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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: Stocks open lower ahead of economic data, but BP rises Weakness on Wall Street and nervousness ahead of some key US data resulted in a negative start for UK stocks on Friday, though gains from oil major BP limited the decline. BP was on the rise early on after being handed a smaller-than-expected civil penalty over the Gulf of Mexico oil spill in 2010.
Nevertheless, London's FTSE 100 was down 0.6% at 6,463 shortly after the open.
"The negative open can be attributed to a weak finish by US bourses following more disappointing US Q4 results from Bank of America, Citigroup and Best Buy, oil retracing gains and mixed data," said Mike van Dulken, head of research at Accendo Markets.
A surprise decision by the Swiss National Bank to remove a currency ceiling rocked financial markets worldwide on Thursday, causing stocks to plummet initially, though equities rallied strongly into the close as hopes for further stimulus measures in the Eurozone increased.
As for Friday's session, the focus will be on data with US consumer-price index (CPI) inflation numbers due out later on, along with US industrial production figures and the University of Michigan US consumer-confidence index.
Inflation will be closely watched and is expected to show that the annual rate of price rises slowed dramatically to just 0.7% in December from 1.3% the month before on the back of a recent slump in oil. Core inflation, which excludes food and energy, is expected to hold steady at 1.7%.
"With rising wages seen bringing inflationary pressures, there is very little concern about the inflation outlook in the US and in fact, the Fed expects inflation to return to its 2% target, opening the door to that first rate hike," said analyst Craig Erlam from Alpari.
The final reading of the Eurozone CPI for December is also due for release and is forecast to show that the region fell into deflation for the first time since October 2009.
BP oil spill fine less than expected
Oil giant BP faces a maximum penalty of $13.7bn under the Clean Water Act, after the District Court for the Eastern District of Louisiana ruling on the Deepwater Horizon case has found that 3.19m barrels of oil were discharged in the Gulf of Mexico in 2010. The bill, which was some $4bn less than feared, put the spill's size below the government's 4.09m estimate and just under the 3.26m estimated by the firm.
Others in the oil and gas sector, however, were mostly weaker such as BG Group, Shell and Tullow Oil.
FTSE 250 producer Afren was extending gains after soaring 32% the previous session on the back of takeover speculation. The advance came after Nigerian group Seplat, which had approached Afren last month regarding a merger, secured an option to raise up to $700m to fund acquisitions.
JD Sports Fashion was a high riser after the sportswear retailer raised its profit outlook for the full year following a strong Christmas. "The board is now confident that the headline profit before tax and exceptional items for our continuing operations will exceed the top end of market expectations for the current financial year which currently range up to £90m," the company said.
Product testing group Spectris also rose after reporting that sales rose across the board in the fourth quarter and like-for-like sales for full 2014 financial year were up 2%.
A slowdown in growth in the fourth quarter at Moneysupermarket.com did little to dampen the stock with the group hailing double-digit growth in revenues and profits for 2014. |
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| Market Movers
techMARK 2,977.43 -0.27%
FTSE 100 6,463.08 -0.55%
FTSE 250 15,859.27 -0.35%
FTSE 100 - Risers
BP (BP.) 399.20p +1.68%
BT Group (BT.A) 404.70p +1.12%
Imperial Tobacco Group (IMT) 2,878.00p +0.98%
SSE (SSE) 1,487.00p +0.47%
Admiral Group (ADM) 1,439.00p +0.35%
United Utilities Group (UU.) 954.00p +0.32%
Glencore (GLEN) 241.30p +0.29%
TUI AG Reg Shs (Post- 16/12/14)(DI) (TUIJ) 1,093.00p +0.28%
Unilever (ULVR) 2,738.00p +0.22%
Rolls-Royce Holdings (RR.) 854.00p +0.12%
FTSE 100 - Fallers
Tullow Oil (TLW) 345.80p -2.56%
ARM Holdings (ARM) 974.00p -2.16%
Meggitt (MGGT) 507.50p -2.03%
Fresnillo (FRES) 839.00p -1.87%
Babcock International Group (BAB) 1,000.00p -1.86%
BG Group (BG.) 806.70p -1.67%
Randgold Resources Ltd. (RRS) 5,180.00p -1.61%
Dixons Carphone (DC.) 427.60p -1.57%
Kingfisher (KGF) 313.80p -1.51%
Burberry Group (BRBY) 1,659.00p -1.48%
FTSE 250 - Risers
Spectris (SXS) 2,110.00p +7.38%
JD Sports Fashion (JD.) 511.00p +7.33%
Afren (AFR) 29.50p +2.57%
Zoopla Property Group (WI) (ZPLA) 167.70p +2.57%
NMC Health (NMC) 499.80p +2.00%
UDG Healthcare Public Limited Company (UDG) 405.00p +1.86%
PayPoint (PAY) 898.00p +1.76%
Jimmy Choo (CHOO) 173.70p +1.76%
Cranswick (CWK) 1,402.00p +1.59%
Saga (SAGA) 164.90p +1.48%
FTSE 250 - Fallers
Lonmin (LMI) 165.10p -3.62%
Countrywide (CWD) 438.00p -3.52%
Premier Oil (PMO) 133.00p -3.34%
Electrocomponents (ECM) 204.70p -3.31%
Ophir Energy (OPHR) 121.40p -3.19%
Dignity (DTY) 1,787.00p -3.09%
Hunting (HTG) 432.30p -2.53%
Kaz Minerals (KAZ) 173.40p -2.14%
Vesuvius (VSVS) 423.00p -2.08% |
| | UK Event Calendar | | Friday 16 January
INTERIM DIVIDEND PAYMENT DATE
Acal, B&M European Value Retail S.A. (DI), Betfair Group, National Westminster Bank 11 1/2% Und Sub Nts (Cnv TO Prf), Northern 2 VCT, Northern 3 VCT, Pets at Home Group , RPC Group, UK Mail Group , World Trust Fund
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Capacity Utilisation (US) (14:15)
Consumer Price Index (GER) (07:00)
Consumer Price Index (US) (13:30)
Industrial Production (US) (14:15)
New Car Registrations (EU) (10:00)
U. of Michigan Confidence (Prelim) (US) (14:55)
Wholesale Price Index (GER) (07:00)
AGMS
Character Group
TRADING ANNOUNCEMENTS
Record, Spectris
FINAL DIVIDEND PAYMENT DATE
Carr's Milling Industries, K3 Business Technology Group |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks decline ahead of Eurozone and US inflation figures European stocks declined ahead of the release of a report which is expected to confirm the Eurozone entered deflation in December.
A final revision on the Eurozone consumer price index is forecast to show a 0.2% fall, compared to 0.3% growth the previous month, well below the ECB's target increase of just below 2%.
The ECB is facing calls to introduce full-blown quantitative easing to address deflation when it next meets on 22 January.
In other European news, the Swiss National Bank announced on Thursday it was ending a cap on the franc against the euro, which sent shares falling.
The US also sees the release of inflation figures with analysts estimating a 0.7% increase in prices in December, slowing from 1.3% a month earlier.
The University of Michigan publishes its index on US consumer confidence, with consensus forecasts for it to climb to 94.1 in January from 93.6 in December.
In corporate news, PSA Peugeot Citroen rallied as European car sales in 2014 rose the first time in seven years, the European Automobile Manufacturers' Association, said today.
BP advanced after a US court ruled the company had dumped less oil into the Gulf of Mexico in 2010 than the government had calculated.
Carrefour SA jumped after the French grocer reported a rise in fourth-quarter sales.
The euro fell 0.02% to $1.1631. |
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| | US Market Report | | US close: Markets drop after Swiss National Bank's shock decision US stocks retreated on Thursday after the surprise announcement by the Swiss National Bank shocked the markets, leading to turbulence.
Switzerland's central bank called time on a three-year self-imposed cap on the strength of its currency, which sent it vaulting 41% higher, although it finished trading up by a lesser 19%.
The Dow Jones Industrial Average fell 0.61% to 17,320.71 while Nasdaq dropped 1.47% to 4,570.82 and the S&P 500 slid 0.91% to 1,992.67.
CMC Markets analyst Jasper Lawler said: "US markets underperformed their European counterparts on Thursday as the respective monetary policies appear to be diverging in favour of Europe as the ECB moves towards what appears to be almost certain QE, a likely boon for risky-assets."
IG analyst Alastair McCaig said: "The burden of raising morale has fallen on the shoulders of the US economic data releases, following the corporates' failure to create any optimism. Although the Empire State Manufacturing index kicked higher, the bigger-than-expected US unemployment claims will have dented the overall perception of the US recovery."
US initial jobless claims came in at 316,000 for the week ended 10 January, after rising by 19,000 from the previous week. The consensus estimate had been for a reading of 291,000.
Lawler noted: "Unemployment rose above 300,000 for the first time since November showing deterioration in the labour market coming off the slowdown in NFP job growth in December from the multi-year highs in November."
"The US jobs trend in January can for now be put down to seasonal factors as hiring slows post the jump before the holiday period. Should there be a few more weeks of claims above 300,000 that may start to impact the outlook for the US labour market and as such the timing of the first Fed rate hike."
Oil prices were making gains during the day but were declining again by closing time with WTI down 4.9% to $46.22 a barrel and Brent down 2.1% to $47.68 a barrel.
McCaig continued: "Both WTI and Brent crude have taken advantage of the markets' focus being taken off them by retesting the $50 a barrel level; they have matched each other stride-for-stride in their efforts to distance themselves from the Saudi oil minister's prophetic $40 call."
Over on COMEX, gold futures increased 1.98% to $1,258.90 while the dollar fell against the yen but rose against the pound and the euro.
The yield on a benchmark US 10-year Treasury dropped fourteen basis points to 1.72%. |
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| | Newspaper Round Up | | Friday newspaper round-up: Belgium anti-terror, IMF, BP... Two people were killed and one other was arrested in an anti-terror operation on Thursday in Verviers, eastern Belgium, reports The Independent. "Prosecutors said that the alleged terror cell was suspected of planning attacks on police stations, where security measures were increased yesterday," the paper said. The collapse is oil prices will not save the global economy, warned International Monetary Fund (IMF) managing director Christine Lagarde, according to The Telegraph. The IMF chief said cheap oil was a "welcome shot in the arm" but growth remains "too low, too fragile and too lopsided".
BP faces a possible civil penalty of up to $13.7bn for the Gulf of Mexico oil spill following a court ruling, the Financial Times said. The news comes after a US judge "split the difference between competing claims about how much oil had escaped into the ocean".
Google has admitted that its 'smart' eyewear, Google Glass, has failed to take off and has decided to stop production of its first version, writes The Times. Experts reckon that the tech giant launched its product "far too soon", the paper said.
The EU may shed "unwelcome light" on Friday about Amazon's favourable tax arrangements in Luxembourg, according to The Guardian. "The investigation centres on suspicions that the deal amounted to illegal state aid or subsidies, distorting the EU single market," the paper said.
Over 100 food and drink suppliers could face collapse because of the price war raging on between the UK's top supermarkets, according to The Telegraph. Research from Begbies Trainer showed that the amount of food manufacturers judged to be in "significant distress" jumped 92% to 1,410 business in the fourth quarter of 2014. | | |
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