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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 edge higher despite growing UK concerns - UK consumer confidence falls
- BoE admits to poor economic estimates
- S&P downgrades EU to 'AA+'
- BAE tumbles after UAE walks away from Eurofighter deal
techMARK 2,732.19 -0.10%
FTSE 100 6,595.40 +0.16%
FTSE 250 15,592.04 +0.01%
UK stocks edged higher on Friday morning with markets hitting their highest levels in December despite growing concerns about the UK economy.
The FTSE 100 was trading up 0.16% at 6,595.4 early on after a 1.4% surge the day before as investors reacted to the Federal Reserve's move to scale back stimulus, ending months of uncertainty that has plagued financial markets worldwide.
London's benchmark index has not closed above this level since November 29th when it ended the session at 6,650.57.
UK consumer confidence declines, BoE admits forecasting errors
Just as the Bank of England has become more cautious on its economic forecasts, data released this morning showed that consumer confidence deteriorated this month. The GfK Consumer Confidence Survey fell from -12 to -13 in December, surprising analysts who had expected a small tick-up to -11.
This was the third straight fall in the sentiment index, its longest decline since 2010, signalling a clear "downwards trend", according to Nick Moon, Managing Director of Social Research at GfK. He said that while the fall was not nearly enough to reverse massive gains made earlier in the year, "the explanation for the last quarter of declining confidence most likely results from people's sense of how well- or rather badly-off they personally feel".
This comes after the BoE admitted in its quarterly bulletin that its economic estimates have been poor since the start of the financial crisis, and have "tended to overpredict growth and underpredict inflation".
"With a number of economic data being released for the UK at 09:30 - current account and final gross domestic product figures headlining - speculators could latch onto this story should the figures miss forecasts," said Alex Conroy, Financial Sales Trader at Spreadex.
Markets on the whole were broadly higher across Europe this morning despite the news that Standard & Poor's has downgraded its long-term debt rating for the European Union from 'AAA' to 'AA+'. The agency said in a statement that the "financial profile of the EU has deteriorated, and that cohesion among EU members has lessened".
Asian markets finished mixed overnight amid continuing volatility in China's money-market rates, which have risen higher for a third straight day. Renewed concerns about another credit crunch prompted the People's Bank of China to make an emergency liquidity injection, while the Shanghai Composite fell for its ninth consecutive session, its worst losing streak since 1994, according to Bloomberg.
BAE tumbles after UAE walks away
BAE Systems was a heavy faller this morning after the United Arab Emirates withdrew its interest in buying 60 Eurofighter Typhoon jet fighters, a major blow for the defence group which had been in talks regarding the £6bn contract for over a year.
Retailers M&S, Tesco, Sainsbury and Morrison were among the best performers early on, recovering after a poor performance in recent days.
Cruise operator Carnival was extending gains after impressing the market with its full-year results yesterday afternoon. Analysts at Numis this morning said that the better-than-expected results mean that "investor sentiment for the stock may now be near an inflection point".
Oil majors BP and Shell were in demand after West Texas crude futures hit a two-month high yesterday following the Fed move.
Natural gas firm BG Group, however, was in the red despite the news that its partner on block BM-S-9 in the Santos Basin, offshore Brazil, has submitted a Declaration of Commerciality to the Brazilian authorites. |
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| | FTSE 100 - Risers
Carnival (CCL) 2,393.00p +3.50%
International Consolidated Airlines Group SA (CDI) (IAG) 395.40p +1.59%
RSA Insurance Group (RSA) 92.00p +1.49%
Schroders (SDR) 2,491.00p +1.18%
Tesco (TSCO) 327.60p +1.16%
GlaxoSmithKline (GSK) 1,587.50p +0.92%
Coca-Cola HBC AG (CDI) (CCH) 1,694.00p +0.89%
Marks & Spencer Group (MKS) 448.00p +0.86%
Aggreko (AGK) 1,649.00p +0.73%
Admiral Group (ADM) 1,276.00p +0.71%
FTSE 100 - Fallers
BAE Systems (BA.) 422.20p -4.48%
Petrofac Ltd. (PFC) 1,125.00p -1.32%
BG Group (BG.) 1,242.00p -1.23%
Anglo American (AAL) 1,269.00p -1.09%
TUI Travel (TT.) 396.30p -1.05%
Severn Trent (SVT) 1,676.00p -0.89%
William Hill (WMH) 387.70p -0.89%
Antofagasta (ANTO) 793.00p -0.81%
Burberry Group (BRBY) 1,439.00p -0.76%
Fresnillo (FRES) 693.00p -0.72%
FTSE 250 - Risers
Centamin (DI) (CEY) 40.81p +1.87%
Berendsen (BRSN) 920.00p +1.77%
Hiscox Ltd (HSX) 679.00p +1.72%
Premier Farnell (PFL) 217.00p +1.64%
Hochschild Mining (HOC) 129.50p +1.57%
Lancashire Holdings Limited (LRE) 782.50p +1.43%
Diploma (DPLM) 720.00p +1.41%
Kentz Corporation Ltd. (KENZ) 627.50p +1.37%
Countrywide (CWD) 548.50p +1.29%
Enterprise Inns (ETI) 150.50p +1.28%
FTSE 250 - Fallers
Polymetal International (POLY) 495.90p -3.90%
Menzies(John) (MNZS) 770.50p -1.97%
Domino's Pizza Group (DOM) 488.70p -1.93%
Supergroup (SGP) 1,379.00p -1.71%
Carpetright (CPR) 535.00p -1.47%
National Express Group (NEX) 271.90p -1.41%
Dialight (DIA) 853.50p -1.39%
Wetherspoon (J.D.) (JDW) 756.50p -1.37%
UDG Healthcare Public Limited Company (UDG) 317.10p -1.37% |
| | UK Event Calendar | | INTERIM DIVIDEND PAYMENT DATE
Alpha Real Trust Ltd., Foresight 2 VCT Infrastructure Shares, Foresight VCT Infrastructure Shares, Liontrust Asset Management, LondonMetric Property, Record, Tesco, Victoria
QUARTERLY PAYMENT DATE
BP, Duet Real Estate Finance Ltd
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Consumer Confidence Indicator (EU) (10:00)
GDP (Final) (US) (13:30)
Producer Price Index (GER) (07:00)
GMS
Inland Homes
SPECIAL DIVIDEND PAYMENT DATE
Lancashire Holdings Limited
AGMS
Botswana Diamonds, Hangar 8, JPMorgan Japanese Inv Trust, Kedco, Kolar Gold Ltd., Mining Investments Resources, Peninsular Gold Ltd., Zambeef Products
UK ECONOMIC ANNOUNCEMENTS
Balance of Payments (09:30)
Current Account (09:30)
GDP (quarterly national accounts) (09:30)
GFK Consumer Confidence (00:01)
Index of Services (09:30)
Public Sector Finances (09:30)
FINAL DIVIDEND PAYMENT DATE
CEB Resources, CVS Group, Dunelm Group, Edinburgh Dragon Trust, Gleeson (M J) Group, Northern Venture Trust, Pan African Resources, St Ives |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks mixed before confidence and GDP figures - Confidence figures in Eurozone, UK and US released
- UK and US GDP figures out
- EU receives downgrade from S&P
FTSE 100: 0.12%
DAX: 0.30%
CAC 40: -0.01%
FTSE MIB: -0.26%
IBEX 35: 0.13%
Stoxx 60: 0.18%
European stocks were mixed before the release of batch of economic data and after the Federal Reserve announced a scaling back of stimulus.
Consumer confidence figures for the Eurozone will be released today and the index expected to increase to -15 in December from -15.4 the prior month.
In Germany, data from Nuremberg-based GfK is forecast to show gauge of consumer confidence in Europe's largest economy climbed to 7.6 in January from 7.4 this month, the highest reading since August 2007.
GfK's consumer confidence index for the UK fell from -12 to -13 in December, surprising analysts who had expected a small tick-up to -11.
The final estimate of UK gross domestic product report is tipped to confirm that the economy grew by 1.5% in the third quarter.
Later in the US, GDP data may confirm a 3.6% annualised expansion in the third quarter.
It comes two days after the Federal Reserve announced a tapering of its monetary stimulus and said it would continue to gradually introduce further reductions if data points to further recovery in the world's biggest economy.
S&P downgrades EU
Standard & Poor's has reduced its long-term credit rating on the European Union to 'AA-plus' from 'AAA' today due to rising tensions on budget negotiations.
"In our opinion, the overall creditworthiness of the now 28 European Union (EU) member states has declined," S&P said in a statement.
"In our view, EU budgetary negotiations have become more contentious, signalling what we consider to be rising risks to the support of the EU from some member states."
BAE, Telenet
BAE slumped after the defense company said yesterday that the United Arab Emirates ended talks to buy its Eurofighter Typhoon.
Telenet gained after Goldman Sachs raised its rating on the stock to 'buy' from 'neutral', citing growth prospects.
Cruise operator Carnival continued to advance as executives said yesterday both pricing and booking levels are returning to historical norms after being decimated by ship problems.
The euro fell 0.20% to $1.3634. |
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| | US Market Report | | US close: Markets mixed as economic data disappoints - Economic data disappoints, jobless claims rise
- Subdued session after Wednesday's strong surge
- Dow hits new record, S&P 500 pulls back from all-time high
Dow Jones: 0.07%
Nasdaq: -0.30%
S&P 500: -0.04%
US markets finished in a mixed fashion on Thursday with the Dow Jones Industrial Average hitting a fresh all-time high and the S&P 500 pulling back from a record high.
Nevertheless, gains on the Dow were only modest after a wave of disappointing economic data, which revealed that jobless claims rose to a nine-month high, along with a fall in existing-home sales and a drop in the Philly Fed manufacturing index.
Meanwhile, investors were still digesting the Federal Reserve's move on Wednesday night to scale back its monthly bond-buying programme from $85bn to $75bn and said it would make similar moderate reductions in the future subject to incoming economic data.
Policymakers predicted that the jobless rate - currently at 7% - would drop to around 6.5% by the end of 2014. However, they stressed that interest rates would be held close to zero "well past the time that the unemployment rate declines below 6.5%, especially if projected inflation continues to run below the [FOMC's] 2% longer-run goal".
"After the enthusiastic reaction of the US markets following last night's FOMC statement, it is possibly no surprise that having a night to reflect fully on the implications has seen a more measured response from traders […]," said Market Analyst Alastair McCaig from IG.
"The current levels of these indices mean that the possibility of a Christmas rally will be a more closely-run thing on the far side of the Atlantic."
Economic data misses forecasts
Jobless claims unexpectedly climbed by 10,000 to 379,000 in the week ended December 14th, the most since the end of March, Labor Department data showed. Economists had called for a decrease to 336,000.
The Philadelphia Fed manufacturing index rose from 6.5 to 7.0 in December, compared with the consensus estimate of a jump to 10.
Existing-home sales fell for the third month in a row in November, dropping by 4.3% to a seasonally-adjusted annual rate of 4.9m, according to the National Association of Realtors. Analysts had expected a figure closer to 5m.
Not all economic data disappointed though, as an index of leading economic indicators increased 0.8% in November after gaining a revised 0.1% the prior month. The forecast was for a 0.7% rise.
Carnival impresses with results
Ocean cruise operator Carnival impressed with its final results, as revenues and earnings were not as bad as feared thanks to a successful marketing push in the fourth quarter and encouraging noises about "momentum" as it enters 2014.
Bristol-Myers Squibb advanced after AstraZeneca said it would buy-out the pharmaceuticals group in its diabetes joint venture for up to $4.3bn.
Facebook declined after saying the company and some shareholders, including Chief Executive Officer Mark Zuckerberg, will sell 70m shares.
ConAgra Foods, Oracle Corp. and Accenture rose strongly after beating estimates with their quarterly results.
S&P 500 - Risers
ConAgra Foods Inc. (CAG) $33.47 +5.28%
Cabot Oil & Gas Corp. (COG) $38.31 +5.22%
United States Steel Corp. (X) $28.64 +5.22%
Accenture Plc (ACN) $79.51 +5.14%
Cablevision Systems Corp. (CVC) $17.16 +4.13%
Jabil Circuit Inc. (JBL) $16.26 +3.77%
Paychex Inc. (PAYX) $44.90 +3.65%
Cliffs Natural Resources Inc. (CLF) $24.87 +3.62%
Sears Holdings Corp. (SHLD) $45.49 +3.50%
Air Products & Chemicals Inc. (APD) $110.92 +3.39%
S&P 500 - Fallers
Health Care REIT Inc. (HCN) $52.58 -3.81%
J.C. Penney Co. Inc. (JCP) $7.96 -3.63%
Darden Restaurants Inc. (DRI) $51.02 -3.59%
AbbVie Inc (ABBV) $52.63 -3.11%
Valero Energy Corp. (VLO) $46.66 -2.99%
Perrigo Company plc (PRGO) $151.14 -2.91%
HCP Inc. (HCP) $35.80 -2.82%
Tenet Healthcare Corp. (THC) $39.85 -2.61%
Exelon Corp. (EXC) $27.22 -2.54%
Rowan Companies plc (RDC) $32.94 -2.52%
Dow Jones I.A - Risers
Chevron Corp. (CVX) $123.22 +1.33%
Walt Disney Co. (DIS) $72.97 +1.07%
International Business Machines Corp. (IBM) $180.22 +0.85%
E.I. du Pont de Nemours and Co. (DD) $62.71 +0.84%
Travelers Company Inc. (TRV) $88.79 +0.74%
American Express Co. (AXP) $86.41 +0.49%
3M Co. (MMM) $136.41 +0.45%
Visa Inc. (V) $216.08 +0.34%
Cisco Systems Inc. (CSCO) $21.07 +0.33%
AT&T Inc. (T) $34.45 +0.20%
Dow Jones I.A - Fallers
Microsoft Corp. (MSFT) $36.25 -0.90%
Wal-Mart Stores Inc. (WMT) $77.24 -0.90%
McDonald's Corp. (MCD) $95.14 -0.82%
Caterpillar Inc. (CAT) $87.54 -0.71%
Johnson & Johnson (JNJ) $91.98 -0.71%
Procter & Gamble Co. (PG) $81.90 -0.58%
Coca-Cola Co. (KO) $39.86 -0.40%
Nike Inc. (NKE) $78.26 -0.37%
General Electric Co. (GE) $27.32 -0.33%
United Technologies Corp. (UTX) $109.50 -0.28%
Nasdaq 100 - Risers
Paychex Inc. (PAYX) $44.90 +3.65%
Sears Holdings Corp. (SHLD) $45.49 +3.50%
Activision Blizzard Inc. (ATVI) $17.66 +2.79%
Whole Foods Market Inc. (WFM) $58.75 +2.07%
Vertex Pharmaceuticals Inc. (VRTX) $69.95 +1.92%
Vodafone Group Plc ADS (VOD) $38.34 +1.75%
Monster Beverage Corp (MNST) $66.24 +1.66%
Alexion Pharmaceuticals Inc. (ALXN) $130.75 +1.63%
Sba Communications Corp. (SBAC) $87.21 +1.56%
Twenty-First Century Fox Inc Class A (FOXA) $33.97 +1.52%
Nasdaq 100 - Fallers
Tesla Motors Inc (TSLA) $140.72 -4.91%
Avago Technologies Ltd. (AVGO) $51.44 -3.22%
Xilinx Inc. (XLNX) $44.31 -1.95%
Cerner Corp. (CERN) $54.69 -1.92%
Altera Corp. (ALTR) $31.26 -1.82%
Maxim Integrated Products Inc. (MXIM) $27.93 -1.69%
Liberty Media Corporation - Class A (LMCA) $143.27 -1.57%
Adobe Systems Inc. (ADBE) $58.13 -1.54%
Texas Instruments Inc (TXN) $42.46 -1.48%
Fossil Group Inc (FOSL) $118.81 -1.39% |
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| | Newspaper Round Up | | Friday newspaper round-up: BAE Systems, interest rates, British Gas BAE Systems suffered a bruising setback after Britain's negotiations to supply 60 Typhoon fighter jets to the UAE collapsed and pricing talks on a separate deal with Saudi Arabia stalled. – Financial Times
Millions of homeowners will be forced to rein in their spending or take a second job when interest rates rise to cope with higher mortgage repayments, the Bank of England has warned. – The Telegraph
Bert Pijls, the brave, perhaps foolhardy, British Gas executive who stepped forth on to Twitter when public rage over rising energy prices was at its most frenzied, was yesterday looking for a new job. – The Times
High Street chains including M&S, Gap and Debenhams have cut prices by up to 75% in battle for shoppers' wallets in the lead up to Christmas. The average discounts rose to 46% compared with 42% last week and 44% in the same week last year, according to the accountancy firm PwC. - The Guardian
An emergency cash injection by the Chinese central bank failed to calm the country's lenders as money market rates climbed to dangerously high levels. Analysts cited a variety of technical factors for the tightness in the Chinese financial system, but the sudden run-up in rates was an uncomfortable echo of a cash crunch that rattled global markets earlier this year. – Financial Times | | |
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