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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: FTSE 100 falls as property stocks subside London stocks opened lower on Wednesday as the housebuilding and property rally ran out of steam and attention turns firmly towards the changing of Britain's leadership and the Bank of England's looming policy tinkering.
After almost half an hour of trading, the FTSE 100 was down 0.27% to 6,662.42, while the FTSE 250 was only just in positive territory at 16,814.33.
The blue chip index was in the red despite a positive Asian and US sessions, noted market analyst Naeem Aslam at Think Markets, as having erased global losses from the initial Brexit shock, investors now wanted to lock some profit after the rebound.
"Generally speaking they are poised to take on risk, however caution remains the main theme among traders in Europe. There have been some impressive gains over in Asia and US, therefore you could say risk mode is gathering steam as a result of this and this is why the US treasury yield had the biggest two days of gains since the 2011," he said.
The pound was up agains the dollar at 1.326 and regained the 1.2 mark against the euro for the first time this month.
CMC Markets' Michael Hewson pointed out that the pound had it best day in weeks on Tuesday as markets cheered the prospect of some form of certainty at the top of government.
"This new found stability may also have tempered some of the prospect of an imminent rate cut at tomorrow's Bank of England rate meeting, given that credit conditions are significantly easier than they were three weeks ago, due to the relaxing of banks capital buffer requirements and the up to £250bn of available extra liquidity that can be called upon if required at the various liquidity auctions."
On the data front, the Bank of England credit conditions survey is at 0930 BST, eurozone industrial production is at 1000 BST and the US import price index is at 1330 BST.
Topping the FTSE 100 was Burberry as, despite declines across all three of its regions leading to a 3% like-for-like drop in retail sales in the first quarter, this was better than the 5% fall that had been forecast by market. The luxury retailer warned that its markets remain challenging and that its wholesale outlook has become more cautious for both the first and second halves but said underlying revenue was flat and that it still expected low single-digit percentage growth in total retail revenue for the full year, as well as a £90m benefit from currency rates if they remain at current levels.
Housebuilder Barratt Developments was one of the big fallers, caught up in a sector-wide retreat, even though it said full year profit before tax was to increase by around 20% to £680m, in line with market expectations.
Total completions, including joint ventures, increased by 5.3% to 17,319, as a result of strong consumer demand during the financial year. It added that was too early to say what the impact of the uncertainty facing the UK economy will be post the Brexit vote.
Pharmaceutical giant AstraZeneca was up slightly after entering into an agreement with Sandoz and its affiliates to resolve litigation relating to fulvestrant product, Faslodex, which Sandoz has been seeking FDA approval for a generic version.
Astra said: "On 12 July 2016, the United States District Court for the District of New Jersey entered a consent judgment filed by AstraZeneca and Sandoz, which includes an injunction preventing Sandoz from launching a generic fulvestrant product until 25 March 2019, or earlier in some circumstances." |
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| Market Movers
FTSE 100 (UKX) 6,677.21 -0.08%
FTSE 250 (MCX) 16,775.14 0.41%
techMARK (TASX) 3,290.61 -0.72%
FTSE 100 - Risers
International Consolidated Airlines Group SA (CDI) (IAG) 409.90p 5.05%
Glencore (GLEN) 186.00p 4.61%
St James's Place (STJ) 825.50p 4.56%
easyJet (EZJ) 1,142.00p 4.29%
Aviva (AV.) 381.80p 4.23%
Prudential (PRU) 1,284.00p 3.38%
Taylor Wimpey (TW.) 145.30p 3.20%
Dixons Carphone (DC.) 329.20p 3.13%
Schroders (SDR) 2,575.00p 2.96%
Legal & General Group (LGEN) 188.90p 2.89%
FTSE 100 - Fallers
Mediclinic International (MDC) 1,060.00p -5.02%
Randgold Resources Ltd. (RRS) 9,115.00p -4.30%
Hikma Pharmaceuticals (HIK) 2,505.00p -3.65%
Fresnillo (FRES) 1,929.00p -2.77%
National Grid (NG.) 1,092.50p -2.24%
Reckitt Benckiser Group (RB.) 7,525.00p -2.17%
Bunzl (BNZL) 2,330.00p -1.98%
AstraZeneca (AZN) 4,467.50p -1.94%
Unilever (ULVR) 3,586.00p -1.91%
Centrica (CNA) 227.50p -1.90%
FTSE 250 - Risers
Rathbone Brothers (RAT) 1,919.00p 11.38%
DFS Furniture (DFS) 207.60p 8.69%
Galliford Try (GFRD) 957.00p 8.50%
Evraz (EVR) 158.30p 8.35%
Marshalls (MSLH) 267.00p 8.27%
Brown (N.) Group (BWNG) 189.50p 8.16%
Aldermore Group (ALD) 139.00p 7.92%
Keller Group (KLR) 1,008.00p 7.69%
Shawbrook Group (SHAW) 164.60p 7.44%
Ocado Group (OCDO) 254.50p 7.38%
FTSE 250 - Fallers
NMC Health (NMC) 1,120.00p -10.33%
Centamin (DI) (CEY) 159.10p -5.63%
Hochschild Mining (HOC) 233.00p -4.31%
Genus (GNS) 1,680.00p -4.22%
Circassia Pharmaceuticals (CIR) 99.40p -3.87%
Acacia Mining (ACA) 538.00p -3.84%
Rotork (ROR) 211.00p -3.48%
UK Commercial Property Trust (UKCM) 76.35p -2.86%
Victrex plc (VCT) 1,545.00p -2.59% |
| | Wednesday 06 July
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Balance of Trade (US) (13:30)
Factory Orders (GER) (07:00)
ISM Non-Manufacturing (US) (15:00)
SPECIAL DIVIDEND PAYMENT DATE
Helios Underwriting
EGMS
Industrial Mlulti Propety Trust
AGMS
Altitude Group, Booker Group, Mobile Tornado Group, Palace Capital , Sainsbury (J), Shires Income, Summit Germany Limited, TechFinancials (DI)
TRADING ANNOUNCEMENTS
Booker Group
FINAL DIVIDEND PAYMENT DATE
Air Partner, Helios Underwriting, Hunting, Laird, Restaurant Group |
| | Brexit has already had a huge impact on the markets. | | But where are the markets headed next? Download your FREE report now |
| | Europe Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks waver as investors pause for breath European stocks wavered in early trade as investors paused for breath following solid gains in the previous session, with the UK in focus again as Theresa May takes over from David Cameron as Prime Minister.
At 0900 BST, the benchmark Stoxx Europe 600 index was flat, Germany's DAX was 0.3% lower and France's CAC 40 was down 0.1%.
At the same time, oil prices retreated after a stellar performance on Tuesday. West Texas Intermediate was down 1.2% at $46.22 a barrel and Brent crude was 1.4% weaker at $47.77. Data from the American Petroleum Institute on Tuesday also weighed on prices, after it showed US crude inventories rose by 2.2m barrels in the week to July 8 to 523.1m, versus analysts' expectations for a 3m barrel drop.
"European equities are range bound in early trade, as markets have reached the point where investors are starting to wonder how much further the rally can go from here and what impact strengthening sterling will have on asset prices," said Rebecca O'Keeffe, head of investment at stockbroker Interactive Investor.
"The last few weeks have seen markets rally strongly as investors assume the most positive outcome for assets, with limited Brexit risks combining with the investor assumption that global central banks will do whatever it takes to ease market concerns and stimulate the market - including the view that the Fed will not hike rates any time soon. In effect, this has created a situation where the global equity market has been operating on the premise that they can have their cake and eat it too!"
Pharmaceuticals giant AstraZeneca was trading a little higher after saying it has entered into an agreement with Sandoz and its affiliates to resolve litigation relating to Faslodex (fulvestrant).
Luxury retailer Burberry was in the black despite reporting declines across all three its regions, which led to a 3% like-for-like drop in retail sales in the first quarter.
Alstom was higher after the French train maker posted a 9% rise in quarterly sales, while UniCredit shares gained ground after the bank sold minority stakes in two of its units.
Poundland surged after it agreed South Africa's Steinhoff Holdings could buy the remaining shares in the London-listed discount retailer it does not already own for 222p per share in cash, valuing it at £597m.
French supermarket operator Groupe Casino was on the back foot after saying second-quarter sales were up 3.8% on a like-for-like basis. |
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| | US Market Report | | US close: Stocks end in the black; Dow and S&P 500 hit fresh records US stocks ended in the black on Tuesday as oil prices advanced and investors welcomed signs of further central bank stimulus, following better-than-expected earnings from industrial bellwether Alcoa.
The Dow Jones Industrial Average and the S&P 500 closed at fresh records, up 0.7%, while the Nasdaq also ended the session 0.7% firmer.
Surging oil prices lent support, with West Texas Intermediate up 4.5% to $46.77 per barrel and Brent crude up 4.5% to $48.35. Oil was given a boost after the Organization of Petroleum Exporting Countries said in a monthly report that non-OPEC output would fall by 880,000 barrels a day this year. Also on Tuesday, the Energy Information Administration said it expects non-OPEC production to fall more than previously estimated in 2016.
Receding fears about Brexit lent a hand as investors continued to cheer news that Theresa May was set to succeed David Cameron as Prime Minister of the UK this week.
In addition, comments from Japanese Prime Minister Shinzo Abe, who promised on Tuesday to stimulate the country's economy, improved the mood. Abe, whose ruling party and coalition won a majority in upper-house elections on Sunday, said he wants "the swift formulation of comprehensive, bold economic measures".
Investors were also looking ahead to Thursday's Bank of England rate announcement amid growing expectations of a rate cut in the wake of the UK's decision to leave the European Union.
Bank of America Merrill Lynch said it expects the BoE to cut interest rates by at least 25 basis points, saying the central bank had nothing to gain by waiting.
On the corporate front, shares in Alcoa continued to rally a day after the aluminium giant reported quarterly earnings and revenue that surpassed analysts' forecasts.
Fastenal, on the other hand, slumped after reporting an unexpected drop in second quarter profit.
Elsewhere, US-listed shares of Shire rallied after the US Food and Drug Administration approved its lifitegrast eye drops for treating signs and symptoms of dry eye disease.
Later this week, major banks are due to report including JP Morgan Chase & Co., Citigroup and Wells Fargo & Co.
Seagate Technology surged after it announced late on Monday that it will cut 6,500 jobs globally, or around 14% of its workforce.
Meanwhile, St. Louis Fed President James Bullard on Tuesday reiterated in a speech that he reckons only a single interest rate increase will be needed for the foreseeable future.
Fellow Fed official Daniel Tarullo urged better regulation of short-term funding both inside and outside the banking system in a separate speech in Washington.
In economic data, NFIB's small business optimism index rose to 94.5 in June from 93.8 a month earlier, beating expectations for 94.0.
Elsewhere, US wholesale inventories rose 0.1% in May compared to a month ago, the Department of Commerce said, following an upwardly revised 0.7% increase in April. Analysts had expected a 0.2% gain.
The Labor Department revealed in its Job Openings and Labor Turnover Survey that the number of job openings fell by 345,000 to 5.5m in May, driven by a decline in the private sector. The job openings rate was at 3.7% in May.
The number of hires was little changed at 5m at a rate of 3.5%. Hiring within private and government were broadly stable.
S&P 500 - Risers
Seagate Technology Plc (STX) $29.35 +21.83%
American Airlines Group (AAL) $34.66 +11.23%
Freeport-McMoRan Inc (FCX) $12.90 +10.73%
Southwestern Energy Co. (SWN) $14.20 +10.08%
Chesapeake Energy Corp. (CHK) $4.58 +9.57%
Transocean Ltd. (RIG) $12.84 +9.00%
United Continental Holdings Inc. (UAL) $46.16 +8.84%
Murphy Oil Corp. (MUR) $32.10 +7.94%
Hess Corp. (HES) $60.13 +7.24%
Diamond Offshore Drilling Inc. (DO) $26.11 +6.96%
S&P 500 - Fallers
Fastenal Co. (FAST) $43.79 -3.46%
Newmont Mining Corp. (NEM) $39.96 -2.68%
Eversource Energy (ES) $57.88 -2.44%
Reynolds American Inc. (RAI) $51.96 -2.33%
Kraft Heinz Co. (KHC) $87.80 -2.27%
Church Dwight Co Inc. (CHD) $99.57 -2.08%
Xcel Energy Inc. (XEL) $43.50 -2.05%
Pinnacle West Capital Corp. (PNW) $79.44 -2.02%
Regeneron Pharmaceuticals Inc. (REGN) $368.75 -1.86%
Wisconsin Energy Corp. (WEC) $63.71 -1.85%
Dow Jones I.A - Risers
Goldman Sachs Group Inc. (GS) $156.92 +3.11%
E.I. du Pont de Nemours and Co. (DD) $65.94 +2.65%
Caterpillar Inc. (CAT) $79.80 +2.57%
Nike Inc. (NKE) $58.06 +2.16%
Intel Corp. (INTC) $34.94 +1.63%
JP Morgan Chase & Co. (JPM) $63.20 +1.49%
American Express Co. (AXP) $63.00 +1.35%
Chevron Corp. (CVX) $106.78 +1.32%
Visa Inc. (V) $77.48 +1.25%
Microsoft Corp. (MSFT) $53.21 +1.18%
Dow Jones I.A - Fallers
Wal-Mart Stores Inc. (WMT) $73.27 -1.07%
Boeing Co. (BA) $130.81 -0.93%
Verizon Communications Inc. (VZ) $55.47 -0.82%
Unitedhealth Group Inc. (UNH) $139.86 -0.33%
Home Depot Inc. (HD) $134.84 -0.23%
Travelers Company Inc. (TRV) $118.09 -0.03%
Johnson & Johnson (JNJ) $122.92 -0.01%
Nasdaq 100 - Risers
Seagate Technology Plc (STX) $29.35 +21.83%
American Airlines Group (AAL) $34.66 +11.23%
Illumina Inc. (ILMN) $148.99 +6.70%
Western Digital Corp. (WDC) $51.84 +4.77%
Micron Technology Inc. (MU) $13.23 +4.67%
Liberty Global plc Series A (LBTYA) $30.60 +4.15%
Liberty Global plc Series C (LBTYK) $29.87 +3.86%
Autodesk Inc. (ADSK) $57.38 +3.41%
Norwegian Cruise Line Holdings Ltd. - Ordinary Shares (NCLH) $44.55 +3.22%
NetApp Inc. (NTAP) $25.16 +3.03%
Nasdaq 100 - Fallers
Fastenal Co. (FAST) $43.79 -3.46%
Kraft Heinz Co. (KHC) $87.80 -2.27%
Regeneron Pharmaceuticals Inc. (REGN) $368.75 -1.86%
Biomarin Pharmaceutical Inc. (BMRN) $87.48 -1.25%
Check Point Software Technologies Ltd. (CHKP) $81.45 -1.25%
Baidu Inc. (BIDU) $164.98 -1.23%
Sirius XM Holdings Inc (SIRI) $4.10 -0.97%
Walgreens Boots Alliance, Inc. (WBA) $81.22 -0.96%
T-Mobile Us, Inc. (TMUS) $43.64 -0.91%
Amazon.Com Inc. (AMZN) $748.21 -0.74% |
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| | Newspaper Round Up | | Wednesday newspaper round-up: BoE bullying, pensions liabilities, Poudland, Rolls Mark Carney may have bounced the Bank of England into an unnecessary interest rate cut by calling for stimulus only days after the Brexit result, leading economists have warned in a fierce attack on the governor. Former Bank policymakers and other senior economists said that Mr Carney's personal assertion on June 30 that "policy easing will likely be required over the summer" had put his colleagues on the monetary policy committee in an impossible position, given the uncertainty since the referendum. - The Times
Britain's gold-plated pensions now have record-breaking liabilities of £1.75 trillion after the EU referendum triggered a rout in their core gilt and equity holdings, highlighting the difficulty of funding the UK's retirement needs. The country has almost 6,000 defined benefit schemes, which are obliged to pay their members an amount in retirement often tied to their final salary. Just 950 of these schemes were in surplus on June 30, with the rest hoping to make up the shortfall from long-term investment returns. - Telegraph
Steinhoff, the acquisitive South African retailer, is poised to announce a £450m agreement to buy full control of Poundland, the struggling UK discount chain, in what would be its first successful takeover of a European company this year. Poundland is expected to reveal on Wednesday that it has a recommended a Steinhoff offer of 220p a share for the remaining 76 per cent of stock it does not already own, according to people close to the talks. - Financial Times
Rolls-Royce could boost its profitability by £1bn if tough targets, in addition to cost cuts already identified by the company, can be hit, according to chief executive Warren East. Speaking at a briefing at Farnborough Airshow, Mr East he was "pleased" with the progress being made on his transformation plan for the engineering company. He said it was on track to take between £150m and £200m of costs out of the business by 2017. - Telegraph
An activist hedge fund has built a stake in SABMiller amid growing investor unease about the terms of the FTSE 100 brewer's £77bn sale to Stella Artois-owner Anheuser-Busch InBev. Elliott Capital Advisors, the UK arm of US hedge fund Elliott Management, has acquired a 1.3pc holding in SAB through derivatives called contracts for difference. - Telegraph
A leading independent City voting adviser has criticised Burberry over the handling of its recent management reshuffle and has attacked its pay to senior executives as being excessive and "out of touch". Manifest berated Burberry for announcing that Marco Gobbetti would replace Christopher Bailey as chief executive only two days before its annual meeting tomorrow. - The Times
Drivers are not receiving the full benefit of declining oil prices since the Brexit vote result, according to motoring group RAC. The group is calling on fuel retailers to pass on the falling price of petrol, and says diesel price cuts may need to follow. - Telegraph
In an effort to reverse three years of falling EuroMillions sales after rollover jackpots have begun to become thin on the ground, Camelot, the National Lottery operator, has revamped the prizes and raised the price of a ticket. Under changes to be introduced in September, there will be higher starting jackpots of £14 million and more than twice as many jackpots of £50 million, a key threshold for driving ticket sales. - The Times
McDonald's is struggling to attract the calibre of bidders it envisioned in the sale of its China and Hong Kong franchise, according to people familiar with the situation. With the auction, announced earlier this year, the company is seeking to reduce its direct exposure to China, where food supply scandals have hurt its share price, and to halt capital expenditure in the region. - Financial Times
JPMorgan Chase is to raise its guaranteed minimum wage for employees by a fifth, placing its baseline pay in line with the national "Fight for $15" movement. "A pay increase is the right thing to do," the chairman and chief executive, Jamie Dimon, wrote in an opinion piece published in the New York Times. - The Guardian | | |
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