| | | | | | | | | |
| | London Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | London close: FTSE drops on ex-divi stocks, supermarkets, US data - FTSE 100 closes 17.67 points lower at 6,818.63
- Ex-divi stocks, Tesco, miners provide drag
- Focus on US data misses and tomorrow's ECB meeting
techMARK 2,822.66 +0.31%
FTSE 100 6,818.63 -0.26%
FTSE 250 15,986.47 +0.09%
Ex-dividends, supermarkets and miners dragged the FTSE to yet another negative finish today, with the index closing 17.67 points lower at 6,818.63.
Also weakening sentiment were worse than expected ADP jobs figures in the States, alongside misses for both productivity and trade data.
Chris Beauchamp, Market Analyst at IG, said: "Ex-dividend stocks and Tesco have been the primary culprits of the FTSE's underperformance versus its peers today, but so long as 6,800 holds the bias remains to the upside. However, until we see 6900 and then move beyond it, it would be too early to suggest a continuation of the rally.
"M&A activity once again lifted Smith & Nephew, and it is pleasant to realise that there are still some things moving in the market and that not everything has shifted into neutral ahead of the ECB meeting. Tesco has seen the fall in its share price intensify this afternoon, putting the supermarket giant on a collision course with the 280p level that marked the lows in April."
This comes ahead of tomorrow's European Central Bank (ECB) meeting, at which members are widely expected to loosen monetary policy in a bid to address weak inflation, high unemployment and a stagnant recovery.
"If the ECB decides to undergo a more aggressive position with respect to combatting inflation, participants will be looking to see how much has already been reflected by prices," noted SpreadEx's David White.
For his part, Chief UK and European Economist at IHS Global, Howard Archer, revealed he sees the ECB cutting interest rates by 10 to 15 points, including taking its deposit rate modestly into negative territory.
"However, we remain doubtful that the ECB will undertake full blown quantitative easing. We suspect this will only happen if Eurozone consumer price inflation falls to new lows over the coming months and Eurozone growth falters markedly," he said.
ADP, productivity, trade data disappoints
Private-sector payrolls increased at the slowest pace in four months in May, according to a report by Automatic Data Processing (ADP). Just 179,000 private payrolls were added last month, down from the 215,000 gain registered in April and below the 210,000 consensus estimate.
In other economic data, US non-farm business sector labour productivity in the first quarter of 2014 was revised lower to show an annual fall of 3.2%, marking the largest drop in productivity since the first quarter of 2008.
Meanwhile, the US trade deficit increased by 6.9% to $47.2bn in April, its highest in two years, according to the Commerce Department. This was up from a revised $44.2bn in March and surprised analysts looking for a fall to $40.6bn.
Ex-divi stocks provide drag as Sports Direct heads higher
National Grid led the fallers after going ex-dividend, with WPP also lower for the same reason.
Tesco erased earlier gains and dropped into the red as the decline in like-for-like (LFL) sales at its UK business worsened in the first quarter, with the recent wave of price cuts and competitive measures taking its toll on the top line. UK LFL sales excluding petrol fell by 3.7% in the first three months of Tesco's fiscal year, worse than the 2.9% drop recorded in the fourth quarter but not as bad as some analysts had feared.
However, shares in grocery rival J Sainsbury put in an even worse performance, while WM Morrison was also out of favour after the statement.
SABMiller was in the red on the back of a downgrade from Morgan Stanley to 'equal weight' from 'underweight', while, Sports Direct rose after Exane BNP Paribas put the retailer on its 'key ideas' list.
Shares in Smith & Nephew were also making gains after JPMorgan Cazenove said that M&A speculation could provide support to the stock in the near term after its recent strong performance. |
| | Unmissable opportunity with the world's largest resort hotelier.. | | Get 7% returns guaranteed for 4 years with one of the world's most exclusive destinations. Our unique opportunity in Cape Verde is one not to be missed!
Register your details here to receive the FREE brochure
|
| | FTSE 100 - Risers
Sports Direct International (SPD) 799.00p +3.63%
Smith & Nephew (SN.) 1,064.00p +3.30%
Melrose Industries (MRO) 280.50p +1.89%
Mondi (MNDI) 1,095.00p +1.86%
Weir Group (WEIR) 2,629.00p +1.66%
Whitbread (WTB) 4,243.00p +1.41%
Friends Life Group Limited (FLG) 314.00p +1.39%
Standard Life (SL.) 393.50p +1.39%
G4S (GFS) 249.00p +1.38%
Shire Plc (SHP) 3,514.00p +1.36%
FTSE 100 - Fallers
National Grid (NG.) 830.50p -5.36%
WPP (WPP) 1,261.00p -2.10%
Sainsbury (J) (SBRY) 327.60p -1.86%
Antofagasta (ANTO) 778.00p -1.52%
Centrica (CNA) 329.70p -1.49%
Tesco (TSCO) 293.50p -1.34%
Vodafone Group (VOD) 205.10p -1.18%
SABMiller (SAB) 3,255.00p -1.17%
Royal Dutch Shell 'A' (RDSA) 2,343.50p -1.14%
Pearson (PSON) 1,158.00p -1.11%
FTSE 250 - Risers
Vedanta Resources (VED) 1,179.00p +4.99%
Workspace Group (WKP) 608.50p +4.20%
RPC Group (RPC) 648.00p +4.10%
Imagination Technologies Group (IMG) 235.40p +3.84%
Close Brothers Group (CBG) 1,329.00p +3.42%
Petra Diamonds Ltd.(DI) (PDL) 163.90p +3.08%
SIG (SHI) 199.30p +2.36%
Northgate (NTG) 525.00p +2.34%
Dairy Crest Group (DCG) 470.10p +2.33%
Enterprise Inns (ETI) 137.60p +1.93%
FTSE 250 - Fallers
Evraz (EVR) 96.20p -7.05%
Tullett Prebon (TLPR) 287.40p -5.46%
Supergroup (SGP) 1,110.00p -5.13%
Perform Group (PER) 266.30p -4.35%
Debenhams (DEB) 74.50p -3.12%
Partnership Assurance Group (PA.) 125.90p -2.70%
Electrocomponents (ECM) 278.70p -2.65%
Laird (LRD) 294.10p -2.58%
Ophir Energy (OPHR) 253.00p -2.50%
Bank of Georgia Holdings (BGEO) 2,454.00p -2.23% |
| | PROVEN 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. |
| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks mixed after euro-area data - Eurozone services PMI revised down
- Eurozone economy grows as expected
- US ADP jobs report misses forecast
- US services PMI falls
FTSE 100: -0.26%
DAX: 0.07%
CAC 40: -0.06%
FTSE MIB: -0.16%
IBEX 35: -0.20%
Stoxx 600: 0.02%
European stocks were little changed following the release of reports on Eurozone service activity and euro-area economic growth.
Markit's services purchasing managers' index (PMI) for the euro-area in May was revised down to 53.2 from the flash estimate of 53.5, but it remained above the 50 level that indicates expansion and April's 53.1.
Another report confirmed the Eurozone economy grew by 0.2% in the first quarter, as forecast.
The data comes a day ahead of the European Central Bank (ECB)'s policy meeting which is expected to reveal monetary easing to tackle inflation, which at 0.5% remains well below the 2% target.
Chief UK and European Economist at IHS Global Howard Archer said he sees the ECB cutting interest rates by 10 to 15 points, including taking its deposit rate modestly into negative territory.
He also predicts the ECB may possible do a Long-Term Refinancing Operation (LTRO) which is tailored specifically towards lifting bank lending to the private sector (especially smaller companies).
"The ECB could also stop sterilising the money it spent buying sovereign bonds during the Eurozone's debt crisis under its now-terminated Securities Markets Program (SMP)," he said.
"However, we remain doubtful that the ECB will undertake full blown quantitative easing. We suspect this will only happen if Eurozone consumer price inflation falls to new lows over the coming months and Eurozone growth falters markedly." In the UK, Markit and the Chartered Institute of Purchasing & Supply (CIPS) said its index for services activity fell to 58.6 in May from April's 58.7, but ahead of forecasts.
US data
American employers added 179,000 jobs in May, according to the ADP Research Institute today, compared to 220,000 the previous month. Economists had pencilled in 210,000 workers.
A final report from Markit showed US services PMI fell to 58.1 in May, from 55 in April. It was revised down from the flash estimate of 58.4.
A separate report from Institute for Supply Management said its composite index, which evaluates manufacturing and services activity, rose to 56.3 in May from 55.2 the previous month. Analysts had expected a reading of 55.5.
In other economic data, US non-farm business sector labour productivity in the first quarter of 2014 was revised lower to show an annual fall of 3.2%, the Bureau of Labor Statistics said, as hours increased by 2.2% and output declined 1.1%. This was the largest drop in productivity since the first quarter of 2008.
Meanwhile, the US trade deficit increased by 6.9% to $47.2bn in April, its highest in two years, according to the Commerce Department. This was up from a revised $44.2bn in March and surprised analysts looking for a fall to $40.6bn.
After the close the Federal Reserve was due to release its Beige Book.
Repsol, Telecom Italia
Repsol slipped after Petroleos Mexicanos sold a 7.9% stake in the Spanish oil firm at €20.10 a share.
Telecom Italia gained after broker Kepler Cheuvreux SA said Italy has the best potential among large European economies for recovery in productivity and profitability.
Volkswagen dropped after selling preferred shares at €191 each to institutional investors as part of funding its acquisition of Swedish truckmaker Scania.
Dufry advanced after agreeing to buy travel retailer Nuance Group for $1.73bn. Tesco declined as the UK supermarket reported a fall in first-quarter like-for-like sales.
The euro fell 0.07% to $1.3618. Brent crude futures edged down $0.295 to $108.500 per barrel, according to the ICE. |
| | Film Investment opportunity from the Executive Producer of The King's Speech | | An EIS opportunity from Mark Foligno, executive producer of ‘The King's Speech’ which grossed over £250m worldwide. The opportunity allows UK investors to offset considerable tax liabilities. Click Here |
| | US Market Report | | US open: Stocks inch lower amid weak data as risk appetite wanes - ADP, productivity, trade data misses forecasts
- ECB meeting, non-farm payrolls in focus
- FuelCell Energy, TIBCO Software drop sharply
Dow Jones: -0.22%
Nasdaq: 0.00%
S&P 500: -0.12%
US stocks were struggling for direction on Wednesday as investors digested a string of disappointing economic data and showed caution ahead of some key 'risk events' later that could spark some market volatility.
Private-sector hiring slowed more than forecast in May, according to data released before the opening bell, while labour productivity and trade figures also came in worse than expectations.
The figures prompted the Dow Jones Industrial Average and S&P 500 to fall around 0.1-0.2% in early trading as investors continued to take profits after both indices recently hit record highs. The Nasdaq, meanwhile, was flat.
Trading started off on the back foot as stocks tracked a subdued performance across Europe ahead of the pivotal European Central Bank meeting on Thursday which could see policymakers unleash new measures to stave off deflation and stimulate growth. Nervousness ahead of the all-important US non-farm payrolls report on Friday was also another reason for investors to keep their powder dry.
ADP, productivity, trade data disappoints
Private-sector payrolls increased at the slowest pace in four months in May, according to a report by Automatic Data Processing (ADP). Just 179,000 private payrolls were added last month, down from the 215,000 gain registered in April and below the 210,000 consensus estimate.
The ADP numbers, often seen as a rough guide to the government's 'official' employment report on Friday, "adds to the downside risk to our forecast that official payroll employment rose by around 230,000 in May", according to Paul Dales, Senior US Economist at Capital Economics. However, he admitted that the ADP survey is not as reliable a predictor of non-farm payrolls as it used to be.
In other economic data, US non-farm business sector labour productivity in the first quarter of 2014 was revised lower to show an annual fall of 3.2%, the Bureau of Labor Statistics said, as hours increased by 2.2% and output declined 1.1%. This was the largest drop in productivity since the first quarter of 2008.
Meanwhile, the US trade deficit increased by 6.9% to $47.2bn in April, its highest in two years, according to the Commerce Department. This was up from a revised $44.2bn in March and surprised analysts looking for a fall to $40.6bn.
FuelCell and TIBCO sink early on
Fuel-cell power group FuelCell Energy sank as much as 14% after losses in its second quarter more than doubled to $15.8m, worse than analysts' expectations. Revenues fell slightly from $42.4m to $38.3m, while operating expenses increased.
TIBCO Software also dropped sharply after missing forecasts with its fiscal second-quarter results, prompting analysts at JMP Securities and Stifel Financial to downgrade their recommendations on the shares.
Japanese group Dai-ichi Life Insurance said it would buy Protective Life Corp for around $5.7bn, causing shares in the US-listed life insurer to surge. |
| | Still in the dark over active tax planning? | | Our planning experts can help you reduce your tax liability! Register here to quality for a FREE financial audit and hear about government approved allowances and existing opportunities available. Its politically correct tax planning for non-celebrities! |
| | Broker Tips | | Broker tips: Tesco, Smith & Nephew, Pennon, Poundland Investors gave a mixed reaction to results from Tesco on Wednesday as a less-than-expected fall in first-quarter like-for-like (LFL) sales failed to stop the shares sinking into the red by mid-morning.
Panmure Gordon Market Commentator David Buik said that despite coming in ahead of forecasts the 3.7% LFL decline "by any standards, represents an unacceptable performance". Meanwhile, Richard Hunter, Head of Equities at Hargreaves Lansdown Stockbrokers, said that investors are trying to figure out whether Tesco is "showing glimpses of revival given its turnaround plan, or whether it is past its sell by date".
Shares in Smith & Nephew (S&N) were making gains on Wednesday after JPMorgan Cazenove said that M&A speculation could support the stock in the near term after a 19% year-to-date rise
"[...] Stryker's comments are likely to leave continuing risk-arbitrage interest in the name which we think should provide some support over the next three-six months."
The prospect of another wave of water industry takeovers should tempt investors to buy shares in South West Water (SWW) owner Pennon, says Deutsche Bank.
Pennon and other listed UK water stocks offer attractive returns compared to low-risk UK and US regulated peers such as National Grid, the German broker said. "We also think there is the potential for more bids once the 2014 review completes, which will set prices through to 2020," Deutsche added.
Investors should start buying cut-price retailer Poundland again after a sell-off caused by competition from rival Tesco, says JP Morgan Cazenove.
Shares in Poundland have fallen 12% since March partly due to market concerns about Tesco's launch of "pound aisles" in some of its biggest stores, JP Morgan said. However, the broker said it believed the potential impact on Poundland of the aisles, which Tesco has dubbed Brand Zones, would be limited because the latter's customers were still likely to shop at Poundland. | | |
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