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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: Macro concerns hit stocks ahead of earnings, Fed minutes UK stocks fell for a second day on Wednesday as concerns about global growth and nervousness ahead of the start of US earnings season eroded risk appetite. Heavy falls from industrial stocks and travel companies saw the FTSE 100 fall 0.3% to 6,475 in early trading.
European stocks fell on Tuesday after the World Bank downgraded its growth forecast for the global economy and industrial production data from Germany showed a worse-than-expected decline.
US indices also declined, with the S&P 500 dropping to an eight-week low, with investors showing caution ahead of third-quarter earnings reporting, which unofficially kicks off after the close on Wednesday with results from aluminium giant Alcoa.
Investors were also awaiting the minutes of the latest Federal Open Market Committee (FOMC) meeting amid speculation about when the first hike in interest rates will come after the of quantitative easing (QE).
"With QE set to end at the end of this month tonight's FOMC minutes could well be instructive with respect to the Federal Reserve's thinking on the trajectory of monetary policy in the coming months," said analyst Michael Hewson from CMC Markets UK.
Speaking in New York on Tuesday, the head of the New York Federal Reserve said that forecasts for a mid-2015 rate hike are "reasonable". William Dudley said: "The consensus view is that lift-off will take place around the middle of next year. That seems like a reasonable view to me."
Industrials, travel stocks provide a drag
Engineering and industrial names such as GKN, Johnson Matthey, IMI and Weir Group were among the worst performers in early deals on the FTSE 100 as fears about global growth weighed on sentiment.
Airlines and travel tour operators were also under pressure as the threat of an Ebola outbreak in Spain spread fear amongst investors. Easyjet, IAG, Carnival and TUI Travel were all trading in the red.
Supermarket group Tesco was continuing to bounce back after recent weakness with HSBC providing a lift after upgrading the stock from 'neutral' to 'overweight'. The bank said that much of the recent bad news is already discounted in the stock price.
Rivals J Sainsbury and Wm Morrison were also on the rise.
Bus and train operator FirstGroup was lower after failing to keep its Scotrail franchise from April next year. The group has already lost its First Capital Connect London commuter franchise and failed in a bid to run London-Scotland sleeper trains.
The share price of AIM-listed oil explorer Oilex sank sharply after the company reported delays at one of its wells on the Cambay field in the Gujarat State of India. |
| Market Movers
techMARK 2,731.05 -0.60%
FTSE 100 6,475.01 -0.32%
FTSE 250 14,991.08 -0.72%
FTSE 100 - Risers
Tesco (TSCO) 189.00p +3.50%
Sainsbury (J) (SBRY) 234.10p +1.69%
Morrison (Wm) Supermarkets (MRW) 161.20p +1.19%
HSBC Holdings (HSBA) 635.20p +0.70%
Travis Perkins (TPK) 1,623.00p +0.56%
SSE (SSE) 1,518.00p +0.53%
Next (NXT) 6,600.00p +0.53%
Pearson (PSON) 1,191.00p +0.34%
Friends Life Group Limited (FLG) 305.00p +0.30%
Unilever (ULVR) 2,523.00p +0.28%
FTSE 100 - Fallers
GKN (GKN) 293.20p -3.99%
easyJet (EZJ) 1,345.00p -3.17%
Ashtead Group (AHT) 947.00p -3.07%
Johnson Matthey (JMAT) 2,818.00p -1.95%
IMI (IMI) 1,154.00p -1.95%
Carnival (CCL) 2,285.00p -1.85%
Aggreko (AGK) 1,482.00p -1.79%
Anglo American (AAL) 1,350.50p -1.78%
Tullow Oil (TLW) 590.00p -1.75%
Experian (EXPN) 938.50p -1.68%
FTSE 250 - Risers
Perform Group (PER) 271.00p +4.59%
Interserve (IRV) 609.50p +3.66%
Redefine International (RDI) 51.25p +1.38%
Euromoney Institutional Investor (ERM) 1,010.00p +1.30%
Greencore Group (GNC) 243.10p +1.29%
Man Group (EMG) 117.10p +1.21%
SSP Group (SSPG) 253.00p +1.20%
JD Sports Fashion (JD.) 438.90p +1.11%
AL Noor Hospitals Group (ANH) 1,002.00p +0.96%
St. Modwen Properties (SMP) 372.00p +0.95%
FTSE 250 - Fallers
FirstGroup (FGP) 107.40p -6.69%
Ocado Group (OCDO) 229.70p -4.96%
Spirent Communications (SPT) 73.70p -4.41%
PayPoint (PAY) 956.50p -3.87%
Zoopla Property Group (WI) (ZPLA) 212.00p -3.64%
Playtech (PTEC) 692.00p -3.42%
Thomas Cook Group (TCG) 109.20p -3.02%
EnQuest (ENQ) 93.75p -2.95%
RPS Group (RPS) 238.20p -2.38% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks decline ahead of FOMC minutes European stocks declined ahead of the release of the minutes from the Federal Reserve's 17 September policy meeting. The minutes, to be released at 19:00 London time, may provide clues 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 non-farm payrolls data and an unexpected drop in the jobless rate have fuelled 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.
Equities in the euro-area dropped on Tuesday after the International Monetary Fund cut its forecasts for global growth and German industrial production fell more than estimated.
Air France, Swisscom
Air France-KLM Group slumped after saying a strike that affected flights for two weeks last month may cut annual profit by €500m.
Swisscom advanced after Reuters reported the Swiss phone carrier is working with UBS on a potential sale of its Italian broadband division.
FirstGroup declined after the UK transport operator lost the ScotRail franchise to Dutch rival Abellio.
Gerresheimer dropped after reporting third-quarter profit that fell short of analysts' estimates.
The euro fell 0.13% to $1.2653. |
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| | US Market Report | | US close: Stocks fall amid Eurozone concern Markets tumbled on Tuesday, amid growing concerns over the spread of virus Ebola and disappointing economic data from the Eurozone, while the International Monetary Fund cut its growth forecast and warned of "frothy" equities. The Dow Jones Industrial Average dropped 272.58 to 16,719.33 points, its biggest drop since 31 July, while the Nasdaq closed 69.60 down to 4,385.20 points and the S&P 500 declined 29.74 to 1,935.08 points.
William Dudley, the president of the Federal Reserve Bank of New York, said that forecast for the US central bank to raise interest rates in mid-2015 are "reasonable".
"It still is premature to begin to raise interest rates," Dudley said during a speech on Tuesday in the state of New York.
"The labor market still has too much slack and the inflation rate is too low."
Dudley cited a strengthening dollar, strong domestic energy production and weak foreign demand were contributing to keep inflation below the Fed's 2% target.
"There still is a significant underutilization of labor market resources," he said.
"The consensus view is that lift-off will take place around the middle of next year. That seems like a reasonable view to me."
Data released by the Federal Reserve on Tuesday showed consumers boosted overall credit by an annual rate of 5% in August, the smallest gain since November and a significant decline from the 8.1% rise in July.
In corporate news, Sodastream International fell 21.94%, as the soft drinks maker warned of a quarterly-sales decline, while Container Store sank 24.90% after the firm announced late on Monday it was cutting its profit and sales view.
Amazon retreated slightly in the wake of news coming from Brussels that the European Commission opened an investigation over the company's tax agreement with Luxembourg, while Agco fell 10.55% after weaker-than-expected demand forced the firm to cut its profit outlook for the year.
Health concerns over Ebola hit the aviation sector, with Delta Airlines and United Continental losing 2.33% and 3.09% respectively.
Christopher & Banks shares plummeted 26.08% after the company said its quarterly sales will fall well below Wall Street's estimate.
Calamp shares soared as high as 21.03% after the company delivered better-than-expected second quarter earnings for and adjusting its full year guidance on earnings per share to be in line with or slightly above Wall Street's consensus.
Lakeland shares surged over 13% amid growing concerns over Ebola, while Energy Focus climbed 16.92% and GT Advanced Technologies rebounded in fashion just 24 hours after plunging 93% on Monday after filing for bankruptcy.
The 10-year Treasury note was down eight basis points to 2.35, while the 30-year-bond yield fell by a similar margin to 3.05 and the five-year treasury note dropped four seven points to 1.63.
The dollar was in retreat against the pound, the euro and the yen but for the second consecutive day.
West Texas Intermediate crude fell 1.7% and closed the day trading below $89 a barrel.
S&P 500 - Risers
Keurig Green Mountain Inc (GMCR) $139.75 +4.88%
CF Industries Holdings Inc. (CF) $282.76 +3.53%
Becton, Dickinson & Company (BDX) $128.00 +2.42%
Allergan Inc. (AGN) $186.20 +1.68%
Diamond Offshore Drilling Inc. (DO) $33.99 +0.95%
Valero Energy Corp. (VLO) $45.13 +0.92%
Wisconsin Energy Corp. (WEC) $44.28 +0.91%
Coca-Cola Co. (KO) $43.92 +0.73%
Xcel Energy Inc. (XEL) $30.83 +0.72%
Northeast Utilities (NU) $45.81 +0.57%
S&P 500 - Fallers
Best Buy Co. Inc. (BBY) $30.23 -6.12%
Carnival Corp. (CCL) $37.34 -5.47%
Newfield Exploration Co (NFX) $33.54 -5.09%
Cummins Inc. (CMI) $129.57 -4.82%
Hewlett-Packard Co. (HPQ) $35.22 -4.48%
Adt Corp (ADT) $33.27 -4.34%
Joy Global Inc. (JOY) $51.69 -4.19%
Allegion (ALLE) $46.59 -4.12%
Charles Schwab Corp. (SCHW) $28.48 -4.11%
E TRADE Financial Corp. (ETFC) $21.51 -4.02%
Dow Jones I.A - Risers
Coca-Cola Co. (KO) $43.92 +0.73%
Dow Jones I.A - Fallers
Caterpillar Inc. (CAT) $94.70 -3.37%
United Technologies Corp. (UTX) $101.42 -2.69%
Johnson & Johnson (JNJ) $102.39 -2.36%
Boeing Co. (BA) $123.32 -2.33%
Goldman Sachs Group Inc. (GS) $183.80 -1.96%
American Express Co. (AXP) $85.35 -1.93%
Intel Corp. (INTC) $33.46 -1.91%
3M Co. (MMM) $137.68 -1.90%
Merck & Co. Inc. (MRK) $58.46 -1.88%
Visa Inc. (V) $208.05 -1.77%
Nasdaq 100 - Risers
Keurig Green Mountain Inc (GMCR) $139.75 +4.88%
Monster Beverage Corp (MNST) $92.43 +0.06%
Sigma-Aldrich Corp. (SIAL) $135.75 +0.02%
Dollar Tree Inc (DLTR) $56.58 +0.02%
Nasdaq 100 - Fallers
F5 Networks Inc. (FFIV) $117.91 -3.48%
Vimpelcom Ltd Ads (VIP) $6.39 -3.47%
Tractor Supply Company (TSCO) $59.35 -3.36%
Alexion Pharmaceuticals Inc. (ALXN) $167.96 -3.28%
Illumina Inc. (ILMN) $157.97 -3.16%
Biogen Idec Inc. (BIIB) $315.92 -2.81%
NetApp Inc. (NTAP) $39.85 -2.79%
Maxim Integrated Products Inc. (MXIM) $28.41 -2.77%
Vertex Pharmaceuticals Inc. (VRTX) $102.83 -2.77% |
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| | Wednesday newspaper round-up: Tesco, Morrisons, Ebola | | Several large investors have signaled to Tesco that they would be willing to support a rights issue, of between £1-2bn, to strengthen the retailer’s hand. Nevertheless, that does not mean that they are pleased by the company’s performance, one of them told The Times, but there is a general acceptance of the need for one. The sooner the better, he added. The rise in high-end homes in London could trigger a construction crunch, the Guardian reported on Wednesday. A record number of luxury homes worth in the region of £60bn are being built in the British capital but analysts have warned this could create a crunch in the construction sector, which could potentially lead to many properties being delayed or even scraped altogether. The number of high-end properties built or planned over the next 10 years has climbed to 25,000 units, a 25% increase compared to 12 months ago, a report from EC Harris, a built asset consultancy, showed. The Daily Telegraph reported that, according to new Morrisons chairman, Andy Higginson, shoppers have “lost trust” in supermarket pricing. Higginson, who joined the board of the supermarket chain earlier in October, said Britain’s four main supermarkets chains had strengthened the position of Lidl and Aldi by "talking to each other, not their customers" in their marketing strategy. “The dialogue with customers has not been honest. Customers have lost trust in supermarket pricing,” said Higginson. “Supermarkets have been very focused on each other. The marketing dialogue has astonished me. It is the big four talking to each other, not their customers." The spread of Ebola through Europe is "quite unavoidable" according to the World Health Organisation (WHO), The Independent reported. WHO European director Zsuzsanna Jakab has warned that more cases will spread in Europe, following the news that four people have been hospitalised in Spain after a nurse became the first person known to have contracted the virus outside Africa. "Such imported cases and similar events as have happened in Spain will happen also in the future, most likely," Jakab was quoted as saying to Reuters. Britain is at the head of the pack when it comes to economic growth among the leading economies of the world, by a mile, the International Monetary Fund said on Tuesday. The UK is now expected to grow by 3.2% this year and 2.7% next. “Among advanced countries, the United States and the United Kingdom in particular are leaving the financial crisis behind and achieving decent growth,” Olivier Blanchard, the IMF chief economist, said, according to The Times. Several large investors have signaled to Tesco that they would be willing to support a rights issue, of between £1-2bn, to strengthen the retailer’s hand. Nevertheless, that does not mean that they are pleased by the company’s performance, one of them told The Times, but there is a general acceptance of the need for one. The sooner the better, he added. | | |
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