming quarters.
Meanwhile, as the dust begins to settle following the last-minute deal on Wednesday to extend the debt ceiling and reopen the US government, investors are now beginning to look at the impact it will have on the economic outlook. Many believe that the political uncertainty in Washington may be enough to delay the Federal Reserve from tapering stimulus until early 2014. Such hopes boosted the S&P 500 on Wall Street to its highest ever close of 1,733.15 on Thursday night.
Markets are looking ahead to the delayed release of the September US employment report next Tuesday, which will be "crucial in gauging the Fed's next possible move, if any move at all", said Market Strategist Ishaq Siddiqi from ETX Capital. "Many are now ruling out tapering during 2013 as the fiscal situation in the US will remain in the backdrop in some fashion until early next year when it has to be dealt with again," he said.
Anglo American falls after iron-ore slump
Diversified mining group Anglo American was lower this morning after reporting a 24% fall in iron-ore production in the third quarter and an 8% decline in manganese, which together account for one half of group profits.
Goldman Sachs was also weighing on the share price this morning after cutting its target for iron ore, saying it wants to see more clarity on the timescale of Fed tapering.
Fellow miner EVRAZ was also in the red after it reported a fall in overall production in the third quarter and said that steel prices continue to be affected by "downward trends" in global markets.
United Utilities advanced this morning after Credit Suisse upgraded its rating for the stock from 'underperform' to 'neutral', saying it only offers 2% total return downside to its target. The target for Severn Trent, its top pick in the sector, was increased from 1,530p to 1,580p. |
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| FTSE 100 - Risers
Prudential (PRU) 1,253.00p +3.21%
Reckitt Benckiser Group (RB.) 4,450.00p +2.16%
Sports Direct International (SPD) 713.00p +1.64%
Whitbread (WTB) 3,314.00p +1.22%
Wolseley (WOS) 3,228.00p +1.13%
Kingfisher (KGF) 383.50p +1.08%
Diageo (DGE) 1,974.00p +1.02%
InterContinental Hotels Group (IHG) 1,848.00p +0.98%
GKN (GKN) 367.70p +0.96%
WPP (WPP) 1,288.00p +0.94%
FTSE 100 - Fallers
William Hill (WMH) 405.00p -2.83%
Anglo American (AAL) 1,512.50p -2.61%
CRH (CRH) 1,531.00p -0.52%
Mondi (MNDI) 1,091.00p -0.46%
Tullow Oil (TLW) 977.00p -0.46%
Barclays (BARC) 277.40p -0.32%
Royal Bank of Scotland Group (RBS) 375.70p -0.32%
British American Tobacco (BATS) 3,304.00p -0.30%
Old Mutual (OML) 196.60p -0.30%
Petrofac Ltd. (PFC) 1,384.00p -0.29%
FTSE 250 - Risers
Alent (ALNT) 348.70p +3.44%
Regus (RGU) 205.50p +2.65%
Renishaw (RSW) 1,620.00p +2.53%
Ted Baker (TED) 1,717.00p +2.32%
Telecity Group (TCY) 812.00p +1.95%
Ocado Group (OCDO) 458.40p +1.75%
Polymetal International (POLY) 579.00p +1.58%
Dunelm Group (DNLM) 878.00p +1.50%
BH Global Ltd. USD Shares (BHGU) 11.57 +1.49%
Rightmove (RMV) 2,587.00p +1.49%
FTSE 250 - Fallers
Savills (SVS) 635.50p -2.00%
Evraz (EVR) 129.50p -1.89%
Cairn Energy (CNE) 285.80p -1.24%
Interserve (IRV) 602.00p -1.23%
Mitchells & Butlers (MAB) 395.80p -1.05%
Keller Group (KLR) 1,040.00p -0.95%
Hansteen Holdings (HSTN) 104.00p -0.95%
Micro Focus International (MCRO) 791.00p -0.75%
UDG Healthcare Public Limited Company (UDG) 322.00p -0.74% |
| | UK Event Calendar | | INTERIMS
Booker Group, Etalon Group Ltd GDR (Reg S)
INTERIM DIVIDEND PAYMENT DATE
Melrose Industries, Netplay TV, RPS Group, Standard Chartered
QUARTERLY EX-DIVIDEND DATE
Caterpillar Inc.
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Balance of Payments (EU) (09:00)
Bloomberg Consumer Confidence (US) (14:45)
Building Permits (US) (13:30)
Capacity Utilisation (US) (14:15)
Continuing Claims (US) (13:30)
Current Account (EU) (09:00)
Housing Starts (US) (13:30)
Industrial Production (US) (16:15)
Initial Jobless Claims (US) (13:30)
Philadelphia Fed Index (US) (15:00)
Speech President New York Fed (17:45)
Speech President Kansas City Fed (17:45)
Speech President Minneapolis Fed (19:45)
IMSS
Cairn Energy, Dechra Pharmaceuticals, Diageo, Jupiter Fund Management , Man Group, Rank Group, Renishaw
EGMS
Zhejiang Expressway Co 'H' Shares
AGMS
Brooks Macdonald Group, Dechra Pharmaceuticals, IG Group Holdings, Monitise, Rank Group, Renishaw
TRADING ANNOUNCEMENTS
Britvic, Mothercare, Rank Group, SABMiller
UK ECONOMIC ANNOUNCEMENTS
Internet Retail Sales (09:30)
Retail Sales (09:30)
FINAL DIVIDEND PAYMENT DATE
Coral Products, Volex
Q1
British Sky Broadcasting Group |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks and Euro move higher - Investors debate timing of Fed tapering
- Euro/dollar near technical resistance
- Banks deposit 44.8bn euros at ECB overnight
FTSE 100: 0.34%
Dax-30: 0.08%
Cac-40: 0.39%
FTSE Mibtel 30: 0.04%
Ibex 35: 0.38%
Stoxx 600: 0.34%
The main European equity indices are now registering small gains, tracking overnight gains on Wall Street, as investors are now left to wonder just where the recent goings-on in Capitol Hill leave expectations for Fed tapering.
Nevertheless, sentiment seems to have received a small boost this morning following the release of in-line Chinese gross domestic product (GDP) data showing a 7.8% rate of expansion, slightly higher than in the previous two quarters.
Tensions in US politics may lead the Federal Reserve to put off any tapering plans until even the end of the first quarter of 2014, many analysts think.
However, not all of them are of the same opinion. In that regard, the Financial Times on Friday morning referenced some according to whom a small tapering in December is still possible.
Others, such as Alpari UK's Craig Erlam, emphasised how the recent political tussle had shown just how weak the Republicans' hand is. Hence, one is left to wonder if the situation in the US Congress is in fact all that dangerous to begin with, he explained to Sharecast. Nevertheless, Erlam also sees Fed tapering being postponed until the end of the first quarter of 2014.
Linked to all of the above, the euro/dollar rose 1.10% to 1.3672 overnight, nearing technical resistance towards 1.3710. Worth noting, the European Central Bank is believed to not be at all content to watch the single currency appreciate excessively.
Cable also moved sharply higher on Thursday and is approaching levels of technical resistance too.
Schindler announces stock buy backprogramme
Elevator maker Schindler has announced that it is to spend as much as 1.06bn francs in a modified share buyback program.
Alken Asset Management has sold a 2.7% stake the Spanish manufacturer of blood-plasma products Grifols. After Thursday's close UBS said it placed the shares to institutional investors at €29 each.
Europe's largest hotel group by sales, Accor, unveiled accelerating revenue growth for the third quarter.
The French auto parts supplier Valeo said revenue rose by 2.2% in the third quarter, as Brazilian and Japanese sales took a hit from adverse currency movements.
Light data calendar
The Belgian consumer confidence index, one of the timeliest, will be released bythe country's central bank at 11:00.
Single currency in focus
Front month Brent crude futures are rising by 0.027 to the $109.14/barrel mark on the ICE.
The euro/dollar is now flat at 1.3690. |
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| | US Market Report | | US close: S&P 500 hits record, but earnings weigh on Dow - Stocks rise on stimulus bets
- Goldman, IBM weigh on Dow
- Markets weigh impact of government shutdown
Dow Jones: -0.01%
Nasdaq: 0.62%
S&P 500: 0.67%
US stocks closed broadly higher on Thursday with the S&P 500 hitting a record high, although the Dow Jones Industrial Average finished flat after some disappointing blue-chip earnings.
Heavyweights Goldman Sachs and International Business Machines (IBM) both fell sharply after failing to meet forecasts with their third-quarter results.
While earnings season got into in full swing, investors were still digesting Wednesday's last-minute deal by lawmakers to extend the debt ceiling and reopen the government, and considering what this means for the economic outlook.
Standard & Poor's has already estimated that the closure has already cost the US economy $24bn in lost activity, which will have a 0.6% adverse impact on growth in the fourth quarter. Meanwhile, Chinese ratings agency Dagong on Thursday downgraded its rating for US sovereign debt from 'A' to 'A-', keeping a negative outlook.
However, on a positive note, the shutdown has spurred speculation that the Federal Reserve will delay tapering its quantitative easing programme until later in the year or possibly into 2014, which could provide some support to equity prices in the near term.
Alex Young, Senior Sales Trader at CMC Markets, said that the sell-off in the dollar on Thursday - falling 1% to $1.3677 per euro - hinted at the market's view on Fed tapering. He said that tapering "must surely now be pushed back well into 2014 given that we are very much in the dark as to the real effect on US growth of the shutdown until the government data departments are back up and running".
Goldman, IBM provide a drag on Dow
Shares in investment banking giant Goldman Sachs took a big hit despite an increase in the dividend and a better-than-expected profit after the company announced a sharp decline in third-quarter revenues. At $6.72bn, revenue for the period fell 20% compared to a year earlier and 22% against the previous quarter. Analyst estimates had averaged $7.35bn.
Technology giant IBM fell sharply after revealing after the market close on Wednesday that third-quarter revenues fell $1bn (-4%) to to $23.7bn, below forecasts for a small increase.
American Express surged to its highest ever level after third-quarter net income rose 9% to $1.4bn, ahead of consensus forecasts, helped by "stronger card member spending across all regions".
Precious metal miners Newmont Mining and Randgold were high risers after the the price of gold gained the most in four weeks on speculation over the Fed.
Coal producer Peabody Energy meanwhile rose strongly after earnings for the second quarter came in at the high-end of its guidance range.
S&P 500 - Risers
Sandisk Corp. (SNDK) $68.50 +8.83%
D. R. Horton Inc. (DHI) $19.14 +6.04%
Tesoro Corp. (TSO) $47.84 +5.65%
American Express Co. (AXP) $80.23 +5.12%
PPG Industries Inc. (PPG) $174.47 +4.96%
Danaher Corp. (DHR) $72.31 +4.57%
Newmont Mining Corp. (NEM) $27.06 +4.56%
Lennar Corp. Class A (LEN) $35.36 +4.43%
PulteGroup Inc. (PHM) $16.66 +4.00%
Peabody Energy Corp. (BTU) $18.58 +3.86%
S&P 500 - Fallers
International Business Machines Corp. (IBM) $174.83 -6.37%
Unitedhealth Group Inc. (UNH) $71.37 -5.08%
eBay Inc. (EBAY) $51.38 -4.00%
Union Pacific Corp. (UNP) $151.16 -3.82%
CIGNA Corp. (CI) $77.48 -3.72%
Hudson City Bancorp Inc. (HCBK) $9.15 -3.53%
Xilinx Inc. (XLNX) $45.39 -3.28%
Range Resources Corp. (RRC) $78.54 -3.17%
Stanley Black & Decker Inc. (SWK) $74.37 -3.10%
Cabot Oil & Gas Corp. (COG) $36.34 -3.02%
Dow Jones I.A - Risers
American Express Co. (AXP) $80.23 +5.12%
Verizon Communications Inc. (VZ) $48.90 +3.49%
Boeing Co. (BA) $122.29 +1.62%
Pfizer Inc. (PFE) $30.26 +1.54%
United Technologies Corp. (UTX) $108.02 +1.49%
Coca-Cola Co. (KO) $38.55 +1.45%
3M Co. (MMM) $122.62 +1.39%
Procter & Gamble Co. (PG) $79.42 +1.38%
Visa Inc. (V) $198.28 +1.35%
General Electric Co. (GE) $24.68 +1.31%
Dow Jones I.A - Fallers
International Business Machines Corp. (IBM) $174.83 -6.37%
Goldman Sachs Group Inc. (GS) $158.32 -2.42%
Cisco Systems Inc. (CSCO) $22.78 -0.93%
Caterpillar Inc. (CAT) $85.85 -0.49%
Merck & Co. Inc. (MRK) $47.11 -0.13%
Travelers Company Inc. (TRV) $86.02 -0.07%
Nasdaq 100 - Risers
Sandisk Corp. (SNDK) $68.50 +8.83%
Randgold Resources Ltd. Ads (GOLD) $72.07 +3.70%
Sba Communications Corp. (SBAC) $84.17 +3.26%
Mondelez International Inc. (MDLZ) $32.29 +2.72%
Vodafone Group Plc ADS (VOD) $37.08 +2.70%
Gilead Sciences Inc. (GILD) $67.36 +2.60%
Biogen Idec Inc. (BIIB) $247.10 +2.46%
Baidu Inc. (BIDU) $153.83 +2.42%
O'Reilly Automotive Inc. (ORLY) $135.19 +2.28%
Netflix Inc. (NFLX) $330.10 +2.24%
Nasdaq 100 - Fallers
Green Mountain Coffee Roasters Inc. (GMCR) $62.17 -7.13%
eBay Inc. (EBAY) $51.38 -4.00%
Xilinx Inc. (XLNX) $45.39 -3.28%
F5 Networks Inc. (FFIV) $85.92 -2.95%
Yahoo! Inc. (YHOO) $32.74 -1.04%
Google Inc. (GOOG) $888.79 -1.03%
Maxim Integrated Products Inc. (MXIM) $29.65 -0.95%
Charter Communications Inc. (CHTR) $137.71 -0.94%
Cisco Systems Inc. (CSCO) $22.78 -0.93%
Autodesk Inc. (ADSK) $40.41 -0.91% |
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| | Newspaper Round Up | | Friday newspaper round-up: December taper, Barclays, Energy bills The US government shutdown sabotaged a crucial month of data and dealt a blow to the world's largest economy, but the Federal Reserve could still begin reducing its asset purchases as early as December. Analysts have slashed their growth forecasts for the fourth quarter to two per cent or below, with many expecting a hit of about 0.5 percentage points from the prolonged shutdown. But many said the economy would bounce back quickly with federal employees back at work, the Financial Times writes.
China's economy expanded 7.8% in the third quarter from the same period a year earlier, marking an acceleration from the second quarter when it grew by 7.5%. The rebound in the world's second-largest economy was largely the result of government efforts to shore up growth with looser monetary policy and a "mini-stimulus" of investment in infrastructure such as rail and subway systems, the Financial Times says.
Forecourt fuel prices fell 5p in the past month, the biggest monthly fall since the 2008 financial crisis. Petrol is down 5.48p a litre on average and diesel 3.4p since mid-September, taking prices back to their levels in the new year, 132.16p for unleaded petrol and 139.12p for diesel. The AA calculated that the decline would reduce the cost of filling a family saloon by £3.84 and would take £10 off the monthly fuel bill of a two-car family, according to The Times.
Barclays could face a fresh investigation into its attempts to manipulate Libor after the discovery of a cache of documents related to the scandal that were not available to regulators before its £290m settlement last year. The Financial Conduct Authority has been informed by Barclays of the existence of the new documents and the market regulator is expected to review the documents before making a decision on whether to open a fresh Libor-rigging inquiry into the bank, The Daily Telegraph reports.
British Gas is hiking energy bills by an eye-watering 9.2%, it announced today. The increase is 8.4% on gas and 10.4% on electricity from November 23rd - adding around £122 on to annual bills. But the rises are just averages – some customers will face considerably higher bill rises. Announcing it was hiking bills, British Gas said: "We recognise that energy bills are a real worry for hard-pressed households, particularly at a time when the cost of living is rising faster than incomes", according to The Daily Mail.
Tory MPs have called for David Cameron to scrap VAT on energy bills after official figures revealed that the government has made almost £1bn from price hikes in the past seven years. British Gas yesterday announced that it is raising prices for 8m customers by 9%, a week after its rival SSE announced similar hikes. Other major energy companies are expected to follow suit. However, the Treasury is also making hundreds of millions of pounds from the price rises because of the 5% VAT it imposes on energy bills, The Daily Telegraph says. | | |
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