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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: Stocks end lower after mixed data, slide in oil prices UK stocks closed in the red on Friday as oil prices fell and investors sifted through a batch of mixed economic data.
Oil prices extended losses amid reports the Iranian oil minister will not attend this Sunday's summit in Qatar. Instead, Iran's OPEC governor will be present at the meeting between global producers to discuss whether to freeze output.
Brent crude fell 2.8% to $42.61 per barrel and West Texas Intermediate dropped 3.1% to $40.22 per barrel at 1630 BST.
On Thursday, the International Energy Agency said the global oil glut was set to ease by the end of this year. It also said that any potential agreement to freeze output at the Doha meeting would have only a limited impact on supplies.
"Overall there's a slight negative bias but this could be no more than a touch of position-squaring after this week's rally and ahead of the weekend," said David Morrison, senior market strategist at SpreadCo.
"Investors are well aware of Sunday's meeting in Doha between OPEC and non-OPEC producers to discuss a freeze on crude output. Equity movements have a strong positive correlation to the oil price so we may see some profit-taking now given uncertainty ahead of the meeting."
In economic data, China's gross domestic product rose 6.7% year-on-year in the first three months of the year, down from 6.8% growth the previous quarter, the National Bureau of Statistics said. The figure was in line with analysts' estimates but marked the slowest quarterly growth for China since the height of the financial crisis in 2009.
Other Chinese data came in more positive. Retail sales jumped 10.3% in March, beating forecasts for a 10.2% increase. Industrial production climbed 6.8% in March compared to forecasts for a 6% gain.
In the UK, data from the Office for National Statistics revealed construction output dipped 0.3% in February compared with the previous month, falling short of expectations for no change. Compared with the same month last year, output rose 0.3% versus analysts' forecasts for a 0.7% increase.
Across the pond, US industrial production fell more than expected in March, according to the latest data from the Federal Reserve. Production was down 0.6% from February, which was much steeper than the 0.1% dip forecast by economists.
Manufacturing output declined 0.3%, with the production of durables down 0.4%.
Other data from the University of Michigan showed consumer sentiment eased in April. The preliminary estimate for the confidence index was 89.7 in April, down from 91.0 in March and worse than the 92.0 reading expected by analysts.
The Empire State index for April rose to its highest level in more than a year to 9.56 compared to 0.62 a month earlier.
On the corporate front, SABMiller gained after Anheuser-Busch InBev NV said it reached an agreement with the South African government to create a $69m investment fund and other commitments to help it secure regulatory approval of its acquisition of the beverage maker.
Man Group advanced after Shore Capital argued that the company's shares were significantly undervalued, following its first quarter update.
Housebuilders were expending their losses from the previous session as concerns about Brexit led Berkeley Group, Barratt Developments and Taylor Wimpey below the waterline. "Ahead of Brexit, people have been selling the housebuilders and the pressure will remain until we get the vote out of the way - that's the main headwind for UK housebuilders," Zeg Choudhry, managing director at LONTRAD, said.
Anglo American also slumped, after Rio Tinto's chief executive Sam Walsh poured cold water on speculation it was keen on Anglo's Australian coal assets on Thursday. |
| | Which way will the major markets be heading in 2016? | | Click here to Download the FREE 2016 Market Mover Report |
| Market Movers
FTSE 100 (UKX) 6,345.23 -0.31%
FTSE 250 (MCX) 16,909.17 -0.54%
techMARK (TASX) 3,172.27 -0.29%
FTSE 100 - Risers
SABMiller (SAB) 4,281.50p 1.48%
Royal Bank of Scotland Group (RBS) 235.00p 1.47%
Antofagasta (ANTO) 471.00p 1.29%
Tesco (TSCO) 179.75p 1.18%
Vodafone Group (VOD) 229.45p 1.17%
Fresnillo (FRES) 1,019.00p 0.89%
Provident Financial (PFG) 3,086.00p 0.85%
Standard Chartered (STAN) 520.90p 0.83%
Inmarsat (ISAT) 1,011.00p 0.60%
British American Tobacco (BATS) 4,232.00p 0.52%
FTSE 100 - Fallers
Travis Perkins (TPK) 1,774.00p -4.62%
Ashtead Group (AHT) 814.50p -4.01%
Berkeley Group Holdings (The) (BKG) 2,862.00p -3.83%
Intu Properties (INTU) 296.50p -3.55%
Kingfisher (KGF) 357.30p -2.96%
Mediclinic International (MDC) 942.50p -2.43%
Taylor Wimpey (TW.) 172.70p -2.43%
Barratt Developments (BDEV) 509.50p -2.39%
Mondi (MNDI) 1,329.00p -2.35%
Wolseley (WOS) 3,850.00p -2.31%
FTSE 250 - Risers
Man Group (EMG) 162.40p 7.19%
Indivior (INDV) 167.00p 5.56%
Evraz (EVR) 133.10p 5.47%
Restaurant Group (RTN) 376.40p 4.18%
Circassia Pharmaceuticals (CIR) 270.00p 3.45%
Millennium & Copthorne Hotels (MLC) 446.70p 3.09%
St. Modwen Properties (SMP) 324.90p 2.98%
Kaz Minerals (KAZ) 173.00p 2.91%
Acacia Mining (ACA) 310.50p 2.64%
Cineworld Group (CINE) 549.00p 2.33%
FTSE 250 - Fallers
Tullow Oil (TLW) 213.10p -5.58%
Grafton Group Units (GFTU) 675.50p -5.52%
McCarthy & Stone (MCS) 252.40p -5.47%
Crest Nicholson Holdings (CRST) 475.00p -4.90%
Savills (SVS) 719.00p -4.26%
Howden Joinery Group (HWDN) 443.90p -3.88%
G4S (GFS) 189.20p -3.62%
Bellway (BWY) 2,285.00p -3.46%
Keller Group (KLR) 809.50p -3.40% |
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| | Europe Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks slip on oil price drop European stocks fell on Friday as caution crept in ahead of this weekend's meeting of oil producers in Doha, and investors digested some key data releases out of China.
The benchmark DJ Stoxx Europe 600 index finished 0.35% lower at 342.79, while Germany's DAX and France's CAC 40 were off by 0.42% and 0.36%, respectively.
Crude oil futures extended losses amid reports the Iranian oil minister will not attend this Sunday's summit in Qatar. Instead, Iran's OPEC governor will be present. West Texas Intermediate was down 2.79% to $40.37 a barrel while Brent crude was 2.26% lower at $42.87.
On Thursday, the International Energy Agency said the global oil glut was set to ease by the end of this year. It also said that any potential agreement to freeze output at the Doha meeting would have only a limited impact on supplies.
"Overall there's a slight negative bias but this could be no more than a touch of position-squaring after this week's rally and ahead of the weekend," said David Morrison, senior market strategist at SpreadCo.
"Investors are well aware of Sunday's meeting in Doha between OPEC and non-OPEC producers to discuss a freeze on crude output. Equity movements have a strong positive correlation to the oil price so we may see some profit-taking now given uncertainty ahead of the meeting."
Stocks in Asia reacted in a pretty muted fashion to data showing China's economy grew 6.7% on the year in the first quarter compared with 6.8% in the fourth quarter of last year.
Although this marked the slowest quarterly growth in seven years, it was in line with both economists' expectations and the country's own targets. The government's growth range is 6.5% to 7%.
For 2015 as a whole, growth came in at 6.9%.
Meanwhile, figures from the National Bureau of Statistics showed industrial output in the world's second-largest economy rose 6.8% in March from the year before and compared with 5.4% growth in January to February. Economists had been expecting a 5.9% increase.
Retail sales increased 10.5% in March from a year earlier compared with 10.2% growth in January to February, just a touch above economists' expectations of 10.4%.
In corporate news, Rio Tinto slipped after announcing the extension of its Channar Mining joint venture with Sinosteel Corporation in Australia's Pilbara region.
Supermarket operator Carrefour pushed higher as its first quarter sales came in marginally ahead of expectations.
Man Group rallied after its first quarter update revealed positive net inflows and a good performance at its AHL unit.
Earlier, data from Eurostat showed the Eurozone trade surplus shrank in February as imports rose more rapidly than exports. |
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| | US Market Report | | US open: Stocks decline as investors digest data US stocks were in the red on Friday as investors weighed a further slowdown in China's economic growth and a worse-than-expected drop in US industrial production.
At 1502 BST, the Dow Jones Industrial Average fell 0.06%, the S&P 500 shed 0.10% and the Nasdaq dropped 0.17%.
China's gross domestic product rose 6.7% year-on-year in the first three months of the year, down from 6.8% growth the previous quarter, the National Bureau of Statistics said. The figure was in line with analysts' estimates but marked the slowest quarterly growth for China since the height of the financial crisis in 2009.
Other Chinese data came in more positive. Retail sales jumped 10.3% in March, beating forecasts for a 10.2% increase. Industrial production climbed 6.8% in March compared to forecasts for a 6% gain.
In the US, industrial production fell more than expected in March, according to the latest data from the Federal Reserve. Production was down 0.6% from February, which was much steeper than the 0.1% dip forecast by economists.
Manufacturing output fell 0.3%, with the production of durables down 0.4%.
Other data from the University of Michigan showed consumer sentiment eased in April. The preliminary estimate for the confidence index was 89.7 in April, down from 91.0 in March and worse than the 92.0 reading expected by analysts.
"With the job market very strong and stocks almost back to their highs, we see no reason for this decline in the index to become a sustained trend," said Ian Shepherdson, chief economist at Pantheon Macroeconomics.
The Empire State index for April rose to its highest level in more than a year to 9.56 compared to 0.62 a month earlier.
Meanwhile, oil prices extended losses amid reports the Iranian oil minister will not attend this Sunday's summit in Qatar. Instead, Iran's OPEC governor will be present at the meeting between global producers to discuss whether to freeze output.
West Texas Intermediate was down 3.4% to $40.13 a barrel while Brent crude was 3.3% lower at $42.41 a barrel.
On Thursday, the International Energy Agency said the global oil glut was set to ease by the end of this year. It also said that any potential agreement to freeze output at the Doha meeting would have only a limited impact on supplies.
"Overall there's a slight negative bias but this could be no more than a touch of position-squaring after this week's rally and ahead of the weekend," said David Morrison, senior market strategist at SpreadCo.
"Investors are well aware of Sunday's meeting in Doha between OPEC and non-OPEC producers to discuss a freeze on crude output. Equity movements have a strong positive correlation to the oil price so we may see some profit-taking now given uncertainty ahead of the meeting."
In company news, Citigroup gained despite reporting a 27% drop in first quarter profit.
In comparison, JP Morgan Chase & Co. reported a 11% fall in the first quarter and Bank of America reported a 16% drop.
Valeant Pharmaceuticals International Inc. fell after a report Thursday that the company may sell off part of its business. |
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| | Broker Tips | | Broker tips: Mothercare, Man Group, Poundland Berenberg downgraded Mothercare to 'sell' from 'hold' and slashed the price target to 130p from 250p following the company's update on Thursday.
The bank said the fourth quarter trading statement was downbeat, highlighting a material slowdown in the international division.
In the 11 week period to 26 March, International retail sales were down 9.7% at constant currency, with sales in actual currency down 10.8%, Mothercare said on Thursday.
"We have been cautious about the name since our initiation, but had believed that the International division would provide something of a solid backbone around which the rebuilt UK business could start to contribute."
However, Berenberg said that although the UK business has shown some improvement in the past year, it is still loss-making.
Amid a deteriorating outlook for the International business, the bank cuts its full year 2016/17 and 2017/18 earnings per share numbers by 32% and 34%, respectively.
It expects earnings before interest and tax in the International business to go backwards and now forecasts £34.5m EBIT in 2016/17 versus £45.9m in 2014/15.
"We believe restructuring the assets will continue to come with a greater-than -average risk and, as such, downgrade our recommendation."
Shares in Man Group are significantly undervalued, analysts at Shore Capital argued following the company's first quarter update.
Contrary to what one might expect, in a quarter pockmarked by volatility the fund manager saw net inflows rise by $0.5bn, helping to keep its total assets under management on an even keel as of 31 March, at $78.6bn.
The performance of its AHL fund was particularly striking, with Quant Alternatives seeing "good" net inflows of $1.3bn (8.0%) and an excellent investment performance of +5% in a volatile quarter, "conditions not usually helpful to trend-following strategies", ShoreCap analyst Paul McGinnis said in a research note sent to clients.
Nevertheless, a difficult first quarter did leave the fund manager nursing losses of 16.3% on its Japan Core Alpha product, versus a 12.0% fall for Tokyo's benchmark Topix index.
Trading on 10.9 times ShoreCap's earnings per share estimate for 2016 of 19.8c and sporting a 4.7% dividend yield, the company was changing hands at about a 20.0% discount to the sector.
That "[discount] materially undervalues [...] and we think it should trade at a sector premium," McGinnis said, sticking by his 'buy' recommendation and fair value estimate of 245p.
His peers at RBC were a bit more circumspect in their appraisal of the company's solidness; hence their recommendation was held at a 'sector perform'.
"Man's efforts to diversify its product range and broaden its distribution network has resulted in net inflows during a volatile and uncertain Q1
"Man remains the most inexpensive asset manager that we cover and trades at 9.1x 2017E EPS (sector: 14.1x) and at 6.4x 2017E EBITDA (sector: 9.8x), largely because of the large proportion of performance fees that it derives and the lower visibility over net inflows," RBC said.
HSBC downgraded Poundland to 'hold' from 'buy' and slashed its target to 160p from 290p after disappointingly slow growth in core trading with no recovery expected until the second half of 2017.
In a trading update on Thursday the discount retailer said it was on track to meet full year profit expectations despite a difficult second half where like-for-like sales fell 4.9%.
The FTSE 250 company said it has been a tough quarter for its core business, which was impacted by difficult market conditions and disruption from the accelerated pace of delivery of the 99p Stores' conversion programme after their acquisition in September.
With the quarterly sales short of its forecasts, HSBC cut its forecasts for underlying profit before tax by 8-15% for the current year and the subsequent two, given 5-6% lower sales and operational gearing impacts.
The bank was reassured by management's continued confidence that the company will generate "at least £25m incremental EBITDA" from 99p Stores.
However, HSBC said the weak core trading was a concern.
"In our view, the distraction of integrating 99p Stores is a legitimate reason for lost focus on the core. However, the extent and duration of this is a surprise and momentum appears to have deteriorated, with no improvement in 4Q despite materially easier comparatives and little prospect of near-term relief."
Planned store openings have also been curtailed to 30-40 for the new financial year, with management anticipating a return towards the historical run rate of 60 once the 99p integration is complete.
HSBC's analysts were also concerned that the investment to stabilise 99p Stores has proved a major drag on cash flow, sending the business to a net debt position. |
| | Award winning Barclays Stockbrokers Investment ISA | | Use your ISA allowance by 5 April 2016. You don't have to make investment choices straight away - as long as you have the cash in place, that’s enough to secure the tax benefits of this year’s allowances.
The value of investments can fall, tax rules may change and their effects depend on individual circumstances.
Find out more about a Barclays Stockbrokers Investment ISA | | |
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