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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: Mining stocks lift FTSE after dovish Fed minutes UK stocks jumped in early trading on Thursday as a dovish set of Federal Reserve meeting minutes and a strong start to the earnings season prompted strong gains on Wall Street the previous session. The FTSE 100 had risen by 0.8% to 6,533 within the opening hour of trade, helped by a decent performance by mining stocks as metal prices advanced.
US stock notched up their best single-day performance this year on Wednesday - the S&P 500 rose 1.8% - after details of the latest Federal Open Market Committee meeting eased concerns about an early rate hike.
Policymakers expressed fears about how a slowdown in global growth and a stronger dollar could affect the US economy, as they maintained their forward guidance to keep interest rates low for a "considerable time".
Analysts at Rabobank said: "It appears the Fed are happy to constantly sell the US recovery story, but not to act on it on the rates front (yet?)."
Meanwhile, aluminium producer Alcoa unofficially kicked off corporate earnings season on Wall Street with a bang after the close, reporting a tripling of third-quarter profits on the back of higher prices and demand.
As for Thursday's session, all eyes will be on the Bank of England was it releases its latest policy decision amid cooling speculation of an interest rate increase. Analysts expect the central bank will keep the benchmark rate at 0.50% and asset purchases unchanged.
However, they have grown somewhat more divided on the timing of the first increase in Bank Rate, while markets have been pushing out the expected date of the first increase to mid-2015, following weaker readings on manufacturing and house prices.
Mining stocks surge
Precious metal miners Randgold Resources, Fresnillo, Polymetal and Centamin were rising strongly early on as a weaker dollar prompted a jump in gold and silver prices. Centamin announced on Thursday that third-quarter gold output increased by 15%.
The wider mining sector was also in positive territory with Antofagasta, Rio Tinto and BHP Billiton putting in decent gains.
Rolls-Royce was in demand after the power systems firm announced an order for its Trent 1000 engines from Nordic airline Norwegian.
Postal operator Royal Mail also rose after saying it has done a deal to end a competition probe in France.
Clothing retailer N Brown saw shares sink after the company lowered its guidance for full-year profits on the back of a weak start to the second half due to mild weather.
A handful of stocks on the top-tier FTSE 100 index were trading lower early on after going ex-dividend, including Aviva and Kingfisher. Travis Perkins, Weir Group and WPP also went ex-dividend, along with FTSE 250 groups Balfour Beatty, Cobham and Rightmove. |
| | Market Movers
techMARK 2,745.94 +0.77%
FTSE 100 6,532.91 +0.78%
FTSE 250 15,075.64 +0.95%
FTSE 100 - Risers
Randgold Resources Ltd. (RRS) 4,326.00p +6.81%
Fresnillo (FRES) 762.50p +5.39%
Ashtead Group (AHT) 978.50p +3.54%
Antofagasta (ANTO) 698.00p +3.41%
ARM Holdings (ARM) 881.50p +3.04%
BHP Billiton (BLT) 1,698.00p +2.47%
Rio Tinto (RIO) 3,060.00p +2.38%
Burberry Group (BRBY) 1,500.00p +2.32%
Smiths Group (SMIN) 1,252.00p +2.12%
Petrofac Ltd. (PFC) 994.50p +2.00%
FTSE 100 - Fallers
Johnson Matthey (JMAT) 2,780.00p -0.71%
Vodafone Group (VOD) 202.95p -0.66%
Associated British Foods (ABF) 2,550.00p -0.58%
Aviva (AV.) 510.00p -0.58%
Kingfisher (KGF) 312.40p -0.10%
HSBC Holdings (HSBA) 634.20p -0.03%
FTSE 250 - Risers
Polymetal International (POLY) 492.60p +4.65%
Vedanta Resources (VED) 946.50p +4.53%
Wood Group (John) (WG.) 707.50p +4.27%
Hays (HAS) 125.10p +4.25%
Elementis (ELM) 243.70p +3.97%
Kazakhmys (KAZ) 251.40p +3.84%
Victrex plc (VCT) 1,647.00p +3.65%
Petra Diamonds Ltd.(DI) (PDL) 190.60p +3.53%
Centamin (DI) (CEY) 59.75p +3.46%
Lonmin (LMI) 178.80p +3.23%
FTSE 250 - Fallers
Brown (N.) Group (BWNG) 304.10p -12.67%
BlackRock World Mining Trust (BRWM) 398.00p -3.96%
Brit (BRIT) 238.60p -2.21%
SSP Group (SSPG) 236.00p -1.54%
Infinis Energy (INFI) 233.10p -1.44%
Balfour Beatty (BBY) 159.30p -1.42%
Saga (SAGA) 158.40p -1.25%
Barr (A.G.) (BAG) 589.50p -1.17%
Britvic (BVIC) 657.50p -0.83% |
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| | UK Event Calendar | | Thursday 9 October
INTERIMS
Brown (N.) Group
INTERIM DIVIDEND PAYMENT DATE
Antofagasta, Arrow Global Group, Communisis, Crest Nicholson Holdings, Molins, Restaurant Group, UBM, Zotefoams
INTERIM EX-DIVIDEND DATE
Amati Vct 2, Amiad Water Systems Ltd, Aviva, Balfour Beatty, Brammer, British American Inv Trust, Cenkos Securities, Central Asia Metals, Cobham, Crawshaw Group, Dillistone Group, F&C Private Equity Trust, Good Energy Group, Hydrogen Group, Johnson Service Group, JPMorgan Senior Secured Loan Fund Limited, Judges Scientific, Kingfisher, Macfarlane Group, Maven Income & Growth 2 VCT, Nationwide Accident Repair Services, Octopus Apollo VCT, Rightmove, SIG, Spirax-Sarco Engineering, Sprue Aegis, StatPro Group, Synthomer, Travis Perkins, Unite Group, Weir Group, Witan Pacific Inv Trust, WPP
QUARTERLY EX-DIVIDEND DATE
Marsh & Mclennan Cos Inc., Merchants Trust, Verizon Communications
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Balance of Trade (GER) (07:00)
Continuing Claims (US) (13:30)
Current Account (GER) (07:00)
ECB Report (EU) (09:00)
Initial Jobless Claims (US) (13:30)
Retail Price Index (GER) (07:00)
Wholesales Inventories (US) (15:00)
IMSS
Hays, Wood Group (John)
SPECIAL EX-DIVIDEND PAYMENT DATE
GVC Holdings
AGMS
IPPlus, Standard Life UK Smaller Companies Trust
FINAL DIVIDEND PAYMENT DATE
Colefax Group
FINAL EX-DIVIDEND DATE
Alumasc Group, Begbies Traynor Group, City of London Investment Group, CPL Resources, Hays, IPPlus, Pacific Horizon Inv Trust, Produce Investments, River and Mercantile Group , Schroder Japan Growth Fund |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks gain as Fed gets cold feet on interest rate hike European stocks rallied after the Federal Reserve released minutes of its September meeting which indicated the central bank would keep interest rates near zero. The minutes from the 16-17 September meeting, released late Wednesday, showed a number of policymakers voiced concerns that US growth may be slower than expected if foreign economic growth came in weaker than anticipated.
The Fed reiterated that it would keep interest rates near zero for a "considerable time" after ending bond purchases as early as October.
Turning to Thursday's agenda the Labor Department will release a report that many show US jobless claim rose to 295,000 last week from 287,000 the previous week, according to forecasts.
In the UK, the Bank of England will announce its latest policy decision. The central bank is expected to keep asset purchase programme at £375bn and interest rates at 0.5%.
Ahead of the start of trading, a report showed German exports fell 5.8% in August following a 4.8% increase the month earlier, worse than the 4% drop predicted by analysts. Imports fell 1.3% in August, compared to a 1.4% decline in July. Economists had forecast a 0.9% increase.
Solvay, Hays
Solvay gained as the Belgian chemical maker restated its results for 2013 and the first six months of 2014 to include the sale of its sulphuric-acid unit Eco Services.
Hays rallied after the UK recruitment agency reported a 4% increase in net fees for the first quarter.
Norsk Hydro advanced after US peer Alcoa posted its highest earnings in three years.
Suedzucker declined after the company reported a 73% decline in second-quarter operating profit.
The euro jumped 0.41% to $1.2786. |
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| | US Market Report | | US close: Markets rally after Fed minutes US stocks rose on Wednesday, after investors reacted positively to the release of the minutes from the Federal Reserve's last meeting. The Dow Jones Industrial Average closed 273.99 up to 16,993.38 points, while the Nasdaq gained 83.39 to 4,468.59 points and the S&P 500 advanced 33.67 to 1,968.79 points.
Federal Reserve policymakers have grown increasingly concerned about weak growth overseas and the impact of a strong dollar on the domestic economy.
According to minutes from the Fed's 16-17 September policy meeting released Wednesday, officials worried that disappointing growth in Europe, Japan and China could damage US exports.
Meanwhile, by reducing the cost of imported goods and services, a strengthening dollar could keep the level of US inflation below the Fed's 2% target.
Partly because of such concerns, Fed officials reduced the bank projection for medium-run growth, with the collective worry another reason for the Fed to hold interest rates near zero in the short - term, even in the event of an improvement in the economy.
"There is little in the minutes to change our view that the first rate hike will be as soon as March next year," said Paul Ashworth, chief US economist at Capital Economics.
"If the unemployment rate continues to fall and wage growth accelerates as we expect, then we think the Fed will be forced to act earlier than many others currently anticipate.
In corporate news, Yum Brands rose 1.45% after a big selloff on Tuesday. The firm's profit and outlook missed estimates and it drastically cut its expectations for full-year growth.
Having gained in the past four trading session after announcing it had reached a long-term supply agreement with Sanofi worth $50bn, Unilife soared 20.23% on Wednesday, while Lakeland rose 15.85% as concerns about the spread of Ebola intensified on both sides of the Atlantic, with the virus registering its first victim in the US.
Radius Health gained 13.87% after announcing on Tuesday it had closed its initial public offering of 3,128,524 shares of common stock at a public offering price of $18.25 per share
Costco Wholesale shares gained 2.76%, 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 1.86% after raising its quarterly dividend from 52.5 cents a share to 55 cents.
Arrowhead Research sank 43.80% and had its price target lowered from $45 to $20 by Deutsche Bank, after disappointment over data on the company's experimental hepatitis B drug.
Mistras plummeted 11.61% after reporting first quarter adjusted earnings per share of $0.04 after the close Tuesday, down from $0.14 last year and well off the analysts' forecast of $0.12, while Gap lost 7% after Glenn Murphy, the group chief executive announced it was stepping down.
Alcoa shares were up 2.1% in after-hours trade as the company announced after the close on Wednesday that quarterly earnings had exceeded expectations.
West Texas intermediate lost over 1% and was trading at just under $88 a barrel, while gold price increased slightly.
The 10-year Treasury note lost two basis points to 2.32, while the 30-year Treasury note was largely unchanged and the five-year note dropped less than eight basis points to 1.55.
Having registered gains early in the session, the dollar was in retreat against the pound and the euro, though it advanced against the yen.
S&P 500 - Risers
Alexion Pharmaceuticals Inc. (ALXN) $176.42 +5.04%
Newmont Mining Corp. (NEM) $23.64 +4.83%
Gilead Sciences Inc. (GILD) $108.87 +4.39%
Cablevision Systems Corp. (CVC) $18.07 +4.39%
Monster Beverage Corp (MNST) $96.47 +4.37%
Marathon Petroleum Corporation (MPC) $84.26 +4.26%
Best Buy Co. Inc. (BBY) $31.51 +4.23%
Tesoro Corp. (TSO) $64.60 +4.13%
Vertex Pharmaceuticals Inc. (VRTX) $107.02 +4.07%
Sealed Air Corp. (SEE) $33.85 +3.96%
S&P 500 - Fallers
Archer-Daniels-Midland Co. (ADM) $48.02 -3.13%
Aon plc (AON) $83.48 -2.28%
Chesapeake Energy Corp. (CHK) $20.63 -1.43%
AES Corp. (AES) $14.04 -1.40%
Halliburton Co. (HAL) $60.41 -1.31%
Delta Airlines Inc. (DAL) $34.81 -1.30%
E TRADE Financial Corp. (ETFC) $21.30 -0.98%
CF Industries Holdings Inc. (CF) $280.28 -0.88%
E.I. du Pont de Nemours and Co. (DD) $68.52 -0.70%
Nabors Industries Ltd. (NBR) $20.85 -0.62%
Dow Jones I.A - Risers
Merck & Co. Inc. (MRK) $60.18 +2.94%
Unitedhealth Group Inc. (UNH) $86.62 +2.89%
Microsoft Corp. (MSFT) $46.78 +2.75%
3M Co. (MMM) $141.41 +2.71%
Johnson & Johnson (JNJ) $104.91 +2.46%
American Express Co. (AXP) $87.41 +2.41%
Intel Corp. (INTC) $34.27 +2.39%
Visa Inc. (V) $212.36 +2.07%
Caterpillar Inc. (CAT) $96.65 +2.06%
Pfizer Inc. (PFE) $29.38 +2.05%
Dow Jones I.A - Fallers
E.I. du Pont de Nemours and Co. (DD) $68.52 -0.70%
AT&T Inc. (T) $35.15 -0.51%
Nasdaq 100 - Risers
Alexion Pharmaceuticals Inc. (ALXN) $176.42 +5.04%
Gilead Sciences Inc. (GILD) $108.87 +4.39%
Monster Beverage Corp (MNST) $96.47 +4.37%
Vertex Pharmaceuticals Inc. (VRTX) $107.02 +4.07%
Applied Materials Inc. (AMAT) $21.15 +3.83%
Symantec Corp. (SYMC) $24.01 +3.54%
PACCAR Inc. (PCAR) $58.75 +3.49%
Illumina Inc. (ILMN) $163.30 +3.37%
Analog Devices Inc. (ADI) $47.75 +3.33%
Seagate Technology Plc (STX) $57.06 +3.28%
Nasdaq 100 - Fallers
Tractor Supply Company (TSCO) $59.23 -0.19% |
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| | Thursday newspaper round-up: Amazon.com, Google, Bank Rate | | The European Commission is to probe Amazon’s tax status in Luxembourg, the Guardian reported on Thursday. The commission has expanded its investigation into the tax treatment of multinational firms and opened a formal inquiry into the online retailer’s tax arrangements in the European country, which grant the firm £90bn in state aid. Amazon's sister company, Amazon EU Sàrl, is a Luxembourg limited partnership but, crucially, it is not subject to Luxembourg tax. “As a result, most European profits of Amazon are recorded in Luxembourg but are not taxed in Luxembourg,” the European commission said in a statement. “At this stage the commission considers that the amount of this royalty [...] might not be in line with market conditions. Google is embroiled in a tax dispute with the French government which could lead to problems for other multinationals across Europe, with other investigations and pressures to change their tax structures. That tax case centres on Google France, which French tax investigators argue is a façade for tax evasion, allowing the tech giant to funnel profits to jurisdictions which have more lenient tax laws, The Wall Street Journal Europe writes. The “high and rising” pound is increasingly a source of worry. Together with the increasing risks surrounding the outlook for the Eurozone, that reinforces the case against an early rise in Bank Rate, the business lobby said, The Times reports. Gap chief executive Glenn Murphy will step down next year, The Wall Street Journal reported. Having reversed a long-running sales slump, Murphy has decided leave the firm and he will be replaced by Art Peck, currently the head of the company's digital division. Following the news, the clothing firm saw its shares fall by 7% in after-hours trading on Wednesday. The Federal Reserve intends to revise its forward guidance about its future interest rates but policymakers are "terrified of a market misunderstanding" according to the minutes of its September meeting, the Financial Times reported. The minutes from the meeting the Fed held between 16-17 September showed that Fed's officials are increasingly worried that weak growth in the foreign markets could damage US exports, while the strength of the dollar could hold the inflation well below the 2% level targeted by the Fed. On Wednesday the European Commission gave the green light for EDF Energy to begin construction of the giant nuclear reactor at Hinkley Point, in Somerset. The cost of the project could rise to as much as €34bn. The decision marks the start of a renaissance for the country’s nuclear industry, according to The Times. The UK economy may be growing, but it has slowed, the British Chambers of Commerce (BCC) warned. That follows disappointing performances by the manufacturing and services sectors, with the strong upsurge seen in the former at the start of the year having now run its course. | | |
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