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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: M&S, Meggitt lead UK stocks higher early on UK stocks rose on Wednesday as decent gains from Marks & Spencer, Meggitt, Tulllow Oil and AB Foods offset falls in the mining sector after yet more weak data from China. The FTSE 100 was trading 0.6% higher at 6,493 in morning trade.
With the exception Japan's Nikkei index, Asian markets weaker overnight after the HSBC China non-manufacturing purchasing managers' index fell from 53.5 to 52.9 in October, showing that growth in the country's services sector eased for the second month in a row.
"Coming following a poor manufacturing PMI release over the weekend, this further compounds the view that China is struggling to move forward in a convincing way following a slowdown earlier this year," said analyst Joshua Mahony from Alpari UK.
Nevertheless, stocks in Tokyo advanced after Bank of Japan governor Haruhiko Kuroda struck a dovish tone in the aftermath of last week's unexpected stimulus boost announcement. He said the central bank is ready to do more to hit inflation targets with "no limits to our policy tools".
Wednesday is set to be a data-heavy session for western markets, with services PMIs due out across the Eurozone, the UK and US. However, the ADP employment report Stateside will likely garner the most attention as investors ready themselves for the official non-farm payrolls figure on Friday. As for the ADP report, analysts expect private-sector payrolls to have increased by 220,000 in October after a 213,000 gain in September.
Markets will also be looking ahead to monetary policy decisions from the Bank of England and European Central Bank on tap for Thursday.
M&S and Meggitt jump early on
High street bellwether M&S surged 8% in early deals after beating analysts' forecasts with its half-year report. Although the market was expecting a fall in profits in the face of the cut-throat retail market, better general retail margins and cost-cutting helped underlying profit before tax rise 2.3% to ?267.6m, while the company unexpectedly lifted its dividend.
Meggitt was also in demand, rising 6% despite warning of a slowdown in the fourth quarter. The aerospace, defence and energy engineer said that organic revenues grew 5% in the third quarter, compared with a 3% decline in the first half.
Exploration firm Tullow Oil rebounded strongly after a steep drop on Tuesday as stocks in the sector tanked on the back of a slumping crude price. US crude oil is continuing to trade at three-year lows.
Primark owner and food ingredients firm Associated British Foods was heading higher after Citigroup upgraded the stock to 'buy', while Rolls-Royce fell after Panmure Gordon cut its recommendation for the engine maker to 'sell'.
Mining stocks were mostly lower after the disappointing data from China. Randgold, Fresnillo, BHP Billiton, Anglo American and Glencore were all registering losses.
There were some heavy fallers on the FTSE 250 on Wednesday, led by Stock Spirits which dropped nearly 18% after warning that full-year profits could be €5m-10m below expectations following a "very tough trading period" in the third quarter for the Central European spirits producer.
Centamin disappointed as it lowered annual production forecasts for its flagship Sukari gold mine in Egypt after plant productivity suffered a slowdown in October. The stock was down 12%.
Insurance firm Esure was also 5% lower after saying that it now expects its full-year combined operating ratio to rise. The company said that it has seen an increase in small bodily injury claims frequency, while premiums for motor insurance continue to fall. |
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| Market Movers
techMARK 2,779.81 +0.97%
FTSE 100 6,493.18 +0.61%
FTSE 250 15,492.12 +0.64%
FTSE 100 - Risers
Marks & Spencer Group (MKS) 438.10p +8.25%
Meggitt (MGGT) 467.90p +6.34%
Associated British Foods (ABF) 2,888.00p +3.77%
Tullow Oil (TLW) 474.20p +3.56%
Travis Perkins (TPK) 1,647.00p +2.04%
Vodafone Group (VOD) 207.45p +1.92%
CRH (CRH) 1,393.00p +1.75%
SABMiller (SAB) 3,535.50p +1.73%
Standard Life (SL.) 391.80p +1.66%
Aggreko (AGK) 1,479.00p +1.65%
FTSE 100 - Fallers
Randgold Resources Ltd. (RRS) 3,701.00p -2.73%
Kingfisher (KGF) 286.60p -2.28%
Fresnillo (FRES) 687.00p -1.51%
Admiral Group (ADM) 1,324.00p -0.90%
Petrofac Ltd. (PFC) 1,040.00p -0.86%
BHP Billiton (BLT) 1,599.50p -0.68%
Standard Chartered (STAN) 939.50p -0.63%
Rolls-Royce Holdings (RR.) 843.00p -0.59%
Anglo American (AAL) 1,318.50p -0.53%
Glencore (GLEN) 309.30p -0.42%
FTSE 250 - Risers
Howden Joinery Group (HWDN) 365.40p +6.56%
Just Retirement Group (JRG) 128.90p +3.20%
Afren (AFR) 71.60p +2.73%
Dunelm Group (DNLM) 857.50p +2.51%
Hikma Pharmaceuticals (HIK) 1,917.00p +2.46%
Supergroup (SGP) 793.00p +2.32%
Diploma (DPLM) 730.50p +2.31%
Spectris (SXS) 1,843.00p +2.16%
Cairn Energy (CNE) 146.30p +2.16%
BBA Aviation (BBA) 360.40p +2.07%
FTSE 250 - Fallers
Stock Spirits Group (STCK) 247.50p -17.61%
Centamin (DI) (CEY) 45.90p -12.15%
Wetherspoon (J.D.) (JDW) 779.50p -6.31%
esure Group (ESUR) 227.40p -5.05%
Aveva Group (AVV) 1,394.00p -2.52%
Hochschild Mining (HOC) 95.35p -1.70%
PZ Cussons (PZC) 358.80p -1.43%
Lancashire Holdings Limited (LRE) 642.50p -1.38%
Synthomer (SYNT) 202.00p -1.03% |
| | UK Event Calendar | | Wednesday 05 November
INTERIMS
Canaccord Genuity Group Inc., First Derivatives, FirstGroup, Marks & Spencer Group, Stewart & Wight
INTERIM DIVIDEND PAYMENT DATE
Carillion, StatPro Group
QUARTERLY PAYMENT DATE
Assura Group Ltd.
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Crude Oil Inventories (US) (15:30)
ISM Non-Manufacturing (US) (15:00)
ISM Services (US) (15:00)
MBA Mortgage Applications (US) (12:00)
PMI Composite (EU) (09:00)
PMI Composite (GER) (08:55)
PMI Services (EU) (09:00)
PMI Services (GER) (08:55)
Retail Sales (EU) (10:00)
Q2
Canaccord Genuity Group Inc.
Q3
Avocet Mining, Lancashire Holdings Limited, OAO Severstal GDR (Reg S), Smurfit Kappa Group
GMS
Atlas Development & Support Services Limited
FINALS
Applied Graphene Materials
IMSS
Aer Lingus Group, esure Group, Hunting, Meggitt, Old Mutual, Wetherspoon (J.D.)
EGMS
OSJC Center for Cargo Container Traffic Transcontainer GDR (Reg S)
AGMS
Hargreaves Services, Haynes Publishing Group, Infrastructure India, Jupiter European Opportunities Trust, Progility, Quoram, Schroder Japan Growth Fund
UK ECONOMIC ANNOUNCEMENTS
BRC Shop Price Index (00:01)
Official Reserves (09:30)
FINAL DIVIDEND PAYMENT DATE
Alumasc Group, IPPlus, Pacific Horizon Inv Trust |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks gain ahead of data as ECB policy decisions looms European stocks bounced higher as investors awaited a slate of economic data ahead of the European Central Bank's (ECB) policy decision. Markit's purchasing managers' index (PMI) for the Eurozone service sector was revised lower to 52.3 in October, from the preliminary estimate of 52.4, surprising analysts who had expected it to remain unchanged.
Separately Markit will also release its PMI composite, which gauges manufacturing and services activity, at 09:30 London time.
A report on Eurozone retail sales at 10:00 is forecast to show a 1.4% rise in September, following a 1.9% increase a month earlier.
The German Finance Ministry will at 13:00 brief lawmakers on the ECB's stress test results.
The ECB is due to announce its latest policy decision on Thursday when it is expected to hold back on changes despite pressure to take action to address low inflation and a weak recovery.
The US will today see the release of mortgage application figures, non-manufacturing from ISM and ADP's employment report. The private payrolls report comes ahead of the all-important official monthly jobs data on Friday.
On the political front for the States, the Republicans seized control of the Senate in Tuesday's midterm elections.
"The US mid-term elections has brought about a somewhat unwelcome result for Barack Obama, who has seen the democrat run Senate go the way of the Republicans, who rode the wave of disenchanted voters to a famous victory overnight," said Alpari UK analyst Craig Erlam.
"The control of both the House and Senate for the final two years of Obama's run as President means that there is going to be immense difficulty in passing any legislature or really getting anything done of any meaning."
Banca, Lafarge
Banca Monte dei Paschi di Siena SpA gained following reports the Italian lender is close to securing underwriters for a share sale to raise as much as €2.5bn.
Lafarge SA advanced after saying it will slow asset sales in the fourth quarter.
Hannover Re jumped as the reinsurer posted a rise in third-quarter profit that beat analysts' estimates.
ING Groep NV rallied after the largest Dutch lender said it will make the final repayment of state aid on Friday, ending a six-year bailout.
The euro fell 0.37% to $1.2499. |
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| | US Market Report | | US close: Markets slide as oil price plummets US stocks fell on Tuesday after energy companies slumped as oil prices reached a three-year low. The Dow Jones Industrial Average closed 17. 60 points up to 17,383.84, while the S&P 500 was largely unchanged to 2,017.81 and the Nasdaq closed 13.06 points down to 4,156.23.
The Eurozone economy is now expected to expand by just 0.8% and 1.1% in 2014 and 2015, according to the European Commission, compared with its previous forecasts in May of 1.2% and 1.7% respectively.
News from the Eurozone saw already weak oil prices slide even further, with Brent and West Texas intermediate crude falling around 2% to just under $83 and just over $77 a barrel respectively. Saudi Arabia lowered prices for crude exports to US customers ahead of US government data due out on Wednesday which is expected to show that stockpiles rose by 1.9m barrels last week.
Craig Erlam, market analyst at Alpari UK, said it was premature to claim there was a connection between weak stocks and falling oil prices. "Weaker oil prices may be bad for the big oil companies, but when it comes to the global economy, it's actually a hidden stimulus," he said.
Meanwhile, the US trade deficit jumped 7.6% in September to the highest level since late spring as exports to Europe, China and Japan all dropped, further proof that the US economy is starting to be affected by slower growth in the economies of key trading partners.
According to data released by the Commerce Department on Tuesday, the trade gap rose to a seasonally adjusted $43bn in September from a slightly revised $40bn in August.
Exports fell 1.5% to $195.6bn, while imports were stable at $238.6bn and the real goods balance widened to a deficit of $50.8bn.
US citizens will go to the polls for the mid-term elections on Tuesday with the race for Senate deemed too close to call, as the Republicans look to secure both chambers of the Congress.
On Tuesday, St. Louis Fed President James Bullard said that the US economy remained on track to grow at a 3% annual rate by 2016, which should allow the Federal Reserve to move ahead with plans to hike short-term interest rates.
Alibaba rose 3.63% after announcing that quarterly revenue jumped 54% in the three months to September and net profit climbed 39%, while Herbalife plummeted 20.57% after disappointing third-quarter results.
RetailMeNot sank 29.14% despite posting strong results, as the firm warned much of its growth was due to "lower monetising mobile visits", while Sprint Corp fell 17.62% after results missed estimates.
Apple and Google were largely unchanged after two tech giants announced they had reached a deal with Disney which will allow consumers who buy a Disney movie from either of their online stores to watch on smartphones, tablets and other digital devices even if they run their rival's operating system.
The dollar was in retreat against the pound, the yen and the euro, while gold futures slid to $1,168.60.
The yield on the 10-year US Treasury note dropped one basis points to 2.34%, while the 30-year note fell two basis points to 3.05% and the five-year Treasuries was stable at 1.63%.
S&P 500 - Risers
Archer-Daniels-Midland Co. (ADM) $49.54 +4.85%
Delta Airlines Inc. (DAL) $42.32 +4.21%
Expeditors International Of Washington Inc. (EXPD) $44.39 +3.96%
International Paper Co. (IP) $52.60 +3.91%
Zoetis Inc (ZTS) $39.12 +3.71%
Intercontinental Exchange Inc (ICE) $217.52 +3.68%
Motorola Solutions Inc (MSI) $66.76 +3.22%
Southwest Airlines Co. (LUV) $36.43 +3.17%
Facebook Inc. (FB) $75.76 +2.54%
L Brands Inc (LB) $74.28 +2.54%
S&P 500 - Fallers
Priceline Group Inc (PCLN) $1,097.70 -8.41%
Nabors Industries Ltd. (NBR) $16.37 -7.09%
Denbury Resources Inc. (DNR) $11.28 -7.01%
Discovery Communications Inc. Class A (DISCA) $33.32 -6.59%
United States Steel Corp. (X) $36.57 -6.57%
Tenet Healthcare Corp. (THC) $53.06 -6.45%
Regeneron Pharmaceuticals Inc. (REGN) $372.39 -5.79%
LyondellBasell Industries (LYB) $84.07 -5.77%
Noble Corporation plc (NE) $19.15 -5.71%
Transocean Ltd. (RIG) $27.35 -5.26%
Dow Jones I.A - Risers
Procter & Gamble Co. (PG) $88.64 +1.44%
Wal-Mart Stores Inc. (WMT) $77.26 +1.28%
Cisco Systems Inc. (CSCO) $24.88 +1.22%
Travelers Company Inc. (TRV) $101.13 +1.18%
3M Co. (MMM) $155.05 +1.14%
Johnson & Johnson (JNJ) $108.62 +1.08%
McDonald's Corp. (MCD) $94.47 +0.92%
Merck & Co. Inc. (MRK) $59.37 +0.76%
Intel Corp. (INTC) $34.54 +0.67%
Visa Inc. (V) $242.97 +0.59%
Dow Jones I.A - Fallers
Caterpillar Inc. (CAT) $98.61 -1.61%
Walt Disney Co. (DIS) $90.35 -1.48%
Chevron Corp. (CVX) $115.37 -1.21%
International Business Machines Corp. (IBM) $162.65 -1.04%
JP Morgan Chase & Co. (JPM) $60.25 -1.03%
Exxon Mobil Corp. (XOM) $94.52 -0.78%
E.I. du Pont de Nemours and Co. (DD) $68.51 -0.54%
Goldman Sachs Group Inc. (GS) $190.27 -0.29%
Boeing Co. (BA) $125.84 -0.15%
AT&T Inc. (T) $34.79 -0.14%
Nasdaq 100 - Risers
Expeditors International Of Washington Inc. (EXPD) $44.39 +3.96%
Facebook Inc. (FB) $75.76 +2.54%
Baidu Inc. (BIDU) $241.96 +2.29%
CH Robinson Worldwide Inc (CHRW) $70.12 +2.08%
Automatic Data Processing Inc. (ADP) $83.15 +1.72%
Costco Wholesale Corp. (COST) $136.55 +1.70%
Adobe Systems Inc. (ADBE) $71.07 +1.66%
Yahoo! Inc. (YHOO) $47.08 +1.60%
Nvidia Corp. (NVDA) $20.13 +1.31%
Cisco Systems Inc. (CSCO) $24.88 +1.22%
Nasdaq 100 - Fallers
Priceline Group Inc (PCLN) $1,097.70 -8.41%
Discovery Communications Inc. Class A (DISCA) $33.32 -6.59%
Regeneron Pharmaceuticals Inc. (REGN) $372.39 -5.79%
Viacom Inc. Class B (VIAB) $69.63 -4.39%
Twenty-First Century Fox Inc Class A (FOXA) $33.33 -2.97%
Expedia Inc. (EXPE) $83.89 -2.37%
Wynn Resorts Ltd. (WYNN) $185.26 -2.24%
Charter Communications Inc. (CHTR) $158.44 -2.01%
Liberty Interactive Corp (QVCA) $25.77 -1.83% |
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| | Wednesday newspaper round-up: Interest rates, Republicans, Bankers' bonuses... | According to The Guardian, the NIESR has claimed that the Bank of England will wait until after next year's general election to raise interest rates. The NIESR now expects the first rate hike to come in June 2015, a month after the election and later than its previous forecast of February 2015, but said that it might not come until even later. Republicans "romped their way across America's electoral map last night", writes The Independent, taking control of the US Senate in the mid-term elections. Their increased power in the House of Representatives will "spell a tumultuous twilight to President Barack Obama’s second term", the paper said. Andrew Bailey, the Bank of England deputy governor for prudential regulation, has declared that banks, rather than authorities, should decide how much their staff are paid, The Daily Telegraph has reported. “We are not, in my view, pay level regulators. That is not our purpose in life,” Bailey said. The UK government is opposing the EU’s bonus cap, which Threadneedle Street officials believe conflicts with rules allowing banks to defer and claw back bonuses, while the European Banking Authority is looking to restrict the use of allowances based on roles individual occupy within a bank, a strategy banks have developed to bypass the bonus cap. The International Monetary Fund’s (IMF) internal commission has criticised the fund’s call for austerity in 2010, the Financial Times said. The decision has sparked a heated debate among policy makers over whether raising taxes and cutting public spending were right measures to adopt after the financial crisis. The IMF called for a worldwide stimulus in 2008-09 and its advice was implemented. In the US and UK, governments ran budget deficits larger than 10 per cent of gross domestic product in 2009. Authors of a government-endorsed report into boardroom diversity have claimed that more needs to be done to increase the proportion of female executives on the boards of some of the UK's largest listed companies, The Guardian writes. Just 39 of firms on the FTSE 100 currently meet the target by Lord Davis for 25% of the boardroom seats to be held by women by 2015. The Financial Times has cited research by the University College London that claims that European immigrants to the UK paid £20bn more in taxes than they received in benefits over the past decade. The government will try to limit the impact of a legal ruling requiring businesses to increase the holiday pay of 5m people who regularly work overtime, The Guardian reported. On Tuesday, the employment appeal tribunal ruled that employers must include overtime when calculating workers’ holiday pay after test cases brought by the Unite union, meaning people who work overtime in the future will see their holiday pay increased. Employees, however, can claim back pay only if it is less than three months since their last holiday. | | |
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