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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: Late rally not enough as UK stocks fall on election day Stocks rallied off five-week lows on Thursday afternoon but still finished firmly in the red, as election-day jitters in the UK and volatility in the European bond markets weighed on sentiment. The FTSE 100 ended the session down 0.67% at 6,886.95 having dropped as much as 1.8% in the morning session to an intraday low of 6,810.05 - its lowest intraday level since 2 April when it touched 6,801.27.
"European stock markets were left a little out of breath on Thursday as government bond markets pulled a full 180 degree turn from savage losses to a sizeable move higher," said analyst Jasper Lawler from CMC Markets.
German bunds in particular rose as much as 20 basis points during the session, but pared gains as falling crude prices "tempered the inflation fears that have caused a massive jump in bond yields this week", Lawler said. Brent oil futures were down 1.9% at $66.47 barrel by the end of the day.
The mood on the market was also dampened by comments from German finance minister Wolfgang Schaeuble who said that hopes for a breakthrough on Greece at the Eurogroup meeting on Monday are not high. "One shouldn't assume any kind of spectacular results," he said.
Election uncertainty takes hold
With less than five hours to go before voting ends and exit poll results are released, investors were showing caution amid uncertainty over which party/parties will come out in the UK general election.
"It's the closest-fought race in many years and as such it will take a while to understand how the government will be formed and the ramifications of the probable coalition will not be immediately known," said Brenda Kelly, head analyst at London Capital Group.
Societe Generale on Thursday recommended investors to steer clear of UK equities even beyond the election, despite their recent underperformance. The bank cited fading growth momentum, currency swings and high exposure to the oil and gas sector as three reasons why the market is unattractive.
Morrisons sinks as sales decline, Telecity jumps
Morrisons was the standout mover of the day on Thursday as investors reacted to deteriorating sales trends at the grocer in its first quarter. Like-for-like sales dropped 2.9% in its first three months of the fiscal year, compared with a lesser 2.6% fall in the fourth quarter. Results were not as bad as many had feared, but that didn't stop the stock from dropping 6.5%.
Despite posting some slightly disappointing first-quarter results, datacentres group Telecity was leading the risers on the FTSE 250 after receiving a £2.32bn takeover offer from Equinix at 1,145p per share in cash and equity, a 27% premium to the closing price on Wednesday.
Mining stocks were also weaker as risk appetite waned on the back of political uncertainty in the UK. The decision by the world's largest steel producer, ArcelorMittal, to cut its profit forecasts for 2015 was also likely hitting shares in the sector. Anglo American, BHP Billiton and Fresnillo were all on the decline.
Falling crude prices were also having a negative effect on shares of oil majors BP and Shell.
Airlines Easyjet and IAG were in demand after reporting traffic growth for April in spite of air-traffic control strikes in France which led to hundreds of cancellations. Easyjet in particular cancelled 602 flights last month, compared with just 48 in April 2014.
Insurance group RSA impressed investors with a positive start to the year as underlying premium income returned to modest growth, though reported results were dented by the strength of the pound.
BT erased an earlier gain despite the telecoms giant's annual profits beating City forecasts for earnings and cash flow as it added a record number of new broadband customers in the fourth quarter.
Market Movers
techMARK 3,196.00 +0.06%
FTSE 100 6,886.95 -0.67%
FTSE 250 17,447.96 +0.21% |
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| | FTSE 100 - Risers
Carnival (CCL) 3,011.00p +3.72%
SABMiller (SAB) 3,531.00p +3.65%
Aberdeen Asset Management (ADN) 445.30p +3.29%
International Consolidated Airlines Group SA (CDI) (IAG) 562.00p +3.12%
easyJet (EZJ) 1,821.00p +2.71%
Aviva (AV.) 527.00p +2.63%
Taylor Wimpey (TW.) 166.00p +2.41%
RSA Insurance Group (RSA) 427.30p +2.22%
Pearson (PSON) 1,309.00p +1.55%
Dixons Carphone (DC.) 437.20p +1.42%
FTSE 100 - Fallers
Morrison (Wm) Supermarkets (MRW) 176.90p -6.55%
GlaxoSmithKline (GSK) 1,447.00p -4.46%
Anglo American (AAL) 1,107.00p -4.03%
BHP Billiton (BLT) 1,538.00p -3.54%
Admiral Group (ADM) 1,496.00p -3.48%
BP (BP.) 457.10p -3.42%
Fresnillo (FRES) 704.00p -3.36%
Randgold Resources Ltd. (RRS) 4,775.00p -2.83%
Smiths Group (SMIN) 1,123.00p -2.69%
Weir Group (WEIR) 1,861.00p -2.57%
FTSE 250 - Risers
Telecity Group (TCY) 1,095.00p +21.73%
PayPoint (PAY) 858.00p +7.32%
Diploma (DPLM) 802.00p +5.74%
Genus (GNS) 1,345.00p +5.57%
Just Eat (JE.) 496.10p +3.96%
Man Group (EMG) 179.00p +3.53%
Moneysupermarket.com Group (MONY) 293.50p +3.42%
Wetherspoon (J.D.) (JDW) 788.50p +3.14%
FirstGroup (FGP) 103.10p +2.69%
TalkTalk Telecom Group (TALK) 372.70p +2.62%
FTSE 250 - Fallers
Tullow Oil (TLW) 405.60p -5.61%
Petrofac Ltd. (PFC) 838.00p -5.42%
Lonmin (LMI) 143.50p -4.90%
Allied Minds (ALM) 590.00p -4.84%
Premier Oil (PMO) 176.00p -4.81%
Kaz Minerals (KAZ) 247.50p -4.55%
Soco International (SIA) 188.80p -4.50%
IMI (IMI) 1,187.00p -4.27%
Hunting (HTG) 586.50p -4.24% |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Equities mixed on UK general election European equity indices were mixed as UK residents voted in the general election in what is expected to result in a hung parliament.
The latest polls show the outcome of the general election is to close to call between the Conservatives and Labour.
Many analysts predict a hung parliament with neither party likely to receive enough votes to rule by majority after voting polls close at 22:00.
"Election Day uncertainty has created hesitancy in markets rather than outright fear of the unknown," said Jasper Lawler, market analyst at CMC Markets. "There's hardly been a tidal wave of selling but seemingly an unwillingness to jump in with two feet to any stocks until the election result is known."
Meanwhile, Greece's government has said it expects its creditors to make concessions on a deal as it is sticking to its guns on labour and pension issues. Government spokesman Gabriel Sakellaridis said further cuts to pension payment and reforms making it easier to sack employees were non-negotiable "red lines" the leftist party refused to cross.
Separately, European Commission President Jean-Claude Juncker said on Thursday he would not raise the possibility of Greece leaving the Eurozone.
Eurozone finance ministers are meeting on Monday to try to resolve the crisis but Greece's lenders have ruled out any headway on the talks.
In economic data, German factory orders rose 1.9% year-on-year in March, as expected. Markit releases its purchasing managers' index on Eurozone retail activity at 09:10 London time.
The euro fell 0.55% to $1.1285 at 17:00 London time.
European bond prices declined, sending investor returns higher, with traders divided on what cause the widespread sell-off. Some pointed to the bond-buying programme the European Central Bank (ECB) launched in March.
Stateside, initial jobless claims increased to 265,000 in the week to 2 May from 262,000 the previous week, less than the 279,000 claims estimated.
Alcatel-Lucent gains
Alcatel-Lucent advanced after revealing adjusted operating income more than doubled in the first quarter.
Siemens AG declined after the European engineering company reported profit that trailed analysts' estimates and said it will cut another 4,500 jobs.
Adecco SA slumped after announcing the departure of its chief executive and chief financial officer.
Tecnologica SA jumped after the Spanish wind-turbine maker said first-quarter profit more than tripled compared to a year ago.
Telecity Group was a high riser after Equinix Inc. made a £2.3bn takeover approach for the UK data-centre operator. |
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| | US Market Report | | US open: Stocks fall as Evans rate-hike comments worry investors New York stocks were mostly lower in early trading on Thursday as investors digested positive jobless claims data and concerns about an imminent rate hike. After an hour into the session, the Dow Jones Industrial Average was down 0.11%, the Nasdaq gained 0.03% while the S&P 500 slipped 0.15%.
Comments from Federal Reserve policymaker Charles Evans were being closely monitored by investors after he said that the central bank could lift interest rates at any meeting.
"We are going into each meeting from now on talking about what the policy rate should be and at the end of every meeting, it's possible that we'll decide to begin the renormalisation process," he said in an interview on CNBC.
Nevertheless, he reiterated his call for the Fed to wait until 2016 to tighten policy.
Analysts also said market sentiment was also dampened by renewed losses in European sovereign debt markets and the recent rally in oil futures and what that might mean for inflation in the Eurozone.
Jobless claims data impresses
In economic data, initial unemployment claims rose by 3,000 to 265,000 over the week ended on 2 May, according to the Department of Labour, less than the 278,000 expected by the market.
Continuing unemployment claims for the previous week ended 25 April, including those which have not been filed for the first time, slipped by 28,000 to a new 15-year low of 2.228m.
Labour-market data was under the spotlight ahead of the all-important US unemployment report due Friday which is expected to show a 230,000 increase in non-farm payrolls last month, nearly double the 126,000 registered in March.
However, analyst Jesse Hurwitz from Barclays said: "The solid progress in labour market separations evidenced in this morning's report, for both initial and continuing unemployment, supports our view that non-farm payroll growth should recover to 250k in tomorrow's April employment report."
Whole Foods losing its flavour
Whole Foods Market tanked nearly 11% after leaving investors less than satisfied. Overnight, the company reported second-quarter sales of $3.65bn, up from $3.32bn in the same period of last year but short of the $3.71bn expected by analysts.
Stock in internet retailer Alibaba surged 7% after the company beat profit and revenues estimates for its fiscal fourth quarter. |
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| | Broker Tips | | Broker tips: Morrisons, GKN, Randgold Shares in Morrisons plunged on Thursday after the grocer reported a worsening of like-for-like sales trends in the first quarter, though analysts at Shore Capital remained upbeat with a 'buy' rating. The broker admitted that the company has a long way to go in its turnaround efforts, but the new chief executive David Potts is taking the right steps to improve the business. The broker said that it is still very early in Potts' tenure "but we sense he is bringing a deep rooted and fundamental change to Morrison's that is for the better".
Credit Suisse has lowered its estimates for GKN but has said that the positives still outweigh the negatives at the engineering group, keeping an 'outperform' rating.
"Following the Q1 trading update we make small forecast changes to reflect current FX rates, a slower than forecast start to the year at Driveline and the earlier than expected impact of the step down in the A330 build rate," the bank said. It has lowered its 2015 and 2016 earnings per share forecasts by 2% and 3%, respectively.
While some people believe that growth at Randgold Resources may come to a standstill, Investec said it isn't one of them. The broker kept a 'hold' rating and 5,163p target on the stock. | | |
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