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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: Greek concerns send UK stocks to three-week low UK stocks fell on Monday, dropping to their lowest in three weeks, as renewed concerns about Greece weighed on sentiment.
London's FTSE 100 finished down 0.51% at 6,876.47 by the end of trading on the back of losses in the real estate and construction sectors. The index has not closed below this level since 16 February.
Greece's new government has threatened that they could call a referendum or have early elections if the Eurozone rejects its proposed reforms.
"We are not attached to our posts. If needed, if we encounter implacability, we will resort to the Greek people either through elections or a referendum," said finance minister Yanis Varoufakis.
These fears saw Greece's 10-year bond yields rise by a staggering 67 basis points to 10.08% by Monday afternoon.
In contrast, yields across the wider Eurozone were lower as the European Central Bank kicked off its landmark bond-buying programme. The bank last week confirmed that its long-awaited scheme to buy up to €1.1tn of government bonds until September 2016 and beyond would start on Monday.
In economic data, China's trade surplus rose to a record $60.62bn in February, compared with $60bn in January. This increase came after a 48.3% year-on-year surge in exports and a 20.5% drop in imports, compared with expectations of +14% and -10% respectively.
Meanwhile, the German trade surplus shrank to €19.7bn in January from €21.6bn the month before as exports fell 2.1% and imports declined 0.3%.
The Sentix Eurozone investor confidence index rose to a seven-year high of 18.6 in March, up from 12.4 in February and ahead of the 15 consensus estimate.
Real estate and CRH provide a drag
Property stocks including Land Securities, British Land and St Modwen Properties were out of favour on Monday as gilt yields rose. Higher yields on low-risk UK bonds typically reduce the attractiveness of income stocks such as those in the real estate sector.
Increased speculation about an earlier-than-anticipated rate rise by the Federal Reserve after last week's strong US jobs report also dampened the share price of building materials group CRH, which is heavily exposed to the American economy. On 6 March the yield differential on 10-year Gilts versus their German equivalent reached its greatest level since 1997 on the heels of a strong US jobs report.
CRH was also likely weighed down by new hurdles in the proposed merger between Holcim and Lafarge - CRH's planned acquisition of €6.5bn of assets from the two cement giants is conditional on their tie-up completing.
Standard Chartered gained after Exane BNP Paribas raised its target on the stock and amid speculation that the company could move its global headquarters.
However, others in the banking sector such as Lloyds, RBS, Barclays and HSBC were trading in the red. The latter was the object of negative coverage in the FT Weekend.
WPP, the world's biggest advertising company, rose after beating expectations with a record ?1.5bn annual profit in 2014, up 12% on the previous year. Revenues were up nearly 5% at ?11.6bn, though currency movements weighed on growth. |
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| | Market Movers
techMARK 3,149.39 -0.55%
FTSE 100 6,876.47 -0.51%
FTSE 250 17,167.07 -0.61% FTSE 100 - Risers
Weir Group (WEIR) 1,887.00p +4.08%
Glencore (GLEN) 296.90p +2.56%
Standard Chartered (STAN) 1,044.00p +1.95%
easyJet (EZJ) 1,702.00p +1.31%
Legal & General Group (LGEN) 283.90p +1.18%
WPP (WPP) 1,559.00p +1.17%
Morrison (Wm) Supermarkets (MRW) 208.20p +1.07%
Smiths Group (SMIN) 1,191.00p +1.02%
Rolls-Royce Holdings (RR.) 995.50p +0.86%
Centrica (CNA) 243.90p +0.79%
FTSE 100 - Fallers
CRH (CRH) 1,727.00p -3.90%
Experian (EXPN) 1,160.00p -2.27%
Royal Bank of Scotland Group (RBS) 367.80p -2.21%
Land Securities Group (LAND) 1,239.00p -2.06%
Travis Perkins (TPK) 1,969.00p -2.04%
Tullow Oil (TLW) 346.10p -2.01%
Schroders (SDR) 3,090.00p -1.94%
Associated British Foods (ABF) 3,069.00p -1.92%
Aggreko (AGK) 1,568.00p -1.88%
British American Tobacco (BATS) 3,756.00p -1.82%
FTSE 250 - Risers
Game Digital (GMD) 274.90p +5.33%
Betfair Group (BET) 2,156.00p +4.36%
Jardine Lloyd Thompson Group (JLT) 993.00p +3.55%
NMC Health (NMC) 630.00p +2.86%
Spire Healthcare Group (SPI) 334.00p +2.77%
Ocado Group (OCDO) 370.50p +2.63%
Entertainment One Limited (ETO) 292.60p +2.56%
Synthomer (SYNT) 294.00p +2.44%
National Express Group (NEX) 285.80p +2.04%
Hunting (HTG) 507.50p +1.97%
FTSE 250 - Fallers
Afren (AFR) 5.47p -8.07%
Polymetal International (POLY) 522.50p -4.13%
Big Yellow Group (BYG) 620.00p -3.95%
Centamin (DI) (CEY) 57.45p -3.69%
Lonmin (LMI) 126.30p -3.44%
Tullett Prebon (TLPR) 365.00p -3.18%
St. Modwen Properties (SMP) 449.00p -3.00%
BBA Aviation (BBA) 334.90p -2.93%
Hikma Pharmaceuticals (HIK) 2,331.00p -2.71% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks little changed as Greece urged to act on reforms European stocks were little changed as the head of Eurogroup urged Greece to "stop wasting time" on reforms.
Speaking before a meeting of Eurozone finance ministers on Monday, Jeroen Dijsselbloem said Greece needs to crack on with reforms to secure aid from international creditors.
"Little has been done since the last Eurogroup [meeting two weeks ago] in terms of talks, in terms of implementation ," Dijsselbloem said.
"We have to stop wasting time and really start talks seriously," he said, adding that Eurozone partners stood ready to support Greece if it continued on the economic reform path.
Greek Finance Minister Yanis Varoufakis has said Greece could call a referendum or have early elections if Eurozone partners reject its debt plans.
Meanwhile, the European Central Bank (ECB) on Monday began its €1.1trn quantitative easing programme which will run through September 2016 at €60bn a month. Purchases included bonds from at least five countries at between €15m and €50m, Bloomberg reported. The yield on Germany's 10-year bunds fell the most in six weeks, down eight basis points to 0.31% at 14:44 GMT.
"The failure to find consensus over the latest set of Greek proposals at Monday's Eurogroup meeting tempered the enthusiasm in European markets surrounding the first day of quantitative easing from the ECB," said Jasper Lawler, market analyst at CMC Markets.
"Uncertainty surrounding Greece and the latest trade data from China left European shares mixed on Monday."
China's monthly trade surplus hit a record $60.6bn in February, as exports grew and imports slid. Exports grew 48.3% year-on-year to $169.2bn, and the value of imports declined by a fifth to $108.6bn. The data pushed mining stocks higher including Glencore, Randgold and Fresnillo.
Germany's trade surplus contracted to €19.7bn in January from December's €21bn, just below forecasts for €19.8bn. Exports fell 2.1% in January to a seasonally adjusted €96.3bn, according to Destatis. Imports dropped just 0.3% to €76.6bn.
Eurozone investor confidence reached its highest level since August 2007 in March, according to a report by market research group Sentix. Sentix said its index of investor confidence rose to 18.6 this month, from a reading of 12.4 in February, exceeding analysts' expectations of a 15.0 reading.
Italian lenders rally
Italian lenders jumped after Goldman Sachs wrote in a note that an Italian bank-reform bill will result in a raft of mergers. Banca Popolare dell'Emilia Romagna SC and Banca Popolare di Milano Scarl were among the big risers.
Holcim's largest stakeholder, Thomas Schmidheiny, told SonntagsZeitung he wanted a better deal for the Swiss cement maker in any merger with France's Lafarge. Holcim's shares advanced while Lafarge declined.
Barclays and Deutsche Bank slumped after the Financial Times reported that traders at both banks are being interviewed by the Serious Fraud Office as part of its investigation into the alleged rigging of the Euribor market.
Italy's Generali gained after Il Sole 24 Ore said it might pay a larger dividend than the €0.58 per share currently expected by markets.
Banking group StanChart was in demand amid speculation it could move its global headquarters to Asia and spin off its Indian business.
In commodities, Brent crude fell 1.1% to $59.08 per barrel at close of trading, according to the ICE, as the dollar strengthened and a supply glut sent global oil inventories higher. |
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| | US Market Report | | US open: Wall Street marks sixth year of bull market with gains US markets showed strong character on Monday, recovering the previous session's losses thanks to deal activity in the materials and real estate sector.
The Dow Jones Industrial Average rose 0.6% to 17,967 while the S&500 added around 0.3% to 2,076. The tech-rich Nasdaq index was flat at 4,400 with Apple leading the gains ahead of the unveiling of a product later on Monday.
Press speculation suggests Apple is launching its smart watch. The company is expected to outline details such as price and launch date of the gadget at the highly anticipated event. Apple shares rose as much as 1% ahead of the event.
Deal news lifted the market's confidence. Alcoa, the world's largest aluminium producer, said it would buy RTI International Metals for $1.5bn. Alcoa shares lost 5% to $13.77 but RTI shares rallied as much as 41% to $38.33.
Elsewhere, Simon Property Group offered to buy Macerich Co for $22.4bn. Macerich rose 6% to 91.86 while Simon Property was up 1% to $181.51.
Wall Street on Monday officially marked the sixth year of its bull market as it recovered from Friday's losses which followed a strong US monthly jobs report in which the country added 295,000 jobs in February and the unemployment rate edged down to 5.5% from 5.7%.
Friday's declines came as investors took profits on concerns that a strong US jobs report could mean the Federal Reserve will hike interest rates much earlier than expected. However by Monday, traders took the opportunity to snap up some bargains following previous session losses.
"With the equity market still very much reliant on central bank liquidity, the hawkish interpretation of the data cheapened stocks by some 1% on average by the close in the States," said David White, analyst at Spreadex.
With a lack of economic data on the menu, markets were left digesting the day's corporate news. McDonald's shares rose 0.9% despite the company reporting same-store sales fell more than expected in February. The company said the drop in US sales was due to "ongoing aggressive" activity in the fast food sector.
General Motors shares rose 3.3% to $37.70 after it said it plans a new, $5bn share buyback in an agreement with dissident investors, and put forward more details on capital allocation that promises investors the potential for further cash returns.
Elsewhere in the autos market, Tesla shares were down 2% after The Wall Street Journal reported planned job cuts in China as the automaker feels the pressure of reduced demand from the world's second-largest economy.
In other assets, Nymex crude prices rose 2.2% to $50.44 a barrel after OPEC Secretary-General Abdalla El-Badri over the weekend said he expects the global oil market to rebalance by the second half of the year as demand grows and producers slash output. |
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| | Broker Tips | | Broker tips: Shell, ITV, RSA Insurance, G4S UBS said it sees less upside at Royal Dutch Shell as it lowered its recommendation on the oil major from 'buy' to 'neutral'.
"Through [recent] outperformance and the more aggressive response to the challenging environment among some peers we see the shares as offering less relative value and hence are cutting the rating," UBS said as it lowered its target for the shares from 2,400p to 2,130p.
ITV's share price was given a boost on Monday by Westhouse Securities which upgraded its stance on the shares from 'neutral' to 'add' after an "impressive" performance by the broadcaster and producers in 2014.
"We remain bullish on the group's fundamentals, have materially increased our [earnings] and [dividend] forecasts and expect attractive growth in these metrics with the former also likely to be boosted by acquisitions," said analyst Roddy Davidson, as he raised his target from 228p to 267p.
Credit Suisse has lowered its target for RSA Insurance from 525p to 475p after "disappointing" 2014 results from the company last month, though it still maintained an 'outperform' rating on the stock.
"Despite limited near-term excitement, we continue to see medium to longer term risks to the upside. This could be derived from further clean-up of legacy items, a reversal of recent headwinds in terms of FX and bond yields, and potential for M&A."
Shares in security group G4S remain expensive, according to Deutsche Bank, but a lack of clear negative catalysts has prompted the broker to lift its rating from 'sell' to 'hold'. | | |
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