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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: Markets bounce back on ECB promise - ECB ready and willing to act
- Vodafone and SuperGroup lead gains
- All eyes on Friday´s US jobs report
Market Movers
techMARK 2,779.24 +1.25%
FTSE 100 6,558.28 +1.55%
FTSE 250 15,789.91 +1.47%
After a cautious start, UK markets pushed firmly into positive territory on Thursday after European Central Bank (ECB) President Mario Draghi indicated he was “ready and willing to act”. Market watchers took that to mean that it may well undertake furher policy measures at upcoming meetings.
The FTSE 100 finished the session 1.55% higher at 6,550.
Contrary to some economists´ expectations the ECB did not announce any further measures to help liquidity conditions in the Eurozone´s short-term funding markets. On the subject of ending the so-called sterilisation of purchases of government bonds via its Securities Markets Programme (SMP) the monetary authority simply said that it was “being looked at” but had not been discussed at the meeting.
The remarks sent the single currency sharply higher on foreign exchange markets.
As was widely expected, the Bank of England said at noon that it kept monetary policy unchanged, leaving the asset purchase programme at £375bn and the Bank Rate at 0.5% - the Bank Rate has remained at this level since the last rate cut in March 2009.
Acting as a backdrop, of course, investors were keenly awaiting tomorrow´s monthly non-farm payrolls report Stateside. The figures are expected to show that non-farm payrolls rose to 184,000 in January from just 74,000 in December.
Somewhat ironically, the fact is that over the last week or so, and in the run-up the US jobs report, the Footsie is little changed, despite the eye-catching bouts of volatility seen on some trading days, as often happens. Nonetheless, those numbers out of the US not infrequently set the tone to trading for the rest of the month.
Vodafone, AstraZeneca, Super Group…
Vodafone gained after third-quarter revenue declined by a less-than-expected 3.6%. Chief Executive Vittorio Colao said that sales trends would begin to improve.
AstraZeneca was in the red after saying that 2013 annual revenue fell 6% to $25.7bn as the drug maker was hurt by competition from generic brands. Core earnings per share fell 26% year-on-year to $5.05. Some analysts also pointed towards weaker-than-expected guidance from the pharmceuticals giant as a reason behind the retreat seen in the shares.
TUI Travel underwhelmed despite saying that it is confident of hitting full-year forecasts after underlying operating losses narrowed in the first quarter.
Imagination Technologies surged after announcing that US gadget giant Apple as extended its multi-year, multi-use license agreement with the chip designer.
Consumer goods giant Reckitt Benckiser made gains after Credit Suisse lifted its rating for the stock from ‘neutral’ to ‘outperform’, saying that investors should look past concerns regarding its struggling pharmaceuticals division.
In a trading statement covering the 13 weeks to January 26th SuperGroup said sales over the period jumped 22.1% to £141m. To take into acount the shares are at what is essentially the last level of technical resistance standing in their path, commented technical analysts at Sharecast. In a late morning note broker Investec described the company as an “attractive long term brand roll-out story [that] supports a premium valuation”. It reiterated its 'buy' recommendation on the shares and 1,800p target.
Insurer Beazley expressed confidence on its outlook after revealing a 25% jump in full year pre-tax profits on the back of a strong underwriting performance and a quiet year for catastrophe related loss claims. The firm hiked its special dividend by 92%. "Ex-the special and second interim [dividend], Beazley is trading on close to a 9 times´ estimated 2014 price-to-earnings multiple, which we would see as an attractive entry point," Cannacord Genuity remarked. |
| | The Fundamentals of Stock Market Highs | | How to Know when the Bull Market Ends - Given that the stock market rally has now lasted nearly five years and in view of new all-time highs, many market participants are faced with the question when will there be a top at the major share indexes. After all, everybody wants to exit the market near a high and lock in their profits before the market turns downwards again. Read more. |
| | FTSE 100 - Fallers
Randgold Resources Ltd. (RRS) 4,336.00p -1.59%
AstraZeneca (AZN) 3,815.50p -1.59%
Fresnillo (FRES) 782.50p -1.20%
Associated British Foods (ABF) 2,859.00p -0.83%
Johnson Matthey (JMAT) 3,215.00p -0.46%
RSA Insurance Group (RSA) 103.30p -0.29%
TUI Travel (TT.) 423.80p -0.14%
FTSE 250 - Risers
Imagination Technologies Group (IMG) 185.10p +14.19%
Supergroup (SGP) 1,600.00p +7.24%
Grainger (GRI) 225.00p +6.18%
Beazley (BEZ) 268.00p +5.76%
International Personal Finance (IPF) 486.40p +4.71%
Investec (INVP) 415.00p +4.59%
Bellway (BWY) 1,592.00p +4.33%
Barratt Developments (BDEV) 394.10p +4.07%
Ocado Group (OCDO) 547.50p +3.99%
Playtech (PTEC) 693.00p +3.98%
FTSE 250 - Fallers
Kenmare Resources (KMR) 14.55p -8.20%
Serco Group (SRP) 398.80p -5.50%
Enterprise Inns (ETI) 157.00p -3.80%
Essar Energy (ESSR) 57.35p -3.29%
Foxtons Group (FOXT) 361.30p -2.61%
TalkTalk Telecom Group (TALK) 298.00p -1.97%
RPS Group (RPS) 323.30p -1.79%
Rotork (ROR) 2,352.00p -1.63%
JD Sports Fashion (JD.) 1,538.00p -1.47%
Kazakhmys (KAZ) 175.30p -1.35%
FTSE TechMARK - Risers
Skyepharma (SKP) 159.50p +10.19%
Electronic Data Processing (EDP) 82.50p +6.45%
Sepura (SEPU) 136.25p +3.61%
Promethean World (PRW) 29.75p +3.48%
BATM Advanced Communications Ltd. (BVC) 16.00p +3.23%
Filtronic (FTC) 56.25p +2.74%
Gresham Computing (GHT) 128.25p +2.60%
Wolfson Microelectronics (WLF) 127.75p +2.20%
Anite (AIE) 87.00p +1.75%
Torotrak (TRK) 22.12p +1.72%
FTSE TechMARK - Fallers
Phoenix IT Group (PNX) 111.62p -3.56%
Consort Medical (CSRT) 999.00p -1.48%
CML Microsystems (CML) 592.50p -0.84%
E2V Technologies (E2V) 158.50p -0.63%
RM (RM.) 127.50p -0.39%
IShares Euro Gov Bond 7-10YR UCITS ETF (IEGM) € 182.72 -0.25%
Dialight (DIA) 727.00p -0.14% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks rise as ECB keeps policy unchanged - ECB and BoE keep policy on hold
- German factory orders fall
- US jobless claims drop
FTSE 100: 1.55%
DAX: 1.54%
CAC 40: 1.71%
FTSE MIB: 2.28%
IBEX 35: 1.90%
Stoxx 600: 1.49%
European stocks advanced as the European Central Bank (ECB) decided to keep its policy unchanged due to the “complexity of the situation” in the euro-area.
The ECB said today it would maintain interest rates at 0.25% despite mounting pressure to tackle falling inflation.
Speaking at a press conference after the announcement, ECB President Mario Draghi said the reason for holding policy was due to the “complexity” surrounding the drivers behind price pressures.
He said the ECB is awaiting more data to be released in March before deciding whether to take further action. In the meantime he reiterated that the ECB stands "ready and willing to act" if necessary.
While he said inflation would remain low for a prolonged period of time, he denied risks of deflation.
Inflation fell to 0.7% last month, well below the ECB’s target of just under 2%.
Asset purchases were kept at £375bn, which was also as expected.
German factory orders
German factory orders dropped 0.5% in December from November when they rose a revised 2.4%, the Economy Ministry revealed today. Economists had predicted an increase of 0.2%.
Daimler, Volvo
Daimler advanced after the luxury vehicle maker posted a 45% rise in quarterly profit.
Volvo gained after reporting fourth-quarter operating profit that beat projections and saying it will cut 4,400 jobs.
AstraZeneca declined after the UK drugmaker forecast 2014 profit will decrease more than analysts had forecast.
Sanofi was lower as France’s largest drugmaker estimated that annual profit will increase no more than 7%, falling short of the analyst projection of 8%.
Dassault Systemes tumbled after the French developer of 3D-design software forecast 2014 earnings that trailed market expectations.
Alcatel-Lucent was higher as the French network-equipment vendor posted its first quarterly profit in two years. Fourth-quarter net income was €134m, compared with a €1.56bn loss a year earlier.
Credit Suisse Group dropped after posting fourth-quarter profit that fell short of analysts’ estimates.
The euro rose 0.53% to $1.3605.
Brent crude futures climbed $0.534 to $106.820 per barrel, according to the ICE. |
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| | US Market Report | | US open: Stocks advance as jobless claims decline US stocks rallied as weekly jobless claims fell more than expected.
Initial US unemployment claims for the week ending February 1st dropped by 20,000, to reach 331,000, according to the US Department of Labor.The consensus estimate had been for a reading of 335,000.
The prior week´s estimate was revised higher from the preliminary print of 348,000.
The data comes ahead of the Labor Department’s jobs report which is expected to show businesses added 188,000 employees in January after an 87,000 increase in December.
Barclays said: “We continue to look for an expansion of 175,000 in nonfarm payrolls, a 175,000 rise in private payrolls, and an unchanged unemployment rate of 6.7% in tomorrow’s BLS employment report.”
Separately, the Commerce Department revealed the US trade deficit increased to $38.7bn in December from a revised $34.6bn a month earlier.
Analysts had expected a trade balance of $36bn.
Exports dropped by 1.8% month-on-month to reach $191.3bn, with decreases seen across a broad swathe of sectors. Imports gained 0.3% on the month to $230bn.
Acting as a backdrop, traders may have been cheered by reports that the ECB might take action in coming months.
On the company front Coca-Cola advanced after agreeing to buy 10% of Green Mountain Coffee Roasters Inc. for about $1.25bn.
Walt Disney edged higher after posting quarterly profit that beat analysts’ estimates.
Twitter declined after reporting a wider-than-expected loss and slowing user growth.
General Motors slipped after posting a fourth-quarter profit that fell short of market forecasts. |
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| | Broker Tips | | Reckitt, Vodafone, Imagination Technologies Consumer goods giant Reckitt Benckiser was making gains on Thursday after Credit Suisse lifted its rating for the stock from ‘neutral’ to ‘outperform’, saying that investors should look past concerns regarding its struggling pharmaceuticals division.
“It is time then to look past pharma challenges, and indeed tough cough/cold comparatives, and look at what Reckitt could be by the end of what is likely to be a seminal year for the group.”
Prime Wealth Group has labelled telecoms titan Vodafone as a ‘buy’, recommending investors to snap up shares quickly after the company’s third-quarter figures beat forecasts on Thursday.
“The stock fell back ahead of today's results which, while suffering from challenging trading conditions in Europe, delivered better-than-expected numbers. Shares are already recovering in early trade, and look set to regain year highs in the near future,” said Dafydd Davies, Senior Trader at Prime Wealth.
Jefferies has maintained its ‘buy’ rating and 364p target for Imagination Technologies after Apple extended its multi-year licence agreement with the chip designer.
“We also expect no material impact to licensing numbers this year given this is merely a contract extension. However, this announcement serves to steady any concerns investors may have had regarding Apple’s possible design out of Imagination’s graphics in favour of either ARM or an in-house play.” | | |
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