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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: FTSE 100 above 6,800 as Fed continues to taper - Markets at highest since February 28th
- Fed sticks with taper
- Plenty of economic data due out
- BSkyB, Lloyds, BG Group and Schroders gain
techMARK 2,785.17 +0.17%
FTSE 100 6,805.94 +0.38%
FTSE 250 15,928.81 +0.71%
The FTSE 100 surpassed the 6,800 mark in early trading on Thursday, a level not seen in over two months, tracking gains made on Wall Street the previous session as investors reacted to the Federal Reserve's decision to continue tapering stimulus.
As was widely expected, the Federal Open Market Committee chose to reduce its quantitative easing programme by a further $10bn a month, taking monthly asset purchases to $45bn.
Despite data earlier in the day showing that the US economy almost stagnated in the first quarter – gross domestic product (GDP) expanded by just 0.1% - US markets finished moderately higher, pushing the Dow Jones Industrial Average to a record high.
The FTSE 100 was trading 0.4% higher at 6,806 this morning; it has not closed above this level since February 28th when it finished at 6,809.7. Gains were helped by well-received quarterly statements from the likes of BSkyB, Lloyds, BG Group and Schroders.
"The FTSE 100 has made it to the 6,800 round number mark helped by a Fed statement and continued taper which maintained confidence in the US recovery following a weak GDP report," said Mike van Dulken, Head of Research at Accendo Markets.
Investors were taking a bullish stance ahead of a flurry of economic data due out in today's session, including manufacturing, mortgage approvals and consumer lending figures from the UK, and jobless claims, personal spending and manufacturing indicators from the US.
Overnight, it was revealed that activity in the Chinese manufacturing sector picked up a little in April but came in slightly lower than analysts' expectations. The government's manufacturing purchasing managers' index increased to 50.4 last month from 50.3 in March, but under the 50.5 consensus forecast.
BSkyB, Lloyds, BG Group and Schroders gain
Earnings fell 2.4% at BSkyB in the third quarter despite a rise in revenues, but continued investment in connected television services was repaid with better-than-expected new subscriptions, pushing shares higher this morning.
Domestic lender Lloyds rose after saying that underlying profits rose 22% in the first quarter as it continues to expect to apply to regulators in the second half to restart dividend payments.
Profits at oil and gas firm BG Group declined in the first quarter despite higher revenues, as lower production volumes and higher costs ate into the bottom line. However, the stock was performing well this morning as it bounced back after weakness earlier in the week.
Fund manager Schroders was also higher as it reported record assets under management in the first quarter, helped by £3.8bn of net new business wins during the period.
Heading the other way was engine maker Rolls-Royce after saying that full-year revenues and profits are likely to be hit by foreign exchange headwinds with underlying results flat.
Scottish engineering group Weir failed to excite as it said trading in the last four months has been in line with expectations. This was helped by a strong performance in the oil and gas and power and industrial divisions. |
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| FTSE 100 - Risers
British Sky Broadcasting Group (BSY) 913.50p +3.81%
Lloyds Banking Group (LLOY) 78.04p +3.56%
Schroders (SDR) 2,627.00p +2.78%
Royal Bank of Scotland Group (RBS) 305.20p +2.14%
BG Group (BG.) 1,220.50p +1.88%
Barclays (BARC) 256.50p +1.71%
Hargreaves Lansdown (HL.) 1,188.00p +1.54%
Aggreko (AGK) 1,601.00p +1.52%
William Hill (WMH) 360.00p +1.49%
TUI Travel (TT.) 433.70p +1.38%
FTSE 100 - Fallers
Sainsbury (J) (SBRY) 324.40p -3.37%
Vodafone Group (VOD) 218.60p -2.39%
Rolls-Royce Holdings (RR.) 1,025.00p -2.38%
Randgold Resources Ltd. (RRS) 4,686.00p -1.97%
Tesco (TSCO) 287.95p -1.71%
Antofagasta (ANTO) 777.50p -1.21%
Anglo American (AAL) 1,564.00p -1.14%
Barratt Developments (BDEV) 365.60p -1.06%
Smith & Nephew (SN.) 911.50p -0.87%
Imperial Tobacco Group (IMT) 2,541.00p -0.63%
FTSE 250 - Risers
Genus (GNS) 1,058.00p +4.34%
Hansteen Holdings (HSTN) 107.00p +3.98%
IP Group (IPO) 178.00p +3.49%
AL Noor Hospitals Group (ANH) 1,032.00p +3.41%
Howden Joinery Group (HWDN) 335.70p +3.23%
Perform Group (PER) 222.40p +3.20%
Brown (N.) Group (BWNG) 529.00p +3.12%
Foxtons Group (FOXT) 327.90p +3.08%
Diploma (DPLM) 678.50p +3.04%
Carphone Warehouse Group (CPW) 316.80p +2.92%
FTSE 250 - Fallers
CSR (CSR) 560.00p -2.52%
Serco Group (SRP) 333.00p -2.09%
Polymetal International (POLY) 556.50p -1.68%
Kazakhmys (KAZ) 234.50p -1.51%
Ladbrokes (LAD) 151.20p -1.37%
Vedanta Resources (VED) 935.00p -1.16%
Direct Line Insurance Group (DLG) 247.90p -0.96%
Lancashire Holdings Limited (LRE) 693.50p -0.93%
Regus (RGU) 207.10p -0.91% |
| | UK Event Calendar | | FINALS
Brown (N.) Group
IMSS
Howden Joinery Group, Lloyds Banking Group, Phoenix Group Holdings (DI), Rolls-Royce Holdings, RPS Group, Schroders, Schroders (Non-Voting), Synthomer, Weir Group
SPECIAL DIVIDEND PAYMENT DATE
Next, Plus500 Ltd (DI)
EGMS
Sirius Real Estate Ltd.
AGMS
Aga Rangemaster Group, Alkane Energy, Alliance Trust, ARM Holdings, Core VCT, Core VCT 'B' Shares, Core VCT IV, Core VCT V, European Real Estate Inv Trust Ltd. Part Pref, Fisher (James) & Sons, GKN, Greggs, Henderson Group, Johnson Service Group, JPMorgan Private Equity Ltd USD Equity Shares, Kerry Group 'A' Shares, Millennium & Copthorne Hotels, Robinson, Rolls-Royce Holdings, Schroders, Schroders (Non-Voting), Synthomer, Weir Group
UK ECONOMIC ANNOUNCEMENTS
Consumer Credit (09:30)
M4 Money Supply (09:30)
M4 Sterling Lending (09:30)
Mortgage Approvals (09:30)
PMI Manufacturing (09:30)
FINAL DIVIDEND PAYMENT DATE
Dragon Oil, Foreign and Colonial Inv Trust, Jardine Lloyd Thompson Group, Plus500 Ltd (DI)
Q1
BG Group, First Quantum Minerals Ltd., Lancashire Holdings Limited, Millennium & Copthorne Hotels, Shire Plc, Smith & Nephew, Wolfson Microelectronics |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Spain revises its growth forecasts higher - Spain revises growth forecasts higher
- Euro moves up towards 1.39
- Most markets closed for holiday
FTSE-100: 0.39%
Dax-30: Closed for holiday
Cac-40: Closed for holiday
FTSE Mibtel 30: Closed for holiday
Ibex 35: Closed for holiday
Stoxx 600: 0.07%
Most of the main European equity markets were closed on Thursday in observance of May Day, although London and Copenhagen remained open.
Hence, there are major, nor minor for that matter, economic reports due for release today on the Continent.
Nonetheless, and despite many traders being away from their desks, the single currency is continuing to grind slowly higher ahead of tomorrow's US non-farm payrolls report.
The above may well just be the result of some traders positioning themselves ahead of that key report. In fact, for now most observers seem to be continuing to expect the US economy to chug along, leading to widening interest differentials and hence a lower single currency.
The wild-card of course are the continuing high portfolio flows into the Eurozone, which have been buoying the euro, alongside other factors.
In any case, just as important as the level of the euro - from the European Central Bank's perspective - is how long it actually remains above these levels, says Alex Bueso at Sharecast.
Of great interest, yesterday the Spanish government approved its new Stability Programme (SP) and new National Reform Plan (NRP) for up until 2017, which includes several upwards revisions.
The growth outlook has been upgraded to 1.2% for 2014, 1.8% for 2015, 2.3% in 2016 and 3% in 2017. Critically, for the sustainability of Spain's national debt, it is expected to peak next year, although some economists believe those forecasts to still be too optimistic.
Euro continues to grind higher
The euro/dollar was 0.15% higher at 1.3890.
Front-month Brent crude futures were off by 0.269% to the $107.78/barrel mark on the ICE. |
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| | US Market Report | | US close: Steady Fed helps stocks close at record high - FOMC holds steady with expected taper
- US GDP expands just 0.1 per cent in Q1
- ADP payrolls beat forecast
- Twitter, eBay provide a drag
Dow Jones: 0.3%
Nasdaq: 0.3%
S&P 500: 0.3%
US stocks ended the day at record levels as the Federal Reserve held steady on its policy course and with a few breezily positive remarks put a positive spin on a mixed day's trading.
The Dow Jones Industrial closed up 0.3% at 16580.84, its seventh monthly gain in the past eight months, while the S&P closed up 0.3% and the Nasdaq bounced back from midway-point negative territory to also close up 0.3%.
Despite near-stagnation in first-quarter gross domestic product growth, the (FOMC), which began its two-day policy meeting on Tuesday, revealed it continued to taper its monthly asset purchases with another £10bn increment, as expected.
While every market commentator and his dog expects tapering to continue in similar increments, with a final $15bn cut on 29 October, the Fed's optimistic painting of the economic landscape helped inject confidence into the market.
Earlier GDP figures had shown growth expanded at an annual rate of just 0.1% in the first quarter, a sharp slowdown from the 2.6% growth registered in the fourth quarter of 2013 and well below the 1% expansion expected by analysts.
But this was brushed aside as largely due to extreme winter weather and is increasingly expected to enjoy a strong rebound in second-quarter growth.
The Fed was convinced of this and said "growth in economic activity has picked up recently, after having slowed sharply during the winter in part because of adverse weather conditions."
The central bankers said household spending "appears to be rising more quickly" than investment, which "edged down".
Other positive data included a rise in private-sector payrolls, as measured by ADP, by 220,000 last month, up from 209,000 in March and ahead of the 200,000 gain expected by analysts.
Twitter shares tumble as user growth slows
Among companies, Twitter's share price sunk as much as 12% during the day, but closing down 8.6%, after the social media messaging service disappointed investors with subdued user number growth in the first quarter. Despite beating analysts' forecasts, the company reported that membership rose at an annual rate of 25% to 255m in the first three months of the year, a slowdown from the 30% growth seen in the previous period.
E-commerce group eBay also beat analysts' estimates but saw shares sink after disappointing with its outlook. The company forecast a smaller-than-expected profit for the second quarter and reported a $3bn tax charge as it decided to repatriate $9bn in foreign earnings, so it only keeps $6bn of its cash. Its shares closed down 5% on the day.
Nuclear plant operator Exelon fell 3.2% after announcing that it will acquire Pepco, the utility group, for $27.25 a share, equal to $5.4bn. Shares in the latter surged to a 17.4% rise on the dat.
Pharmacy group Express Scripts dropped as it slashed its 2014 forecasts and released lower-than-expected adjusted profits for the first quarter.
Crude futures move lower
West Texas Intermediate futures were 1.70% lower at $99.57 a barrel on the NYMEX.
The yield on a 10-year US Treasury was down five basis points at 2.64%.
S&P 500 - Risers
Pepco Holdings Inc. (POM) $26.76 +17.42%
Fiserv Inc. (FISV) $60.78 +7.03%
Pitney Bowes Inc. (PBI) $26.80 +6.90%
Dun & Bradstreet Corp. (DNB) $110.76 +6.86%
Gilead Sciences Inc. (GILD) $78.49 +5.95%
WellPoint Inc. (WLP) $100.68 +5.55%
Sealed Air Corp. (SEE) $34.31 +5.28%
Newfield Exploration Co (NFX) $33.85 +4.99%
Alexion Pharmaceuticals Inc. (ALXN) $158.30 +4.39%
Garmin Ltd. (GRMN) $57.10 +4.37%
S&P 500 - Fallers
Goodyear Tire & Rubber Co. (GT) $25.20 -7.39%
Express Scripts Holding Co (ESRX) $66.58 -6.24%
eBay Inc. (EBAY) $51.83 -4.97%
Exelon Corp. (EXC) $35.03 -3.18%
PACCAR Inc. (PCAR) $63.98 -2.78%
Coach Inc. (COH) $44.65 -2.32%
Marathon Oil Corp. (MRO) $36.15 -2.03%
Noble Energy Inc. (NBL) $71.78 -1.75%
Murphy Oil Corp. (MUR) $63.43 -1.70%
Seagate Technology Plc (STX) $52.58 -1.70%
Dow Jones I.A - Risers
Intel Corp. (INTC) $26.69 +1.37%
3M Co. (MMM) $139.09 +1.12%
Goldman Sachs Group Inc. (GS) $159.82 +1.00%
Exxon Mobil Corp. (XOM) $102.41 +0.95%
Walt Disney Co. (DIS) $79.34 +0.89%
AT&T Inc. (T) $35.70 +0.79%
International Machines Corp. (IBM) $196.47 +0.70%
United Technologies Corp. (UTX) $118.33 +0.65%
Nike Inc. (NKE) $72.95 +0.65%
Coca-Cola Co. (KO) $40.79 +0.54%
Dow Jones I.A - Fallers
Pfizer Inc. (PFE) $31.28 -1.51%
American Express Co. (AXP) $87.43 -0.41%
Chevron Corp. (CVX) $125.52 -0.36%
Travelers Company Inc. (TRV) $90.58 -0.35%
Merck & Co. Inc. (MRK) $58.56 -0.27%
Microsoft Corp. (MSFT) $40.40 -0.27%
JP Morgan Chase & Co. (JPM) $55.98 -0.21%
Unitedhealth Group Inc. (UNH) $75.04 -0.21%
McDonald's Corp. (MCD) $101.38 -0.12%
Verizon Communications Inc. (VZ) $46.73 -0.09%
Nasdaq 100 - Risers
Fiserv Inc. (FISV) $60.78 +7.03%
Gilead Sciences Inc. (GILD) $78.49 +5.95%
Avago Technologies Ltd. (AVGO) $63.50 +4.48%
Alexion Pharmaceuticals Inc. (ALXN) $158.30 +4.39%
Garmin Ltd. (GRMN) $57.10 +4.37%
CH Robinson Worldwide Inc (CHRW) $58.90 +4.27%
Micron Technology Inc. (MU) $26.12 +4.06%
Sirius XM Holdings Inc (SIRI) $3.19 +3.91%
Verisk Analytics Inc. (VRSK) $60.09 +3.82%
Cerner Corp. (CERN) $51.30 +3.78%
Nasdaq 100 - Fallers
Express Scripts Holding Co (ESRX) $66.58 -6.24%
eBay Inc. (EBAY) $51.83 -4.97%
Charter Communications Inc. (CHTR) $135.57 -3.20%
Check Point Software Technologies Ltd. (CHKP) $64.00 -2.84%
PACCAR Inc. (PCAR) $63.98 -2.78%
Catamaran Corp (CTRX) $37.75 -2.53%
Seagate Technology Plc (STX) $52.58 -1.70%
Intuitive Surgical Inc. (ISRG) $361.70 -1.66%
Texas Instruments Inc (TXN) $45.45 -1.45% |
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| | Newspaper Round Up | | Thursday newspaper round-up: Zero-hour contracts, The City, Channel 5 The number of workers on zero-hours contracts has almost tripled to 1.4m since last year's estimate, according to official data on Wednesday that piled pressure on Vince Cable, the business secretary, to provide more safeguards for workers with no guaranteed minimum hours or pay. More than one in 10 employers are using such contracts, which are most likely to be offered to women, young people and people over 65. – The Guardian
The future of the City of London is under threat after the European Union's highest court threw out a British legal challenge against plans for a financial transaction tax, Boris Johnson has warned. The Mayor of London attacked the "barmy" EU tax and warned that the latest defeat in the EU courts raised "serious questions" over the government's ability to defend the City's financial sector from damaging European regulation. – The Daily Telegraph
Richard Desmond is set to complete the sale of Channel 5 to the owner of MTV for up to £450m. The deal, which is expected to be announced by Viacom in New York today or tomorrow, marks the first time that an American broadcaster has bought one Britain's five free-to-air channels. The purchase price, however, falls well short of the ambitious £700m target set by Mr Desmond, who also owns the Daily Express and Daily Star newspapers. – The Times
WM Morrison today unveils permanent price cuts on hundreds of products such as sausages, crisps and salmon to help "smart" shoppers with their budgets. The supermarket will cut prices by an average 17% across 1,200 products. Chief executive Dalton Philips said: "Customers have been so smart shopping in five different stores a week to get best value. "They are getting tired of phoney, tit-for-tat price wars. We're going to be cheaper permanently on the products that matter most to them. It's our declaration of independence." – Daily Express
The company that advised the government not to raise its flotation price for Royal Mail made £8m from selling its shareholding within a week. The asset management division of Lazard, adviser for the initial public offering, was one of sixteen institutions given priority access to the shares, which Labour said amounted to a "golden ticket". As the price soared, it cashed in its six million shares, the head of the division told the Commons public accounts committee. – The Times
A 50% slump in profits and a government crackdown on its most lucrative business would not normally be a cause for celebration, but, after the year Ladbrokes has had, it's all relative. Shares in the embattled bookmaker jumped by 9.9p to 153.3p, a rise of almost 7%, as the market breathed a sigh of relief that the group's recent dismal run of luck did not get any worse. – The Times | | |
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