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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: Shell leads oil stocks lower as markets react to Fed Heavy falls from Shell and other blue chips in the oil sector weighed heavily on UK stock markets on Thursday, as investors reacted to another plunge in crude prices and the Federal Reserve's outlook for interest rates. Shell said it would be cutting $15bn of potential spending over the next three years as its fourth-quarter results missed forecasts. Meanwhile, oil prices were trading near their lowest in nearly six years.
London's FTSE 100 was down 0.8% at 6,773 early on, tracking late declines on Wall Street after a policy announcement from the Federal Open Market Committee (FOMC).
The Fed painted an improved picture of the economy, changing its language about recent job gains from "solid" to "strong", and adjusting its view of the recovery from "moderate" to "solid".
However, it said it would still "be patient in beginning to normalise the stance of monetary policy" and highlighted that it was watching global economic developments.
The language was widely interpreted to mean that policymakers won't begin to hike rates from near-zero for at least another two FOMC meetings.
Analysts at Danske Bank said the statement "raises the likelihood of a later hike than we currently anticipate (June 2015)".
Brent crude was down 0.1% at $48.41 a barrel, extending losses after a sharp drop on Wednesday after US government data showed that crude inventories in the States rose by 8.87m barrels to 406.7m last week, the highest since the early 1980s.
Shell curtails spending after weak Q4
Oil major Shell said it is looking to reduce costs and lower investment in 2015 in response to the collapse in crude prices, as it curtailed over $15bn of potential spending over the next three years. The comments came as the firm reported adjusted annual profit growth of 12% in the fourth quarter to $3.3bn, well below the consensus forecast of $4.2bn.
Shell's shares were down over 3% early on, dragging others in the sector lower such as BP, BG Group, Tullow Oil, Afren and Soco International.
News of a cut in spending by one of the biggest oil groups in the world was also weighing on stocks in the energy services and equipment sectors, such as Weir Group, Petrofac, Wood Group and Hunting.
Banking stocks were also under pressure in London, with RBS, HSBC, Barclays, Lloyds and Standard Chartered all trading firmly in the red.
Royal Mail declines after revealing that its chairman Donald Brydon will step down later this year. |
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| | Market Movers
techMARK 3,073.24 -0.34%
FTSE 100 6,772.57 -0.78%
FTSE 250 16,322.76 -0.63%
FTSE 100 - Risers
easyJet (EZJ) 1,807.00p +2.26%
Experian (EXPN) 1,203.00p +1.60%
Diageo (DGE) 1,986.50p +1.25%
Unilever (ULVR) 2,933.00p +1.24%
Rolls-Royce Holdings (RR.) 888.00p +0.62%
Imperial Tobacco Group (IMT) 3,108.00p +0.36%
Smith & Nephew (SN.) 1,195.00p +0.34%
Rio Tinto (RIO) 2,901.50p +0.24%
Centrica (CNA) 288.30p +0.24%
Aggreko (AGK) 1,534.00p +0.20%
FTSE 100 - Fallers
Weir Group (WEIR) 1,607.00p -4.17%
Royal Dutch Shell 'B' (RDSB) 2,178.50p -3.09%
Royal Dutch Shell 'A' (RDSA) 2,087.00p -3.09%
BP (BP.) 420.40p -2.90%
BG Group (BG.) 875.00p -2.54%
Standard Chartered (STAN) 884.80p -2.23%
Dixons Carphone (DC.) 419.50p -2.21%
Randgold Resources Ltd. (RRS) 5,470.00p -2.06%
Royal Bank of Scotland Group (RBS) 367.60p -1.95%
3i Group (III) 455.50p -1.85%
FTSE 250 - Risers
Jimmy Choo (CHOO) 177.20p +3.02%
IP Group (IPO) 230.70p +2.08%
Henderson Group (HGG) 240.00p +1.82%
Nostrum Oil & Gas (NOG) 570.00p +1.79%
De La Rue (DLAR) 520.50p +1.76%
Infinis Energy (INFI) 190.00p +1.60%
Synthomer (SYNT) 247.70p +1.18%
Brit (BRIT) 260.90p +1.12%
Card Factory (CARD) 270.00p +1.12%
Ophir Energy (OPHR) 127.20p +1.03%
FTSE 250 - Fallers
Afren (AFR) 4.03p -14.26%
Centamin (DI) (CEY) 65.45p -4.80%
Kaz Minerals (KAZ) 185.10p -3.64%
Soco International (SIA) 269.90p -3.61%
Vedanta Resources (VED) 377.90p -3.00%
Amec Foster Wheeler (AMFW) 808.00p -2.94%
Euromoney Institutional Investor (ERM) 1,047.00p -2.88%
Hunting (HTG) 402.90p -2.85%
Evraz (EVR) 172.60p -2.82% |
| | UK Event Calendar | | Thursday 29 January
INTERIMS
Angle, CPL Resources, Filtronic, Hansard Global, Haynes Publishing Group, Kofax Limited (DI), Rank Group, Renishaw
INTERIM DIVIDEND PAYMENT DATE
Dairy Crest Group
INTERIM EX-DIVIDEND DATE
Anite, Blackstone/GSO Loan Financing Limited, Conviviality Retail , Downing One VCT , Fair Oaks Income Fund Limited , IG Group Holdings, NCC Group, Pennon Group, Puma High Income VCT , Puma Vct 8, Puma VCT 9, Puma Vct VII, red24, Zibao Metals Recycling Holdings
QUARTERLY EX-DIVIDEND DATE
Merchants Trust
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Business Climate Indicator (EU) (10:00)
Continuing Claims (US) (13:30)
Economic Sentiment Indicator (EU) (10:00)
Initial Jobless Claims (US) (13:30)
M3 Money Supply (EU) (09:00)
Pending Homes Sales (US) (15:00)
Q2
Kofax Limited (DI)
Q4
Royal Dutch Shell 'A', Samsung Electronics Co Ltd (ATT) GDR (Reg S)
FINALS
Kcell Joint Stock Co GDR (Reg S), Royal Dutch Shell 'A', Skandinaviska Enskilda Banken
IMSS
Euromoney Institutional Investor, Great Portland Estates, PayPoint
AGMS
Baobab Resources, Boxhill Technologies , easyHotel, Edinburgh Worldwide Inv Trust, Euromoney Institutional Investor, ITE Group, JPMorgan Indian Investment Trust, Lonmin, Mitchells & Butlers, MXC Capital, Premier African Minerals Ltd, Redefine International
UK ECONOMIC ANNOUNCEMENTS
CBI Distributive Trades Surveys (11:00)
FINAL DIVIDEND PAYMENT DATE
WH Smith
FINAL EX-DIVIDEND DATE
Blackrock Frontiers Investment Trust, Cardiff Property, Fenner, Renew Holdings, RWS Holdings, Titon Holdings, Tracsis |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks slide on oil majors' results European stocks declined as a slew of energy companies fell on weak financial results. Royal Dutch Shell slumped as it said it will cut spending after reporting worse-than-forecast fourth-quarter profit. Vallourec SA edged lower after saying it will write down the value of assets by as much as €1.2bn. Repsol SA dropped after ending its buyback programme.
Oil prices have fallen by almost 60% since June due in part to the boom in US shale production. Brent crude rose 0.14% to $48.54 per barrel in morning trade, according to the ICE.
German unemployment
German unemployment fell 9,000 in January, less than the 10,000 drop that was predicted. The jobless rate fell to 6.5% in January however, down from the 6.6% revised figure for December.
Separately, a report on German consumer prices at 13:00 GMT is forecast to reveal a 0.1% drop in January after a 0.2% gain in December. The figures come amid concerns about the risk of deflation in the euro-area.
The European Central Bank this month announced a major quantitative easing programme to help move inflation closer to its target of just below 2%.
Another release is expected to show the Eurozone consumer confidence index fell slightly to 101.6 in January from 1007 in December.
In other euro-news, the Italian parliament will begin voting for a new head of state on Thursday. The election of a new president to replace 89-year-old Giorgio Napolitano, who resigned this month, will begin at 2pm GMT.
The euro rose 0.10% to $1.1298.
Later on, the US sees the release of reports on initial jobless claims and pending home sales.
The Federal Reserve last night decided to keep interest rates unchanged at 0.25%, saying it would not raise borrowing costs any earlier than June.
In corporate news, Nokia Oyj slipped after saying that profitability is likely to fall this quarter. |
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| | US Market Report | | US close: Markets decline after Fed statement as oil prices sink US stocks slid on Wednesday, after the Federal Reserve's policy-making committee reiterated it plans to remain patient and watch the data as it decides when to raise interest rates. The Dow Jones Industrial Average closed 195.84 points down at 17,191.37, while the S&P 500 and the Nasdaq ended the session down 1.35% and 0.93% respectively.
As expected, the Fed maintained its stance on the interest rates, saying it "can be patient in beginning to normalise the stance of monetary policy".
That language is widely interpreted as meaning that the Fed won't begin to hike rates from near-zero for at least another two Federal Open Market Committee meetings.
"The bigger picture is still that stronger economic growth and lower unemployment will eventually put more upward pressure on prices and wages," analysts at Capital Economics said in a note.
"Accordingly, we still expect a June lift-off, with the fed funds rate reaching a target of between 1.00% and 1.25% by end-2015 and 2.75% to 3.00% by end-2016. That implies a considerably more aggressive tightening that either Fed officials or the markets currently anticipate."
Some experts went as far as suggesting they feared interest rates might not be raised in September, as inflation remains too low.
"There are fears inflation is too low to even think about raising interest rates, but we still expect rates to rise in mid-2015 in line with the long-term strategy of Yellen and her Fed colleagues," said Dennis de Jong, managing director at UFX.com.
In corporate news, Apple shares soared 6.13% after the company said late on Tuesday night that it had sold 74.5m iPhones in the first quarter and profit rose 38% to a record high.
Boeing rose 5.40% after the company's fourth-quarter earnings beat forecasts, while US Steel surged 10.86% after the steel producer's earnings beat analysts' expectations.
Abiomed Inc. jumped 29.17% after the medical device maker posted earnings that were much better of Wall Street estimates, while Yahoo! declined 3.08% after jumping as rising as much as 7% after the bell on Tuesday when it announced it intends to spin off its stake in Alibaba.
Energy stocks suffered heavy losses as oil prices fell over 3%, with Denbury Resources and Cabot OIl & Gas Corp losing 9.38% and 4.88% respectively.
Oil prices tumbled after a larger-than-expected increase in US crude supplies kept inventories at their highest level in 80 years. CrudeWest Texas Intermediate crude plunged 4.5% to $44.24 a barrel, while Brent shed over 2% and ended the session at $48.44 a barrel.
Gold futures fell 0.5% to 1,284.70, while the dollar gained 0.2% against the pound and 0.7% against the euro but lost 0.3% against the yen.
S&P 500 - Risers
Electronic Arts Inc. (EA) $54.59 +12.77%
United States Steel Corp. (X) $23.58 +10.86%
Total System Services Inc. (TSS) $36.42 +6.43%
Apple Inc. (AAPL) $115.31 +5.65%
Boeing Co. (BA) $139.64 +5.40%
TE Connectivity Ltd (TEL) $67.45 +4.36%
Juniper Networks Inc. (JNPR) $22.65 +3.76%
Western Digital Corp. (WDC) $99.83 +2.25%
Mattel Inc. (MAT) $26.99 +1.81%
Adt Corp (ADT) $34.38 +1.75%
S&P 500 - Fallers
Nabors Industries Ltd. (NBR) $10.49 -11.70%
Denbury Resources Inc. (DNR) $6.47 -9.38%
Hess Corp. (HES) $66.02 -7.81%
National Oilwell Varco Inc. (NOV) $53.53 -7.23%
Murphy Oil Corp. (MUR) $43.40 -7.23%
Noble Corporation plc (NE) $15.98 -7.09%
Pioneer Natural Resources Co. (PXD) $144.55 -6.81%
Helmerich & Payne Inc. (HP) $59.67 -6.49%
QEP Resources Inc (QEP) $19.54 -6.01%
Devon Energy Corp. (DVN) $58.43 -5.91%
Dow Jones I.A - Risers
Boeing Co. (BA) $139.64 +5.40%
Caterpillar Inc. (CAT) $80.01 +0.20%
3M Co. (MMM) $163.94 +0.19%
Dow Jones I.A - Fallers
Chevron Corp. (CVX) $103.71 -4.20%
Microsoft Corp. (MSFT) $41.19 -3.45%
Exxon Mobil Corp. (XOM) $87.95 -3.30%
JP Morgan Chase & Co. (JPM) $54.75 -2.58%
General Electric Co. (GE) $23.84 -2.21%
E.I. du Pont de Nemours and Co. (DD) $71.71 -2.01%
Pfizer Inc. (PFE) $31.95 -1.99%
Goldman Sachs Group Inc. (GS) $173.05 -1.95%
United Technologies Corp. (UTX) $116.92 -1.88%
Visa Inc. (V) $246.36 -1.84%
Nasdaq 100 - Risers
Apple Inc. (AAPL) $115.31 +5.65%
Western Digital Corp. (WDC) $99.83 +2.25%
Mattel Inc. (MAT) $26.99 +1.81%
Nxp Semiconductors Nv (NXPI) $79.13 +1.41%
Activision Blizzard Inc. (ATVI) $20.67 +0.98%
Seagate Technology Plc (STX) $57.53 +0.81%
Facebook Inc. (FB) $76.24 +0.61%
Monster Beverage Corp (MNST) $119.21 +0.34%
Avago Technologies Ltd. (AVGO) $105.00 +0.20%
O'Reilly Automotive Inc. (ORLY) $191.27 +0.16%
Nasdaq 100 - Fallers
Vimpelcom Ltd Ads (VIP) $3.44 -4.71%
Charter Communications Inc. (CHTR) $150.60 -3.72%
Microsoft Corp. (MSFT) $41.19 -3.45%
Tesla Motors Inc (TSLA) $199.22 -3.28%
Liberty Media Corporation - Class A (LMCA) $34.32 -3.24%
Yahoo! Inc. (YHOO) $46.44 -3.23%
Baidu Inc. (BIDU) $220.31 -3.17%
Comcast Corp. (CMCSA) $54.59 -3.13%
Autodesk Inc. (ADSK) $54.59 -2.78% |
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| | Newspaper Round Up | | Thursday newspaper round-up: Tesco, Mark Carney, McDonald's... Tesco chief executive Dave Lewis revealed the names of 43 Tesco stores that will be closed down in an attempt to reduce overheads, said the City A.M. The chain revealed it will close 30 convenience stores, including 18 express outlets and 12 inner-city Metro shops. The closures are spread across the UK and will occur 15 March and 4 April. Bank of England governor Mark Carney has attacked German austerity, according to The Times, by warning that unless wealthy states help poorer countries, the Eurozone may become trapped in "another lost decade".
After the company recorded its first sales drop in 12 years, McDonald's has appointed a new chief executive. The Guardian said that Don Thompson will step down as president and chief executive on 1 March to be replaced by British businessman Steve Easterbrook.
British defence secretary Michael Fallon has revealed the armed forces will sell-off its surplus land, barracks and equipment to boost front-line funds, The Telegraph reported.
Greece's new left-wing prime minister Alexis Tsipras may take on the EU on Thursday in regard to its stance on Russia, according to The Times. It is believed Athens may threaten to veto when EU ministers gather in Brussels to discuss stiffening sanctions against Moscow, prompted by recent fighting in the eastern Ukraine.
The Tories will have to slash the welfare budget a further £21bn post-election to keep up with the pensions bill, the Daily Mail reported on Thursday.
According to The Independent, the British public was the second-most satisfied with the NHS it has ever been in 2014. The data revealed in a new survey indicated that high waiting times and more pressure on A&E services have done nothing to sway people's faith in the national health service.
Former French president Nicolas Sarkozy uses tax-payer money to fund his office, car, security and even his dry-cleaning bills to the tune of €2.2 m each year, according to The Times. Outraged campaigners have claimed that Sarkozy and two other French presidents Valéry Giscard d'Estaing and Jacques Chirac cost France €6.2m every year.
Hundreds of millions of pounds worth of British public funds have been passed on to an aid agency accused of paying international criminals according to a government spending watchdog, The Guardian wrote. | | |
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