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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: Stocks slide ahead of Fed's interest rate decision London stocks opened the week in the red, reversing gains on Friday after the European Central Bank hinted a further stimulus in December and China cut rates.
The People's Bank of China cut its one-year deposit rate and one-year lending rate by 25 basis points each to 1.5% and 4.35%, respectively. The PBoC also cut the reverse requirement ratio for all banks by 50 basis points to 17.5%, with an extra 50 bps reduction for some lenders. The move was welcomed by most economists. Goldman Sachs analyst said they believe the cuts "may be necessary to prevent a tightening of financial conditions".
The ECB also provided a boost to markets last week by saying that it will re-examine its quantitative easing programme and consider extending it past September 2016 if necessary.
"The market reaction may be a little over the top; the ECB has not done anything yet. A statement saying the ECB governing council will 're-examine' the level of monetary accommodation doesn't mean that the examination will conclude anything needs to be done," said Jasper Lawler, market analyst at CMC Markets.
"Consumer price inflation data for the Eurozone released this Friday will surely be a large chunk of what the ECB evaluates before its December meeting."
ECB official Yves Mercsh may elaborate when he speaks in Brussels later on Monday.
Looking ahead, the Federal Reserve's policy meeting on Wednesday is taking centre stage as analysts speculate on whether the central bank will raise interest rates. The consensus forecast is that rates will remain at 0.25% amid low inflation and risks arising from a slowdown in emerging markets.
"I personally think that the Federal Reserve completely missed the boat with an opportunity to begin raising US interest rates during its September policy meeting and that the chances of a US interest rate rise at all this year have weakened each passing week since," said Jameel Ahmad, chief market analyst at FXTM.
"The reduced US interest rate expectations are not limited to just slowing US economic momentum, but because the central bank cited global economic weakness as a reason to leave US rates unchanged in September."
On the company front, WPP slumped after reporting a healthy rise in revenue for the third quarter and saying it expects an even better fourth quarter.
AstraZeneca climbed after the US Food and Drug Administration's Arthritis Advisory Committee recommended the approval of lesinurad tablets for the treatment of hyperuricemia with gout.
Intertek gained after buying New York-based MT Group and Material Testing Lab in a bid to expand its building and construction capabilities in the US.
Oil stocks, including BG Group and Royal Dutch Shell, rallied as Brent and West Texas Intermediate crude futures ticked higher by 0.5% to $48.26 per barrel and 0.6% to $44.91 per barrel, respectively, at 0900 BST. |
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| Market Movers
FTSE 100 (UKX) 6,411.87 -0.50%
FTSE 250 (MCX) 17,182.14 -0.34%
techMARK (TASX) 3,097.02 -0.39%
FTSE 100 - Risers
Aberdeen Asset Management (ADN) 365.20p 3.93%
BG Group (BG.) 1,062.50p 0.52%
St James's Place (STJ) 928.00p 0.49%
Royal Dutch Shell 'B' (RDSB) 1,784.00p 0.48%
Royal Mail (RMG) 450.40p 0.40%
Pearson (PSON) 904.00p 0.39%
AstraZeneca (AZN) 4,084.50p 0.37%
Hikma Pharmaceuticals (HIK) 2,046.00p 0.34%
Royal Dutch Shell 'A' (RDSA) 1,767.00p 0.26%
TUI AG Reg Shs (DI) (TUI) 1,211.00p 0.25%
FTSE 100 - Fallers
WPP (WPP) 1,450.00p -2.03%
Travis Perkins (TPK) 1,900.00p -2.01%
Anglo American (AAL) 599.80p -1.66%
Glencore (GLEN) 117.20p -1.64%
Persimmon (PSN) 1,993.00p -1.53%
Barratt Developments (BDEV) 644.00p -1.45%
Burberry Group (BRBY) 1,332.00p -1.41%
ITV (ITV) 253.70p -1.28%
ARM Holdings (ARM) 1,060.00p -1.21%
Berkeley Group Holdings (The) (BKG) 3,262.00p -1.12%
FTSE 250 - Risers
Senior (SNR) 245.90p 3.76%
Wizz Air Holdings (WIZZ) 1,868.00p 2.36%
Hansteen Holdings (HSTN) 121.80p 2.35%
Electra Private Equity (ELTA) 3,707.00p 1.98%
National Express Group (NEX) 280.60p 1.67%
Northgate (NTG) 421.60p 1.61%
Indivior (INDV) 211.50p 1.49%
Tullett Prebon (TLPR) 346.30p 1.38%
Renishaw (RSW) 1,944.00p 1.09%
Aberforth Smaller Companies Trust (ASL) 1,174.00p 1.03%
FTSE 250 - Fallers
TalkTalk Telecom Group (TALK) 245.10p -4.56%
Kaz Minerals (KAZ) 123.30p -3.07%
Rank Group (RNK) 270.50p -2.84%
Cairn Energy (CNE) 150.40p -2.40%
Tullow Oil (TLW) 208.20p -1.93%
Vedanta Resources (VED) 500.00p -1.77%
OneSavings Bank (OSB) 361.00p -1.69%
Betfair Group (BET) 3,155.00p -1.62%
Henderson Group (HGG) 279.20p -1.55% |
| | UK Event Calendar | | Monday 26 October
INTERIM DIVIDEND PAYMENT DATE
Playtech, Quarto Group Inc.
QUARTERLY PAYMENT DATE
General Electric Co
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
IFO Business Climate (GER) (09:30)
IFO Current Assessment (GER) (09:30)
IFO Expectations (GER) (09:30)
New Homes Sales (US) (15:00)
Q3
Torchmark Corp.
GMS
Enegi Oil
FINALS
Avacta Group
AGMS
Trinity Capital
TRADING ANNOUNCEMENTS
WPP
UK ECONOMIC ANNOUNCEMENTS
BBA Mortgage Lending Figures (09:30)
CBI Industrial Trends Surveys (11:00)
FINAL DIVIDEND PAYMENT DATE
Mattioli Woods |
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| | Europe Market Report | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks start modestly lower ahead of Chinese plenum, US Fed meeting Investors took some money off the table at the start of the week ahead of a much anticipated policy meeting of the US central bank, although the focus was expected to be on the results of the Chinese Communist Party's plenum to thrash out the country's next five-year economic plan.
As of 08:28 the benchmark DJ Stoxx 600 was 0.52% or 1.98 points lower to 375.32, the Dax-30 down by another 0.25% to 10,767.47 and the Cac-40 in Paris by 0.77% to 4,885.90.
"Since [September], it has been confirmed that economic growth in China has fallen below the government target while economic sentiment in Europe is continually plagued by both low inflation and stagnant growth and concerns remain elevated about the pace of economic recovery in Japan.
"Under this logic and the statement made by the FOMC in September, it has become very difficult to argue for a US rate rise in 2015," said Jameel Ahmad, chief market analyst at FXTM.
Chinese Communist Party plenum in focus
At this week's plenum China's top-ranking officials were set to decide on their next five-year plan.
The focus was expected to be on reducing the state's role in the economy and the possible reform of state owned enterprises. Authorities were also expected to unveil their GDP growth target for the coming years.
German IFO index retreats by less than expected in September
The Volkswagen scandal and the poor news out of China took their toll on German businesses' confidence, a survey from a leading think-tank revealed.
The IFO institute's business confidence index for the month of October slipped to a reading of 108.2 from September's 108.5. Economists had pencilled in a print of 107.8.
However, a sub-index of companies' expectations improved to a reading of 103.8 after a print of 103.3 for the month before (consensus: 102.4).
Securitas AB jumped on news that Diebold Inc. had agreed to sell its North America security business.
Aberdeen Asset Management was higher on the heels of a report in the Financial Times - denied by the fund manager - that the firm had put itself on the block.
Another report from the FT dragged Deutsche Bank 1.7% lower. US regulators were expanding a money-laundering investigation into the lender's Russian unit, the newspaper reported. |
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| | US Market Report | | US close: Tech stocks jump to 15-year high A slightly unexpected rate cut by China's central bank on the heels of Thursday's dovish ECB policy meeting stoked a further push higher in US stocks, with talk of a 'Christmas rally' already doing the rounds.
The Dow Jones Industrials jumped by 158 points or 0.90% to reach the 17,647 point mark, alongside a 22 point gain in the S&P 500 to hit 2,075. The Nasdaq was also to be seen higher, advancing 112 points or 2.28% to 5,032.
The benchmark S&P 500 clocked gains of 2.1% for the latest five-day stretch, for a fourth consecutive weekly advance.
The CBoE volatility index edged higher by 0.07% to reach 14.46 points.
Tech issues at 15-year high
That came as Amazon, Google and Microsoft tacked on a combined $80bn to their market capitalisations, carrying the S&P technology sub-index to a 15-year high.
Amazon rallied 6.23% after soaring 11% late on Thursday, after the e-commerce giant posted an unexpected profit for the third quarter and offered an upbeat outlook for the holiday period.
Alphabet, Google's holding company, surged 7.7% after announcing its first ever stock buyback plan, revealing it will invest more than $5bn in the programme.
"Profits are up almost 50% in the third quarter over the previous year, and this is whilst Google's earnings are still wrapped up with costly side projects like self-driving cars, which won't be the case in January under the new corporate structure," said CMC Markets' analyst Jasper Lawler.
Microsoft jumped 10.08% after posting better-than-expected revenue and profit late on Thursday, while Twitter gained 1.34% after its chief executive pledged to give $200m of his own shares to the employee stock pool..
PBoC cuts interest rates
After the close of the Asian session, the People's Bank of China said it will cut its one-year deposit rate and one-year lending rate by 25 basis points each to 1.5% and 4.35%, respectively, as it looks to bolster the slowing economy.
"As usual the PBOC showed its preference for action over rhetoric by cutting interest rates for the sixth time since November," said David Morrison, market analyst at SpreadCo.
"China's move should help to underpin risk assets as we get further towards the year-end. But the ECB have to come up with the goods at their December meeting. Then the big question is whether the Fed will delay a rate hike until next year."
Meanwhile, Asian and European stocks rallied as both were boosted by the prospect of more stimulus from the European Central Bank.
On Thursday, after the press conference after the rate announcement, ECB President Mario Draghi said the governing council had discussed expanding its bond-buying programme and cutting the rate on reserves held at the central bank.
"Although there might well be some debate as to the direct benefits of a change to already record-low interest rates, this once again proves that under Mario Draghi the ECB is acting rather than just venting rhetoric," said Alastair McCaig, senior market analyst at IG.
Yields on the benchmark 10-year Treasury note were six basis points higher to 2.09%
West Texas crude futures lost 1.43% to $44.73 a barrel on the NYMEX.
S&P 500 - Risers
Microsoft Corp. (MSFT) $52.87 +10.08%
Capital One Financial Corp. (COF) $81.12 +8.25%
Alphabet Inc. Class C (GOOG) $702.00 +7.70%
Wynn Resorts Ltd. (WYNN) $67.60 +7.00%
VeriSign Inc. (VRSN) $80.18 +6.33%
Amazon.Com Inc. (AMZN) $599.03 +6.23%
Tenet Healthcare Corp. (THC) $29.99 +6.20%
Allergan plc (AGN) $268.55 +6.13%
Juniper Networks Inc. (JNPR) $31.49 +5.81%
Alphabet Inc. Class A (GOOGL) $719.33 +5.61%
S&P 500 - Fallers
Stericycle Inc. (SRCL) $120.31 -19.28%
VF Corp. (VFC) $63.75 -12.92%
Whirlpool Corp. (WHR) $145.90 -8.70%
PVH Corp. (PVH) $88.17 -8.09%
NRG Energy Inc. (NRG) $14.02 -6.03%
Host Hotels & Resorts Inc. (HST) $16.54 -5.86%
Ventas Inc. (VTR) $55.13 -5.57%
Target Corp. (TGT) $72.94 -5.38%
Nordstrom Inc. (JWN) $64.99 -5.14%
Fossil Group Inc (FOSL) $52.00 -4.66%
Dow Jones I.A - Risers
Microsoft Corp. (MSFT) $52.87 +10.08%
Apple Inc. (AAPL) $119.08 +3.10%
Procter & Gamble Co. (PG) $77.03 +2.91%
American Express Co. (AXP) $74.59 +2.88%
Pfizer Inc. (PFE) $34.05 +2.16%
Unitedhealth Group Inc. (UNH) $115.92 +1.85%
E.I. du Pont de Nemours and Co. (DD) $60.27 +1.82%
Merck & Co. Inc. (MRK) $52.88 +1.67%
McDonald's Corp. (MCD) $112.59 +1.55%
Intel Corp. (INTC) $34.90 +1.45%
Dow Jones I.A - Fallers
Nike Inc. (NKE) $130.53 -1.42%
Coca-Cola Co. (KO) $42.79 -1.04%
Wal-Mart Stores Inc. (WMT) $58.30 -1.02%
Chevron Corp. (CVX) $91.24 -0.41%
General Electric Co. (GE) $29.51 -0.24%
Walt Disney Co. (DIS) $113.09 -0.14%
3M Co. (MMM) $155.79 -0.13%
Travelers Company Inc. (TRV) $112.28 -0.04%
Nasdaq 100 - Risers
Microsoft Corp. (MSFT) $52.87 +10.08%
Alphabet Inc. Class C (GOOG) $702.00 +7.70%
Wynn Resorts Ltd. (WYNN) $67.60 +7.00%
Amazon.Com Inc. (AMZN) $599.03 +6.23%
Alphabet Inc. Class A (GOOGL) $719.33 +5.61%
Seagate Technology Plc (STX) $41.15 +4.87%
Yahoo! Inc. (YHOO) $33.17 +4.74%
Mylan Inc. (MYL) $40.96 +4.60%
Vertex Pharmaceuticals Inc. (VRTX) $114.37 +4.46%
Illumina Inc. (ILMN) $147.43 +3.77%
Nasdaq 100 - Fallers
Stericycle Inc. (SRCL) $120.31 -19.28%
Dollar Tree Inc (DLTR) $62.53 -3.50%
Maxim Integrated Products Inc. (MXIM) $37.95 -2.99%
Ross Stores Inc. (ROST) $49.66 -2.70%
Check Point Software Technologies Ltd. (CHKP) $80.43 -1.96%
Nxp Semiconductors Nv (NXPI) $96.09 -1.90%
Expedia Inc. (EXPE) $125.41 -1.70%
Costco Wholesale Corp. (COST) $155.74 -1.52%
Tesla Motors Inc (TSLA) $209.09 -1.24% |
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| | Newspaper Round Up | | Monday newspaper round-up: Savers, Home, SAB Miller Savers have seen at least £7bn removed from the value of their stock funds during the past six months because of the market turmoil that sent prices plummeting. Figures from the industry reveal the extent of the damage inflicted on share funds - unit trusts and investment trusts - used by tens of thousands of people as long-term savings vehicles. The numbers reveal the risk of buying into stock funds unless they are intended to be held for the long term. - The Times
The opportunity to buy a home in England and Wales is at its best in 13 years amid a decline in the cost of essentials, a drop in mortgage payments and a rise in average incomes over the past 12 months. It improved for the third quarter in a row in the three months to June and is 40% up on 2007, according to Hamptons International's latest ability-to-buy index, which measures changes in the cost of living, interest payments and house prices. - The Times
Carlos Brito, the chief executive of the Belgian-Brazilian giant behind Budweiser and Stella Artois, is on Thursday believed to have visited South Africa, where there is already opposition to the deal. The trip is understood to have been his first visit to the country since AB InBev announced an "agreement in principle" with SAB earlier this month for what would be Britain's biggest ever takeover. - The Daily Telegraph
TalkTalk chief executive Dido Harding has insisted the company's cybersecurity is "head and shoulders" better than its competitors in the wake of the massive hack attack affecting thousands of customers. In an interview, Harding conceded it would be "naive" to rule out the prospect of the telecoms firm suffering a similar cyber-attack in the future, describing the threat from hackers as "the crime of our generation". - The Guardian |
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