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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 on budget deal, taper speculation - US negotiators reach budget deal
- Taper speculation ramps up ahead of Fed meeting
- Imagination disappoints with poor H2 outlook
- RBS Finance Director Bostock steps down
techMARK 2,678.82 +0.23%
FTSE 100 6,524.52 +0.02%
FTSE 250 15,401.84 -0.06%
Markets opened broadly flat on Wednesday in the aftermath of a budget deal in the States, with upside being capped by the continuing uncertainty surrounding Federal Reserve monetary policy.
Imagination Technologies was also providing a drag on sentiment this morning after giving a poor outlook for its second half, while a surprise exit by a RBS boardmember was weighing heavily on the bank's share price.
US markets finished slightly lower last night but news after the closing bell that negotiators in Washington had reached a deal has given UK markets a small fillip this morning.
Democratic and Republicans agreed on a budget deal to ease spending cuts for the next two years, which removes the threat of a government shutdown next month. While the budget still needs to be passed in both the Senate and the House, House Budget Committee Chairman Paul Ryan said the agreement "is a clear improvement on the status quo". "It makes sure we don't lurch from crisis to crisis," he said.
"The only question now is, will this deal have any impact on the Fed's decision to taper when it meets next week? While the data suggests it shouldn't, I imagine it must be something the Fed officials will consider when making their decision next week," said Market Analyst Craig Erlam from Alpari.
Ahead of the Fed policy meeting on December 17-18th, speculation continues to ramp up regarding a tapering of quantitative easing, especially after last week's strong economic data from the States.
According to a recent survey by Bloomberg, 12 out of 35 economists believed that the Fed will begin to taper at its meeting next week, nine said a withdrawal will start in January while the remaining 14 don't expect a scaling back of stimulus until March.
Imagination Tech slumps on poor outlook, RBS falls
The share price of chip group Imagination Technologies sank sharply after markets opened as the firm said that shipment growth from its partners for the second half would be at a "slightly lower rate than previously seen".
It expects its partners to ship 580-630m units (excluding MIPS) during the full year, down from a previous estimate of 650m, due to slowing growth in the higher-end smartphone market.
Fellow chip designer ARM Holdings was also trading lower this morning.
RBS was also a heavy faller after the surprise exit of Finance Director Nathan Bostock after just 10 weeks in the position. He is to leave to become Deputy Chief Executive of the UK arm of Spanish banking group Santander.
Lloyds was also under the weather this morning, while HSBC, Standard Chartered and Barclays edged higher.
Transport firm FirstGroup gained after rebuffing "flawed" restructuring proposals from US activist investor Sandell and said it planned to continue on its current strategy.
Engineering services group Babcock International was trading lower this morning after going ex-dividend, meaning that from today investors can't access the company's latest payout. 3i Group, Betfair Group, Big Yellow Group, Daisy Group and Bellway also went ex-div today.
Utility stocks were putting in a decent performance this morning with SSE, Severn Trent, United Utilities and Centrica among the best performers. |
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| FTSE 100 - Risers
BAE Systems (BA.) 424.50p +2.19%
Whitbread (WTB) 3,510.00p +1.01%
Severn Trent (SVT) 1,681.00p +0.90%
BT Group (BT.A) 371.80p +0.87%
Compass Group (CPG) 925.00p +0.82%
United Utilities Group (UU.) 646.50p +0.78%
SSE (SSE) 1,318.00p +0.69%
WPP (WPP) 1,318.00p +0.69%
easyJet (EZJ) 1,450.00p +0.69%
IMI (IMI) 1,455.00p +0.69%
FTSE 100 - Fallers
Royal Bank of Scotland Group (RBS) 329.90p -2.02%
Randgold Resources Ltd. (RRS) 4,073.00p -1.64%
Mondi (MNDI) 960.50p -1.49%
BHP Billiton (BLT) 1,786.50p -1.16%
Lloyds Banking Group (LLOY) 77.28p -1.13%
Antofagasta (ANTO) 757.50p -1.05%
Bunzl (BNZL) 1,362.00p -1.02%
Aggreko (AGK) 1,565.00p -1.01%
Anglo American (AAL) 1,303.00p -0.99%
Prudential (PRU) 1,275.00p -0.93%
FTSE 250 - Risers
Oxford Instruments (OXIG) 1,660.00p +6.00%
FirstGroup (FGP) 119.40p +2.93%
Rank Group (RNK) 136.70p +2.78%
Chemring Group (CHG) 211.50p +2.47%
Carpetright (CPR) 545.00p +2.44%
Cobham (COB) 264.70p +1.81%
QinetiQ Group (QQ.) 212.10p +1.73%
Ultra Electronics Holdings (ULE) 1,858.00p +1.47%
Stagecoach Group (SGC) 367.10p +1.46%
Debenhams (DEB) 88.95p +1.31%
FTSE 250 - Fallers
Imagination Technologies Group (IMG) 206.00p -17.27%
Kenmare Resources (KMR) 19.01p -3.89%
AL Noor Hospitals Group (ANH) 894.50p -2.45%
Big Yellow Group (BYG) 474.20p -2.23%
Soco International (SIA) 394.60p -2.21%
Savills (SVS) 629.50p -2.18%
3i Group (III) 359.00p -2.13%
Ashtead Group (AHT) 724.50p -2.09%
Investec (INVP) 414.30p -1.92% |
| | UK Event Calendar | | Wednesday December 11
INTERIMS
Begbies Traynor Group, Darty, Imagination Technologies Group, Stagecoach Group
INTERIM EX-DIVIDEND DATE
3i Group, API Group, Babcock International Group, Betfair Group, Big Yellow Group, Caffyns, Caledonia Investments, China Chaintek United Co. Limited, Cropper (James), Daisy Group, Falkland Islands Holdings, Foresight 2 VCT Infrastructure Shares, Foresight VCT Infrastructure Shares, Hyder Consulting, Investec, Juridica Investments Ltd., MDM Engineering Group Ltd. (DI), Montanaro European Smaller Companies Trust, MS International, Northgate, Plastics Capital, Sepura, Telford Homes, Ventus 2 VCT, Ventus 2 VCT 'C' Shares, Ventus VCT, Ventus VCT 'C' Shares, Vianet Group
QUARTERLY PAYMENT DATE
M Winkworth, Unilever
QUARTERLY EX-DIVIDEND DATE
XP Power Ltd. (DI)
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Consumer Price Index (GER) (07:00)
Crude Oil Inventories (US) (15:30)
MBA Mortgage Applications (US) (12:00)
GMS
Tangiers Petroleum Ltd (DI)
SPECIAL EX-DIVIDEND PAYMENT DATE
3i Group, Juridica Investments Ltd., MDM Engineering Group Ltd. (DI)
EGMS
Middlefield Canadian Income PCC
AGMS
Frontier Mining Ltd (DI), International Biotech Trust, Sareum Holdings, YouGov
TRADING ANNOUNCEMENTS
Carillion, PZ Cussons
FINAL DIVIDEND PAYMENT DATE
Finsbury Food Group, London Finance & Investment Group
FINAL EX-DIVIDEND DATE
Bellway, JPMorgan Chinese Inv Trust, K3 Business Technology Group, Netcall, Numis Corporation, Schroder UK Mid Cap Fund, Scottish Oriental Smaller Companies Trust, Waterman Group
|
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks rise as Fed policy meeting looms - Investors weigh outlook on Fed stimulus
- US budget deal reached
- German inflation data to be released
FTSE 100: 0.08%
DAX: 0.04%
CAC 40: 0.40%
FTSE MIB: 0.12%
IBEX 35: 0.31%
Stoxx 600: 0.15%
European equities edged higher as investors speculated over whether the US Federal Reserve will begin scaling back monetary stimulus next week.
With the Fed's policy meeting fast approaching, economists are weighing the outlook on the timing of a tapering of the monthly $85bn bond buying programme.
Earlier this week three Fed officials offered strong hints that the central bank would announce a reduction to asset purchases at the December 17th-18th meeting.
"There's going to be a lot of focus on the Federal Reserve this week, ahead of next week's decision on its QE3 programme," said Craig Erlam, analyst at Alpari.
"However, with Fed members now under an embargo, we're unlikely to get any official comments that could potentially create any major swings in the markets."
Investors are also focusing on the US budget as negotiators worked on a deal before the December 13th deadline to cut automatic spending cuts.
House Budget Committee Chairman Paul Ryan announced after the closing bell yesterday that a deal had been reached to ease spending cuts for the next two years which removes the threat of a government shutdown next month.
The budget still needs to be passed in both the Senate and the House.
Turning to today's agenda will be the release of German inflation and US mortgage applications.
RBS Finance Director leaves to join Santander UK
The Royal Bank of Scotland slumped after confirming Finance Director Nathan Bostock will resign -less than 10 weeks after joining the board – to join Santander UK.
Imagination Technologies dropped after posting half-year sales that missed analysts' estimates.
Mediolanum retreated as Fininvest SpA, the investment company of Silvio Berlusconi's family, raised €253m from the sale of a 5.61% stake in the financial-services company.
The euro fell 0.05% to $1.3754.
Brent crude futures rose $0.283 to $109.690 per barrel, according to the ICE. |
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| | US Market Report | | US close: Stocks fall on taper, budget uncertainty - Taper speculation ramps up, S&P 500 pulls back from record
- Budget uncertainty ahead of deadline, deal reached after the close
- Goldman gains as Volcker Rule eased slightly
Dow Jones: -0.33%
Nasdaq: -0.20%
S&P 500: -0.32%
US markets ended with moderate losses on Tuesday with the S&P 500 pulling back from an all-time high, as investors assessed uncertainty regarding monetary policy and budget talks in Washington.
Limiting the downside was data showing that job openings rose to 3.93m in October, up from 3.88m the month before and ahead of forecasts.
The S&P 500 finished 0.32% lower at 1,802.62, retreating after hitting its 39th record close of the year on Monday, while the Dow Jones Industrial Average fell 0.33% to finish below the milestone level of 16,000 for the first time in three sessions.
Acting as a backdrop, Mark Hulbert from MarketWatch pointed out that the Dow Jones Industrial Average could be hitting a "dangerous triple top", trading at similar levels (in inflation-adjusted terms) to its highs of 2000 and 2007. "It should give us pause to note that the market — strong as it has been — is only back to the level that turned the market back on two prior occasions," he said.
Markets continued to focus on a potential tapering of stimulus ahead of the Federal Reserve's next policy meeting on December 17th to 18th. However, ongoing budget talks in Washington and a vote on new banking regulation were also being closely watched.
Stocks gained yesterday despite increased bets over a taper after St Louis Fed President James Bullard said that a small taper of asset purchases might be possible this month. Meanwhile, Fed officials and well-known hawks Richard Fisher and Jeffrey Lacker also said that policymakers would discuss lowering the rate of asset purchases but gave no specific details.
According to a recent survey by Bloomberg, 12 out of 35 economists believed that the Fed will begin to taper at its meeting next week, nine said a withdrawal will start in January while the remaining 14 don't expect a scaling back of stimulus until March.
Investors were also awaiting the outcome of budget talks as negotiators worked on a deal before the December 13th deadline to cut automatic spending cuts. House Budget Committee Chairman Paul Ryan announced after the closing bell that a deal had been reached to ease spending cuts for the next two years which removes the threat of a government shutdown next month.
Goldman climbs to three-month high on Volcker Rule vote
Banking stocks were in focus on Tuesday as investors awaited the outcome of the Volcker Rule, as Wall Street's top five regulators voted on the plan to prohibit proprietary trading by banks. Goldman Sachs finished at its highest price in three months after some provisions were eased in the final wording of the rule.
JPMorgan Chase & Co also gained, while Bank of America, Citigroup and Wells Fargo finished lower.
Auto giant GM fell after the government sold its final stake in the company after a state bailout in 2008. The company also appointed Mary Barra as its new Chief Executive, replacing Dan Akerson.
Lululemon Athletica advanced after founder Chip Wilson stepped down as Chairman of yogawear retailer.
Rambus rallied after Micron Technology agreed to pay $280m over the next seven years for the right to use patents for the manufacture of integrated-circuit products.
Analogic declined after the medical and airport-security device maker reported quarterly sales that missed analysts' estimates.
S&P 500 - Risers
J.C. Penney Co. Inc. (JCP) $8.73 +3.56%
PVH Corp. (PVH) $131.87 +3.48%
Yahoo! Inc. (YHOO) $40.22 +3.47%
AutoZone Inc. (AZO) $471.86 +3.17%
Cardinal Health Inc. (CAH) $66.22 +3.03%
E*TRADE Financial Corp. (ETFC) $18.69 +2.64%
Newmont Mining Corp. (NEM) $24.18 +2.46%
Dow Chemical Co. (DOW) $41.78 +2.40%
PerkinElmer Inc. (PKI) $39.61 +2.38%
Nvidia Corp. (NVDA) $15.56 +2.33%
S&P 500 - Fallers
Campbell Soup Co. (CPB) $40.96 -3.74%
Jabil Circuit Inc. (JBL) $19.89 -3.26%
Gilead Sciences Inc. (GILD) $72.81 -3.17%
Starbucks Corp. (SBUX) $77.38 -2.95%
Quest Diagnostics (DGX) $58.60 -2.87%
Mylan Inc. (MYL) $42.60 -2.86%
Newfield Exploration Co (NFX) $23.71 -2.55%
JDS Uniphase Corp. (JDSU) $12.32 -2.53%
Gap Inc. (GPS) $38.72 -2.20%
Spectra Energy Corp. (SE) $33.46 -2.05%
Dow Jones I.A - Risers
Goldman Sachs Group Inc. (GS) $169.73 +1.23%
Walt Disney Co. (DIS) $71.57 +0.65%
Caterpillar Inc. (CAT) $86.42 +0.38%
JP Morgan Chase & Co. (JPM) $56.70 +0.34%
Chevron Corp. (CVX) $123.66 +0.26%
E.I. du Pont de Nemours and Co. (DD) $61.44 +0.08%
Dow Jones I.A - Fallers
Microsoft Corp. (MSFT) $38.11 -1.54%
Coca-Cola Co. (KO) $39.85 -1.36%
Procter & Gamble Co. (PG) $83.65 -1.33%
Home Depot Inc. (HD) $78.61 -1.24%
Wal-Mart Stores Inc. (WMT) $79.08 -1.09%
Visa Inc. (V) $199.43 -1.07%
Verizon Communications Inc. (VZ) $49.05 -1.05%
AT&T Inc. (T) $34.40 -0.84%
3M Co. (MMM) $127.55 -0.79%
Pfizer Inc. (PFE) $31.34 -0.76%
Nasdaq 100 - Risers
Baidu Inc. (BIDU) $179.93 +4.67%
Randgold Resources Ltd. Ads (GOLD) $67.96 +3.50%
Yahoo! Inc. (YHOO) $40.22 +3.47%
Facebook Inc. (FB) $50.24 +2.88%
Charter Communications Inc. (CHTR) $131.75 +2.80%
Nvidia Corp. (NVDA) $15.56 +2.33%
Broadcom Corp. (BRCM) $28.51 +2.26%
Netflix Inc. (NFLX) $363.10 +2.09%
Green Mountain Coffee Roasters Inc. (GMCR) $72.95 +1.59%
Henry Schein Inc. (HSIC) $115.22 +1.53%
Nasdaq 100 - Fallers
Gilead Sciences Inc. (GILD) $72.81 -3.17%
Starbucks Corp. (SBUX) $77.38 -2.95%
Mylan Inc. (MYL) $42.60 -2.86%
Sirius XM Holdings Inc (SIRI) $3.60 -2.04%
Mondelez International Inc. (MDLZ) $34.06 -1.82%
Sears Holdings Corp. (SHLD) $46.86 -1.80%
Avago Technologies Ltd. (AVGO) $46.60 -1.63%
Microsoft Corp. (MSFT) $38.11 -1.54%
Cerner Corp. (CERN) $55.85 -1.51%
Expeditors International Of Washington Inc. (EXPD) $42.81 -1.38% |
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| | Newspaper Round Up | | Wednesday newspaper round-up: US budget, RBS, Fracking... Democratic and Republican negotiators on Tuesday night agreed a deal to set spending levels until 2015, breaking the latest fiscal logjam in Congress and stopping a cycle of crisis-driven economic policy making in Washington. The agreement is small in size – worth 85bn dollars – but may herald the return of an era in which Congress can perform basic functions without the political brinkmanship that has repeatedly threatened the US economic recovery in recent years. - Financial Times
Royal Bank of Scotland was facing fresh management upheaval on Tuesday night when the bailed-out bank's newly-appointed finance director suddenly quit. Nathan Bostock, who was only promoted to the top finance position on October 1st, is understood to have quit to become deputy chief executive of the UK arm of Spanish bank Santander. It is a bank he knows well, having left Santander in 2009 to join RBS after its £45bn taxpayer bailout. - The Guardian
Britain should press ahead with fracking, the chairman of the Government's climate change advisory body said yesterday. Lord Deben dismissed claims by green groups that fracking would cause significant damage to the environment, adding that Britain needed to drill shale wells to reduce reliance on foreign imports of fossil fuel. - The Times
An activist investor with a stake in FirstGroup has called on the bus and rail operator to boost shareholder value by more than 50% through a split from its US businesses. New York-based Sandell Asset Management, a hedge fund that was set up by Swedish bil. investor Thomas Sandell, said it had written to FirstGroup's board proposing a spin-off and flotation of its US school buses and transit businesses, and a sale of Greyhound, its intercity bus provider. - The Telegraph
Tesco Bank is creating hundreds of jobs in Edinburgh and Glasgow as it steps up its challenge to the established high street giants. The company will hire 300 staff in the coming months, rising to 650 over two years, as it prepares to roll out a crucial current account offering in the middle of next year that will help it move towards becoming a full service bank. - The Scotsman
The Archbishop of Canterbury has summoned the bosses of the 'Big Six' energy companies to a private meeting on Wednesday to discuss fuel poverty and rising energy prices. The meeting comes after the Most Rev Justin Welby said he understood why people felt above-inflation price rises were "inexplicable" and called on the companies to act with "generosity". - The Telegraph | | |
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