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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 close: Mining stocks drag FTSE 100 lower - Mining stocks track metals prices lower
- Economic data from the US comes in mixed
- BTG jumps on US approval of Varithena
techMARK 2,649.54 -0.07%
FTSE 100 6,636.22 -0.87%
FTSE 250 15,306.13 +0.04%
Weakness in the mining sector kept markets firmly in the red on Tuesday as a lack of newsflow and falling metals prices capped risk appetite in London.
After rising on Monday following an agreement to limit Iran's nuclear activity, the FTSE 100 pulled back today, falling 58.4 points to 6,636.22 by the close.
Economic data from the States was in focus given the absence of any macro indicators closer to home. However, figures failed to give markets a spark this afternoon after the Conference Board's index measuring US consumer confidence unexpectedly fell to 70.4 in November, below the 72.4 reading in October and disappointing analysts who had expected a slight pick-up.
Nevertheless, as analyst Cooper Howes from Barclays explained: "We view consumer confidence as being on an upward trend despite the month-to-month volatility caused in part by several negative policy shocks in recent years."
Data from the US housing market was more positive, with Case-Shiller's index tracking home prices in 20 cities rising at its fastest pace since early 2006 and new housing permits surging to their highest level in over five years.
Nevertheless, Wall Street markets were relatively subdued after the opening bell as traders begin to show hesitance ahead of the Thanksgiving holiday later this week.
Miners provide a drag; BTG surges after US approval
Mining stocks were providing a drag in the UK today as metals prices fell across the board. Heavyweight producers Anglo American, Vedanta Resources, Fresnillo, Rio Tinto and BHP Billiton were all trading with moderate losses before the close.
Glencore Xstrata also fell after the news that Chinalco has dropped out of the bidding for its $5.9bn Las Bambas copper mine in Peru.
Supermarket giant Tesco was also weighing on the market after Deutsche Bank cut its target for the shares ahead of its third-quarter trading update next week, saying that it expects like-for-like sales to have deteriorated.
Brewing firm SABMiller and Diageo were under the weather today after French spirits firm Remy Cointreau warned that annual operating profits will see a "double-digit" decline due to a slowdown in China.
On the upside was specialist healthcare group BTG which jumped after the announcement that US regulators have approved its varicose veins treatment Varithena. "We look forward to the commercial US launch in the second quarter of 2014," said Chief Executive Louise Makin.
Investors also celebrated banknote printer De La Rue's interim results as ongoing cost savings helped adjusted profits increase by 20% despite a slip in banknote print volumes. The stock was also lifted from 'hold' to 'buy' by Investec.
Pubs group Mitchells & Butlers and soft drinks maker Britvic were also in positive territory after impressing with strong profit growth in their annual results.
Utilities firm Severn Trent was out of favour after delivering a flat first half in terms of underlying profits, as a robust start by the water business was not enough to compensate for a lower contribution from the services arm. |
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| FTSE 100 - Risers
Wolseley (WOS) 3,349.00p +3.24%
Petrofac Ltd. (PFC) 1,239.00p +2.23%
Babcock International Group (BAB) 1,311.00p +2.10%
Whitbread (WTB) 3,542.00p +1.40%
Persimmon (PSN) 1,228.00p +1.07%
Kingfisher (KGF) 394.80p +1.00%
InterContinental Hotels Group (IHG) 1,905.00p +0.95%
William Hill (WMH) 378.50p +0.93%
Travis Perkins (TPK) 1,820.00p +0.89%
International Consolidated Airlines Group SA (CDI) (IAG) 376.00p +0.86%
FTSE 100 - Fallers
Coca-Cola HBC AG (CDI) (CCH) 1,738.00p -3.18%
Anglo American (AAL) 1,334.50p -2.70%
Old Mutual (OML) 194.00p -2.61%
Tesco (TSCO) 345.35p -2.51%
SABMiller (SAB) 3,175.00p -2.44%
Fresnillo (FRES) 818.00p -2.33%
Glencore Xstrata (GLEN) 304.80p -2.32%
British Sky Broadcasting Group (BSY) 817.00p -2.04%
Centrica (CNA) 336.60p -1.92%
BHP Billiton (BLT) 1,841.00p -1.81%
FTSE 250 - Risers
BTG (BTG) 522.00p +13.75%
De La Rue (DLAR) 916.00p +9.44%
Spirent Communications (SPT) 107.00p +6.15%
Telecom Plus (TEP) 1,929.00p +5.87%
Homeserve (HSV) 259.30p +5.11%
Imagination Technologies Group (IMG) 250.00p +4.17%
Moneysupermarket.com Group (MONY) 180.20p +4.16%
Computacenter (CCC) 638.00p +3.74%
Mitchells & Butlers (MAB) 404.70p +3.50%
Interserve (IRV) 655.50p +3.23%
FTSE 250 - Fallers
Essar Energy (ESSR) 83.00p -4.98%
Intermediate Capital Group (ICP) 421.30p -4.94%
Chemring Group (CHG) 204.90p -3.80%
Afren (AFR) 157.00p -3.09%
Laird (LRD) 252.70p -2.92%
Ocado Group (OCDO) 412.80p -2.78%
KCOM Group (KCOM) 102.20p -2.67%
NMC Health (NMC) 380.50p -2.44%
Centamin (DI) (CEY) 42.64p -2.43%
Henderson Group (HGG) 214.40p -2.41% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks little changed after mixed US data - US consumer confidence falls
- US house prices increase
- US manufacturing activity grows
- BoE in no hurry to raise interest rates, says Carney
FTSE 100: -0.85%
DAX: -0.01%
CAC 40: -0.47%
FTSE MIB: -0.05%
IBEX 35: 0.28%
Stoxx 600: -0.56%
European equities were mixed as US consumer confidence fell to a seven-month low while house prices and manufacturing activity in the world's biggest economy rose.
The Conference Board's index for consumer confidence unexpectedly declined to 70.4 in November from a revised 72.4 a month earlier. Economists had predicted a reading of 72.6.
"Overall, the decline in consumer confidence is a little disconcerting," Capital Economics said.
"But confidence hasn't been a very good indicator of consumption growth in recent years and, besides, the improving fundamentals suggest that confidence should rebound soon."
In contrast, house prices in 20 US cities increased by the most since February 2006 in the 12 months through September. The S&P/Case Shiller index of property values climbed 13.3% after rising 12.8% a month earlier. Consensus was for a 13% gain.
"The strong price gains in the West are sparking questions and concerns about the possibility of another bubble," said David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. "However, the talk is focused on fear of a bubble, not a rush to join the party and buy."
Another report on manufacturing improved in November, according to a survey by the Federal Reserve Bank of Richmond. The Bank's manufacturing index jumped to 13 from 1 in October, beating estimates for a reading of 4.
Federal Reserve policymakers are turning to economic data to gauge the US recovery and weigh when to begin scaling back monetary stimulus.
The Fed has suggested that a tapering of its $85bn-per-month bond buying programme could begin as soon as December but most economists expect the central bank will hold off until March 2014.
BoE governor addresses interest rate hike speculation
Bank of England (BoE) Governor Mark Carney has stressed that the central bank is in no rush to raise interest rates despite recent signs of economic recovery.
Carney said that the bank may still keep its benchmark interest rate at a record-low of 0.50% even when unemployment falls to the 7% threshold to consider tightening monetary policy.
"7% is a threshold, not a trigger," he told the parliament's Treasury Committee today.
The BoE in August said it would not consider raising interest rates until the jobless rate fell to 7%.
Since then, unemployment has come down faster than expected fuelling speculation over the Bank's next move on its key rate.
Banca Monte dei Paschi di Siena
Banca Monte dei Paschi di Siena declined after approving the launch of a capital increase of €3bn to repay part of a state loan it obtained in February.
Remy Cointreau retreated after the maker of Remy Martin cognac said it expects profit will fall in its financial year through March.
Repsol surged after the Spanish and Argentinian governments reached a preliminary agreement to compensate the Madrid-based oil-company for its stake in YPF SA.
Algeta advanced after it said Bayer AG has started talks to acquire the Norwegian drugmaker.
Hugo Boss slumped after the German luxury fashion company forecast that it will miss a 2015 target to achieve 255 margin based on earnings before interest, tax, depreciation and amortisation (EBITDA).
Other asset classes gain
The euro increased 0.27% to $1.3555.
Brent crude futures advanced $0.018 to $111.020 per barrel, according to ICE data. |
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| | US Market Report | | US open: Markets flat as consumer confidence slips - Consumer confidence unexpectedly falls
- Housing permits, home prices beat expectations
- Tiffany jumps after strong Q3 results, higher guidance
Dow Jones: 0.05%
Nasdaq: 0.01%
S&P 500: -0.03%
US markets were trading mixed on Tuesday morning as strong data from the housing market was being outweighed by a fall in consumer confidence.
The Dow Jones and S&P 500 indices are continuing to fluctuate at or around record highs following solid gains since the start of the year. In fact, the S&P 500 has rallied 26% in 2013 alone and is heading for its largest annual rise since 2003.
Analysts predict a quiet week for financial markets with low trading volumes due to the shortened week on Wall Street as the US celebrates the Thanksgiving holiday.
Nevertheless, upside was being capped in early trading on Tuesday after the Conference Board’s consumer sentiment index unexpectedly fell from 71.2 to 70.4 in November, below the rise to 72.6 expected.
In other economic news, Case-Shiller’s index tracking home prices in 20 US cities rose at its fastest pace since early 2006. The index increased at an annual rate of 13.29% in September, up from a revised 12.8% gain August and ahead of the 13% forecast.
New housing permits in the US rose 6.2% to an annualised rate of 1.034m in October, according to the latest figures published by the Department of Commerce, its highest level in over five years. This came in much higher than the consensus estimate for 935,000.
“On a year-on-year basis, total permits stand 13.9% higher, suggesting that housing market activity has remained resilient despite the rise in mortgage rates during the past few months,” said analyst Cooper Howes from Barclays.
Housing starts data was scheduled for release today but has been delayed due to ongoing effects of the government shutdown. The figures for September, October and November will be released on December 18th.
Tiffany gains after quarterly results
Tiffany rallied as the luxury jeweller reported a rise in net income in the quarter ended October 31st that beat analysts’ expectations. Net income increased to 73 cents a share in its third quarter from 49 cents previously. Meanwhile the firm lifted its full-year profit target range by 15 cents to $3.65-3.75 per share.
Ligand advanced as the drugmaker was added to the S&P Smallcap 600 index, replacing SHFL on the gauge from tomorrow.
Nuance declined as the maker of speech-recognition software forecast full-year 2014 adjusted revenue that exceeded consensus.
Freeport-McMoRan Copper & Gold Inc slumped as Goldman Sachs lowered its rating on the US miner to ‘neutral’ from ‘buy’. |
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| | Broker Tips | | Broker tips: Tesco, Petrofac, Airlines, De Le Rue Deutsche Bank has cut its target for Tesco from 405p to 386p ahead of its third-quarter trading update next week, saying that like-for-like (LFL) trends have deteriorated.
"We expect Q3 LfL trends to have deteriorated in most markets versus Q2, most notably in the UK, Thailand, Ireland and Korea, but this is unlikely to surprise the market given market share data in the UK and peer group and macro reports outside the UK," said analyst James Collins. Nevertheless, the bank maintained its 'buy' rating for the stock on the back of the potential upside to total shareholder returns.
Credit Suisse has reiterated its 'outperform' rating for oilfield services (OFS) group Petrofac, saying that the stock has been "unfairly punished" after the cautious guidance given last week.
Credit Suisse said that the stock now trades on less than 10 times 2014 earnings with 30% upside potential to its target of 1,535p. If it rolls valuations forward to 2015, the price-to-earnings ratio would be just 7.9 and the upside would rise to 57%.
JPMorgan Cazenove has maintained its 'overweight' rating for IAG, easyJet and Ryanair, saying that it sees "respectable upside potential" for all three airline stocks on its new revised price targets.
"Turning towards 2014, we expect to see renewed investor confidence in the low-cost carrier (LCC) business model following 2013's Ryanair-induced skepticism, as well as continued momentum at IAG given Spanish contributions and improving Heathrow competition," the bank said.
Investec has upgraded its rating for banknote printer De La Rue from 'hold' to 'buy' following recent weakness in the share price with the stock offering a 5% dividend yield.
The target for the stock has been lifted from 885p to 890p, reflecting the 10-year average price-to-earnings ratio of 15.1. | | |
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