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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: Astrazeneca leads FTSE higher on bid speculation - Healthcare stocks lift FTSE
- German PMI data drives sentiment
- Investors look ahead to Draghi speech
- UK retail sales disappoint
techMARK 2,819.77 +0.82%
FTSE 100 6,777.66 +0.33%
FTSE 250 15,838.57 +0.57%
London's blue chips ended Thursday's session on a positive note, led by Astrazeneca. Increased speculation regarding ECB action, on the heels of a weaker than forecast readings on the Eurozone economy, was offset by a weak report on UK retail sales.
After making gains both early and late on, the FTSE 100 ultimately closed 22 points higher at 6,778.
July saw UK retail sales registered their slowest annual gain since November, with volumes surprising with a slowdown to just a 0.1% rate of gain, compared to an advance of 0.2% in June.
Expectations had been for a rise of 0.4%.
Investors were also surprised to see that food sales declined, the first time on record that this has happened.
The Office for National Statistics also released figures showing that while UK public finances improved last month borrowing still remained above the government's target.
Across the Channel, Markit's 'flash' composite Purchasing Managers' Index (PMI), which tracks growth in the manufacturing and service sectors that make up more than two-thirds of the economy, fell to 54.9 in August from 55.7. However, it nonetheless remained well above the crucial 50 mark that separates growth from contraction.
On the upside, Germany's private sector grew for a 16th month running in August, suggesting Europe's largest economy could expand robustly in the third quarter after it suffered a surprise contraction in the second.
However, following those figures Barclays Research pointed out that it sees "material downside risks" to its forecast for the Eurozone's GDP to expand at 0.3% quarter-on-quarter clip in the third quarter.
Meanwhile, the Jackson Hole Symposium of central bankers is due to kick off later Stateside with comments from policymakers around the world likely to be closely watched.
Bid speculation sends Astrazeneca racing ahead
Healthcare stocks gained strongly amid speculation Pfizer may make another bid for Astrazeneca. Smith & Nephew and GlaxoSmithKline also rose strongly.
Financial stocks also made decent gains, with Hargreaves Lansdwon, Standard Life, Old Mutual and Aviva all higher.
Mining stocks led to the downside after metals consumer China disappointed with its manufacturing data and metals prices fell. Fresnillo, Randgold Resources, Anglo American, Rio Tinto and BHP Billiton all fell into the red.
BHP was still under pressure in the aftermath of Tuesday's underwhelming plans for a demerger. Chief financial officer Graham Kerr, who is due to be the head of the spin-off company, has been cited as saying that the lack of a share buyback - which many investors had been expecting - was a "sore point", while plans to give shareholders stock in the new firm may have "irritated" some who are not mandated to hold investments in Australia.
Oil stock Tullow Oil was also in the red.
On the second tier, metal miner Kazakhmys hailed progress with a shake-up designed to focus it on the lucrative copper market, but said 2014 gold production was likely to fall short of hopes, pushing the stock into the red.
Investec knocked Ophir Energy lower after it reduced its rating to 'hold' from 'buy' and lowered its target to 250p from 315p. |
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| | FTSE 100 - Risers
AstraZeneca (AZN) 4,411.50p +2.95%
Schroders (SDR) 2,392.00p +2.66%
Hargreaves Lansdown (HL.) 1,133.00p +2.16%
CRH (CRH) 1,401.00p +2.04%
Barratt Developments (BDEV) 366.20p +1.84%
Smith & Nephew (SN.) 1,064.00p +1.62%
3i Group (III) 387.60p +1.57%
Standard Life (SL.) 376.90p +1.48%
Mondi (MNDI) 1,018.00p +1.39%
Rolls-Royce Holdings (RR.) 1,037.00p +1.37%
FTSE 100 - Fallers
Fresnillo (FRES) 938.00p -3.55%
Randgold Resources Ltd. (RRS) 4,904.00p -1.86%
Kingfisher (KGF) 306.80p -1.67%
Anglo American (AAL) 1,573.50p -1.29%
Antofagasta (ANTO) 808.50p -1.28%
Royal Mail (RMG) 440.30p -1.21%
Petrofac Ltd. (PFC) 1,126.00p -1.14%
easyJet (EZJ) 1,324.00p -1.12%
Aberdeen Asset Management (ADN) 431.70p -1.10%
Rio Tinto (RIO) 3,433.00p -0.72%
FTSE 250 - Risers
Senior (SNR) 292.40p +3.84%
Hikma Pharmaceuticals (HIK) 1,742.00p +2.96%
Ocado Group (OCDO) 377.90p +2.89%
Phoenix Group Holdings (DI) (PHNX) 735.50p +2.87%
RPS Group (RPS) 269.50p +2.86%
Cranswick (CWK) 1,349.00p +2.82%
International Personal Finance (IPF) 520.00p +2.77%
Diploma (DPLM) 686.00p +2.62%
Spirent Communications (SPT) 103.50p +2.48%
Carillion (CLLN) 337.60p +2.30%
FTSE 250 - Fallers
Kazakhmys (KAZ) 291.10p -5.64%
Petra Diamonds Ltd.(DI) (PDL) 183.60p -3.72%
Ophir Energy (OPHR) 221.40p -3.61%
Exova Group (EXO) 220.00p -3.51%
Just Retirement Group (JRG) 146.20p -2.60%
Thomas Cook Group (TCG) 121.00p -2.42%
Electrocomponents (ECM) 239.80p -2.36%
Ladbrokes (LAD) 132.30p -2.22%
Lonmin (LMI) 212.90p -2.11%
African Barrick Gold (ABG) 239.60p -1.80% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks finish at session highs despite weak PMIs - Stocks close near best levels of the session
- Eurozone PMI ahead of forecasts
- Eurozone GDP
FTSE 100: 0.33%
Dax-30: 0.93%
Cac-40: 1.23%
FTSE Mibtel: 2.06%
Ibex 35: 1.30%
Stoxx 600: 0.66%
The main European equity benchmarks had registered moderate advances by the close of trading, with some observers attributing the gains to increased expectations for ECB action following a weaker than expected reading on the Eurozone's manufacturing and services sector.
Significant advances in US equities following a spate of stronger than forecast economic indicators out Stateside served to buttress gains.
In particular, the Federal Reserve bank of Philadelphia's regional manufacturing index rose to the 28 point mark from the 23.9 level seen in June (consensus: 19.7).
Markit's Eurozone composite Eurozone purchasing managers' index (PMI) slipped in August to 52.8 from 53.8 in the month before, with both the manufacturing and services sector registering worsening.
Following the report Barclays Research indicated it now sees the balance of risks to its 0.3% quarter-on-quarter estimate of GDP growth as tilted "to the downside". Also of interest, the broker now sees euro-area wide inflation dropping to a 0.2% year-on-year pace in September.
Raiffeisen and Air Berlin lead gains
Austrian lender Raiffeisen Bank was one of the biggest advancers in Europe after it said that it expected a "very low" impact on its business from the sanction which gave been levied by the Wests on Russia.
Air Berlin was a standout gainer after the regional carrier posted a second quarter profit of €8.6m, in comparison with a loss of €38m a year ago. The airline is to carry out a 10% reduction in capacity.
From a sector standpoint the biggest gains on the DJ Stoxx 600 were being seen in the following industrial groups: Construction&Materials (1.59%), Automobiles&Parts (1.37%) and Banks (1.11%).
Single currency moves slightly higher
The euro/dollar turned around following recent weakness to trade slightly higher by 0.18% to the 1.328 mark.
Front month Brent crude futures edged higher by 0.234% to $102.51/barrel on the ICE. |
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| | US Market Report | | US open: Stocks slide before Fed's meeting minutes US stocks slid ahead of the release of the Federal Reserve's meeting minutes.
The Federal Reserve will also release minutes from its July meeting, potentially offering clues on its first interest rate rise.
In July, the Fed announced it would cut a further $10bn off monthly bond purchases and maintain interest rates at 0.25%. The US central bank has indicated that it sees no immediate need to lift rates, saying that the labour market still has room to grow.
The annual Fed Bank of Kansas City's economic symposium will begin on Thursday in Jackson Hole, Wyoming. Fed Chair Janet Yellen and European Central Bank President Mario Draghi will discuss their economic outlook and monetary policy.
"While I don't think that we'll see a rate hike until the end of the first quarter of next year, at the earliest, given Chairwoman Janet Yellen's very dovish stance, and the similar stance of most of the committee, two or three votes in favour of raising rates could cause quite a stir in the markets," said Alpari UK analyst Craig Erlam.
In corporate news, Apple declined after reaching a record close on Tuesday evening. The stock finished at $100.53, ahead of the previous closing record set in September 2012, on the back of optimism surrounding the gadget giant's upcoming new products.
Home-improvement retailer Lowe's was in the red despite beating analysts' forecasts with its second-quarter profits, as the company cut its revenue guidance for the full year.
West Texas Intermediate futures rose 0.57% to $93.39 per barrel, according to the ICE.
The 10-year yield climbed two basis points to 2.42%. |
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| | Broker Tips | | Broker tips: Glencore, Kazakhmys, WH Smith UBS has upped its target for mining and commodities trading giant Glencore from 330p to 350p after an "encouraging" roundtable meeting with management.
However, while the bank said it is attracted to the business strategy, it said the improving outlook for zinc and nickel markets and positive earnings momentum from the marketing division is already reflected in the share price, which has outperformed the sector by 11% so far this year. UBS maintained a 'neutral' stance.
Credit Suisse said it sees huge upside potential at Kazakhmys over the medium term but had kept a 'neutral' rating on the stock despite the miner's interim results beating expectations.
Credit Suisse said: "On a medium-term outlook we see substantial upside potential (60% to £5/share) if the company can successfully execute on its two major projects without any major overruns. However, with the main restructuring catalyst having largely played out it will be another 12-18 months before growth volumes begin and we can better gauge the project execution success."
Trading at WH Smith is "building momentum", according to Investec, which repeated its 'buy' recommendation for investors on Thursday following an 'in-line' pre-close statement from the stationery, magazines and books retailer.
"The shares trade at a circa 20% discount to the retail sector and are attractive as a more defensive play with a strong management focused on creating shareholder value. Buy," the broker said. | | |
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