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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: Miners drag FTSE into the red on concerns over China - Miners drag FTSE into red
- Feb US consumer confidence falls
- EU expects mild euro area recovery
techMARK 2,903.08 -0.49%
FTSE 100 6,830.50 -0.52%
FTSE 250 16,527.88 -0.07%
Stocks eased back from some of the session's earlier losses, but still ended the day on a downbeat note as miners weighed heavily on the back of fears over the economic situation in China.
The FTSE ended the session down 35.36 points at 6,830.50.
US consumer confidence falls
The Conference Board's consumer confidence index for February slipped to a reading of 78.1 from 79.4 the month before, led by a slide in the expectations component, which fell to 75.7, from 80.8.
Capital Economics Economist Amna Asaf added: "Overall, we aren't too concerned about the tiny decline in confidence, as the improving fundamentals suggest that a rebound is just around the corner."
Meanwhile, house prices in the 20 main US cities increased at a slower pace in December, albeit more quickly than had been foreseen. The S&P/Case-Schiller Index climbed 13.4% from a year earlier. It rose 13.71% in November.
EU expects mild euro area recovery, cuts inflation forecast
The European Commission said today it expects a mild recovery in the euro-area over the next two years, according to its latest forecast. The euro-area is predicted to grow 1.2% this year and 1.8% next year after two consecutive years of contraction.
The EU's executive body also cut its inflation forecast for the single currency area after lower-than-expected price rises at the beginning of the year. Revised figures showed consumer prices rose 0.8% in January, well below the European Central Bank's 2% target.
CRH soars on 2014 outlook
CRH climbed to the top of the leaderboard as it looked ahead to 2014, predicting it would be a year of profit growth. The gains came despite poor results in 2013, for which it blamed severe winter conditions and weaker trading in Europe. Comments from broker Jefferies, giving the stock a 'buy' rating and 1,700p price target, helped.
RSA Insurance recovered somewhat from yesterday's declines, which came after it issued a statement acknowledging recent press speculation regarding a potential rights issue and stated it was "considering" several options. Fellow insurer Admiral followed suit. The latter had its neutral rating reiterated by analysts at Credit Suisse earlier today.
Miners weighed heavily on the index, with Anglo American, Rio Tinto, Antofagasta and Fresnillo all registering big drops as concerns about China, which is the largest metals consumer in the world, dragged sentiment lower and metals prices moved into the red. Investors are concerned that Chinese lenders could be cutting back on credits to property developers.
GKN shares fell sharply after the group reported a flat full-year performance in Europe, while both Japanese and Indian production fell 4%. Brokers Jefferies, Numis, Societe Generale and Investec were all upbeat about the stock, however, with all choosing to reiterate their 'buy' ratings.
On the second tier index, asset manager Ashmore was at the bottom of the pile after its first-half profits fell by a third as it counted the cost of investor wariness over emerging markets against a backdrop of the US winding down its bond-buying stimulus programme. The news prompted Canaccord to downgrade the stock to 'hold'.
Looking ahead to Wednesday
Tomorrow is set to be a busy session for earnings, with annual results due out from ITV, Petrofac, Taylor Wimpey, CSR, Weir and Direct Line.
Also on the cards is an announcement on fourth quarter UK economic growth from the Office for National Statistics, which is expected to confirm a quarter-on-quarter rise of 0.7%. |
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FTSE 100 - Risers
CRH (CRH) 1,788.00p +6.18%
RSA Insurance Group (RSA) 101.00p +3.59%
Sports Direct International (SPD) 808.50p +1.89%
William Hill (WMH) 377.30p +1.59%
Admiral Group (ADM) 1,491.00p +1.43%
Sage Group (SGE) 435.50p +1.42%
International Consolidated Airlines Group SA (CDI) (IAG) 451.70p +1.39%
Associated British Foods (ABF) 2,955.00p +1.20%
ITV (ITV) 206.10p +1.13%
Marks & Spencer Group (MKS) 511.00p +1.09%
FTSE 100 - Fallers
Fresnillo (FRES) 967.50p -3.01%
Rio Tinto (RIO) 3,439.00p -2.76%
Anglo American (AAL) 1,500.50p -2.15%
Vodafone Group (VOD) 246.95p -2.12%
Antofagasta (ANTO) 914.50p -1.98%
BG Group (BG.) 1,097.50p -1.79%
BHP Billiton (BLT) 1,928.50p -1.61%
BAE Systems (BA.) 410.90p -1.58%
Standard Chartered (STAN) 1,284.50p -1.57%
Rexam (REX) 505.50p -1.46%
FTSE 250 - Risers
Essar Energy (ESSR) 71.75p +6.77%
Kentz Corporation Ltd. (KENZ) 776.50p +6.66%
St James's Place (STJ) 835.00p +5.10%
Foxtons Group (FOXT) 384.40p +4.71%
Perform Group (PER) 229.00p +4.09%
JD Sports Fashion (JD.) 1,550.00p +4.03%
Greencore Group (GNC) 247.00p +3.78%
Paragon Group Of Companies (PAG) 411.30p +3.63%
Hellermanntyton Group (HTY) 324.40p +3.61%
Spirent Communications (SPT) 107.10p +3.58%
FTSE 250 - Fallers
Centamin (DI) (CEY) 53.80p -6.92%
Ashmore Group (ASHM) 317.80p -6.53%
Lonmin (LMI) 297.30p -4.71%
Evraz (EVR) 76.45p -4.62%
Cable & Wireless Communications (CWC) 54.60p -3.79%
Vedanta Resources (VED) 839.00p -3.40%
COLT Group SA (COLT) 135.40p -3.29%
Pace (PIC) 403.60p -3.21%
Rank Group (RNK) 142.30p -3.00%
Homeserve (HSV) 336.00p -2.78% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks mixed as EU revises forecasts - EU predicts tepid growth, cuts inflation forecast
- ECB to withhold interest rate cut until April, Goldman expects
- German fourth quarter GDP confirmed at 0.4 per cent growth
- Ukraine delays unity government vote
- Slump in Chinese yuan hurts mining stocks
FTSE 100: -0.52%
DAX: -0.10%
CAC 40: -0.10%
FTSE MIB: -0.02%
IBEX 35: 0.47%
Stoxx 600: 0.06%
European stocks were mixed after the European Commission predicted tepid growth for the euro-area over the next two years and cut its inflation forecast.
The euro-area is expected to grow 1.2% this year and 1.8% next year after two consecutive years of contraction, according to the latest economic forecasts from European Union's (EU) executive body.
The Commission also cut its inflation projection to just 1% over the course of 2014, compared to a November estimate of 1.5%.
Revised figures on Monday showed consumer prices rose 0.8% in January, well below the European Central Bank's (ECB) 2% target.
The EU's new forecasts pile pressure on the ECB to enact greater measures to boost the recovery of the bloc amid high unemployment and falling inflation.
ECB President Mario Draghi has indicated that the central bank will consider changing its policy at its March meeting following the release of more comprehensive data, including its own economic forecasts.
Goldman Sachs today said it sees the ECB holding back on an interest rate cut until April but did not rule out a move to keep money market liquidity topped up by ending its weekly 'sterilisation' of past government bond purchases.
In other European news today, confirmed figures showed Germany's gross domestic product (GDP) increased by a modest 0.4% on the quarter between October and December compared with 0.3% during the previous three months.
The Federal Statistics Office said foreign trade drove growth in Europe's largest economy in the fourth quarter, while domestic demand dragged.
In France, business confidence remained stable in February, continuing to point to a recovery, the statistics bureau Insee said today.
The indicator of French business confidence came in at 100, the long-term average for the index and in line with expectations.
In the UK, retail sales grew at a considerably faster-than-expected pace in the 12 months to February and at their fastest rate since the middle of 2012, the Confederation of British Industry's (CBI) Distributive Trades Survey.
The total sales gauge rose to a reading of 37, from 14 in January (consensus: 15).
Ukraine, China
Ukraine's interim President Olexander announced today that the formation of a unity government was delayed until Thursday to allow further consultations to avoid the risk of separatism.
A unity government would allow the troubled nation to receive economic aid to prevent a default, but many in Ukraine's Russian-speaking regions oppose the installation of a more European-leaning interim administration.
It comes as the Ukrainian parliament voted to send the fugitive President Viktor Yanukovych to The Hague to be tried over the violence that led to at least 82 deaths in Kiev last week. He is on the run and believed to be in Crimea.
In China, stocks slid after a sharp fall in the yuan raised fears that of slower growth in the world's second largest economy. China's yuan dropped the most in more than three years on bets the central bank wants to end the currency's appreciation to boost trading.
US consumer confidence, house prices
The Conference Board's consumer confidence index for February slipped to a reading of 78.1 from 79.4 the month before. Economists had pencilled in a reading of 80.
Capital Economics said the drop was probably weather related or a delayed reaction to the recent dip in equity prices.
"Overall, we aren't too concerned about the tiny decline in confidence, as the improving fundamentals suggest that a rebound is just around the corner."
Another report showed house prices in the 20 main US cities increased at a slower pace in December. The S&P/Case-Schiller Index climbed 13.42 % from a year earlier, down from a 13.71% rise in November. Nevertheless, it beat the consensus estimate for a 13.40% increase.
Vivendi, Jyske Bank
Vivendi declined after the French media and telecoms business reported 2013 results that fell short of analysts' expectations.
Jyske Bank advanced after the Dutch lender agreed to buy BRFkredit for about 7.4bn kroner.
Ashmore Group fell after the UK emerging markets money manager reported $2.9bn of net outflows in its fiscal first half as investors sought to avoid assets in developing economies.
A gauge of miners, including Fresnillo, Rio Tinto and Anglo American, were down as the price of metals fell on the drop in the Chinese yuan.
Aixtron edged lower as the German maker of equipment for semiconductors reported fourth-quarter sales below forecasts.
St. James's Place was higher after the British wealth manager increased its full-year dividend by 50%.
Fresenius Medical Care slid as the world's biggest provider of kidney dialysis posted full-year earnings that missed market forecasts.
Straumann Holding gained after the world's biggest maker of dental implants reported a increase in 2013 earnings and said it expects revenue will rise in a low-single-digit range in 2014.
The euro rose 0.09% to $1.3748.
Brent crude futures dropped $0.857 to $109.700 per barrel, according to data from the ICE. |
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| | US Market Report | | US open: Stocks waver on China concerns - Consumer expectations slipped in February
- Drop in Chinese yuan raises growth concerns
- House prices rise slightly more than expected
Dow Jones Industrials: -0.05%
Nasdaq Composite: -0.02%
S&P 500: -0.03%
US equity benchmarks were trading near the unchanged mark following a slightly weaker-than-expected reading on consumer confidence and in reaction to an overnight drop in the Chinese yuan.
Some observers fear that moves by Beijing to further lay the foundations currency convertibility could impact negatively on the outlook for the economy in the near-term.
The Conference Board's consumer confidence index for February slipped to a reading of 78.1 from 79.4 the month before, led by a slide in the expectations component.
House prices in the 20 main US cities increased at a slower pace in December, albeit more quickly than had been foreseen. The S&P/Case-Schiller Index climbed 13.4 % from a year earlier. It rose 13.71% in November.
Acting as a backdrop, markets were closely watching geopolitical events in Ukraine.
Western Union, Office Depot
Western Union Co. declined after disclosing it got subpoenas in November under an investigation into fraud-induced money transfers.
Office Depot slumped after reporting an unexpected loss in the fourth quarter.
Home Depot gained following fourth quarter earnings that beat forecasts.
Zulily Inc. advanced after the online children's fashion retailer said it expects first quarter sales that missed analyst's estimates.
Front month West Texas crude futures were lower by 1.47% to the $101.33/barrel mark on the NYMEX.
Ten-year US treasury yields moved lower by three basis points to the 2.71%.
S&P 500 - Risers
Frontier Communications Co. (FTR) $4.96 +7.97%
GameStop Corp. (GME) $37.99 +5.38%
Macy's Inc. (M) $55.48 +4.56%
Sears Holdings Corp. (SHLD) $39.61 +4.10%
Home Depot Inc. (HD) $79.95 +2.67%
Lowe's Companies Inc. (LOW) $48.28 +2.24%
Best Buy Co. Inc. (BBY) $25.71 +2.15%
Kohls Corp. (KSS) $52.97 +1.96%
Lorillard Inc. (LO) $49.14 +1.91%
AutoNation Inc. (AN) $52.04 +1.70%
S&P 500 - Fallers
Tenet Healthcare Corp. (THC) $45.05 -6.79%
Expeditors International Of Washington Inc. (EXPD) $39.99 -4.81%
Cliffs Natural Resources Inc. (CLF) $20.34 -4.73%
Staples Inc. (SPLS) $12.87 -3.88%
Monster Beverage Corp (MNST) $71.81 -3.64%
CONSOL Energy Inc. (CNX) $39.11 -2.95%
United States Steel Corp. (X) $23.48 -2.81%
Transocean Ltd. (RIG) $42.72 -2.73%
Halliburton Co. (HAL) $54.98 -2.47%
ONEOK Inc. (OKE) $59.74 -2.43%
Dow Jones I.A - Risers
Home Depot Inc. (HD) $79.95 +2.67%
Chevron Corp. (CVX) $115.17 +0.89%
Coca-Cola Co. (KO) $37.79 +0.77%
E.I. du Pont de Nemours and Co. (DD) $64.95 +0.57%
Walt Disney Co. (DIS) $80.97 +0.29%
General Electric Co. (GE) $25.35 +0.24%
Microsoft Corp. (MSFT) $37.76 +0.19%
Nike Inc. (NKE) $77.97 +0.17%
Visa Inc. (V) $226.55 +0.16%
3M Co. (MMM) $132.34 +0.11%
Dow Jones I.A - Fallers
Caterpillar Inc. (CAT) $96.45 -0.89%
JP Morgan Chase & Co. (JPM) $57.56 -0.81%
AT&T Inc. (T) $32.21 -0.80%
Boeing Co. (BA) $128.69 -0.69%
Cisco Systems Inc. (CSCO) $21.99 -0.61%
Travelers Company Inc. (TRV) $82.97 -0.56%
Pfizer Inc. (PFE) $31.82 -0.52%
Goldman Sachs Group Inc. (GS) $165.67 -0.52%
Unitedhealth Group Inc. (UNH) $75.68 -0.43%
Verizon Communications Inc. (VZ) $46.34 -0.43%
Nasdaq 100 - Risers
Tesla Motors Inc (TSLA) $247.72 +13.82%
Tractor Supply Company (TSCO) $68.78 +3.01%
Priceline.Com Inc. (PCLN) $1,335.00 +1.62%
TripAdvisor Inc. (TRIP) $99.46 +1.22%
Amazon.Com Inc. (AMZN) $356.07 +1.22%
Catamaran Corp (CTRX) $52.00 +1.15%
Whole Foods Market Inc. (WFM) $53.48 +1.13%
Mylan Inc. (MYL) $51.56 +1.00%
Garmin Ltd. (GRMN) $52.21 +0.99%
Costco Wholesale Corp. (COST) $115.07 +0.97%
Nasdaq 100 - Fallers
Expeditors International Of Washington Inc. (EXPD) $39.99 -4.81%
Staples Inc. (SPLS) $12.87 -3.88%
Monster Beverage Corp (MNST) $71.81 -3.64%
Charter Communications Inc. (CHTR) $121.44 -1.73%
Vimpelcom Ltd Ads (VIP) $10.16 -1.65%
CH Robinson Worldwide Inc (CHRW) $52.51 -1.56%
Avago Technologies Ltd. (AVGO) $58.67 -1.51%
Broadcom Corp. (BRCM) $30.28 -1.50%
Regeneron Pharmaceuticals Inc. (REGN) $342.55 -1.46%
Applied Materials Inc. (AMAT) $18.80 -1.40% |
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| | Broker Tips | | Broker tips:St.James Place, Croda, Ashmore Shore Capital has reiterated its 'buy' stance on financial advisory firm St James's Place after the company reported an 'excellent' set of final results.
The broker, which set a price target 795p, said 2013 results highlight that "in financial terms the company is going from strength to strength", with hefty increases in underlying cash, new business profit, new business, funds under management and the dividend.
"The shares have had a terrific run in recent months and now trade at a 30% premium to our 2014 net asset value of 610p (upgraded by around 2%) reducing to 21% in 2015 (against 655p)," Shore Capital said.
It noted a forward yield of around 2.7% against a 2014 dividend forecast which has been upgraded to 21.2p from 17p.
"We believe the stock has further to run, given the growth prospects of the business, both organic and from a likely acquisition in the Far East, and the increasingly cash-generative nature of the back-book," Shore said.
Credit Suisse maintained its outperform rating on natural chemicals company Croda after its better-than-expected fourth quarter numbers, though it remains concerned about the impact of currency headwinds on the group over 2014.
The broker notes that Croda is guiding the market to an adverse currency impact of £9m for a proforma 2013 using spot FX levels. At the same time, Croda expects to deliver constant currency sales and profit growth in 2014.
Croda, which makes chemicals used in personal care, crop care and home care products, said adjusted pre-tax profit for the year ended December 31st increased 5.4% to £251.4m. Revenue increased 2.4% to £1.077bn.
The group's fourth quarter EBIT of £62.8m was 3% ahead of the broker's expectations and 2% ahead of consensus.
Credit Suisse has a 2850p target for the stock.
Below par interim results at Ashmore have led to a downgrade by Canaccord to "hold".
Describing the numbers, which came in at 25% below consensus, as "lacklustre", the broker reduced its target to 325p.
Canaccord said that Ashmore's assets under management are more or less maintained and "given we don't bake in a strong level of performance fees in our estimates" it attributed the fall in overall revenues to margins.
"New mandate win levels were roughly on par with last year's levels (£7bn vs £8bn gross inflows). Given the margin issue, we look for more guidance...on the margin levels at which new business is being written on," it said.
"Given a lack of seasonality, full year earnings per share consensus is likely to trend towards 18p. Ashmore would thus be trading at 18 times earnings based on expected revised consensus. Consensus and our estimates are expected to rebase downwards towards," Canaccord said. | | |
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