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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: FTSE down as Russian units spotted in Ukraine - FTSE closes down 42.15 points at 6,541.61
- Ukraine says Russian forces have entered the country
- UK inflation falls to 1.6 per cent in March
- German investor confidence falls for 4th month
techMARK 2,630.91 -0.44%
FTSE 100 6,541.61 -0.64%
FTSE 250 15,590.50 -0.71%
It was another negative finish in the City on Tuesday as concerns about Ukraine, mixed corporate news, and disappointing Chinese, UK and German data all weighed on sentiment.
The FTSE 100 closed down 42.15 points at 6,541.61.
Chris Beauchamp, Market Analyst at IG, said: "A lacklustre morning for the FTSE has given way to an even less impressive afternoon. We are continuing to shed the ground gained yesterday, and an apparent escalation of the situation in Ukraine is not helping."
It proved a busy day for macro news, with UK inflation falling to 1.6% in March from 1.7% a month earlier, moving further away from the Bank of England's 2% target.
"The further fall in consumer price index inflation in March suggested that the six-year squeeze on real wages is finally over and took it a step closer to the 1% figure we think it could reach by the end of the year," Capital Economics said.
Meanwhile, total UK retail sales grew by 0.3% month-on-month during March, but fell by 1.7% in like-for-like terms, according to the latest data from the British Retail Consortium (BRC).
That was mainly due to the later timing of Easter this year, which weighed on sales of household accessories and furniture.
The three-month average rate of sales, on the other hand, was 2.1%, just below the 12-month average of 2.4%.
It was also announced that producer prices increased in March despite a drop in input prices, according to the Office for National Statistics (ONS).
Prices were 0.5% in the year to March, after a gain of 0.6% the month before. Factory gate prices were 0.2% higher in comparison with the previous month, following a gain of 0.1% in the month before.
Meanwhile, across the Channel German investor confidence fell for a fourth month in April.
The ZEW Centre for European Economic Research in Mannheim said its index of investor an analyst expectations, which aims to forecast economic developments six months in advance, dropped to 43.2 from 46.6 in March, well below analysts' expectations of 45.
Ukraine says Russian forces have entered the country
In the latest out from Eastern Europe, Ukraine has said Russian forces have entered the country, according to Bloomberg.
That followed another report from RIA Novosti, which said that Russia's elite airborne special forces unit, Spetsnaz 45th Guards regiment, have been spotted in the Ukrainian town of Slovyansk.
While information is scarce, the deployment of such units could, in a worst case scenario, be a first indication that other more conventional units might soon follow.
On the other hand, it could be that they are being used in a more limited role to help pro-Russian forces in eastern Ukraine, gathering information on Ukraine's recently launched anti-terrorist operation, analysts at Sharecast explain.
That came after acting President of Ukraine, Olexander Turchynov, announced the start of an "anti-terrorist operation" against pro-Russian separatists. The operation began in the north of Donetsk Region and Turchynov said it was being conducted "stage by stage, in a responsible manner".
President Barack Obama urged Vladimir Putin to use his influence to make separatists in Donetsk and other parts of eastern Ukraine stand down, but the Russian President denied his country was intervening in the crisis.
"Ukrainian forces appear to have gone into action and, while the situation is confused, there are reports that Russian forces have been identified. Regardless of whether these things are true, the rumours are sufficient to ignite fresh selling," Beauchamp added.
March sees US consumer price rise
Over in the States, consumer prices accelerated in March on the back of gains in food and rent.
The consumer price index increased 0.2% after rising 0.1% the prior month, the Labor Department revealed. Analysts had expected prices to remain unchanged.
Capital Economics said the rise in inflation was in part due to the "unwinding of the previous weather distortion".
"Overall, we suspect that core inflation will rise to 2% this year and beyond it next year, which would catch the Fed off guard," the analyst said.
Switching focus from the world's biggest economy to the second, China's broadest measure of new credit fell 19% in March from a year earlier and money supply grew at the slowest pace since 2001, according to the People's Bank of China. It comes ahead of a report tomorrow, which is forecast to show economic growth in China slowed in the first quarter.
Royal Mail leads risers, G4S slides on downgrade
Royal Mail shares were in the top spot in today's session, as investors await to hear the government's decision on whether to sell the remaining 30 per cent stake in the group now that the lock-up period has expired. According to the BBC, senior Tories are firmly in favour of a sale.
Defensive stocks United Utilities, National Grid, SSE and Severn Trent were all higher as the wider index fell on the back of disappointing Chinese, UK and German data.
Temporary power generator Aggreko was also on the up after it reported an "encouraging" start to the year with underlying revenues up 5% in the first three months. Prime Wealth labelled the stock a 'buy', saying it sees Aggreko as an "early stage if slightly speculative recovery play ahead of what will be a high profile year for the group".
Meanwhile, security solutions group G4S was trading firmly in the red after the stock was downgraded from 'hold' to 'sell' by Deutsche Bank. G4S has also come under fire from shareholders after the security company announced a major pay rise for its new Chief Executive amid a series of scandals.
Miner Rio Tinto fell despite saying it started the new financial year strongly with record first-quarter iron ore production and shipments, though production eased when compared with the end of last year. Sector peers Fresnillo, Anglo American, BHP Billiton and Randgold Resources.
Imperial Tobacco rose after saying it said it has begun talks with trade unions about cutting 900 jobs as it looks to close two factories in Nottingham and Nantes, France. |
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FTSE 100 - Risers
Royal Mail (RMG) 510.00p +3.66%
United Utilities Group (UU.) 769.50p +2.12%
SSE (SSE) 1,495.00p +1.77%
Severn Trent (SVT) 1,787.00p +1.59%
National Grid (NG.) 824.00p +1.29%
Aggreko (AGK) 1,528.00p +1.19%
Centrica (CNA) 342.40p +0.91%
Royal Dutch Shell 'A' (RDSA) 2,230.50p +0.77%
Royal Dutch Shell 'B' (RDSB) 2,390.00p +0.70%
Sports Direct International (SPD) 745.50p +0.68%
FTSE 100 - Fallers
Fresnillo (FRES) 901.50p -3.32%
Rio Tinto (RIO) 3,302.50p -3.10%
G4S (GFS) 240.60p -2.98%
Aviva (AV.) 491.40p -2.69%
Mondi (MNDI) 963.50p -2.68%
ARM Holdings (ARM) 930.00p -2.57%
Randgold Resources Ltd. (RRS) 4,727.00p -2.44%
Marks & Spencer Group (MKS) 416.60p -2.37%
SABMiller (SAB) 3,052.50p -2.29%
Lloyds Banking Group (LLOY) 70.94p -2.26%
FTSE 250 - Risers
Heritage Oil (HOIL) 256.50p +6.39%
Moneysupermarket.com Group (MONY) 170.70p +5.44%
Centamin (DI) (CEY) 53.80p +4.98%
Debenhams (DEB) 81.00p +4.45%
BTG (BTG) 512.00p +3.12%
Supergroup (SGP) 1,447.00p +2.55%
COLT Group SA (COLT) 148.50p +2.41%
ITE Group (ITE) 211.30p +2.13%
PZ Cussons (PZC) 348.60p +1.90%
WH Smith (SMWH) 1,079.00p +1.79%
FTSE 250 - Fallers
Ocado Group (OCDO) 328.40p -6.09%
Imagination Technologies Group (IMG) 187.60p -4.72%
Tullett Prebon (TLPR) 290.40p -4.25%
Polymetal International (POLY) 615.00p -4.06%
Elementis (ELM) 274.90p -3.75%
Inchcape (INCH) 618.50p -3.66%
Partnership Assurance Group (PA.) 125.90p -3.52%
Xaar (XAR) 829.50p -2.98%
CSR (CSR) 634.50p -2.98%
Pace (PIC) 388.10p -2.98%
FTSE TechMARK - Risers
Filtronic (FTC) 39.00p +1.96%
Dialight (DIA) 923.50p +1.71%
Phoenix IT Group (PNX) 116.50p +1.30%
E2V Technologies (E2V) 162.25p +1.25%
SDL (SDL) 323.00p +0.94%
Anite (AIE) 82.50p +0.92%
Skyepharma (SKP) 211.00p +0.84%
IShares Euro Gov Bond 7-10YR UCITS ETF (IEGM) € 187.99 +0.45%
FTSE TechMARK - Fallers
Vectura Group (VEC) 117.75p -6.18%
Oxford Biomedica (OXB) 2.17p -3.56%
Kofax Limited (DI) (KFX) 461.75p -2.81%
Innovation Group (TIG) 31.25p -2.34%
Gresham Computing (GHT) 125.00p -1.96%
Ricardo (RCDO) 661.50p -1.71%
Consort Medical (CSRT) 891.00p -1.00%
NCC Group (NCC) 171.25p -0.44%
XP Power Ltd. (DI) (XPP) 1,596.00p -0.37%
Sepura (SEPU) 133.75p -0.37% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: German stocks hit as Russian units enter Ukraine - Parts of Russian special forces unit spotted in Ukraine – RIA Novosti
- Ukraine says Russian troops have entered the country - Bloomberg
- Italian and German equities bear brunt of selling
FTSE 100: -0.65%
DAX: -1.80%
CAC 40: -0.88%
FTSE MIB: -2.12%
IBEX 35: -0.79%
Stoxx 600: -0.99%
European stocks took a sharp turn for the worse in afternoon trading as reports began to filter in that parts of Russia's elite 45th Guards airborne regiment had been spotted in eastern Ukraine.
More specifically, the above is an elite Spetsnaz reconnaissance unit.
Information is scarce but the deployment of such units could, in a worst-case scenario, be a first indication that other more conventional units might soon follow.
On the other hand, it could be that they are being used to help pro-Russian forces in eastern Ukraine in a more limited manner, gathering information on Ukraine's anti-terrorist operation which began this morning.
Not surprisingly, German and Italian equities bore the brunt of selling given those two countries' energy dependency on Russia.
Ukraine begins 'anti-terrorist' operation
German investor confidence fell for a fourth month in April.
The ZEW Centre for European Economic Research in Mannheim said its index of investor an analyst expectations, which aims to forecast economic developments six months in advance, dropped to 43.2 from 46.6 in March, well below analysts' expectations of 45.
Not surprisingly, the Ukraine crisis was foremost on investors' minds, the results of the survey showed.
SABMiller, Banca Monte
From a sector standpoint, and within the DJ Stoxx 600, the worst performing industrial groups now are: Basic resources (-2.43%), Automobiles and Aparts (-2.36%) and Banks (-1.70%).
SABMiller declined as the world's second-biggest brewer said its 39.6% holding in hotel and casino operator Tsogo Sun is not a core part of its operations.
Banca Monte dei Paschi di Siena SpA dropped as Italy's third-largest bank said it may increase the size of a planned share sale to reimburse part of a €4.1bn government bailout.
Siemens AG retreated the Chief Executive of Russian Railways, Vladimir Yakunin, said German, French and Italian businesses, including the engineering firm, will be hurt by sanctions against Russia.
Osram Licht AG gained as Citigroup recommended investors buy shares in the lighting manufacturer that spun off from Siemens.
L'Oreal advanced as the world's largest cosmetics maker posted a rise in first-quarter revenue.
Roche Holding edged higher as the world's biggest manufacturer of cancer drugs reported first-quarter sales that met analysts' estimates.
Other asset classes little changed
The euro fell 0.10% to $1.3806.
Brent crude futures dipped 0.267% to $108.78 per barrel, according to the ICE. |
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| | US Market Report | | US open: Stocks rise as US inflation accelerates US stocks gained as investors reacted positively to results from Coca-Cola and Johnson & Johnson, and a pick-up in inflation.
Coca-Cola's shares rallied after the beverages giant reported first quarter earnings per share (EPS) of 44 cents on an adjusted basis, in line with analysts' forecasts.
Cosmetics and pharmaceuticals manufacturer Johnson & Johnson gained after posting first-quarter EPS of $1.64, up from $1.22 the year before and well ahead of the $1.48 estimate. Revenue rose 3% to $18.1bn, slightly higher than the $18bn forecast.
On the macro-front, US consumer prices accelerated in March on the back of gains in food and rent.
The consumer price index increased 0.2% after rising 0.1% the prior month, the Labor Department revealed. Analysts had expected prices to remain unchanged.
Capital Economics said the rise in inflation was in part due the "unwinding of the previous weather distortion".
"Overall, we suspect that core inflation will rise to 2% this year and beyond it next year, which would catch the Fed off guard," the analyst said.
The report offset data which showed manufacturing in the New York area grew at a slower pace in April. The Federal Reserve Bank of New York's Empire Manufacturing index fell to 1.3 this month from 5.6 in March. Analysts had predicted an increase to 8.0.
China, Ukraine
China's broadest measure of new credit fell 19% in March from a year earlier and money supply grew at the slowest pace since 2001, according to the People's Bank of China. It comes ahead of a report tomorrow, which is forecast to show economic growth in China slowed in the first quarter.
Meanwhile, acting President of Ukraine, Olexander Turchynov, has announced the start of an "anti-terrorist operation" against pro-Russian separatists.
The operation began in the north of Donetsk Region and Turchynov said it was being conducted "stage by stage, in a responsible manner".
President Barack Obama urged his Vladimir Putin to use his influence to make separatists in Donetsk and other parts of eastern Ukraine stand down, but the Russian President denied his country was intervening in the crisis.
West Texas Intermediate crude futures fell by $0.338 to $103.700 per barrel, according to data from the ICE.
The US 10-year yield was flat at 2.65%. |
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| | Broker Tips | | Broker tips: SABMiller, Aggreko, G4S, Debenhams, Caracal Investec has cut its recommendation for drinks group SABMiller from 'buy' to 'hold', saying that the stock's valuation now looks 'reasonably full'.
Investec has kept its 3,200p target for the stock, based on the shares trading at 20 times 2014 calendar year earnings. "Rising appetite for EM risk will likely be positive for SAB's earnings outlook and rating, but we choose to adopt a more cautious stance after the recent rally."
Prime Wealth has labelled temporary power provider Aggreko as a 'buy' after its first-quarter trading update on Tuesday, in which it reported an encouraging start to the year.
The broker said it sees Aggreko as an "early stage if slightly speculative recovery play ahead of what will be a high profile year for the group".
Security solutions group G4S was trading in the red on Tuesday morning after the stock was downgraded from 'hold' to 'sell' by Deutsche Bank.
The German bank said it does not see significant "hidden value" in G4S to warrant its current valuation and expects a lower growth profile in this cycle despite the company's exposure to emerging markets.
Investec has cut its forecasts for Debenhams after the High Street department store's interim results and kept a 'sell' rating, saying that the stock's valuation is "not compelling enough".
The broker said it doesn't expect a "quick fix" for the company and estimates that the financial year ending August 2014 will be the fourth year of operating profit declines. Investec has lowered its target from 67p to 64p.
Barclays has downgraded its rating for Canada-based Caracal Energy from 'overweight' to 'underweight' after Glencore Xstrata's takeover offer for the Chad-focused oil and gas explorer.
Barclays Analyst Alessandro Pozzi labelled Glencore's £800m offer as "light but welcome". "Although the 61% premium implied by Glencore's £5.50/share bid does not fully reflect the value of Caracal's acreage in Chad in our view, we believe it is likely to be welcomed by most investors in light of its recent share price underperformance." | | |
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