| | | | | The Top 10 Stocks for Q4 | | Your guide to the best investments for the new quarter
Our latest Top 10 Stocks report takes a look at a fresh selection of blue chips that have the potential to offer exciting trading opportunities for the new quarter and into year-end.
Get your copy of this report and discover our top picks for the quarter.
Losses can exceed deposits | | |
| | London Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | London close: Stocks close slightly lower amid interest rate speculation The UK equity market declined on Tuesday as investors weighed remarks from the Bank of England's Ian McCafferty and US data.
McCafferty, who was the only member of the Monetary Policy Committed to vote for higher interest rates in the past three meetings, said that the BoE should begin raising rates now to ensure gradual and steady path.
In a speech at Bloomberg's headquarters in London, McCafferty said: "If we on the MPC are to achieve our ambition of raising rates only gradually, so as to minimise the disruption to households and businesses of a normalisation of policy after a long period in which interest rates have been at historic lows, we need to avoid getting behind the curve."
Meanwhile, US data showed construction on new US homes snapped a two-month decline and rose in September.
According to the Commerce Department, housing starts climbed 6.5% last month to 1.21m compared with an upwardly revised reading of 1.1m last month, while analysts expected a largely unchanged reading.
"Stronger-than-expected housing starts suggest more residential investment," said analysts at Barclays. "However, much of this activity is likely to show up in construction spending in the fourth quarter. Our third quarter GDP tracking estimate remains unchanged after rounding at 1.2%."
Elsewhere in the US, Federal Reserve official John Williams said the central bank should raise interest rates in the near future as the economy recovers. Speaking Bloomberg Television with Michael McKee on Monday he said: "My own view is that the economy is still on a good trajectory."
In the euro-area, a European Central Bank survey showed credit standards for companies eased more than expected in the third quarter as banks used additional liquidity from the ECB's €60bn a month asset-purchase programme to grant loans.
The ECB's QE programme is under the microscope ahead of the monetary authority's policy decision and press conference on Thursday.
In company news, Tesco tumbled after separate surveys from Kantar and Nielsen showed the supermarket has lost market share.
Astrazeneca slipped after Credit Suisse cut the company to 'underperform' from 'neutral' and trimmed its price target to 4,000p from 4,320p, citing a weak overall score for the group in its 2016 PharmaValues Strategic analysis.
Intercontinental Hotels surged after posting a rise in third quarter revenue per available room and expressed confidence in the outlook.
Asos climbed after reporting a better-than-expected increase in full-year pre-tax profit, as UK and international sales grew.
Whitbread jumped after serving up first-half results that beat analysts' estimates and increased the dividend more than forecast.
Aveva rallied after Berenberg upgraded the engineering software company's stock to 'buy' from 'hold' and lifted the price target to 2,450p from 1,977p.
Domino's Pizza got a boost after Citigroup lifted the stock to 'buy' from 'neutral' and raised the price target to 1,170p from 760p. |
| | The Top 10 Stocks for Q4 | | Your guide to the best investments for the new quarter
Towards the end of September, we've seen markets rally as buyers return to pick up some nicely discounted shares while inflation concerns look to be pushing a US interest rate rise further into the future. Our latest Top 10 Stocks report takes a look at a fresh selection of blue chips that have the potential to offer exciting trading opportunities for the new quarter and into year-end.
Download your copy of this report and discover our top picks for the quarter.
Losses can exceed deposits |
| | Market Movers
FTSE 100 (UKX) 6,353.82 0.02%
FTSE 250 (MCX) 16,995.23 0.46%
techMARK (TASX) 3,029.82 -0.07%
FTSE 100 - Risers
InterContinental Hotels Group (IHG) 2,476.00p 7.14%
Inmarsat (ISAT) 955.50p 3.52%
Whitbread (WTB) 4,883.00p 3.34%
Glencore (GLEN) 113.45p 3.14%
Next (NXT) 7,845.00p 2.28%
BT Group (BT.A) 437.20p 2.11%
Barratt Developments (BDEV) 643.00p 1.74%
Taylor Wimpey (TW.) 193.70p 1.57%
3i Group (III) 486.70p 1.42%
United Utilities Group (UU.) 992.00p 1.22%
FTSE 100 - Fallers
AstraZeneca (AZN) 4,024.50p -3.18%
Tesco (TSCO) 189.30p -2.22%
Hikma Pharmaceuticals (HIK) 2,072.00p -1.57%
International Consolidated Airlines Group SA (CDI) (IAG) 594.50p -1.49%
ARM Holdings (ARM) 964.50p -1.13%
easyJet (EZJ) 1,729.00p -1.03%
Smiths Group (SMIN) 989.00p -0.90%
Old Mutual (OML) 208.10p -0.81%
Prudential (PRU) 1,509.50p -0.76%
Shire Plc (SHP) 4,594.00p -0.69%
FTSE 250 - Risers
Dairy Crest Group (DCG) 641.00p 4.57%
Sophos Group (SOPH) 240.90p 4.24%
Brown (N.) Group (BWNG) 380.00p 4.17%
Just Eat (JE.) 439.00p 4.08%
Aveva Group (AVV) 2,081.00p 3.64%
Big Yellow Group (BYG) 727.50p 3.49%
AO World (AO.) 160.00p 3.23%
Auto Trader Group (AUTO) 373.80p 3.00%
Bovis Homes Group (BVS) 1,027.00p 2.85%
Stagecoach Group (SGC) 340.90p 2.68%
FTSE 250 - Fallers
Vedanta Resources (VED) 499.00p -7.93%
Evraz (EVR) 80.70p -6.97%
Tullow Oil (TLW) 220.30p -3.67%
Drax Group (DRX) 275.80p -3.23%
Premier Oil (PMO) 78.15p -3.10%
Serco Group (SRP) 95.70p -3.04%
Hunting (HTG) 400.00p -2.51%
Nostrum Oil & Gas (NOG) 452.80p -2.01%
OneSavings Bank (OSB) 371.20p -1.98%
Ophir Energy (OPHR) 91.80p -1.82% |
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| | Europe Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks slide as hopes for more stimulus fade European equities markets lost ground on Tuesday, falling into the red as expectations of further stimulus were dampened by a bank lending survey from the European Central Bank showing improved lending conditions.
The benchmark Stoxx Europe 600 index closed down 0.43%, while France's CAC 40 was 0.64% lower and Germany's DAX fell 0.16%.
As of 1632 BST, the euro was on the front foot against the main currencies, gaining 0.12% and 0.16% against the dollar and the pound and rising 0.43% against the yen, while Brent crude climbed 0.21% to $48.71 a barrel.
Credit standards ease in third quarter
Regional indices headed south after the latest ECB bank lending survey revealed that credit standards for Eurozone companies eased more than expected in the third quarter as banks made use of the central bank's asset-purchase programme to grants loans.
The survey found that banks lowered their credit standards in the third quarter as they became increasingly competitive, and the net percentage of banks reporting an easing of credit standards on loans to firms in the third quarter was -4% from -3% in the second quarter.
"The APP had a net easing impact on credit standards and particularly on credit terms and conditions. The easing impact was greatest for loans to enterprises," the ECB said.
Although good news in itself, market participants interpreted it as meaning that the ECB would see no need for further stimulus.
An ECB meeting takes place in Malta on Thursday and many investors had been hoping for fresh stimulus measures to be announced.
"Thursday's ECB get-together is likely to be much talk but little action, in common with most of these meetings, but there is still a growing sense that something must be done to enliven a flagging eurozone economy," said IG's senior market analyst Chris Beauchamp.
On the economic data front, according to data published by Destatis, Germany's producer prices fell 0.4% month-on-month in September compared with a 0.5% decline in the previous month and with analysts' expectations for a 0.2% decline.
On a year-on-year basis, producer prices fell 2.1% compared with a 1.7% decline in August, while economists expected a 1.8% decline.
Fresh woes for Volkswagen
In company news, Swedish phone carrier TeliaSonera gained 0.94% after downgrading its full-year earnings forecasts and reporting a drop in profit, as the results weren't as bad as feared.
Swiss biotechnology company Actelion rallied 3.90% after it lifted its full-year earnings forecast and posted better-than-expected sales of its new drug to treat pulmonary arterial hypertension. |
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| | US Market Report | | US open: Equity markets edge lower amid deluge of corporate earnings US stocks edged lower early on Tuesday, as investors digested a number of mixed corporate earnings reports.
After around half an hour of trading, the Dow Jones Industrial Average was down 47 points to 17,183.40, while the S&P 500 and the Nasdaq were six and 18 points lower respectively.
The US reporting season has had a mixed start and with economic data mostly positive, there is little agreement among traders and strategists about whether the Federal Reserve will hike rates this year.
Mixed earnings on Wall Street
Among the companies that reported before the opening bell, Verizon rose 0.60% after it posted third quarter earnings that beat expectations, while insurer Travelers Cos climbed 2.30% after its third quarter profit and revenue topped Wall Street's forecast.
Harley Davidson slumped 9.46% after its quarterly profit fell short of expectations, while defence group Lockheed Martin shed 1.63% after saying its third quarter profit declined on the back of lower demand and military force reductions.
After the market closes, Yahoo!, Discover Financial Services and Chipotle Mexican Grill are all scheduled to release quarterly earnings.
Meanwhile, IBM shed 4.96% after the technology giant posted a drop in third quarter revenue late on Monday.
Flash memory manufacturer SanDisk surged 6.34% after Bloomberg reported the company was in advanced negotiations with Western Digital over a takeover offer it received.
Honeywell International gained 0.09% and could be in focus after revealing it had reached an agreement to sign German-based laboratory research business Seelze from Sigma-Aldrich for $119.4m.
Yum Brands jumped 4.55% after the owner Pizza Hut, Taco Bell and KFC revealed plans to spin off its business in China.
On the economic data front, construction on new US homes snapped a two-month decline and rose in September, figures released on Tuesday showed.
According to the Commerce Department, housing starts climbed 6.5% last month to 1.21m compared with an upwardly revised reading of 1.1m last month, while analysts expected a largely unchanged reading.
"Stronger-than-expected housing starts suggest more residential investment," said analysts at Barclays.
"However, much of this activity is likely to show up in construction spending in the fourth quarter.
"Our third quarter GDP tracking estimate remains unchanged after rounding at 1.2%.
Elsewhere, Asian equity markets struggled for direction, as lower oil prices offset a rally in Chinese stocks, while European stocks reversed earlier gains to edge lower.
The dollar was broadly stable against the pound but declined 0.31% against the euro and gained 0.21% against the yen, while gold futures climbed 0.25% to $1,173.70. |
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| | Broker Tips | | Broker tips: Domino's Pizza, Ocado, Aveva Domino's Pizza got a boost after Citigroup lifted the stock to 'buy' from 'neutral' and raised the price target to 1,170p from 760p.
The bank said it sees continuing strong UK growth in the medium term through both good like-for-like sales and store roll-out.
In addition, it said mobile ordering is a key driver of LFL sales momentum, a trend it sees continuing.
For the German business, although the difficulties to date have been well documented, it reckons Domino's will prove a success in the long run, especially in the context of the 560 stores in Belgium/France/Netherlands, run by the Australian Domino's business.
"We recognise that profitability in Germany has been pushed out, but we see similarities to the UK business, which also saw limited profitability in its early years. We await further news on the repositioning in Germany."
Macquarie initiated coverage of Ocado at 'outperform' with a 410p price target, saying the market is significantly underestimating operating leverage in the company's business model.
"We think conservative company guidance on operating costs is holding back the market," the broker said.
It noted that in its first-half results, Ocado set the bar low, guiding to +100-200bps long-term margin from warehouse and delivery efficiencies. Macquarie said a lack of clarity on timing or further upside has put a lid on expectations, adding that Ocado has a history of setting itself very beatable targets.
In addition, Macquarie said significant start-up costs are masking operating leverage.
It said the Ocado Smart Platform, subscale non-food business, and preparation for cosmetics site launch all penalise the company's admin expenses, where Macquarie believes it is achieving significant operating leverage on an underlying basis.
Shares in engineering software company Aveva rallied in early trade after Berenberg upgraded the stock to 'buy' from 'hold' and lifted the price target to 2,450p from 1,977p.
"Our discussions with various interested parties have strengthened our view that the deal between Aveva and Schneider will close," it said.
Berenberg noted that Schneider has acquired a number of software assets over the past five years and as a result, the bank reckons its management is strongly motivated to close its reverse takeover of Aveva.
While Aveva's share price seems to reflect the market's uncertainty about the deal closing, Berenberg said it believes the due diligence process is drawing to an end and the publication of a prospectus will create more certainty. |
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