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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 default fears grip markets as UK stocks pull back from record Stocks finished lower on Thursday with UK markets retreating from a record high, as bonds yields in Athens soared on the back of concerns over a potential Greek default.
London's FTSE 100 was down 36.33 points (-0.51%) by the close at 7,060.45.
The index pulled back from Wednesday's all-time closing high of 7,096.78; it also set a record intraday high of 7,111.72 during the previous session.
Sentiment was hammered by reports that Athens made an informal approach to the International Monetary Fund about delaying loan repayments, only to be told that rescheduling was not possible. The IMF is owed nearly €1bn in two payments due in May.
"Neither the desperation from Greece in asking for an extension, nor the hard-line approach from the IMF in denying it bode well for a resolution," said CMC Markets analyst Jasper Lawler.
Meanwhile, German finance minster Wolfgang Schäuble said that an agreement between Greece and its international creditors is unlikely to be reached at the next Eurogroup meeting on 24 April. Also playing on investors' minds were reports that an advisor to the Greek government had reportedly suggested that the government may hold a referendum.
The impact was clearly being felt on the bond market, with yields on Greek two-year notes rising nearly four percentage points on the day to a record high of 27.9%. The yield on the benchmark 10-year bond rose over one percentage point to a two-year high of 12.9%.
Ex-div stocks, Telecom Plus and Petra fall
Footsie constituents BAE Systems, Hikma Pharmaceuticals, Capita, Intu Properties, Smith & Nephew and Reckitt Benckiser were all trading with heavy losses after going ex-dividend.
UBS was providing further downwards pressure on aerospace and defence group BAE after cutting the stock from 'buy' to 'neutral', saying "we do not believe there is sufficient upside potential to maintain the 'buy' rating".
On the 250 Telecom Plus shares plummeted nearly 20% after the group warned that profit growth for 2015 and 2016 will be well below market expectations as the Utility Warehouse owner unexpectedly wrote down a large amount of unbilled customer debt.
Petra Diamonds plunged 11% as the diamond mining group said its annual results are expected to fall below market forecasts due to poorer diamond grades it found at its Cullinanin mine in South Africa.
Consumer goods colossus Unilever jumped after enjoying a strong start to 2015 with underlying sales for the first quarter ahead of analysts' estimates.
Miller Lite and Grolsch maker SABMiller also rose as strong growth in Africa and Latin America helped to accelerate net producer revenue growth in the fourth quarter. Sector peer Diageo, however, fell as organic sales declined in the third quarter, surprising the market which had pencilled in an increase.
UK housebuilder Persimmon was unwanted after saying that despite an "encouraging start" to 2015, political uncertainty ahead of the elections meant it is increasingly difficult to secure planning consents for sites in the land market.
Supermarket group Morrisons dropped into the red after saying it will recruit 5,000 new staff in-store and start consultations to simplify the head office by cutting 720 roles. Meanwhile, Sainsbury's slipped on reports the retailer is planning to convert some 1.5m square foot of food space to non-food.
Market Movers
techMARK 3,221.04 -0.93%
FTSE 100 7,060.45 -0.51%
FTSE 250 17,730.27 -0.80% |
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| | FTSE 100 - Risers
Unilever (ULVR) 3,011.00p +2.62%
Aggreko (AGK) 1,621.00p +1.95%
Randgold Resources Ltd. (RRS) 5,080.00p +1.91%
Royal Dutch Shell 'A' (RDSA) 2,109.00p +1.81%
GKN (GKN) 370.60p +1.79%
Old Mutual (OML) 240.30p +1.78%
SABMiller (SAB) 3,636.00p +1.42%
British American Tobacco (BATS) 3,742.00p +1.38%
Glencore (GLEN) 302.10p +1.07%
Royal Dutch Shell 'B' (RDSB) 2,144.50p +1.06%
FTSE 100 - Fallers
Pearson (PSON) 1,370.00p -3.99%
Diageo (DGE) 1,896.50p -3.58%
Meggitt (MGGT) 546.50p -3.10%
BAE Systems (BA.) 516.00p -3.10%
Intu Properties (INTU) 353.20p -2.89%
Barratt Developments (BDEV) 529.50p -2.49%
Rio Tinto (RIO) 2,842.00p -2.40%
Sainsbury (J) (SBRY) 277.90p -2.39%
Tesco (TSCO) 241.05p -2.37%
Smith & Nephew (SN.) 1,146.00p -2.22%
FTSE 250 - Risers
Debenhams (DEB) 84.90p +6.66%
JD Sports Fashion (JD.) 562.50p +4.36%
NMC Health (NMC) 726.00p +2.91%
Infinis Energy (INFI) 190.00p +2.65%
Vedanta Resources (VED) 574.00p +1.95%
Brown (N.) Group (BWNG) 329.80p +1.63%
Poundland Group (PLND) 341.00p +1.46%
Imagination Technologies Group (IMG) 206.00p +1.43%
Redefine International (RDI) 57.80p +1.23%
FirstGroup (FGP) 103.00p +1.08%
FTSE 250 - Fallers
Telecom Plus (TEP) 785.00p -19.73%
Petra Diamonds Ltd.(DI) (PDL) 165.00p -10.47%
Amlin (AML) 483.80p -8.72%
Petrofac Ltd. (PFC) 1,024.00p -3.85%
Ophir Energy (OPHR) 160.30p -3.38%
Soco International (SIA) 182.60p -3.28%
Bovis Homes Group (BVS) 963.50p -3.12%
Grafton Group Units (GFTU) 808.00p -2.94%
Countrywide (CWD) 526.00p -2.86% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks in the red on Greek debt default fears European stocks were in the red on fears of a Greek debt default, which sent yields on debt of the Mediterranean country shooting higher. Overnight, Germany's finance minister Wolfgang Schaeuble said there was no chance Athens would achieve an agreement with creditors next week on economic reforms that would unlock further bailout funds.
On Wednesday, Standard & Poor's downgraded Greece's long-term sovereign rating to CCC+ from B-, with a negative outlook. The ratings agency said it thinks the Greek government will have exhausted its cash if there is no agreement by the time it has to cough up a €745m repayment to the International Monetary Fund (IMF) on 12 May. Greece's next payment to the IMF is due on 1 May for €200m.
The Financial Times earlier reported that Greece made an informal request to the IMF to have its repayments delayed but the fund later dismissed the claims.
"Despite the negative headlines, we think both sides still want to avoid the worst outcome," said Royal Bank of Scotland analysts.
"According to German newspaper Die Zeit, the German government is working on a plan to keep Greece inside the Eurozone even after a potential missed payment. The plan aims to ensure continued liquidity provision for Greek banks even if the sovereign misses a payment."
Greek 10-year bond yields rose by 58 basis points to hit 12.68%.
The euro rose 0.42% to $1.0729.
Elsewhere in the bloc, the European Central Bank (ECB) published its Survey of Professional Forecasters for the second quarter, which supported President Mario Draghi's assertion on Wednesday that quantitative easing is helping bring inflation back towards the monetary authority's target of just below 2%.
The survey, conducted between 31 March and 7 April 2015, revealed upward revisions by economists to their inflation expectations for 2016 and 2017 to 1.2% and 1.6% respectively, both up by one tenth of a percentage point from the previous estimate.
"Our own view is that inflation, while trending higher reflecting energy-related base effects and the impact of the weaker currency, will remain subdued overall and lower than the ECB staff projections," according to BNP Paribas analyst Luigi Speranza.
"This in turn should allow the ECB to continue its asset purchases according to plan, very much in line with Draghi's comments yesterday."
In the US, a report on housing starts showed a 2% rise in March, well below the 15.9% increase expected.
Initial jobless claims climbed to 294,000 in the week to 11 April from 282,000 a week earlier. Analysts had predicted 280,000 claims.
Holcim, SABMiller rise
Holcim climbed after a major shareholder signalled that it may vote in favour of merger of the Swiss cement maker with French rival Lafarge.
SABMiller advanced after the brewer reported quarterly beer sales that exceeded analysts' estimates.
Airbus Group NV gained after proposing a buyback of as much as 10% of its shares.
Unilever jumped after the consumer goods company reported an increase in first quarter sales that surpassed forecasts. |
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| | US Market Report | | US open: Dow declines as investors digest earnings and falling oil prices US stocks slid on Thursday, as investors digested a raft of earnings from some major firms and oil prices declined.
Just after 15:00 BST, the Dow Jones Industrial Average was down 19 points, while the S&P 500 and the Nasdaq shed five and three points respectively.
On Wednesday, better-than-expected earnings and a strong rebound in oil prices pushed benchmarks higher.
"There's been a lot of attention on the current earnings season and what impact the dollar, weather and oil prices had on profits," said Oanda's senior market analyst Craig Erlam.
"The biggest concern is the strength of the dollar and to what extent it has eroded away at overseas profits, especially as it is only likely to get stronger in the next 12 months."
Atlanta Fed President Dennis Lockhart, a voting member of the FOMC, is scheduled to speak to business leaders in Palm Beach, Florida at 18:00 BST.
Cleveland Fed President Loretta Mester will also give a speech on the economic outlook in New York, while Boston Fed President Eric Rosengren will speak in London, at 18:10 BST and 18:30 BST respectively,
Mester and Rosengren, both non-voting members of the FOMC, will be followed at 20:00 BST by Fed Vice Chairman Stanley Fischer, who is set to talk about inflation at the International Monetary Fund.
Initial US unemployment claims rose by 12,000 over the seven days ending on 11 April to reach 294,000, according to the Bureau of Labour Statistic (BLS).
"The slight uptick in initial claims is in line with the near-term volatility of the series, and we continue to view claims data as reflective of overall improvement in labor markets," analysts at Barclays said in a note.
Meanwhile, US housing starts grew by 2% month-on-month in March to reach an annualised pace of 926,000, falling below the 1.04m expected by economists.
February's tally was revised higher to show 908,000 starts, in comparison to a preliminary estimate of 897,000.
Netflix jumped after the internet television network said late on Wednesday that it added 4.88m subscribers in the first quarter, more than the 4.05m analysts had forecasted.
Philip Morris gained 4% after the tobacco giant beat profit and sales estimates and raised its full-year outlook.
UnitedHealth rose 3.4% after raising its outlook for 2015 earnings to $6.15 to $6.30 per share from $6.00 to $6.25 per share.
Citigroup rose 1.3% after earnings beat expectations, while Goldman Sachs shed 0.9% despite better-than-expected results.
Going the other way, SanDisk plunged over 8% ahead of the bell the memory-chip maker reported a drop in profit late on Wednesday.
Blackrock lost 2.5% even after its earnings beat expectations.
Oil prices relinquished the previous session's gains, with West Texas Intermediate losing 1% to $55.82 a barrel, while Brent crude fell 1.2% to $62.56 a barrel. |
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| | Broker Tips | | Broker tips: Unilever, SABMiller, BAE Systems Shore Capital has reiterated a 'buy' recommendation on Unilever after the consumer products giant beat forecasts with its first-quarter update, with the broker labelling it as a long-term winner in the FMCG sector. "Unilever's valuation sits comfortably within a basket of its global FMCG peers, and we continue to view the group as a longer-term winner with its leading emerging market exposure (which remains a major virtue despite short-term constraints), strong balance sheet and ongoing margin potential from 'maxing the mix', the focus on home care returns and ongoing operational leverage," Shirley said.
SABMiller impressed the market with a pick-up in sales growth in its fourth quarter, prompting Numis Securities to maintain a 'buy' rating on the brewing titan.
However, the broker said its positive stance on the stock is "predicated on the view that SABMiller is an industry consolidation target".
Shares in aerospace and defence group BAE Systems were trading lower on Thursday after the stock went ex-dividend, though UBS was providing further downwards pressure after cutting its rating from 'buy' to 'neutral'. | | |
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