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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 come off intraday highs as US data disappoints UK stocks trimmed earlier gains by the close after a weak start on Wall Street, but still managed to finish in the green as markets bounced slightly following a sell-off the previous session. London's FTSE 100 finished the session up 36.46 points, or 0.54%, at 6,809.50. The index had dropped 1.7% to a two-and-a-half-week low of 6,773.04 on Tuesday.
Stocks had jumped as much as 1% during the session after manufacturing purchasing managers' indices (PMIs) from China, Europe and the UK all showed an improvement in March.
Meanwhile, weak industrial jobs figures from China added to speculation that Beijing will soon inject more stimulus measures to shore up growth.
However, US equities opened on the back foot after economic data came in lower than expected, with ADP March payrolls rising at a mediocre pace and nationwide manufacturing activity growing at its slowest rate since 2013.
"From manufacturing this morning, the focus has shifted to employment, particularly the all-important US jobs situation, with the picture looking a lot less optimistic as we head towards the Friday jobs report," said analyst Chris Beauchamp from IG.
He said that as the US approaches full employment, it will be hard for the American economy to sustain the impressive run of good jobs reports over recent months.
In other news, Brent crude futures for May delivery were up 2.7% at $56.62 a barrel in afternoon trade as talks over Iran's nuclear programme continued.
Banking stocks rise
UK domestic banks such as Barclays, Lloyds and RBS were performing well after Morgan Stanley said quantitative easing in the Eurozone could help banking commission and trading income across the sector. Lloyds was also benefiting from a ratings upgrade to 'hold' by Jefferies which forecast a "more meaningful dividend" this year.
Specialist British bank Shawbrook made a stunning stock market debut in London with shares surging to well above the top of its preset price range of 290p.
Oil major Shell was making gains after being given the green light by the US government to restart an exploration campaign in the Alaskan Arctic.
Kingfisher retreated after a well-received annual report and strategy update on Tuesday, with Nomura weighing on the shares after lowering its target from 315p to 305p, keeping a 'neutral' rating.
Asos saw profits fall by a tenth in the first half as a sharp drop in margins outweighed a strong sales performance, though results still beat analysts' expectations.
Russia-focused steelmaker Evraz surged after pledging to buy-back shares despite reporting a net loss of $1.28bn last year.
FirstGroup rose strongly after saying trading for the year to the end of March had remained in line with expectations, with progress continuing on its medium-term transformation plans.
Sportswear retailer Sports Direct was a high riser after Morgan Stanley started coverage with an 'overweight' rating, saying the business has the potential to replicate its UK success in many European markets.
Down on AIM, Nationwide Accident Repair Services surged after directors accepted a £43.2m cash takeover offer from private equity colossus Carlyle, a month after major shareholder Quindell sold its stake.
Market Movers
techMARK 3,143.88 +0.02%
FTSE 100 6,809.50 +0.54%
FTSE 250 17,123.41 +0.19% |
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| | FTSE 100 - Risers
Imperial Tobacco Group (IMT) 3,045.00p +2.77%
Barclays (BARC) 249.30p +2.76%
BG Group (BG.) 851.40p +2.70%
Fresnillo (FRES) 700.00p +2.56%
Randgold Resources Ltd. (RRS) 4,801.00p +2.30%
TUI AG Reg Shs (DI) (TUI) 1,211.00p +2.02%
Sports Direct International (SPD) 620.50p +1.89%
Aviva (AV.) 549.00p +1.67%
Friends Life Group Limited (FLG) 420.20p +1.60%
National Grid (NG.) 878.50p +1.60%
FTSE 100 - Fallers
Kingfisher (KGF) 368.00p -3.31%
Shire Plc (SHP) 5,260.00p -1.96%
Barratt Developments (BDEV) 521.00p -1.42%
WPP (WPP) 1,513.00p -1.18%
Carnival (CCL) 3,258.00p -1.15%
Standard Chartered (STAN) 1,082.00p -1.05%
Smith & Nephew (SN.) 1,132.00p -1.05%
3i Group (III) 477.40p -1.04%
Persimmon (PSN) 1,647.00p -0.96%
ARM Holdings (ARM) 1,095.00p -0.91%
FTSE 250 - Risers
FirstGroup (FGP) 97.15p +6.82%
Evraz (EVR) 197.50p +5.22%
Serco Group (SRP) 144.60p +4.86%
Cable & Wireless Communications (CWC) 63.80p +4.68%
Card Factory (CARD) 308.00p +4.30%
Marston's (MARS) 158.30p +3.94%
Go-Ahead Group (GOG) 2,413.00p +3.56%
TalkTalk Telecom Group (TALK) 355.50p +3.31%
Virgin Money Holdings (UK) (VM.) 411.00p +3.27%
Indivior (INDV) 196.10p +3.21%
FTSE 250 - Fallers
Ocado Group (OCDO) 339.40p -4.07%
NMC Health (NMC) 638.00p -3.99%
Thomas Cook Group (TCG) 141.60p -2.81%
Drax Group (DRX) 353.70p -2.80%
Imagination Technologies Group (IMG) 205.10p -2.70%
RPC Group (RPC) 564.50p -2.67%
Home Retail Group (HOME) 160.70p -2.61%
Balfour Beatty (BBY) 234.30p -2.42%
Booker Group (BOK) 142.40p -2.26% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks rally on Greek hopes, factory data European stocks ended the session on a high note amid hopes of a deal on Greek debt and after manufacturing data in the Eurozone and China beat forecasts. The Eurozone manufacturing purchasing managers' index (PMI) for March was revised to 52.2 from 51.9, ahead of estimates of 52.4. A reading above 50 signals expansion while a level below indicates contraction.
HSBC's final estimate on the Chinese PMI for manufacturing in March was revised to 49.6 from a previous estimate of 49.2, ahead of analysts' forecasts of 49.3.
A separate measure of China manufacturing also showed an improvement in March. The China Federation of Logistics and Purchasing said the PMI rose to 50.1 last month from 49.9 in February, compared to the consensus of 49.3.
UK manufacturing PMI climbed to 54.4 in March from 54 a month earlier, as expected.
In the US, ISM's manufacturing PMI fell to 51.5 in March from 52.9 in February, compared to forecasts for a reading of 52.5.
The US also saw the release of the ADP private payrolls report which showed employers added 189,000 jobs in March, missing expectations of 225,000. The data comes ahead of the all-important non-farm payrolls report on Friday.
Meanwhile, Greece remained on watch as economy minister George Stathakis told Skai TV he expects the nation to come to an agreement next week with Eurozone partners and the International Monetary Fund on a package of reforms that will unlock further aid.
Eurozone deputy finance ministers held a conference call about Greece on Wednesday.
The euro increased 0.31% to $1.0764 on hopes Greece was nearing a deal.
In commodities, Brent crude gained 3.4% to $57.06 per barrel, according to the ICE.
Companies
Asos advanced after reporting a positive outlook for the second half of the year.
Shawbrook Group was up on its first day of trading in London after raising £90m in its initial public offering.
Thyssenkrupp jumped after Societe Generale upgraded the stock to 'buy' from 'hold'.
Barry Callebaut AG rallied after reporting first-half earnings that surpassed analysts' predictions.
William Demant Holding A/S declined after UBS Group AG cut its rating on the stock to 'sell'. |
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| | US Market Report | | US open: Dow falls 160 points following disappointing ADP report US stocks declined on Wednesday as investors digested a disappointing ADP employment report, while oil prices climbed slightly. Just after 10:00 in New York, the Dow Jones Industrial Average was down 0.92%, while the S&P 500 and the Nasdaq slid 0.18% and 0.07% respectively.
The ADP report, widely seen a precursor to the monthly nonfarm payrolls report showed the US economy added 189,000 in March, short of market forecasts.
Economists had predicted that 225,000 jobs were created last month, up from 212,000 in February.
"We view the 25,000 deceleration in March ADP employment growth as consistent with our forecast for a 245,000 rise in private payrolls in Friday's employment report from the Labor Department," Barclays analysts said in a note.
As such, the US labour market's recovery was in question on Wednesday as investors worried the recent strength could soon diminish, as attention switches to the official non-farm release on Friday which economists forecast will show 245,000 positions were created in March.
"At some point the average monthly gain in payrolls is going to drop back towards 200,000," said Capital Economics' chief US economist Paul Ashworth.
"This will be heralded as a disastrous collapse by some, but it won't be anything of the sort.
"The gains of nearer 300,000 per month that we've seen over the past six months are simply unsustainable."
Eyes turned to the Institute for Supply Management's manufacturing index for March will be released, which is expected to have slipped to 52.5% from 52.9% in February.
Meanwhile, San Francisco Fed President John Williams and Atlanta Fed chief Dennis Lockhart, both voting members of the Federal Open Market Committee, are set to give talks at different events.
In company news, shares of Hewlett-Packard climbed 1.16% after Jefferies lifted the computer maker to buy, saying it sees "significant longer-term value" not reflected in the current valuation.
Twitter 2.34% rose after Jeffries initiated coverage on the stock with a 'buy' rating, while office supplier Staples climbed 0.71% after KeyBanc Capital lifted the company to 'overweight'.
Biopharmaceutical group Sarepta Therapeutics gained 6.89% after the group unveiled Edward Kaye as its interim chief executive with immediate effect.
Oil prices edged forward but remained under pressure as negotiations over Iran's nuclear programme continued in Switzerland after the deadline was extended. |
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| | Broker Tips | | Broker tips: Mining stocks, Lloyds, Rolls-Royce, Asos JPMorgan Cazenove has reduced targets across the UK mining sector after lowering its commodity forecasts, predicting further demand weakness, especially from China, in the second quarter. The broker has lowered its 2015/2016 forecasts for copper prices by 3%/6%, aluminium by 5%/9%, zinc by 4%/6% and nickel by 14%/15%. The result is a reduction in earnings estimates for a number of blue-chip mining companies, including Rio Tinto, BHP Billiton, Glencore Antofagasta and Anglo American.
Shares in Lloyds Banking Group were given a lift on Wednesday by analysts at Jefferies who said they see a better reward/risk balance at the lender, upgrading the stock from 'underperform' to 'hold'.
"A progressively rising dividend (4.2p in 2017 from 0.75p in 2014) should provide support for LLOY's premium price-to-tangible book value (P/TBV) valuation, despite a persistently material gap between so-called 'underlying' and statutory earnings and lack of earnings upgrades," Jefferies said. "Reward/risk is no longer asymmetric to the downside and we move to 'hold' as a result."
Aerospace and defence engineer Rolls-Royce has been cut to 'underperform' from 'market perform' at Bernstein who cited "emerging challenges" in two of the company's divisions.
"We believe the emerging challenges in 'Civil Aerospace' and Land & Sea (divisions) will not support the current valuation. The recent strength in share price performance does not reflect improving fundamentals of key areas of risk in the company, in our view," said Bernstein.
Asos is building momentum and making "significant progress", according to Numis Securities, after first-half results came in ahead of expectations. | | |
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