| | | | | | | | | |
| | London Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | London close: Market sell-off leaves FTSE 100 at one-month low - Markets at lowest level since December 20th
- EM currency weakness hits risk appetite
- Aberdeen sinks sharply on EM worries after broker downgrade
techMARK 2,789.84 -1.34%
FTSE 100 6,663.74 -1.62%
FTSE 250 15,703.44 -1.73%
The FTSE 100 suffered triple-digit falls on Friday, dropping to levels not seen in over a month as volatile conditions in emerging markets spread fear amongst investors across the globe.
UK markets were pushed even further lower in afternoon trade after another sell-off on Wall Street as the Dow Jones Industrial Average sank as much as 200 points with analysts labelling it as the beginning of a so-called correction.
Back in London, the FTSE 100 closed 109.54 points down at 6,663.74, a fall of 1.6% on the day. The last time the index closed lower was on December 20th 2013.
Emerging markets in focus
Weakness in emerging-market currency markets – the Argentinian peso, Turkish lira, Russian ruble, Ukrainian hryvnia, South African rand and Brazilian real - was prompting investors to shy away from riskier assets and move towards safer investments during today's session.
As such, gold prices rose as much as 0.8% to a two-month high of $1,273.20 an ounce today; US Treasuries and UK Gilts also advanced, with yields on benchmark 10-year bonds for both falling sharply.
"European markets fell flat on their faces as the emerging market currency rout continued […] as economic growth concerns start to spread out beyond China," said Michael Hewson, Chief Market Analyst at CMC Markets.
Markets are still reacting to data yesterday which revealed a surprise contraction in China's manufacturing sector this month, along with a poor batch of economic figures from the US on manufacturing and existing-home sales.
Concerns over the effects of the Federal Reserve's tapering plans are also still having an impact on developing markets, with speculation ramping up ahead of the next policy meeting at the end of the month. Investors are waiting to see whether policymakers will continue to reduce asset purchases by $10bn a month after last month's decision to cut them from $85bn to $75bn.
Acting as a backdrop, the future of Mark Carney's forward guidance plan - which links monetary policy to the unemployment rate – was up in the air after comments from the Bank of England (BoE) Governor at the World Economic Forum in Davos. He said that there was no immediate need for a rise in rates, but forward guidance would need to "evolve" given the recent drop in unemployment in the UK along with other improving data.
Aberdeen, Lloyds, easyJet, Whitbread hit by downgrades
Fund manager Aberdeen fell sharply after receiving a ratings downgrade by Morgan Stanley to 'underweight'. The bank said that a deteriorating fund performance compounds challenging emerging-market fundamentals, "increasing the risk of negative revisions and further multiple de-rating at Aberdeen".
Investec has cut its rating for Lloyds Banking Group from 'buy' to 'hold', saying that expectations for 2013 are still "slightly frothy", causing the stock to slip this morning.
Budget airline easyJet continued to fall after its first-quarter update yesterday in which it said that losses in the first half would be worse than last year. HSBC lowered its rating on the company today to 'underweight'.
Cafe, restaurant and hotel owner Whitbread was also down after Citigroup cut the stock to 'neutral', citing limited upside after a strong rally over recent months.
Fresnillo and Randgold were among a handful of blue chips to finish in positive territory, benefitting from a rise in gold and silver prices.
Royal Mail was unwanted after underwhelming with a 2% rise in like-for-like revenue for the nine months ended December 29th.
Cairn Energy, the oil and gas group, fell after informing investors that it was contacted by the Income Tax Department of India to discuss income tax assessments for the year ending March 31st 2007. |
| | iPad mini worth £269 for new trading accounts! | | A minimum volume is required. Terms and conditions apply. Find out more, click here. |
|
FTSE 100 - Risers
RSA Insurance Group (RSA) 101.70p +1.95%
Fresnillo (FRES) 792.00p +1.54%
Randgold Resources Ltd. (RRS) 4,233.00p +1.07%
Sainsbury (J) (SBRY) 362.10p +0.92%
ARM Holdings (ARM) 978.00p +0.51%
Admiral Group (ADM) 1,427.00p +0.49%
Morrison (Wm) Supermarkets (MRW) 245.10p +0.37%
Centrica (CNA) 321.80p +0.34%
Land Securities Group (LAND) 1,050.00p +0.29%
Sports Direct International (SPD) 708.00p +0.28%
FTSE 100 - Fallers
Aberdeen Asset Management (ADN) 397.30p -5.72%
International Consolidated Airlines Group SA (CDI) (IAG) 406.30p -4.94%
Experian (EXPN) 1,072.00p -4.63%
Mondi (MNDI) 936.00p -4.39%
Prudential (PRU) 1,262.00p -3.66%
Ashtead Group (AHT) 770.00p -3.63%
Persimmon (PSN) 1,264.00p -3.51%
Tullow Oil (TLW) 860.00p -3.42%
Coca-Cola HBC AG (CDI) (CCH) 1,696.00p -3.20%
BG Group (BG.) 1,255.00p -3.09%
FTSE 250 - Risers
Petra Diamonds Ltd.(DI) (PDL) 135.00p +2.27%
Devro (DVO) 311.70p +2.20%
Polymetal International (POLY) 596.00p +1.71%
Betfair Group (BET) 987.00p +1.60%
Serco Group (SRP) 509.00p +1.29%
Ladbrokes (LAD) 152.60p +1.26%
Britvic (BVIC) 699.50p +0.94%
BH Macro Ltd. EUR Shares (BHME) € 19.49 +0.93%
Hiscox Ltd (HSX) 640.50p +0.71%
Galliford Try (GFRD) 1,178.00p +0.60%
FTSE 250 - Fallers
Bank of Georgia Holdings (BGEO) 2,214.00p -6.03%
Cairn Energy (CNE) 247.50p -5.57%
Enterprise Inns (ETI) 153.70p -5.47%
Ashmore Group (ASHM) 325.80p -5.29%
Tullett Prebon (TLPR) 343.60p -4.98%
Inchcape (INCH) 603.00p -4.96%
Fenner (FENR) 417.20p -4.86%
Halfords Group (HFD) 448.10p -4.82%
Smith (DS) (SMDS) 324.00p -4.79%
Ophir Energy (OPHR) 280.00p -4.76% |
| | The Share Centre: | | Cheaper fund investing has arrived at The Share Centre.
We don't believe it's fair to charge you extra just for holding funds.
So we don't. Find out more.
Capital at risk. Click Here |
| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks fall on concerns of weak EM currencies - Banks fall on drop in EM currencies
- BoE's Carney signals end to forward guidance
- Germany's Schaeuble says Europe crisis over
FTSE 100: -1.71%
DAX: -2.56%
CAC 40: -2.92%
FTSE MIB: -2.30%
IBEX 35: -3.88%
Stoxx 600: -2.40%
Stoxx 600: -1.61%
Banks dragged European stocks lower on concerns that a weakening of emerging-market currencies may hurt earnings.
Banco Bilbao Vizcaya Argentaria declined as investors assessed a tumble in currencies in countries such as Argentina. Banco Santander also slumped.
Some fear the Federal Reserve's reduction in monetary is hampering growth in emerging markets.
The central bank began scaling back monthly asset purchases by $10bn to $75bn last month and will decide whether to scale back further when policymakers meet next week.
World Economic Forum
Bank of England (BoE) Governor Mark Carney said Britain was "very much part of Europe" when quizzed about the prospect of the UK's exit from the bloc today the World Economic Forum in Davos.
He said the Bank is fully engaged in European processes and developments but deals with the facts not hypothetical situations.
Ahead of his speech at Davos, Carney signalled that the BoE would scrap the central bank's so-called forward guidance.
The central bank has vowed to keep interest rates at the record low of 0.5% at least until unemployment falls to 7% but a faster-than-expected drop has put pressure on the Bank to change its guidance.
Chancellor George Osborne said today at Davos, "I completely reject that forward guidance is a failure" and added that it helped create "a very strong set of data in the UK".
German Finance Minister Wolfgang Schaeuble also attended Davos where he said Europe is recovering from years of crisis thanks to its biggest lender.
"Europe is no longer the centre of worries about the stability of the global economic development."
Aberdeen, Celesio
Aberdeen Asset Management tumbled after Morgan Stanley cut its rating on the money manager to 'underweight' from 'equal weight'.
Celesio advanced as McKesson Corp. agreed to buy majority owner Franz Hanile Cie.'s entire stake in the German healthcare and pharmaceutical company.
Syngenta was down after the maker of crop chemicals was asked by the National Grain & Feed Association and North American Export Grain Association to halt sales of two types of genetically modified corn seeds in the US that have not been approved in China.
Nokia bounced up as Societe Generale raised its rating on the shares 'buy' from 'hold'.
The euro fell 0.15% to $1.3676.
Brent crude futures decreased by $0.308 to $107.250 per barrel, according to the ICE. |
| | NEW Trading Strategy - Currently running at 70% success rate | | Earn a tax free income trading, from just 20 minutes a day – no experience needed. Our powerful trading software will help you decide when to enter trades and how to maximise profits.
Register for a FREE brochure and trading guide, Click Here. |
| | US Market Report | | US open: Emerging-market turbulence sinks stocks - Emerging-market currencies weaken
- Gold and Treasuries gain as investors flee to safety
- Microsoft beats forecasts in Q2
Dow Jones: -0.61%
Nasdaq: -0.78%
S&P 500: -0.68%
Stocks sunk sharply again on Friday on a quiet day for economic data as investors scaled back risk appetite ahead of the weekend.
Analysts said that the turbulence and weakness in emerging-market currency markets – the Argentinian peso, Turkish lira, Russian ruble, Ukrainian hryvnia, South African rand and Brazilian real - was prompting investors to shy away from riskier assets and move towards safer investments.
As such, gold prices rose as much as 0.8% to a two-month high of $1,273.20 an ounce today; US Treasuries also advanced, with the yield on a 10-year bond down five basis points at 2.72%.
"Having led the recovery back in 2008, emerging markets are showing a worrying potential to turn from hero to villain on current form, and seem destined to be a focus for investors in the short - term," said Toby Morris, Senior Sales Trader at CMC Markets.
Markets are still reacting to data yesterday which revealed a surprise contraction in China's manufacturing sector this month, along with a poor batch of economic figures from the US on manufacturing and existing-home sales.
Concerns over the effects of the Federal Reserve's tapering plans are also still having an impact on developing markets, with speculation ramping up ahead of the next policy meeting at the end of the month. Investors are waiting to see whether policymakers will continue to reduce asset purchases by $10bn a month after last month's decision to cut them from $85bn to $75bn.
Turning to today's agenda, the World Economic Forum in Davos, Switzerland, continues with celebrities and leaders from across the globe outlining their views on the economy and ways to spur growth. US Secretary of State John Kerry will speak later today at a special address at Davos.
Microsoft jumps after strong results
Software giant Microsoft advanced after reporting a better-than-expected rise in both revenue and profit for its fiscal second quarter. Results were helped by strong demand for its new Xbox game console.
Procter & Gamble gained after the consumer-products firm reported a less-than-expected fall in second-quarter earnings and kept its full-year forecasts.
Pharmaceuticals group Bristol-Myers Squibb also managed to beat Street forecasts even though profits fell 21% in the fourth quarter.
International Game Technology was a heavy faller after the Las Vegas-based company posted first-quarter profit that missed analysts' estimates.
Intuitive Surgical retreated after the maker of a robotic-surgery devices posted a fall in fourth-quarter sales of systems.
Starbucks edged higher as the coffee chain reported an increase in net income that beat market expectations. Revenues also rose to a record $4.2bn during its fiscal first quarter. |
| | Download your free Santa Rally report. | | Have you heard of the stock market phenomenon called the Santa Rally? The FTSE 100 has risen in 18 of the last 20 Decembers*. Download your free report showing a breaking down of what the average rise has been for the stocks within the FTSE over the month of December. Losses can exceed deposits. * Past performance is no guarantee of the future |
| | Broker Tips | | Broker tips: Aberdeen, Lloyds, Pearson, Whitbread Fund manager Aberdeen was a heavy faller on the FTSE 100 on Friday after a ratings downgrade by Morgan Stanley from 'equal weight' to 'underweight'.
The bank said that a "deteriorating" fund performance at Aberdeen compounds challenging fundamentals in the emerging markets (EM). This "increases the risk of negative revisions and further multiple de-rating" for the stock, it said.
Investec has cut its rating for Lloyds Banking Group from 'buy' to 'hold', saying that expectations for 2013 are still "slightly frothy".
Analyst Ian Gordon believes that sell-side forecasts for earnings per share in 2013 are still too high, with the current 2.5p estimate more than double what it should be. Meanwhile, there is still upside risk to charges for PPI redress with Lloyds' cover "far too thin".
Deutsche Bank has maintained its 'sell' rating for publishing and education firm Pearson, saying that the market seems to be under-appreciating the severity of the firm's gloomy trading update.
"The bigger picture message - a more costly, bigger restructuring, of a business facing numerous cyclical, competitive, timing and structural problems - suggests to us a stock that should be de-rating, not re-rating."
Citigroup has lowered its recommendation for Whitbread from 'buy' to 'neutral', saying that the valuation of the hotel and leisure stock is approaching peak multiples.
Following a 25% rally since October after "strong results, a positive investor day and further confirmatory trading data", the bank said that stock now looks "fully valued". | | |
New ADVFN Service - FREE Reports Get your free report on Isa's, Investment Trusts, Funds,
Sipps Travel and Cars - FREE and Easy service CLICK HERE
To advertise in the Euro Markets Bulletin please contact patrick@advfn.co.uk |
| | | | | | | To unsubscribe from this news bulletin or edit your mailing list settings click here. Registered Office/Accounts Dept: Suite 27, Essex Technology Centre, The Gable, Fyfield Road, Ongar, CM5 0GA. Customer Support +44 (0) 207 0700 961. Company registered in England and Wales: Number 2374988 VAT No. GB 549 2130 49 | |
No comments:
Post a Comment