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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 on front foot as property and banks bounce London stocks were lifted in early Thursday trading as shares were lifted after a positive US session lifted by a dovish Federal Reserve and rebounding oil prices.
After just over half an hour of trading in the City, the FTSE 100 was up 1.25% to 6,544.23 and the FTSE 250 was bouncing back from three days of falls with a 1% rise to 15,826.29.
Leading the blue chip index was a rally from embattled property giants and financials, which have seen their shares ravaged by the market in the days since the Brexit result.
European markets were trading higher despite German industrial production numbers falling well short of expectations with a reading of -1.3% versus a forecast of 0.1%.
Sterling was also off its lows but blessed with little momentum, up 0.13% against the dollar at 1.2948 and up 0.4% on the euro to 1.1695.
Minutes of the Federal Reserve's latest rate setting meeting revealed the committee's caution ahead of the EU referendum vote on these shores, giving the market an opportunity to breathe a sigh of relief that a rate hike is not immediately around the corner.
Oil prices moved off one-month lows thanks to a larger than expected drawdown in API inventories overnight, with front-month Brent Crude up 0.43% at $49.01 a barrel and WTI up 0.57% at $47.7.
"US stock markets closed with modest gains overnight after paring earlier losses on positive macro data and a bounce in the oil price," said analyst Mike van Dulken at Accendo Markets.
"The FOMC minutes gave markets little more to chew on, since they related to a meeting that took place before the UK's Brexit vote. Nonetheless, worries about inflation being too low are likely to lead thought concerning US monetary policy going forward and point towards a 'lower for longer' interest rate environment. This type of thing tends to be good for equity markets."
Later on Thursday will see meeting accounts from the European Central Bank's mid-June June meeting, though like their US counterparts' they will be somewhat outdated but could still move the markets.
There will also be data on UK manufacturing and industrial production data.
CMC analyst Michael Hewson said: "Given the sharp contraction seen in the equivalent May manufacturing PMI numbers it is hard to see how these numbers could match the sharp gains seen in the April numbers. In April we saw a rebound of around 2% in both which was rather surprising. The May numbers are expected to show a decline of in excess of 1% for both numbers."
In company news, Marks & Spencer saw a huge drop in clothing sales in the first quarter as new chief executive Steve Rowe's recovery plan for general merchandise took hold, though reported group sales up 1.3%. Food sales in the 13 weeks to 2 July fell 0.9% on a like-for-like basis, hit by the difference in Easter timing compared to last year, but despite an 8.9% slide in LFL sales from the Clothing & Home as the number of promotions was cut back but Rowe was encouraged despite the "weak market".
Associated British Foods was on the up after it said the significantly weakness in the pound after last week's Brexit vote had improved the outlook for the current financial year and it no longer expect a decline in adjusted earnings per share for the group. "In our next financial year, these rates would have both positive and negative effects on profit. There would be an adverse transactional effect on the profit margin on Primark's UK sales, currently half of its turnover, a favourable transactional effect on British Sugar's margins and a translation benefit on group profits earned outside the UK, which last year were some 50% of the total," the company said.
Hospitality group Whitbread announced on Thursday that it has exchanged agreements with Legal & General for the sale and leaseback of its 389-room 'Hub by Premier Inn' hotel in Kings Cross, due to open in 2017, in exchange for a 25 year lease agreement. The FTSE 100 company announced plans in April to carry out sale and leaseback transactions during this year, with proceeds of £100m to £150m. Legal & General will pay £84.5m in cash for the property, with an initial payment of £46.5m due on exchange and further staged payments made during the construction of the property.
High street retailer Sports Direct reported on a "disappointing" year on Thursday, with retail revenue excluding Heatons improving by just 0.6%. The FTSE 250 firm said total group revenue was up 2.5% to £2.9bn in the year to 24 April, with gross group margin improving 0.4% to 44.2%. Underlying EBITDA shrunk 0.5% to £381.4m, with underlying profit before tax dropping 8.4% to £275.2m and underlying earnings per share retreating 8.7% to 35.5p. Reported profit before tax was ahead 15.4% at £361.8m, with reported earnings per share reaching 46.8p. |
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| | FTSE 100 - Risers
British Land Company (BLND) 579.00p 6.34%
Land Securities Group (LAND) 976.50p 5.85%
Associated British Foods (ABF) 2,699.00p 5.72%
Provident Financial (PFG) 2,313.00p 3.72%
Schroders (SDR) 2,275.00p 3.36%
Royal Bank of Scotland Group (RBS) 153.70p 3.22%
Prudential (PRU) 1,187.50p 3.13%
Lloyds Banking Group (LLOY) 49.01p 3.07%
Glencore (GLEN) 164.20p 2.85%
Aviva (AV.) 362.50p 2.84%
FTSE 100 - Fallers
Fresnillo (FRES) 1,967.00p -2.04%
Randgold Resources Ltd. (RRS) 9,640.00p -0.77%
Next (NXT) 4,716.00p -0.55%
Marks & Spencer Group (MKS) 292.50p -0.54%
Dixons Carphone (DC.) 280.60p -0.36%
British American Tobacco (BATS) 4,903.50p 0.07%
SABMiller (SAB) 4,379.50p 0.08%
Hargreaves Lansdown (HL.) 1,112.00p 0.09%
Capita (CPI) 902.50p 0.17%
Burberry Group (BRBY) 1,172.00p 0.26%
FTSE 250 - Risers
Sports Direct International (SPD) 309.00p 10.79%
Aldermore Group (ALD) 112.20p 7.06%
Thomas Cook Group (TCG) 58.30p 6.68%
NCC Group (NCC) 277.90p 6.11%
Serco Group (SRP) 111.90p 5.47%
Wetherspoon (J.D.) (JDW) 715.50p 4.76%
Morgan Advanced Materials (MGAM) 227.00p 4.37%
Great Portland Estates (GPOR) 583.00p 3.55%
CMC Markets (CMCX) 273.80p 3.36%
Aberdeen Asset Management (ADN) 281.30p 3.27%
FTSE 250 - Fallers
CLS Holdings (CLI) 1,125.00p -7.02%
McCarthy & Stone (MCS) 137.00p -5.52%
Galliford Try (GFRD) 762.50p -5.51%
Countryside Properties (CSP) 191.40p -2.79%
Euromoney Institutional Investor (ERM) 870.00p -2.68%
Hochschild Mining (HOC) 225.00p -2.39%
TalkTalk Telecom Group (TALK) 212.40p -2.16%
Pennon Group (PNN) 914.00p -1.98%
Dairy Crest Group (DCG) 544.00p -1.72% |
| | UK Event Calendar | | Thursday 07 July
INTERIM DIVIDEND PAYMENT DATE
Cardiff Property, Income & Growth VCT
INTERIM EX-DIVIDEND DATE
Character Group, Dewhurst, Dunedin Smaller Companies Inv Trust, One Media IP Group, Safestore Holdings, Sherborne Investors (Guernsey) 'B' Limited, Zytronic
QUARTERLY EX-DIVIDEND DATE
Fair Oaks Income Fund Limited , GLI Alternative Finance , Investors Capital Trust 'A' Shares, Schroder Income Growth Fund, SQN Asset Finance Income Fund Limited C SHS NPV
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Industrial Production (GER) (07:00)
FINALS
NCC Group, ReNeuron Group
IMSS
Dunelm Group
SPECIAL EX-DIVIDEND PAYMENT DATE
Establishment Inv Trust, Stock Spirits Group
AGMS
3i Infrastructure, Adgorithms Limited (DI), Atalaya Mining, C&C Group, China Africa Resources, Great Portland Estates, Maven Income & Growth VCT, Octopus AIM VCT, TwentyFour Select Monthly Income Fund Limited
TRADING ANNOUNCEMENTS
Associated British Foods, Dunelm Group, Great Portland Estates, Marks & Spencer Group, Premier Oil, Robert Walters
UK ECONOMIC ANNOUNCEMENTS
Halifax House Price Index (08:30)
Industrial Production (09:30)
Manufacturing Production (09:30)
FINAL DIVIDEND PAYMENT DATE
Arrow Global Group, Cineworld Group, Huntsworth, JPMorgan Euro Small Co. Trust, Mears Group, Tarsus Group, Young & Co's Brewery 'A' Shares
FINAL EX-DIVIDEND DATE
Amati VCT , Atkins (WS), Bisichi Mining, Burberry Group, Calculus VCT 'C' Shares, Crawshaw Group, Dairy Crest Group, E2V Technologies, Entertainment One Limited, Establishment Inv Trust, Homeserve, IG Design Group, Impellam Group, Mission Marketing Group, Monks Inv Trust, Next, Palace Capital , Pennon Group, Speedy Hire, Sprue Aegis, TalkTalk Telecom Group , Telecom Plus, ULS Technology , Vedanta Resources, VP, Wincanton, Workspace Group
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| | Europe Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks gain after oil price rebound, cautious Fed minutes European stocks gained on Thursday as oil prices rebounded and the Federal Reserve struck a cautious tone in its meeting minutes.
Oil prices rose after the American Petroleum Institute said on late Wednesday crude supplies fell 6.7 million barrels for the week ended 1 July. The closely watched Energy Information Administration report is due at 1600 BST.
Brent crude climbed 0.53% to $49.04 per barrel and West Texas Intermediate increased 0.60% to $47.72 per barrel.
Meanwhile, minutes of the Fed's 14-15 June policy meeting on late Wednesday showed most policymakers agreed to keep interest rates to a range between 0.25% and 0.5% following a weak May jobs report and uncertainty leading up to Britain's 23 June European Union referendum.
"The cautious tone from the FOMC minutes on Wednesday may be giving investors a lift today," said Craig Erlam, senior market analyst at Oanda.
"The Brexit vote alone is likely to deter them from raising rates until at least the end of the year as they wait to see what the knock on effects will be, both from an economic and financial markets perspective."
The European Central Bank at 1230 BST releases its own account of its last policy meeting in June when members also decided to keep policy unchanged. Investors will be focusing on any remarks with regard to Brexit.
In economic data, German industrial production fell the most in 21 months in May amid a global economic slowdown and political uncertainty in Europe. Production fell 1.3% from the previous month when it increased a revised 0.5%, the Economy Ministry said. Economists had pencilled in zero growth.
Still to come, UK industrial and manufacturing production at 0930 BST, US initial jobless claims at 1330 BST and the NIESR's UK gross domestic product estimate at 1500 BST.
On the company front, Marks & Spencer was in the red after reporting a like-for-like drop in clothing and home sales in the 13 weeks to 2 July while food sales fell 0.9%.
Danone shares jumped after saying it will acquire WhiteWave Foods in a deal that values the US organic foods producer at $12.5bn. |
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| | US Market Report | | US close: Stocks rally as Fed caution vindicated and oil rebounds US stock markets recovered from early Wednesday wobbles to recoup most of the week's losses so far as minutes from the Federal Reserve's latest policy meeting indicated there would be no rate hike until markets simmered down and domestic data strengthens.
The Dow Jones Industrial Average stood 0.44% higher at 17,918.62 by the close, with the S&P 500 up 0.54% at 2,099.73 and the Nasdaq was up 0.75% at 4,859.16.
Earlier as stocks slid, benchmark Treasury yields wallowed around record low of 1.357% from the prior day, while the price of gold showed steel as investors flock to perceived safe havens.
After an initial dip, oil was back up above $47, with front-month West Texas Intermediate rising 2.7% at $47.86 a barrel by home time on Wall Street, with Brent Crude also 2.7% higher to $49.23.
The dollar was up 0.8% as the pound was again roughed up to almost £0.774, but down 0.2% versus the euro at €0.901 and down 0.4% on the yen at 101.32.
The rate-setting Federal Open Market Committee was divided in its opinion but was shown to have played it safe in its 14-15 June meeting, 10 days before the result of the crucial European Union referendum across the Atlantic that has since proved a catalyst for considerable market turmoil.
"Members generally agreed that, before assessing whether another step in removing monetary accommodation was warranted, it was prudent to wait for additional data on the consequences of the UK vote," the minutes read, while views were split on the interpretation of payroll data from April and May, and on the likelihood of inflation rising.
As at the April meeting, the FOMC set three conditions for an interest rate hike: a pickup in economic growth, employment growth sufficient to reduce unemployment, and inflation likely to rise to 2% over the medium term.
Many analysts see December as the likely date for a hike, though some even see this being pushed back.
"The minutes support our view that the FOMC is now taking a wait-and-see approach to assess the employment growth slowdown, the impact of Brexit and the sustained decline in business investment," said Rabobank's US strategist Philip Marey. "If the economy continues to grow despite the stronger headwinds, slack in the labor market will continue to fall and the FOMC may want to squeeze in a rate hike before the end of the year.
He added that though he was still eyeing a December hike "the risk that the Fed will have to wait until next year has increased considerably. In fact, a few more setbacks could even force the FOMC to take a pause in its 'hiking cycle' altogether."
But Barclays sees liftoff sooner: "If the labor market firms (as per our baseline forecast), they are likely to hike in September (our baseline expectation). If the labor market remains soft or deteriorates further, the FOMC will be unlikely to hike in September."
Earlier, US services sector activity rallied in June, according to the widely-followed purchasing managers' index (PMI) survey from the Institute for Supply Management (ISM). The ISM PMI rose to 56.5 from 52.9, beating the forecast reading of 53.3. A gauge of firms' new orders rose from 54.2 to 59.9, alongside another tracking employment improving from 49.7 to 52.7.
The US May trade deficit data ahead of the opening bell, with the figure widening to $41.1bn against $37.4bn in the prior month.
Among companies, pharmacy giant Walgreens Boots Alliance posted quarterly earnings, with net earnings jumping 14.7% year-on-year to $1.3bn in the three months to 31 May.
The company also reported adjusted diluted earnings per share of $1.18 on net sales of $29.5bn - more or less in line with analyst forecasts.
Investors are also looking to Friday's non-farm payrolls as the next big data event.
S&P 500 - Risers
Carmax Inc. (KMX) $50.42 +5.57%
Martin Marietta Mtrl (MLM) $194.89 +4.35%
Celgene Corp. (CELG) $104.60 +4.34%
Nucor Corp. (NUE) $51.07 +4.31%
Edwards Lifesciences Corp. (EW) $103.45 +3.83%
Vertex Pharmaceuticals Inc. (VRTX) $89.66 +3.64%
Freeport-McMoRan Inc (FCX) $10.88 +3.62%
Southwestern Energy Co. (SWN) $12.07 +3.52%
Abbott Laboratories (ABT) $40.82 +3.50%
Regeneron Pharmaceuticals Inc. (REGN) $371.57 +3.33%
S&P 500 - Fallers
Marathon Petroleum Corporation (MPC) $36.49 -5.91%
Tesoro Corp. (TSO) $71.14 -5.07%
Netflix Inc. (NFLX) $94.60 -3.38%
United Continental Holdings Inc. (UAL) $39.29 -2.48%
Valero Energy Corp. (VLO) $48.66 -2.37%
National Oilwell Varco Inc. (NOV) $31.48 -2.05%
Frontier Communications Co. (FTR) $4.88 -2.01%
American Airlines Group (AAL) $28.35 -2.00%
Phillips 66 Common Stock (PSX) $76.37 -2.00%
Church Dwight Co Inc. (CHD) $101.28 -1.99%
Dow Jones I.A - Risers
Merck & Co. Inc. (MRK) $59.15 +1.98%
Home Depot Inc. (HD) $131.56 +1.71%
Cisco Systems Inc. (CSCO) $28.72 +1.38%
Exxon Mobil Corp. (XOM) $94.09 +1.15%
JP Morgan Chase & Co. (JPM) $60.20 +1.09%
Nike Inc. (NKE) $55.79 +1.08%
Wal-Mart Stores Inc. (WMT) $73.84 +0.96%
Chevron Corp. (CVX) $104.55 +0.95%
General Electric Co. (GE) $31.74 +0.92%
Intel Corp. (INTC) $32.97 +0.89%
Dow Jones I.A - Fallers
E.I. du Pont de Nemours and Co. (DD) $61.87 -1.73%
Visa Inc. (V) $74.12 -0.74%
Verizon Communications Inc. (VZ) $56.25 -0.50%
Procter & Gamble Co. (PG) $85.03 -0.48%
Coca-Cola Co. (KO) $45.25 -0.40%
3M Co. (MMM) $175.11 -0.30%
McDonald's Corp. (MCD) $120.61 -0.12%
Boeing Co. (BA) $126.93 -0.03%
Nasdaq 100 - Risers
Celgene Corp. (CELG) $104.60 +4.34%
Vertex Pharmaceuticals Inc. (VRTX) $89.66 +3.64%
Incyte Corp. (INCY) $82.48 +3.48%
Regeneron Pharmaceuticals Inc. (REGN) $371.57 +3.33%
Endo International Plc (ENDP) $17.10 +3.26%
Bed Bath & Beyond Inc. (BBBY) $43.55 +3.05%
Alexion Pharmaceuticals Inc. (ALXN) $121.12 +2.96%
Whole Foods Market Inc. (WFM) $33.16 +2.63%
Facebook Inc. (FB) $116.71 +2.38%
Check Point Software Technologies Ltd. (CHKP) $81.63 +2.37%
Nasdaq 100 - Fallers
Netflix Inc. (NFLX) $94.60 -3.38%
Walgreens Boots Alliance, Inc. (WBA) $81.55 -2.36%
JD.com, Inc. (JD) $20.38 -2.30%
American Airlines Group (AAL) $28.35 -2.00%
Vodafone Group Plc ADS (VOD) $29.77 -1.52%
Micron Technology Inc. (MU) $11.73 -1.51%
Ctrip.Com International Ltd. Ads (CTRP) $40.22 -1.08%
Fiserv Inc. (FISV) $108.71 -0.66%
Norwegian Cruise Line Holdings Ltd. - Ordinary Shares (NCLH) $40.30 -0.52% |
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| | Newspaper Round Up | | Thursday newspaper round-up: China deal, pension deficits, BT, Amazon Chinese officials are open to launching trade negotiations with Britain in the aftermath of the Brexit vote, raising hopes that the UK's economy can receive a boost after it leaves the EU. Critics of Brexit warned that the UK could find itself alone and cut off from the world economy outside the EU, but the indications from China are that deals are possible. - Telegraph
Company pension schemes could be given new ways to calculate the cost of future promises to members in an attempt to ease the pressure of rising deficits. Ros Altmann, the pensions minister, said she was reviewing how schemes could account for their liabilities, as new measures to ease the economic shocks from Brexit are expected to inflate pension shortfalls. - FT
BT Group faces a renewed attack from Sky over control of Openreach, after pensions experts and the former City minister Lord Myners said its £47bn retirement scheme would be unaffected by financial independence for the network unit. A report by the law firm Sackers, due to be circulated in the City on Thursday, claims there are multiple "straightforward" options to maintain the scheme if Openreach is incorporated as a legally separate subsidiary with control over its own cash flows. - Telegraph
London has cemented its position as Britain's number one taxpayer since the financial crash, leaving the government more dependent on the capital for its tax income. A study by the thinktank the Centre for Cities found that London generated almost as much tax as the next 37 largest cities combined and increased its share of "economy taxes" underpinning the Treasury's finances to 30%, up five percentage points since 2004/5. - Guardian
The world risks becoming ever more reliant on Middle Eastern oil as lower prices derail efforts by governments to curb demand, the west's leading energy body has warned. The head of the International Energy Agency told the Financial Times that Middle Eastern producers, such as Saudi Arabia and Iraq, now have the biggest share of world oil markets since the Arab fuel embargo of the 1970s. - FT
Amazon is planning to hire 1,000 more people than previously expected in the UK this year as the online retailer rolls out its one-hour delivery operation and extends its web services. The company will now create 3,500 permanent full-time jobs in the UK in 2016, taking Amazon's total workforce to 15,500 as its Prime Now fast-delivery service, launched a year ago, reaches more than a third of the UK population. - Guardian
The plunge in sterling following the UK's decision to leave the EU has prompted a flurry of interest in luxury homes in London from overseas buyers, who stand to save about 10% of the cost of buying a £1m property, a property consultancy has claimed. Arcadis said its clients had reported "a bounce in inquiries" since the referendum, with investors keen to make the most of the favourable exchange rate. - Guardian
Danone the world's biggest yoghurt maker, has agreed to acquire WhiteWave Foods, the natural and health-focused food group, in a deal that values the US company at $12.5bn including debt. The French group announced on Thursday that it would pay WhiteWave shareholders $56.25 per share in cash, resulting in an enterprise value of around $12.5bn. - FT
Shares in Britain's top three supermarket retailers fell sharply yesterday after analysts said there were "not enough sales to go around" amid growing fears of a renewed food price war. Tesco topped the list of biggest fallers in the FTSE blue-chip index, down more than 8 per cent to 161½p a share, after an analyst at Redburn, an independent research group, said that overcapacity and competition meant Tesco's "fair value" was 80p, less than half the grocer's closing price. - The Times
A fraudster who cheated users of a crowdfunding website out of thousands of pounds has received a two-year suspended prison sentence and a £100 fine. Alan Christopher Colton, who had pleaded guilty, conned users of Crowdcube into handing over money, ostensibly to support a flavoured vodka and champagne start-up called 88 Delicious. - The Times | | |
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