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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 ends session with modest gains The top tier closed slightly higher on Thursday, as a strong performance by Smith & Nephew was offset by losses amongst the mining sector. The FTSE 100 ended the day 9.68 points higher than on the previous day at 6,463.55.
Investors were paying attention to what analysts called an "artificially high" gross domestic product (GDP) reading for the US, which rose at an annualised clip of 3.5% in the third quarter, exceeding consensus estimates for a rise of 3.0% rise.
"The market has made a rapid recovery as the US growth figure isn't as impressive as initially thought," said IG market analyst David Madden.
"When the 3.5% US GDP figure flashed on the screens it was traders' worst nightmare! Dealers feared a rate rise must be around the corner but after closer inspection the jump in growth was largely down to Washington's spending on defence.
"After nearly six years of quantitative easing from the US, traders still have the attitude that bad news is good news; old habits die hard."
Meanwhile, figures published by the Labor Department showed that the number of Americans who applied for new unemployment benefits in October remained below the 300,000 level for the seventh consecutive week.
In the week ended 25 October, initial jobless claims rose by 3,000 to 287,000, "more or less" in-line with consensus expectations of 285,000, while claims for the previous week were revised to 284,000, as the four-week moving average remained at 281,000, its lowest level since 2000.
Smith & Nephew rises after first quarter results
Medical devices maker Smith & Nephew rose strongly after it posted a 3% increase in both revenue and profit for the third quarter, thanks to an improvement in its emerging and international markets units, recent product launches and investment in the sales force. On an underlying basis, turnover climbed from $1,027m to $1,148m, thanks to its Sports Medicine and Trauma & Extremities divisions, which benefited from recent product launches and investment in the US sales force.
Wealth manager St James's Place was another stand-out performer, rising strongly after seeing impressive inflows in its third quarter, helped by a big increase in demand for new ISA investments. Funds under management reached a record £49.1bn by 30 September, up 17% on the year before.
Mondi was also higher thanks to the news Moody's Investors Service has upgraded the group's credit rating to Baa2 from Baa3. Chief executive Andrew King said it was "further testament to the robustness of the group's business model and the ability of the business to generate strong cash-flows through the business cycle".
Meanwhile, shares in Standard Chartered fell for a fourth day amid reports US prosecutors have re-opened their investigations into whether the lender withheld information into the possible violation of the sanctions regime imposed on Iran.
Mining groups dropped in the face of falling metal prices, with gold at a three-week low and copper pulling back from a six-week high. Fresnillo, Randgold, Anglo American, Glencore and Antofagasta were among the worst performers.
Tullow Oil was knocked lower by Deutsche Bank, which cut its target from 790p to 650p. |
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| | Market Movers
techMARK 2,749.84 +0.56%
FTSE 100 6,463.55 +0.15%
FTSE 250 15,298.32 +0.42%
FTSE 100 - Risers
St James's Place (STJ) 712.50p +3.56%
Smith & Nephew (SN.) 1,054.00p +3.54%
Friends Life Group Limited (FLG) 313.80p +2.62%
Mondi (MNDI) 1,037.00p +2.37%
Shire Plc (SHP) 4,164.00p +2.18%
Carnival (CCL) 2,467.00p +1.82%
InterContinental Hotels Group (IHG) 2,337.00p +1.79%
Capita (CPI) 1,101.00p +1.76%
Persimmon (PSN) 1,444.00p +1.69%
Rolls-Royce Holdings (RR.) 815.50p +1.68%
FTSE 100 - Fallers
Randgold Resources Ltd. (RRS) 3,779.00p -6.02%
Standard Chartered (STAN) 943.60p -4.89%
Fresnillo (FRES) 716.50p -4.34%
Anglo American (AAL) 1,320.50p -2.37%
Glencore (GLEN) 317.10p -2.04%
BT Group (BT.A) 367.90p -2.02%
Tullow Oil (TLW) 484.10p -2.00%
Antofagasta (ANTO) 690.50p -1.92%
ITV (ITV) 200.50p -1.81%
BG Group (BG.) 1,026.50p -1.72%
FTSE 250 - Risers
National Express Group (NEX) 246.20p +4.68%
Rightmove (RMV) 2,123.00p +4.48%
Polymetal International (POLY) 510.00p +3.95%
Keller Group (KLR) 826.50p +3.51%
JD Sports Fashion (JD.) 450.00p +3.31%
Grafton Group Units (GFTU) 620.50p +3.24%
Moneysupermarket.com Group (MONY) 197.50p +3.03%
Just Retirement Group (JRG) 132.80p +2.95%
UBM (UBM) 562.00p +2.93%
AL Noor Hospitals Group (ANH) 1,022.00p +2.92%
FTSE 250 - Fallers
Afren (AFR) 78.70p -15.60%
Hochschild Mining (HOC) 101.30p -5.94%
Ferrexpo (FXPO) 85.85p -4.24%
Premier Oil (PMO) 259.10p -3.89%
Cairn Energy (CNE) 148.70p -3.82%
Lonmin (LMI) 172.90p -3.62%
Bank of Georgia Holdings (BGEO) 2,502.00p -3.40%
Vedanta Resources (VED) 810.50p -3.34%
Centamin (DI) (CEY) 54.85p -2.92%
Hays (HAS) 117.70p -2.24% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks pick up after Eurozone, US data European stocks rebounded as investors digested a batch of data in the Eurozone and the US. On the upside, German unemployment fell 22,000 in October, more than the 4,000 gain predicted by analysts. It followed a 12,000 increase a month earlier. The unemployment rate held at 6.7%, as expected.
Euro-area economic confidence rose unexpectedly in October, another report showed. The sentiment index rose to 100.7 from 99.9 in September, more than the 99.7 predicted by analysts.
On the downside, German inflation in October rose by an estimated 0.7% year-on-year, less than analysts' forecasts for 0.9% on a harmonised basis.
It follows an 0.8% increase a month earlier, adding to concerns about the health of Europe's biggest economy.
Spanish gross domestic product (GDP) growth slowed down during the third quarter, in line with what the market expected, but analysts raised concerns about how the recovery will fare next year.
Spanish GDP expanded by 0.5% during the July-September period, easing from the 0.6% growth seen in the second quarter.
The European Central Bank (ECB) has been working hard to address a stagnant recovery, including the introduction of this month's covered bonds and asset backed securities programmes.
"The ECB seems unlikely to announce any new policies this month as it continues to purchase small quantities of covered bonds and prepares to buy asset-backed securities," according to Capital Economics.
"With the risk of deflation growing, President Mario Draghi may confirm speculation that the ECB is also considering buying corporate bonds. And we suspect that government bond purchases will ultimately be needed to ensure an expansion of the bank's balance sheet large enough to exert meaningful upward pressure on inflation. But these policies will probably take time to come to fruition given opposition in Germany and elsewhere."
In the US, GDP rose by 1.3% in the third quarter following a 2.1% increase a quarter earlier. Analysts had predicted a 1.4% gain. Initial jobless claims in the week to 25 October rose 287,000, compared to 284,000 the prior week and the market estimate for 285,000 claims.
The data follows the Federal Reserve's decision on Wednesday to keep interest rates unchanged and end its quantitative easing programme.
Fed Chair Janet Yellen on Thursday said that having a range of different ideas and perspectives is crucial to ensuring the US central bank makes correct decisions.
During a speech at a conference on how to attract more minorities and women into the economics profession, she insisted she welcomed the range of contrasting views at the table and hoped to see it replicated "at all levels and throughout the Fed system".
Bayer, Linde
Bayer AG rallied as the German drug-maker reported third-quarter earnings that topped estimates and raised its forecast for the year.
Linde AG slumped after the industrial-gases company said it will miss full-year and 2016 profit targets.
Renault edged higher as Europe's third-largest carmaker posted a rise in quarterly earnings.
Barclays advanced after reporting a rise in third quarter pre-tax profit which beat market estimates.
Deutsche Lufthansa dropped after reducing its 2015 profit forecast.
Volkswagen gained as Europe's largest automaker posted profit that beat analysts' predictions on sales growth at the Audi and Skoda brands.
The euro fell 0.11% to $1.2618.
Brent crude futures declined 0.92% to $86.32 per barrel, according to the ICE. |
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| | US Market Report | | US open: Markets fluctuate after GDP and claims data US stocks fluctuated on Thursday after accelerating gross domestic product data led to speculation that the economy might be strong enough for the Federal Reserve to raise interest rates earlier in 2015.
Not long after 10:00 in New York, the Dow Jones Industrial Average was 65.66 points up to 17,039.97, while the S&P 500 lost 4.88 points to 1,977.42 and the Nasdaq was 20.84 points down to 4,069.71
Data released on Thursday showed US real gross domestic product (GDP) rose an annualised 3.5% in the third quarter of 2014, exceeding consensus estimates of a 3.0% rise.
Government spending increased to 4.6%, driven by a 16% rise in federal defence spending, the largest increase in five years, while business investment spending rose 5.5% and real consumer spending advanced slightly more than expected to 1.8%.
"The GDP figure was stronger than expected, the fact that the surprise was in defence spending, which is unlikely to be repeated, leads us not to extrapolate the stronger growth into future quarters," Barclays said in a note, adding that it expected real GDP growth to be 2.5% in the final quarter of 2014.
Figures published by the Labor Department showed that the number of Americans who applied for new unemployment benefits in October remained below the 300,000 unit for the seventh consecutive week.
In the week ended 25 October, initial jobless claims rose by 3,000 to 287,000, in line with consensus expectations of 285,000, while claims for the previous week were revised to 284,000, as the four-week moving average remained at 281,000, its lowest level since 2000.
In corporate news, Visa rallied after fourth quarter earnings fell less than analysts expectations, while rival Mastercard rose after its third quarter profit and sales also beat analyst estimates.
Lakeland Industries soared as high as 40% after the maker of hazmat suits announced it accelerated manufacturing capacity due to the Ebola crisis.
Take-Two Interactive Software and both rose sharply, the former after reporting losses that were less severe than previously anticipated.
Kraft Food fell after reporting its third quarter profit from $500m to $446m, while Avon Products shares dropped significantly, even though the firm topped analysts' estimates after positive results in Europe.
The yield on the 10-year US Treasury note fell four basis points to 2.28%, while the yield on the 30-year note fell by the same margin to 3.01 and the five-year Treasuries were unchanged at 1.58.
Gold futures slid to $1,203.20, while West Texas intermediate and Brent crude both retreated and were trading at just over $81 and just over $86 respectively. |
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| | Broker Tips | | Broker tips: Shell, Barclays, British Land, St James's Place Broker Charles Stanley has lifted its recommendation for Royal Dutch Shell from 'accumulate' to 'buy', saying that the company should be resilient to the recent slump in oil prices.
The broker said Shell was "well-placed to improve its returns and deliver its objectives" over the medium term in spite of crude's current volatility.
Shore Capital has retained its 'buy' rating on shares of Barclays after the UK bank reported third-quarter profits well ahead of the broker's forecasts.
Shore analyst Gary Greenwood said that the stock's "depressed valuation" - trading at just 0.77 times tangible net asset value of 287p - "more than compensates investors for the inherent risks in the business".
Broker Liberum reiterated its 'buy' recommendation for British Land after reports the company let one floor of the 'Cheesegrater' building in London's Leadenhall Street for a record amount.
Liberum said the deal underlined British Land's "success in bringing West End rents to the City core", with the building becoming a hub for insurance companies.
Wealth manager St James's Place (SJP) has delivered "yet another strong quarter", according to Berenberg which repeated its positive stance on the stock on Thursday. | | |
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