| | | | | | | | | |
| | London Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | London close: Stocks finish higher after US non-farm payrolls exceed forecasts London stocks ended the week on the front foot after a much better-than-expected US non-farm payrolls report.
The US non-farm payrolls report provided a boost to markets as it smashed expectations in June. The Labor Department said the US economy added 287,000 jobs in June, well above the 180,000 that economists had forecast. May's figures were revised down to 11,000 jobs from an already-low 38,000, which had been affected by 35,000 Verizon workers on strike.
However, the unemployment rate rose to 4.9% in June from 4.7% in May, more than the expected rate of 4.8%.
Wage growth was weaker-than-anticipated, with average hourly earnings rising 2.6% in June from a year ago compared to estimates for a 2.7% increase. Earnings climbed 2.5% year-on-year in May.
"US employment growth rebounded with a vengeance in June, but the underlying trend remains one of a slowdown in hiring, and it's far from clear whether June's bumper non-farm payroll increase reflects a renewed appetite for companies to hire staff," said Chris Williamson, chief economist at Markit.
"For sure, today's data add to scope for interest rates to be nudged higher before the year is out. But the bigger picture remains one in which the Fed is likely to err on the side of caution, with policymakers viewing the better than expected hiring in the perspective of a more uncertain longer-term outlook."
Earlier in the session, weak UK data had sent stocks lower.
The GfK's post-Brexit consumer confidence index contracted further to -9 from -1 in June, marking the sharpest drop since December 1994 and the lowest level since December 2013.
"The post Brexit vote plunge in consumer confidence reported by GfK reinforces concern that consumers are likely to markedly rein in their spending over the coming months," said Howard Archer, chief UK and European economist at IHS Global Insight.
"This would be especially damaging to growth UK prospects given the key role that the consumer has played."
Separately, official data showed the UK's total trade deficit in goods and services widened to £2.3bn in May but was not as bad as the £3.6bn feared by economists, as exports fell 4.4% month-on-month and imports were down 3.5%.
In the eurozone, Germany's trade surplus shrank in May as exports declined unexpectedly, the Federal Statistical Office revealed The seasonally-adjusted trade surplus narrowed to €22.2bn in May from €24.1bn in April, according to Destatis, slightly below forecasts of €23bn. Exports fell 1.8% in May while imports rose 0.1%.
Meanwhile, the International Monetary Fund cut its growth forecast for the eurozone following the UK's vote to leave the European Union. In its annual report on the currency union's economy, the IMF said it now expects gross domestic product to rise 1.6% this year, compared its estimate of 1.7% growth before the EU referendum.
In 2017 the fund sees GDP growth of 1.4%, down from 1.7% forecast previously. In 2018 GDP will grow at 1.6% rather than 1.7%, the fund said.
On the company front, housebuilders and real estate stocks rebounded from lower levels seen throughout the week including Berkeley Homes, Barratt Developments, Persimmon and Taylor Wimpey.
Marks & Spencer also bounced back after Credit Suisse raised its rating on the stock to 'neutral' from 'underperform'.
Aveva Group was a strong riser as it said it could benefit from a potentially sizeable currency gain for the full year due to weakness of sterling since the EU referendum.
On the downside, miners were sitting lower as gold prices dropped. Randgold Resources and Antofagasta were among the fallers.
Sports Direct was on the back foot after on Thursday reporting on a "disappointing" year, with retail revenue excluding Heatons improving by just 0.6%. |
| | Join the UK`s hottest investment niche & discover great returns! | | Earn 6.37% up to 7.52% p.a paid to your bank account monthly! Limited availability - Offer ends on 31.6.16 Click Here |
| Market Movers
FTSE 100 (UKX) 6,599.49 1.01%
FTSE 250 (MCX) 16,177.75 1.75%
techMARK (TASX) 3,265.95 0.88%
FTSE 100 - Risers
Taylor Wimpey (TW.) 131.50p 7.70%
Berkeley Group Holdings (The) (BKG) 2,498.00p 7.49%
Barratt Developments (BDEV) 373.20p 6.90%
Royal Bank of Scotland Group (RBS) 168.80p 6.43%
Persimmon (PSN) 1,420.00p 6.21%
Marks & Spencer Group (MKS) 317.30p 6.16%
Lloyds Banking Group (LLOY) 52.63p 5.90%
Dixons Carphone (DC.) 315.30p 5.81%
Hargreaves Lansdown (HL.) 1,199.00p 5.55%
Hammerson (HMSO) 517.50p 5.08%
FTSE 100 - Fallers
Fresnillo (FRES) 1,875.00p -2.14%
Antofagasta (ANTO) 456.70p -1.72%
Imperial Brands (IMB) 4,034.00p -1.31%
Coca-Cola HBC AG (CDI) (CCH) 1,538.00p -1.03%
British American Tobacco (BATS) 4,902.00p -0.92%
Shire Plc (SHP) 4,841.00p -0.68%
Diageo (DGE) 2,147.00p -0.65%
AstraZeneca (AZN) 4,574.00p -0.42%
Pearson (PSON) 944.50p -0.37%
Unilever (ULVR) 3,651.50p -0.23%
FTSE 250 - Risers
Bovis Homes Group (BVS) 737.00p 11.67%
Aldermore Group (ALD) 125.90p 11.51%
OneSavings Bank (OSB) 199.70p 11.50%
Ibstock (IBST) 126.70p 10.46%
Entertainment One Limited (ETO) 187.00p 9.23%
Bellway (BWY) 1,880.00p 9.05%
Crest Nicholson Holdings (CRST) 380.60p 7.97%
Marshalls (MSLH) 222.00p 7.51%
Countryside Properties (CSP) 211.90p 7.35%
CYBG (CYBG) 229.60p 7.29%
FTSE 250 - Fallers
Sports Direct International (SPD) 268.20p -3.91%
CLS Holdings (CLI) 1,163.00p -3.08%
AO World (AO.) 138.90p -2.18%
Card Factory (CARD) 305.00p -2.18%
Ascential (ASCL) 233.60p -1.85%
GCP Infrastructure Investments Ltd (GCP) 117.00p -1.10%
DFS Furniture (DFS) 185.00p -0.96%
Millennium & Copthorne Hotels (MLC) 400.60p -0.84%
NB Global Floating Rate Income Fund Ltd GBP (NBLS) 90.50p -0.77%
Dechra Pharmaceuticals (DPH) 1,175.00p -0.76% |
| | Learn how to become an Angel Investor from leading Angels | | Business Agent, Bond Dickinson and Angels Den would like to invite you to attend our ‘Become an Angel’ lunchtime masterclass. The Become an Angel masterclass is designed to provide Angels with valuable information in order to allow them to make informed and educated decisions when it comes to investing. It also allows Angel Investors to network with other Angels and thought leaders in the market. This class will cover the basics of investing by highlighting what to look for in businesses and identifying the best practices for making investments. Click Here to Register |
| | Europe Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Markets close higher on solid US jobs data European stocks rose on Friday after the US nonfarm payrolls for June were released, with a surprisingly high headline figure.
Germany's DAX edged up 2.24%, France's CAC 40 increased 1.77%, Italy's FTSE MIB jumped 4.08% and Spain's IBEX 35 gained 2.22%.
Oil prices were also higher with Brent crude last up 0.54% to $46.65 per barrel per barrel and West Texas Intermediate up 0.46% to $45.35 per barrel.
The Labor Department's nonfarm payrolls report came in with a headline reading of 287,000 jobs in June, against expectations for 180,000 and a reading of just 38,000 in May.
The Federal Reserve is watching the labour market closely in determining when to raise interest rates.
It said a weak May jobs report played a part in its decision to keep rates unchanged in June.
"Last month's US payroll data changed the landscape for the markets and for the Fed," said Naeen Aslam, chief market analyst at Think Market UK.
"As a result, investors scaled back on their bullish dollar bets because they could not see the Fed increasing the interest rate anytime soon."
In eurozone data, Germany's trade surplus shrank in May as exports declined unexpectedly, the Federal Statistical Office revealed The seasonally-adjusted trade surplus narrowed to €22.2bn in May from €24.1bn in April, according to Destatis, slightly below forecasts of €23bn. Exports fell 1.8% in May while imports rose 0.1%.
In the UK, the GfK's post-Brexit consumer confidence index contracted further to -9 from -1 in June, marking the sharpest drop since December 1994 and the lowest level since December 2013.
"The post Brexit vote plunge in consumer confidence reported by GfK reinforces concern that consumers are likely to markedly rein in their spending over the coming months," said Howard Archer, chief UK and European economist at IHS Global Insight.
"This would be especially damaging to growth UK prospects given the key role that the consumer has played."
Meanwhile, official data showed the UK's total trade deficit in goods and services widened to £2.3bn in May but was not as bad as the £3.6bn feared by economists, as exports fell 4.4% month-on-month and imports were down 3.5%.
On the corporate front, shares in banks and real-estate investment trusts rallied after being pummelled throughout the week.
Germany's Deutsche Bank was among the risers in banks along with Italy's Banca Monte dei Paschi di Siena SpA which said it was working with European banking authorities to reduce its bad loans.
Among real estate shares, Hammerson and Land Securities were in the black. |
| | Open Trading Account | | Thinking about trading binary options? Test out a free $10,000 Demo account with iq option. Click Here to start trading |
| | US Market Report | | US open: Stellar nonfarms lead markets higher Markets in the US opened higher on Friday, after a surprisingly strong nonfarm payrolls reading before the opening bell.
After the bell, the Dow Jones Industrial Average was up 0.7%, the S&P 500 added 0.73% and the Nasdaq Composite rose 0.72%.
The 287,000 headline nonfarms figure was well ahead of the forecast 170,000 increase, and reassured investors after a surprisingly small reading for May.
With the rise in payrolls came a rise in unemployment to 4.9% from 4.7%, however, as more Americans entered the workforce in search of jobs.
The Federal Reserve has said it is using the jobs market as an indicator of when it should next raise interest rates.
There was concern after May's disappointing result, and the fallout of Brexit across the pond, that the Fed's planned rate increases were being put on hold.
Investors are no longer pricing in a rate increase this year, according to the CME Fed Watch Tool, having previously anticipated several rate hikes over the course of 2016.
Oil was still rising, with West Texas Intermediate up 1.01% at $45.60 per barrel and Brent crude adding 0.94% at $46.84.
In corporates, Eleven Biotherapeutics shares soared after the drugmaker's Investigational New Drug application for EBI-031 became effective, entitling the company to a $22.5m milestone payment from Hoffman-La Roche.
Gap announced late on Thursday that same-store sales rose 2% in June, leading the stock to jump early on Friday.
Juno Therapeutics tumbled after the company said on Thursday that its study into a cancer drug has been suspended by the FDA after two patients died.
Polycom was up after it was announced that Siris Capital will acquire the telecoms equipment maker for $2bn in cash, though that also brought the axe down on a previously agreed merger between Polycom and Mitel Networks.
SemiLEDS fell in early trading, after flying 208% higher on Thursday on news Peter Chiou was spending $5 per share to buy 577,000 shares in the firm. |
| | Broker Tips | | Broker tips: Aveva, Compass, Petra Diamonds Aveva Group's shares jumped on Friday as Numis reiterated a 'buy' rating and target of 1,910p.
The information technology group said it could benefit from a potentially sizeable currency gain for the full year due to weakness of sterling since the EU referendum.
The company added that trading had remained satisfactory in recent weeks. At the same time, Aveva announced the stepping down of chief executive Richard Longdon after three decades at the data and IT provider.
Longdon will be replaced by chief financial officer James Kidd at the end of 2016.
Kidd, who has been CFO since January 2011 and taking an increasing role in the commercial and operational development of the group in recent years, will be replaced in that role by Aveva's current head of finance, David Ward.
"In our view both James and David are very able individuals who will rise to the challenges of their new roles, and Richard's ongoing position with Aveva will ease the transition," according to Numis.
Numis said its numbers suggest a 5% incremental benefit on a weaker pound for fiscal year 2017, but the broker will leave its forecasts unchanged for the time being.
"Our investment case remains that at some point the market backdrop will improve and Aveva will return to strong topline growth accompanied by significant margin expansion, and thus could deliver earnings 50% better than current levels (i.e. 90p + of earnings per share) which would put the shares on c.15x enterprise value: net operating profit after tax."
Compass Group's 'buy' rating was left unchanged and its target was lifted to 1,645p from 1,425p by Canaccord Genuity on Friday.
Canaccord said it was upgrading its forecasts and target on the catering company to reflect the benefits from a weaker sterling post-Brexit as about 90% of its earnings before interest and tax (EBIT) is generated outside the UK.
The broker has raised its earnings per share forecast by 4.9% to 61.7p for fiscal year 2016, by 12.5% to 71.7p for 2017 and by 12.3% to 76.9p for 2018.
"Compass generates only around 10-12% of EBIT in the UK and a 1% change in a basket of all its currencies has a £12m impact on EBIT," Canaccord said.
"The major currency is the US$ and a five US cents move has an around £20m impact to full year EBIT; a five Euro cents move in the €:£ is worth around £7.5m."
On Compass Group's Capital Markets Day last week, Canaccord said it was "impressed by the quality of the management team, their cohesiveness and their enthusiasm to maintain and enhance their secular track record".
Canaccord added that it believes Compass is the biggest player in contract catering with an estimated 9% share.
Petra Diamonds had its 'buy' rating and target of 197p maintained on Friday by FinnCap after the miner announced a joint venture with Ekapa Mining.
Petra and Ekapa Mining plans to combine its operations in Kimberley, South Africa, including the Kimberley underground mine and the Kimberley and Ekapa tailings retreatment operations.
"This has allowed the old plants at Kimberley mine to be closed with all processing henceforth to use the new Combined Treatment Plant (CTP)," said FinnCap analyst Martin Potts. | | |
New ADVFN Service - FREE Reports Get your free report on Isa's, Investment Trusts, Funds,
Sipps Travel and Cars - FREE and Easy service CLICK HERE
To advertise in the Euro Markets Bulletin please contact advertise@advfn.com |
| | | | | | | To unsubscribe from this news bulletin or edit your mailing list settings click here. Registered Office/Accounts Dept: Suite 27, Essex Technology Centre, The Gable, Fyfield Road, Ongar, CM5 0GA. Customer Support +44 (0) 207 0700 961. Company registered in England and Wales: Number 2374988 VAT No. GB 549 2130 49 | |
No comments:
Post a Comment