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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: Stocks rally strongly after Swiss move as ECB stimulus hopes rise A surprise policy move by the Swiss National Bank (SNB) resulted in a choppy day for UK markets on Thursday, though stocks were able to regain their composure and rally strongly as the dust settled. The FTSE 100 finished the session 110.32 points higher at 6,498.78, up 1.7% on the day due to increased speculation about a new potential quantitative easing (QE) programme by the European Central Bank next week.
Equities had dropped sharply into the red mid-morning, with the FTSE 100 falling as low as 6,298.15, after the SNB abandoned its minimum exchange rate for the franc.
"As the day has progressed the panic caused by the SNB has subsided, and hope for Eurozone QE has seen markets rally into the close with the FTSE battling to post a triple-digit gain," said analyst Alastair McCaig from IG.
With exactly one week to go before the ECB's policy meeting on 22 January, analysts said the SNB's move was pre-emptive ahead of a possible ECB government bond-buying programme. According to Connor Campbell from Spreadex, "the SNB appears to have decided it would be unable to maintain its currency cap in the face of such wide-spread stimulus".
US economic data came in mixed on Thursday, with jobless claims unexpectedly rising to a four-month high and regional manufacturing surveys moving in opposite directions.
Gold miners surge, Afren rockets
Gold mining stocks were performing well after UBS said they are "well-placed to benefit from FX and oil weakness" compared with their industrial metal peers. Precious-metal producers Randgold Resources and Fresnillo were the best performers.
Afren, the oil group which plummeted this week after reserve estimates were cut for a part-owned project in the Kurdistan region of Iraq, soared over 32% by the close on the back of takeover speculation. Nigeria's Seplat, which had approached Afren last month, said on Thursday that it had secured an option to raise $700m of debt to fund acquisitions. It has until 19 January to return to the table and bid for Afren.
Third-quarter organic revenue was flat at information services group Experian, but weakness in some divisions was offset by a strong performance in the core credit services unit, causing shares to rise.
Tullow Oil erased early gains as investors digested an trading update that showed the company was taking billions of dollars-worth of write-offs and impairment charges. The group also said profits more than halved last year due to the collapse in crude prices, as it lowered its exploration budget for 2015.
Estate agency Savills impressed with a trading update, while statements from Home Retail, Booker and Bovis Homes disappointed. |
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| | Market Movers
techMARK 2,985.44 +0.88%
FTSE 100 6,498.78 +1.73%
FTSE 250 15,915.29 +0.27%
FTSE 100 - Risers
Randgold Resources Ltd. (RRS) 5,265.00p +6.36%
Experian (EXPN) 1,121.00p +5.26%
Morrison (Wm) Supermarkets (MRW) 188.10p +5.03%
Sainsbury (J) (SBRY) 255.30p +5.02%
BHP Billiton (BLT) 1,348.00p +4.90%
Fresnillo (FRES) 855.00p +4.78%
Royal Dutch Shell 'B' (RDSB) 2,129.00p +3.75%
Associated British Foods (ABF) 3,147.00p +3.69%
Shire Plc (SHP) 4,663.00p +3.62%
Prudential (PRU) 1,515.50p +3.55%
FTSE 100 - Fallers
Kingfisher (KGF) 318.60p -3.22%
Imperial Tobacco Group (IMT) 2,850.00p -2.80%
Dixons Carphone (DC.) 434.40p -2.16%
Glencore (GLEN) 240.60p -1.39%
Taylor Wimpey (TW.) 124.10p -1.35%
Compass Group (CPG) 1,091.00p -1.27%
Tullow Oil (TLW) 354.90p -0.84%
Persimmon (PSN) 1,456.00p -0.82%
Antofagasta (ANTO) 670.00p -0.74%
InterContinental Hotels Group (IHG) 2,601.00p -0.57%
FTSE 250 - Risers
Afren (AFR) 28.76p +32.29%
Polymetal International (POLY) 591.00p +9.55%
Savills (SVS) 699.50p +7.29%
Acacia Mining (ACA) 299.70p +4.79%
Cairn Energy (CNE) 170.70p +4.34%
Premier Oil (PMO) 137.60p +4.24%
Kaz Minerals (KAZ) 177.20p +3.99%
Serco Group (SRP) 159.90p +3.90%
Soco International (SIA) 259.30p +3.55%
Game Digital (GMD) 250.00p +3.31%
FTSE 250 - Fallers
Vedanta Resources (VED) 375.80p -7.94%
Spire Healthcare Group (SPI) 315.00p -7.30%
Bovis Homes Group (BVS) 769.50p -6.10%
Home Retail Group (HOME) 199.10p -6.08%
Hikma Pharmaceuticals (HIK) 2,250.00p -4.94%
Petra Diamonds Ltd.(DI) (PDL) 171.60p -4.88%
Enterprise Inns (ETI) 106.10p -4.41%
IG Group Holdings (IGG) 709.50p -4.38%
Booker Group (BOK) 155.70p -4.24%
IP Group (IPO) 221.00p -2.64% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks rise as German GDP grows, SNB scraps key policy tool European stocks were in positive territory after a report revealed Germany's economy expanded in 2014. German gross domestic product (GDP) rose 1.5% last year, compared to a 0.1% increase in 2013, the Federal Statistics Office revealed, as expected by analysts. It marked the fastest pace of growth in three years.
"After a soft spell over the summer, the German economy now appears to be expanding again at a stronger pace," Barclays Research said.
"We expect further quarter-on-quarter growth acceleration early this year and annual 2015 GDP growth at 1.4% with some upside risks posed by the slump in oil prices and weaker euro."
The data comes ahead of the European Central Bank's (ECB) policy meeting next Thursday.
The ECB is under pressure to introduce full-on quantitative easing after a preliminary estimate showed the Eurozone entered deflation. Eurostat releases the final report on consumer prices on Friday.
Meanwhile, the Swiss National Bank unexpectedly scrapped its three-year policy of capping the Swiss franc against the euro.
The central bank also lowered the interest rate on sight deposit account balances that exceed a given exemption threshold to minus 0.75% from minus 0.25%.
In the US, a report showed initial jobless claims rose to 316,000 in the week to 10 January from 294,000 the previous week, more than the 290,000 forecast.
However, Capital Economics noted that the claims data is "notoriously volatile", particularly after the holidays.
Miners rally
A gauge of mining stocks advanced, including Randgold Resources and BHP Billiton, as metal prices climbed.
Cie. Financiere Richemont slumped as the maker of Cartier jewellery reported flat third-quarter revenue as protests in Hong Kong disrupted sales.
Experian was a high riser after saying it expected to meet its full-year targets.
Beiersdorf AG climbed after the German maker of Nivea products reported full-year sales that beat analysts' estimates.
Associated British Foods gained after posting an increase in revenue over the holiday season, boosted by its Primark division.
Brent crude dropped 0.66% to $48.37 per barrel, according to the ICE. |
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| | US Market Report | | US open: Stocks fall amid lower than expected retail sales in December Markets were falling on Wednesday after the US retail sales advance came in lower than expected month-on-month for December. Early in the day the Dow Jones Industrial Average dropped 1.27% to 17,390.90, the S&P 500 decreased 0.95% to 2,003.79 and Nasdaq declined 0.67% to 4,630.24.
US retail sales fell 0.9% month-on-month in December, posting a sharper decline than consensus expectations of -0.1%.
Barclays Research said: "After incorporating the weaker-than-expected core retail sales data, our tracking estimate of fourth quarter (Q4) real consumer spending fell to 4.1% (previous: 4.4%) and our Q4 real gross domestic product tracking estimate fell two-tenths to 3.4%."
Oil prices were under continued pressure with WTI down 0.1% at $45.84 a barrel and Brent falling 0.2% to $46.51 a barrel.
Jasper Lawler from CMC Markets said: "Declining oil and copper prices reflect in part oversupply but also slower demand particularly from the likes of China, the world's biggest buyer of commodities.
"Oil and copper not only have their own particular supply/demand issues but are being pressured by a rallying US dollar in which they are denominated."
IG analyst Alastair McCaig added: "Copper has managed the impossible by shifting oil off the top of the commodities watch list. This sudden collapse in the metal by more than 5% has been triggered by the World Bank's downgrade of global growth for 2015."
Over on COMEX, gold futures were advancing 0.45% to $1,239.90 while the dollar was sliding against the pound, the yen and the euro.
The yield on a benchmark US 10-year Treasury fell eight basis points to 1.82%. |
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| | Broker Tips | | Broker tips: Tullow Oil, Experian, Home Retail News of a multibillion-dollar write-down at Tullow Oil sent the share price in the exploration company lower on Thursday, though analysts at Westhouse Securities retained their positive rating on the stock. While the size of the $2.3bn write-down (after tax), is likely to disappoint investors, the broker said: "The fundamental long-term production/cashflow growth story remains intact in our view and we would be buyers of Tullow on any weakness."
Headline group growth at Experian missed analysts' forecasts on Thursday, but Shore Capital's Robin Speakman applauded the stronger-than-expected third-quarter performance from the core credit services division.
"The data services specialist continues to report mixed trading patterns across the group, impacted by a number of short-term trading items offsetting strong performances in the core credit divisions across the regions," Speakman said.
Home Retail, the owner of the Argos and Homebase, sacrificed like-for-like (LFL) sales in the third quarter to protect profitability, according to Canaccord Genuity. | | |
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