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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: Global economic fears hit markets Jitters about the global economy ahead of potential hints about the direction of US economic policy dragged back London shares on Wednesday. The FTSE 100 Index closed 13.34 points adrift at 6482.24 as investors continued to mull over International Monetary Fund (IMF) growth downgrades before the release of Federal Reserve minutes later on Wednesday.
The IMF stoked investor unease by highlighting a range of negative factors dogging the global economy, from eurozone stagnation to the Ebola virus, and warned that global growth may not top pre-crisis levels again.
Market analyst Craig Erlam at Alpari UK said people would study the minutes very closely for signs that the Fed was becoming more hawkish and could bring forward its first rate hike.
"The stance of the Fed is always a major talking point for the markets, particularly when we appear to be approaching a change in monetary policy and even more so when it's the first rate hike since June 2006," he said.
Travel and leisure stocks were under pressure from Ebola, with TUI Travel falling 24.5p to 367p and cruise operator Carnival floating 29p lower to 2299p.
Defensive stocks made a comeback including utilities and tobacco stocks, with United Utilities gushing 7p to 801.5p, energy supplier SSE sparking 12p to 1522p and Imperial Tobacco wafting 19p higher to 2677p.
Investors jumped off FirstGroup after the bus and train operator failed to keep its Scotrail franchise. Shares reversed 5.6p to 109.5p.
Brewing and pub group Marston's lost its fizz by 1.2p to 139.6p as full-year underlying sales at its core managed pubs lifted 3.1%, representing a slowdown from 4.1% growth in the first 41 weeks of the year, as poor weather in August hit sales.
Shopping centre developer Capital & Regional ticked up 0.5p or 1% to 48.5p after it reported an increase in the value of its Mall fund and said it was increasing its holding in The Mall Fund from 91.8% to 99.1%.
Market Movers
techMARK 2,724.99 -0.82%
FTSE 100 6,482.24 -0.21%
FTSE 250 14,933.52 -1.10% |
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| | FTSE 100 - Risers
London Stock Exchange Group (LSE) 1,849.00p +2.21%
Prudential (PRU) 1,408.00p +1.92%
Tesco (TSCO) 185.10p +1.37%
Petrofac Ltd. (PFC) 975.00p +1.35%
Legal & General Group (LGEN) 227.70p +1.11%
Reckitt Benckiser Group (RB.) 5,230.00p +1.06%
Intu Properties (INTU) 315.90p +1.02%
G4S (GFS) 252.60p +0.96%
United Utilities Group (UU.) 801.50p +0.88%
SSE (SSE) 1,522.00p +0.79%
FTSE 100 - Fallers
Tullow Oil (TLW) 576.00p -4.08%
TUI Travel (TT.) 367.00p -3.93%
GKN (GKN) 294.70p -3.50%
Antofagasta (ANTO) 675.00p -3.36%
Ashtead Group (AHT) 945.00p -3.28%
Anglo American (AAL) 1,338.00p -2.69%
Johnson Matthey (JMAT) 2,800.00p -2.57%
Randgold Resources Ltd. (RRS) 4,050.00p -2.46%
Aggreko (AGK) 1,477.00p -2.12%
CRH (CRH) 1,343.00p -1.83%
FTSE 250 - Risers
Infinis Energy (INFI) 236.50p +5.11%
Interserve (IRV) 610.50p +3.83%
Man Group (EMG) 119.30p +3.11%
Just Retirement Group (JRG) 126.50p +2.02%
Tate & Lyle (TATE) 601.00p +1.69%
Pets at Home Group (PETS) 175.40p +1.62%
Rexam (REX) 484.40p +1.62%
Lonmin (LMI) 173.20p +1.58%
Riverstone Energy Limited (RSE) 899.00p +1.35%
Millennium & Copthorne Hotels (MLC) 557.00p +1.27%
FTSE 250 - Fallers
Ferrexpo (FXPO) 94.90p -7.68%
Spirent Communications (SPT) 71.20p -7.65%
FirstGroup (FGP) 109.50p -4.87%
Afren (AFR) 105.70p -4.77%
Ophir Energy (OPHR) 212.30p -4.71%
Soco International (SIA) 352.80p -4.52%
EnQuest (ENQ) 92.50p -4.24%
International Personal Finance (IPF) 461.00p -4.24%
RPS Group (RPS) 233.80p -4.18%
SSP Group (SSPG) 239.70p -4.12%
FTSE TechMARK - Risers
Filtronic (FTC) 22.00p +5.39%
Phoenix IT Group (PNX) 119.50p +3.91%
XP Power Ltd. (DI) (XPP) 1,550.00p +1.31%
Anite (AIE) 82.00p +0.92%
IShares Euro Gov Bond 7-10YR UCITS ETF (IEGM) € 197.83 +0.10%
FTSE TechMARK - Fallers
CML Microsystems (CML) 273.50p -11.06%
DRS Data & Research Services (DRS) 14.25p -8.06%
Torotrak (TRK) 15.62p -6.72%
Vectura Group (VEC) 122.75p -4.84%
Promethean World (PRW) 29.25p -4.10%
Innovation Group (TIG) 27.00p -3.57%
Gresham Computing (GHT) 97.00p -3.48%
Sarossa (SARS) 1.69p -2.87%
Microgen (MCGN) 119.75p -1.84% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks slide as investors await Fed meeting minutes European stocks slumped as investors awaited the Federal Reserve's minutes of its 17 September policy meeting.
The minutes, to be released at 19:00 London time, could shed further light on the exact timing of the first interest rate hike in the current cycle.
The Fed is due to wrap up its monthly bond purchase programme at the end of October but has said it won't raise interest rates for a considerable time afterwards.
However, better-than-forecast US non-farm payrolls data and an unexpected drop in the jobless rate on Friday fueled speculation that an interest rate rise could come sooner than previously thought.
"There is usually a bit of consolidation ahead of the FOMC minutes and following the more dovish statement from the meeting it could be an excuse to stay long but if the sell-off continues and the panic accelerates we could see them decide to head for the exit," Capital Spreads said.
Meanwhile, travel stocks continued edge lower on concerns over the Ebola virus which has reached Europe.
Air France-KLM Group slumped after saying a strike that affected flights for two weeks last month may cut annual profit by €500m.
SAP dropped on news the company may freeze hiring until 2015 in order to reduce costs.
FirstGroup declined after the UK transport operator lost the ScotRail franchise to Dutch rival Abellio.
Swisscom advanced after Reuters reported the Swiss phone carrier is working with UBS on a potential sale of its Italian broadband division.
The euro rose 0.07% to $1.2678. |
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| | US Market Report | | US open: Markets fluctuate on Wednesday as investors await Fed minutes US stocks fluctuated early on Wednesday, as investors awaited the release of the minutes from the Federal Reserve's latest meeting. Increasing concerns over the spread of Ebola in Europe continued to have an impact on the Eurozone markets, with the tourism and travel industry severely affected. The Federal Open Market Committee will release minutes from its 16-17 September meeting on Tuesday afternoon. After the meeting, policymakers pledged to keep interest rates near zero for a "considerable time" after ending bond purchases and they also anticipated a steeper increase in borrowing costs in 2015.
Investors are expected to look at corporate results for indications on the strength of the US economy, with Alcoa Inc. unofficially starting the earnings season after the close of markets on Wednesday.
Profit at companies on the S&P 500 index rose 4.9% between July and September period, according to analysts' data.
The benchmark index has fallen 3.3% in the past month, the worst pre-earnings performance since 2009. The gauge has averaged a 2.2% gain in the month before earnings start since the bull market began.
In corporate news, Yum Brands rose slightly after a big selloff on Tuesday. The firm's profit and outlook missed estimates and it drastically cut its expectations for full-year growth.
Costco Wholesale shares gained early on, after the company reported a 13% rise in profit on growth in same-store sales and higher sales from membership fees, while Kraft Foods advanced slightly after raising its quarterly dividend from 52.5 cents a share to 55 cents.
Symantec Corporation moved up after Bloomberg News reported the company could be looking at a split, while the price of Monsanto shares registered a slight increase after the seed firm forecast financial earnings for 2015 trailed analysts' expectations.
West Texas intermediate lost almost 2% and was trading at just over $87 a barrel, while gold price increased slightly.
The 10-year Treasury note rose marginally to 2.34, while the 30-year Treasury note was largely unchanged and the five-year note dropped less than one basis point to 1.62. |
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| | Broker tips | | Tesco's stock was back on investors' shopping lists again on Wednesday after HSBC upgraded its rating on the UK grocer from 'underweight' to 'neutral' and lifted its target from 175p to 195p.
Though sentiment is still fragile after a string of profit warnings and an accounting scandal at the supermarket group, the bank said it sees an "improving risk profile".
This has been "implied by recent board appointments, decisive action by the chief executive and a share price 52% lower than a year ago", said analyst Dave McCarthy.
Tesco has now suspended its fifth executive since revealing that it had overstated its profit guidance for its first half by £250m. The company also said that the boss of catering group Compass and the former chief of IKEA would be joining its board from November, as it attempts to restore confidence amongst shareholders.
It was also rumoured that chairman Richard Broadbent would consider stepping down once an independent investigation by Deloitte into Tesco's accounting practices is complete.
McCarthy said: "We expect further bad news on accounting, pensions and a re-basing of profits, but believe much of this is now in the price.
"Focus is shifting to the positive with balance sheet concerns to be addressed (through a rights issue and/or asset disposals) and more senior appointments, executive and non-executive, and probably including a new chairman."
He said that there is still likely to be "more pain along the way", but the recent positive news should support the share price.
Aerospace and automotive group GKN should be able to weather any impact on its car parts business of economic weakness in Europe, according to Westhouse Securities.
Westhouse analysts, who met investor relations executives from the company on Tuesday, said they left feeling encouraged about its markets, revenue and margin trajectory of GKN’s key businesses, in particular drive-shaft business Driveline.
"While slowing economic data from the Eurozone and Asia is likely to have some impact on global vehicle production if sustained, we believe the impact on GKN may be modest," the broker said in a note.
"We leave our earnings per share estimates and 450p price target unchanged."
Shares in GKN fell 10.5p or 3.4% to 294.9p at 12:19 in London.
Airline investors should check in with Ryanair and IAG rather than rivals, according to Bank of America Merrill Lynch (BoAML).
The broker prefers companies such as the Irish budget carrier and the British Airways and Iberia owner that are likely to see consensus earnings upgrades, it said in a note.
BoAML has 'buy' recommendations on IAG and Ryanair, a 'neutral' on Lufthansa and 'under-perform' ratings on Easyjet and Air France-KLM.
It said Ryanair was "stealing the baton" from Easyjet as the former copies much of what the latter pioneered, describing the Irish airline's second half yield guidance as conservative.
BoAML said: "With no fewer than three 'investor days' in November/December (in our view, a statement of intent & confidence, if ever there was one), alongside strong Q3 traffic and a share price down 14% in the year to date, we would buy the shares here."
It added that Lufthansa's planned cost savings were untenable, that Easyjet was struggling to show investors how it would deal with a short-haul price war and AF-KLM was facing competition from Easyjet and Gulf carrier Etihad. | | |
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