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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: Global banks lead early gains, Aveva rockets Risk appetite in markets was muted but positive in early trading as traders' eyes turned again towards Greece given the dearth of economic data due out on Monday.
Greek banks reopened their doors and limits on cash withdrawals were relaxed slightly as the country prepared to pay back €3.5bn owed to the European Central Bank and falling due later today. The stockmarket however remained closed.
Ordinary Greeks will need the extra cash to pay for the increase in value added tax which was also set to to go in effect today, from 13% to 23% on items such as taxis and restaurant meals. In the mind of some, the harshness of such measures underline the need for the Eurozone not to be excessively ambitious in the pace of reforms asked of the country - given that maintaining political stability in the medium-term will be key. On 17 July Barclays estimated the country's GDP would shrink by 1.6% this year and 1.0% next.
As of 08:30 the Footsie was trading points 9.16 points higher to 6,784.24.
That came as German Chancellor Angela Merkel said overnight she is open to extending the maturity of Greek debt and lowering the interest the country pays on the same. However, speaking to ADR TV she was clear that debt write-downs could not be fathomed.
Acting as a backdrop, gold dropped sharply lower as markets continued to shift their attention away from events in China and Greece and back towards central banks and corporate earnings, particularly Stateside.
Economists' expectations for interest rates hikes in the UK and US have grown in recent weeks on the back of more hawkish rhetoric from central bankers. In parallel, long-term interest rates have been on the rise even as inflationary pressures remain muted and geopolitical risks arguably decline following the nuclear deal reached with Iran.
As of 0845 BST gold futures for August delivery on COMEX were at $1,114 per ounce, after trading closer to $1,100 earlier in the session, down by more than 2% from Friday's close of $1,131.40.
Data showing lower gold reserves in China were another factor weighing on the price of the yellow metal.
The Shanghai stock exchange's benchmark index finished the session up by 0.88% to reach 3,992.11 points. That followed some weakness at the intraday level, with some market commentary highlighting a move by Beijing to curb internet financing over the weekend.
If you cant beat'em, buy'em: Aveva rockets on M&A
Shares in Aveva were up by more than a quarter after engineering design firm Schneider Electric said it would acquire the firm in a reverse takeover deal, beating out rumoured rivals Emerson and General Electric.
Barclays is reportedly planning to cut more than 30,000 jobs in the next two years, just days after the bank usted chief executive Antony Jenkins. According to sources cited by the Times on Sunday, the cuts - which are seen as the only way to address the bank's underperformance and lift its share price - could take the bank's global workforce to below 100,000 by the end of 2017.
Tullow Oil said gas export from the Jubilee Field to the Ghana Gas plant at Atuabo has been suspended since 3 July due to technical issues and is expected to resume mid-August.
Aerospace and defence company Rolls-Royce announced two new deals worth more $2.23bn. The company has been selected by SAUDIA, the national carrier of Saudi Arabia to provide long-term TotalCare engine service support worth $1.3bn for Airbus A330 Regional aircraft. It's also been selected by International AirFinance Corporation to provide Trent 700 engines worth $930m for 20 Airbus A330 Regional aircraft.
Standard Chartered has announced a radical management shake-up designed to restore the fortunes of the bank.
Under the new regime, chief executive Bill Winters will take more responsibility as all heads of business units will report to him not his deputy Mike Rees, the bank said in an announcement. The restructure formed part of a previously announced goal of $1.8b in savings by the end of 2017.
British Land said it has had a good start to the year, with strong occupational demand and lettings well ahead of estimated market rental value. In its first-quarter trading update, the company said its Leadenhall Building, also known as the Cheesegrater, is now 90% full, with 107,000 square feet of new lettings and 52,000 square feet under offer. |
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| | Market Movers
techMARK 3,211.80 +0.60%
FTSE 100 6,788.52 +0.20%
FTSE 250 17,785.71 +0.17%
FTSE 100 - Risers
Standard Chartered (STAN) 1,028.00p +1.08%
HSBC Holdings (HSBA) 586.10p +1.02%
TUI AG Reg Shs (DI) (TUI) 1,113.00p +1.00%
Sage Group (SGE) 535.50p +0.94%
AstraZeneca (AZN) 4,355.50p +0.94%
Royal Dutch Shell 'B' (RDSB) 1,843.50p +0.77%
Sports Direct International (SPD) 752.50p +0.74%
Royal Dutch Shell 'A' (RDSA) 1,827.00p +0.72%
Dixons Carphone (DC.) 465.40p +0.69%
Shire Plc (SHP) 5,520.00p +0.64%
FTSE 100 - Fallers
Randgold Resources Ltd. (RRS) 3,909.00p -2.37%
Fresnillo (FRES) 642.50p -2.36%
Antofagasta (ANTO) 644.50p -1.00%
Smiths Group (SMIN) 1,148.00p -0.95%
Direct Line Insurance Group (DLG) 356.30p -0.83%
Royal Mail (RMG) 504.50p -0.79%
Anglo American (AAL) 870.80p -0.75%
BHP Billiton (BLT) 1,236.50p -0.68%
Glencore (GLEN) 241.50p -0.66%
Aviva (AV.) 532.00p -0.65%
FTSE 250 - Risers
Aveva Group (AVV) 2,257.00p +27.37%
Just Eat (JE.) 459.80p +5.00%
Aggreko (AGK) 1,505.00p +2.10%
Clarkson (CKN) 2,700.00p +1.96%
Evraz (EVR) 119.10p +1.79%
Bwin.party Digital Entertainment (BPTY) 105.80p +1.73%
Ladbrokes (LAD) 129.90p +1.72%
Virgin Money Holdings (UK) (VM.) 394.00p +1.60%
OneSavings Bank (OSB) 297.50p +1.54%
Diploma (DPLM) 782.00p +1.43%
FTSE 250 - Fallers
Acacia Mining (ACA) 266.00p -3.97%
Centamin (DI) (CEY) 56.70p -3.82%
IP Group (IPO) 195.00p -3.70%
Lonmin (LMI) 78.65p -3.14%
Homeserve (HSV) 426.90p -2.72%
Shawbrook Group (SHAW) 331.20p -1.66%
Rathbone Brothers (RAT) 2,147.64p -1.44%
Synergy Health (SYR) 1,768.00p -1.39%
Nostrum Oil & Gas (NOG) 565.50p -1.31% |
| | UK Event Calendar | | Monday July 20
INTERIMS
Michelmersh Brick Holdings, W H Ireland Group
INTERIM DIVIDEND PAYMENT DATE
Gooch & Housego, Scottish Inv Trust
QUARTERLY PAYMENT DATE
SQN Asset Finance Income Fund Limited
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Balance of Payments (EU) (09:00)
Current Account (EU) (09:00)
Producer Price Index (GER) (07:00)
FINALS
Schroder Real Estate Investment Trust Ltd
SPECIAL DIVIDEND PAYMENT DATE
LondonMetric Property
AGMS
All Asia Asset Capital Limited (DI), Aquatic Foods Group , Ashmore Global Opportunities Limited GBP , Ensor Holdings, GTS Chemical Holdings , Lead All Investments Ltd (DI), Origo Partners , Quintain Estates & Development, Rame Energy
UK ECONOMIC ANNOUNCEMENTS
Trends in Lending (09:30)
FINAL DIVIDEND PAYMENT DATE
Downing Planned Exit VCT 6, Downing Planned Exit VCT 7, LondonMetric Property, Mission Marketing Group |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks edge higher as fears over Greece recede European stocks were a little higher in early trade, with investors awaiting fresh catalysts as fears over Greece receded.
By 0850 BST, the benchmark Stoxx Europe 600 index and France's CAC 40 were up 0.3%, while Germany's DAX was up 0.1%. Spain's IBEX 35 was 0.3% firmer and Italy's FTSE Mib was up 0.7%.
Banks in Greece reopened after three weeks of being closed, although capital controls were still in place, with customers restricted to withdrawals of €420 rather than €60 a day.
Greece is due to pay its €4.2bn debt to the European Central Bank on Monday and is expected to repay it through the €7.16bn bridge loan that was approved last week.
"While some less onerous reforms still need passing into law in Athens this week, the main hurdles appear to have been cleared, however, PM Tsipras has lost more support, requiring a cabinet reshuffle and increasing political risk via the chance of snap elections in the autumn," said Michael van Dulken, head of research at Accendo Markets.
Greece's coalition government has sworn in its new reshuffled cabinet; five prominent dissidents from the Syriza party were replaced.
Over the weekend, German Chancellor Angela Merkel said in an interview with German broadcaster ARD that Germany is open to the possibility of offering further debt relief to Greece, but not write-downs, once the details of the latest bailout have been thrashed out.
Meanwhile, French President Francois Hollande called for the creation of a common Eurozone government.
On the corporate front, banking stocks were in the spotlight in London.
Barclays is reportedly planning to cut more than 30,000 jobs in the next two years, just days after the bank ousted chief executive Antony Jenkins. According to the sources cited by the Times on Sunday, the cuts - which are seen as the only way to address the bank's underperformance and lift its share price - could take the bank's global workforce to below 100,000 by the end of 2017.
Standard Chartered was on the front foot after announcing a radical management shake-up designed to restore its fortunes.
HSBC was also in the black after Citigroup upgraded the stock to 'buy' from 'neutral' .
Also in London, Aveva shares rocketed after Schneider Electric said it would acquire the firm in a reverse takeover deal, beating rumoured rivals Emerson and General Electric.
Elsewhere, Rolls-Royce nudged higher after saying it has secured two new Trent 700 contracts worth more than $2bn. |
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| | US Market Report | | US close: Google powers gains in Nasdaq indices A surge in Google stock on Friday drove the Nasdaq Composite to its best weekly gain since last October, amid mixed economic data although some market commentary took note of the rise in core consumer prices, which might comfort the Fed.
For the day the Dow Jones Industrials edged lower by 0.19% to 18,086.45, the Nasdaq Composite was up 0.91% to 5,210.14 points (and the Nasdaq-100 at fresh 15-year highs) while the S&P 500 drifted higher on the coattails of tech stocks by 0.11% to finish at 2,126.64 points.
In weekly terms, the Nasdaq Composite clocked gains of 4.3% while the S&P 500 advanced by another 2.4%, its best showing since March. The Dow Industrials was the ugly duckling this time around, sporting a 1.8% rise, with the stronger dollar acting as a headwind.
Core CPI ticks up
US inflation rose in June compared to a year ago as rents increased by the most in almost two years, data showed on Friday.
The Labor Department revealed the consumer price index (CPI) grew 0.1% year-on-year in June, up from 0% in May, as expected analysts.
Core consumer prices rose by 0.2% month-on-month and were 1.8% higher in year-on-year terms, up from 1.7% in May, which was also as forecast.
"The uplift in core inflation pours further fuel on expectations of US rates rising by the end of the year," said Chris Williamson, chief economist at Markit.
"A rise could come as soon as September, when policymakers will have seen what's likely to be a chunky GDP number for the second quarter.
"The economy is widely estimated to have grown at an annualised rate of at least 2.5% in the three months to June, rebounding convincingly from the soft spot seen earlier in the year."
Be that as it may, the yield on the benchmark 10-year US Treasury note ended the day lower by one basis point to 2.35%.
Meanwhile,the University of Michigan sentiment gauge fell from 96.1 to 93.3 in July, short of the 95 figure economists had expected.
There was more positive news in the construction sector, as US homebuilders broke ground on 9.8% more homes in June than in the prior month, to reach an annualised pace of 1.174m against consensus of a 1.1m reading, figures released by the US Department of Commerce showed.
Nonetheless, the rise activity was led by so-called multifamily starts, instead of single family homes. Construction permits - a lead indicator for activity - rose to 1.343m (consensus: 1.150m) from 1.25m in May.
Google surges on earnings
In company news, Google surged 16.26% after the tech giant posted better-than-expected quarterly profit after the close on Thursday.
General Electric climbed 0.74% having announced on Friday that its second quarter revenue and earnings beat expectations.
Technology group Honeywell International gained 1.9% after saying its second quarter profits and sales had topped Wall Street forecast.
By sectors, the largest gains were seen in the following industrial groups: Internet (9.39%), Software (9.43%) and Travel (3.06%). |
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| | Newspaper Round Up | | Monday newspaper round-up: Barclays, Greece, BAE Systems Barclays is planning to cut more than 30,000 of its staff within two years as the struggling bank considers accelerating a group-wide cost-cutting programme after firing Antony Jenkins, its chief executive, this month. A radical redundancy programme that could lead to the lender's global workforce falling below 100,000 by the end of 2017 is thought to be the only way to address the bank's chronic underperformance and hit an ambitious target of doubling its share price, according to senior sources. - The Times
Banks in Greece will reopen today, three weeks after they were shut to stop a flood of withdrawals and save the country's financial system from collapse. Trading could also resume on the Athens stock market after being suspended nearly a month ago as the government clashed with international creditors over the terms of a new bailout. - The Daily Mail
BAE Systems will have to limit its search for a new chief executive to a British national after the government indicated it was against relaxing its ban on a foreigner running the UK's premier defence company. The defence giant which builds Eurofighter Typhoons and Astute submarines and, for the United States, armoured vehicles and parts of the F-35 fighter, is "scanning the horizon" to find a successor to Ian King, its chief executive since 2008, who, at 59, is approaching retirement age. - The Times
Swedish retail giant Ikea has announced it will adopt the Government's new living wage from April 1 next year. The company said the move would affect 50pc of its 9,000 workers in the UK. It means that all Ikea employees across the UK, not just those over 25, will receive a minimum of £7.85 per hour and £9.15 per hour within London by 2016. - The Daily Telegraph Large companies paid out £28.3bn in ordinary dividends during the second quarter of the year, sharing the benefits of the cheaper pound against the dollar with a 12.7% bigger windfall for investors compared to last year. The fall of the pound against the dollar has intensified the effect of the rising payments, boosting dividends by £800m according to estimates from Capita Asset Services. The jump goes some way to the currency translation pain experienced by investors in global firms in 2014. - The Daily Telegraph |
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