| | | | | | | Think You Know The Markets? PROVE IT Put your trading knowledge to the test at City Index. Whatever’s happening out there, we’ll make sure you’re ready to seize the opportunity, with expert analysis and our award winning platforms. The rest is up to you. Losses can exceed deposits. Trade now | | |
| | London Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | London close: Stocks fall on growing expectations of a Fed rate hike London stocks declined on Thursday as expectations of an interest rate hike by the Federal Reserve this year rose and China trade data came in weaker than expected.
The FTSE 100 ended down 0.66% to 6,977.74 points while the pound rose 0.11% to $1.2217 as a three-day High Court hearing on formal Brexit negotiations began.
Lord Pannick QC, a barrister representing London businesswoman Gina Miller, argued in his opening remarks that the government does not have the legal power to trigger Article 50 without a vote in Parliament.
Meanwhile, oil prices wavered even as data from the Energy Information Administration reported that US crude supplies rose by 4.9 million barrels in the week ended 7 October. Brent crude rose 0.3% to $51.97 per barrel and West Texas Intermediate increased 0.4% to $50.40 per barrel at 1647 BST.
In the US, the minutes of the central bank's 20-21 September meeting late on Wednesday suggested a December rate hike could be on the cards.
The minutes showed it was a close call to keep rates on hold in September, with policymakers generally of the view that a move higher could happen within months if the economy keeps on track.
Adding to bets of a hike this year, Philadelphia Fed President Patrick Harker on Thursday said the possibility of a rate increase in November should not be written off. Speaking in Dublin, he said he would have been comfortable with a 25 basis point interest rate rise at the September meeting.
He added the central bank will likely have enough data to back-up the need for a rate hike at its December policy meeting.
Harker is not on the voting committee this year but will be in 2017.
In other US news, the Labor Department revealed initial jobless claims remained at a four-decade low of 246,000 last week, compared to forecasts of 253,000.
In China, data showed the trade surplus came to $41.99bn in September, down from $52.05bn in August and compared to forecasts of $53bn.
Exports in dollar terms fell 10% year-on-year in September, far more than the 3.3% decline expected, following a 2.8% dip the previous month. Imports slid 1.9% in September, below estimates for a 0.7% increase and after a 1.5% rise in August.
Mining stocks, including Rio Tinto, BHP Billiton and Anglo American, were on the back foot following the data.
On this side of the Pond, the Royal Institution for Chartered Surveyors said surveyors reported an unexpected increase in house prices in the last three months as demand outstripped supply. The headline balance of firms reporting that house prices have risen over the last three months increased to +17% in September from +13% in August and beating the City consensus, which had predicted a slide to +12%.
The report gave housebuilder stocks a boost, including Persimmon, Taylor Wimpey and Barratt Developments.
Elsewhere, Prudential shares fell as Societe Generale lowered its rating on the stock to 'sell' from 'hold' and cut its target to 1,250p from 1,400p.
United Utilities rallied as Societe Generale upgraded the stock to 'buy' from 'hold', noting that recent share price weakness now implies a total shareholder return of 18%.
Paper and packing group Mondi was lower despite posting a jump in third-quarter underlying operating profit compared to a year ago and saying it expects to benefit from higher selling prices as it moves into 2017.
Unilever took a hit as supermarkets pulled Marmite and several of its other brands from their shelves over a pricing dispute. The company posted forecast-beating underlying sales and a 28.9p dividend amid tough third-quarter conditions.
Tesco was also under the cosh after deciding to pull Marmite from its stores. |
| | Discover a new way to trade with eToro | | Trade 1000s of markets independently, connect with millions of other traders and copy top performing traders move-for-move. Click Here 
|
| Market Movers
FTSE 100 (UKX) 6,977.74 -0.66%
FTSE 250 (MCX) 17,883.48 -0.41%
techMARK (TASX) 3,534.60 -0.03%
FTSE 100 - Risers
United Utilities Group (UU.) 940.50p 2.79%
Intu Properties (INTU) 290.20p 2.44%
British Land Company (BLND) 595.50p 2.32%
Hammerson (HMSO) 564.50p 2.17%
Polymetal International (POLY) 863.00p 2.13%
Barratt Developments (BDEV) 483.20p 1.94%
Severn Trent (SVT) 2,340.00p 1.92%
Persimmon (PSN) 1,723.00p 1.89%
Fresnillo (FRES) 1,666.00p 1.83%
Land Securities Group (LAND) 986.50p 1.81%
FTSE 100 - Fallers
Standard Life (SL.) 331.20p -5.07%
Rio Tinto (RIO) 2,576.00p -4.86%
Anglo American (AAL) 990.60p -4.80%
Prudential (PRU) 1,382.00p -4.66%
BHP Billiton (BLT) 1,184.00p -4.40%
Royal Bank of Scotland Group (RBS) 170.40p -3.67%
Mondi (MNDI) 1,598.00p -3.50%
Unilever (ULVR) 3,596.50p -3.41%
Antofagasta (ANTO) 539.50p -3.05%
Tesco (TSCO) 195.10p -3.03%
FTSE 250 - Risers
Booker Group (BOK) 185.10p 5.41%
Capital & Counties Properties (CAPC) 279.80p 4.68%
Great Portland Estates (GPOR) 613.00p 2.42%
Assura (AGR) 59.75p 2.31%
Savills (SVS) 721.50p 2.20%
G4S (GFS) 235.70p 2.08%
Unite Group (UTG) 602.00p 2.03%
Bellway (BWY) 2,310.00p 1.99%
Acacia Mining (ACA) 466.30p 1.86%
Workspace Group (WKP) 661.50p 1.85%
FTSE 250 - Fallers
Evraz (EVR) 201.00p -7.25%
Brown (N.) Group (BWNG) 187.40p -6.49%
Allied Minds (ALM) 348.10p -5.66%
Vedanta Resources (VED) 614.50p -5.61%
Close Brothers Group (CBG) 1,319.00p -5.04%
IP Group (IPO) 145.00p -4.73%
Riverstone Energy Limited (RSE) 1,158.00p -4.69%
Man Group (EMG) 108.70p -4.65%
Aberdeen Asset Management (ADN) 325.50p -3.70% |
| | Bargain Blue Chips | | Is the current dip a buy opportunity? The UK's blue chip stock index has delivered exceptional trading opportunities to date in 2016 and, with the FTSE100 currently consolidating, optimism remains that the trend will resume imminently. Download this exclusive report to find out why a good run of UK macro data has been taken badly by the markets, what key event in September could pump them up once more, and which key stocks that could play a leading role in boosting the index back to last year's all-time record highs. Losses can exceed deposits |
| | Europe Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Chinese data knocks stocks off their perch European stocks fell on Thursday as weak Chinese trade data weighed on the basic resources sector.
The benchmark Stoxx Europe 600 index was down 0.87%, Germany's DAX was off 1.04% and France's CAC 40 was 1.06% weaker.
Meanwhile, oil prices steadied, having slipped back after OPEC said in the previous session that production in September rose to its highest level in eight years. West Texas Intermediate was flat at $50.17 a barrel and Brent crude was up 0.1% at $51.86.
Basic resources suffered the brunt of the selling, with the Stoxx 600 sub-index for the sector down 2.94% following the release of disappointing Chinese trade data.
Figures released earlier showed Chinese exports and imports in September missed expectations, with exports down 10% in dollar terms year-on-year and imports down 1.9%. Economists had been expecting a 3% decline in exports and a 1% rise in imports.
In yuan terms, exports were 5.6% lower on the year, while imports were up 2.2%.
Meanwhile, investors also continued to digest the minutes of the Federal Reserve's 20-21 September meeting. The minutes, released on Wednesday, showed it was a "close call" to keep rates on hold, with policymakers generally of the view that a move higher could be on the cards within months if the economy keeps on track.
Lee Wild, heady of equity strategy at stockbroker Interactive Investor, said the market had already pencilled in a December hike, so finding out that September was a close call was not a needle mover.
"Fears about the global economy are. Overnight data shows Chinese exports fell 10% last month, much more than expected. Imports in dollar terms were down, too, proving August's surprise increase was a one-off. Expect the Chinese currency to devalue further, which could have a major impact on demand for commodities and imported goods.
"Oil prices are already lower Thursday, although figures showing producers are pumping like crazy to beat a possible cut in output is hurting here. An extra 220,000 barrels a day left the ground last month as oil nations fill their boots before OPEC's meeting in Vienna next month. If a cut doesn't happen - and there are no guarantees with OPEC - prices will fall much further."
In corporate news, Unilever was under pressure after a storm broke over a supermarket pricing dispute over Marmite and several other of its brands, although the group reported solid underlying sales amid tough third-quarter conditions.
The dispute was with Tesco, whose shares declining on Thursday.
Elsewhere, French supermarket operator Groupe Casino was lower despite reporting a rise in third-quarter sales.
Shares in Deutsche Bank fell following reports the lender has introduced a hiring freeze as it looks to cut costs.
Subscription broadcaster and broadband provider Sky was in the red after saying first-quarter group revenue rose 7%, while WH Smith gained ground after reporting an 8% rise in pre-tax profit for the year to the end of August. |
| | IS Lloyds a Brexit Bargain? | | Get all the details now in this FREE Report Lloyds shares have fallen around 40% from last year's high. Download your FREE special report now |
| | US Market Report | | US open: Stock falls signalling December Fed rate hike Stocks in the US tumbled on Thursday after data showed US joblessness remained at a 43-year low, adding to the case for an interest rate hike in December by the Federal Reserve.
The Dow Jones Industrial Average fell 0.75% to 18,008.71 points, the S&P 500 declined 0.83% to 2,121.37 points and the Nasdaq dropped 0.9% to 5,191.77 points at 1445 BST.
The Labor Department reported that jobless claims were unchanged at 246,000 in September, below the 253,000 forecast, which was the lowest reading since November 1973.
Dollar bullish investors were on the offensive, according to Lukman Otunuga, an analyst at FXTM, as minutes from the Fed's 20-21 September committee meeting released on Wednesday reinforced expectations over a rise in interest rates before the end of the year.
"Market participants were provided some clarity after the minutes showed September's inaction being a 'close call' with several members even agreeing that the Fed should raise rates in the near term if US data continued to strengthen."
With domestic data repeatedly displaying signs of stability and inflation slowing towards the 2% target, it suggests that the Fed would pull the trigger in the coming months.
"Although the overall market reaction was somewhat muted, the minutes have displayed the Federal Reserve's intentions to raise US rates this year, consequently providing the markets a cushion for the shock beforehand."
The Fed's Patrick Harker is to speak on the economic outlook to the World Affairs Council of Philadelphia at 1715 BST followed by Neel Kashkari who is to address the University of Montana at 0200 BST.
Fed chair Janet Yellen is due to speak in Boston on Friday at 1700 BST, with investors hoping she would provide a hint on the direction of the central bank's policy.
Meanwhile Chinese trade data showed exports fell 10% year-on-year in September, below expectations of a 3% decline, sparking concerns for the world's second largest economy and global demand as US stocks fell.
Oil prices steadied having fallen after OPEC said September's oil production rose to its highest level in eight years.
West Texas Intermediate was down 0.04% to $50.16 a barrel and Brent crude was lower by 0.058% to $51.78 at 1517 BST.
On companies, shares in rail shipper CSX Transportation were up 1.752% as it reported better than expected third quarter results. |
| | It's been an incredible year for gold! | | The precious metal has rallied more than 25% since January. But how much higher will it go? Download your FREE report now |
| | Broker Tips | | Broker tips: United Utilities, Prudential, service sector United Utilities got a boost on Thursday as Societe Generale upgraded the stock to 'buy' from 'hold', noting that recent share price weakness now implies a total shareholder return of 18%.
The stock has underperformed the FTSE 100 by 11% since the 2 October Tory Party conference.
SocGen said European regulated utilities have suffered recently on the back of the "taper tantrum" from press comments regarding the European Central Bank's bond-buying programme and sterling weakness resulting from comments at the Tory Party Conference.
During this time, UU has been the worst performer among UK utilities despite the benefit which should accrue from higher inflation, it said.
"While nominal gilt yields have recently risen (+25 basis points), they remain 40bp below pre-Brexit levels, and inflation expectations have picked up," SocGen said.
"We estimate the effect of higher inflation is equivalent to 1-2% per annum on the UU equity value for every 100 basis points of higher than expected RPI, and therefore on an absolute basis higher inflation and lower real gilt yields should be viewed as value accretive."
Prudential shares fell on Thursday as Societe Generale lowered its rating on the stock to 'sell' from 'hold' and cut its target to 1,250p from 1,400p.
Societe Generale said Prudential is on its list of least preferred stocks as it believes its it most vulnerable to the "growing cocktail" of variable annuity risks.
"Not only are Pru's future sales and earnings looking challenged, but also the back-book may come under pressure," the broker said.
"Its hedging has been effective so far but has not been tested in a bear market."
The financial services company reduced its earnings per share forecasts for fiscal years 2017 and 2018 by 3% and 4% respectively, due to lower estimates for variable annuity sales and profit margin.
Societe Generale also cut its dividend per share expectations by 5% for 2017 and 9% for 2018.
RBC Capital Markets initiated coverage of several stocks and changed its recommendations as it took a look at the business services sector.
The bank started Ashtead at 'outperform' with a 1,580p price target, saying it sees a robust US market, while the branch rollout and disciplined capital allocation should lead to above-average growth at an attractive valuation.
RBC initiated coverage of Johnson Service Group at 'outperform' with a 130p price target, saying good organic growth and the potential to consolidate more of the UK textile market should lead to strong growth. It added that the stock's valuation is attractive and said it sees Johnson as a consolidation candidate in the medium term.
RBC Capital upgraded G4S to 'outperform' from 'sector perform' and lifted the price target to 260p from 170p. It said it now sees value after the selloff in the shares and noted the company's low UK exposure.
It downgraded Intertek to 'underperform' from 'sector perform' and kept the price target at 3,400p, saying the stock was up with events and a pause for breath is due. RBC noted the shares have outperformed the FTSE 100 by 32% in the last 12 months. "We like the structural growth characteristics, market position and the new CEO's strategy but feel relatively low organic growth and valuation are limiting factors to further short-term potential upside."
It downgraded Mitie to 'sector perform' from 'outperform' and slashed the price target to 195p from 310p. It said trading was likely to remain tough through 2017 and 2018, the balance sheet is increasingly stretched and there are few catalysts on the horizon.
RBC cut Rentokil to 'outperform' from 'top pick' after the strong run in the stock, but lifted the price target to 260p from 240p. "Whilst the stock has performed well, we see earnings risk on the upside and improving mix should continue to provide scope for further rerating. M&A optionality is arguably in the share price for free." However, RBC said Rentokil remains its favoured larger cap defensive in the sector.
It changed its recommendation on Travis Perkinsto 'sector perform' from 'outperform' and cut the target to 1,450p from 2,000p, pointing to tougher times ahead. "We are fans of what Travis is doing re stamping its scale advantages on the market. However, investment is still going in when markets are more uncertain. With some leading indicators rolling over and Brexit uncertainty likely to remain, we see forecast uncertainty given the inherent leverage in the business."
Finally, the bank downgraded WS Atkins to 'sector perform' from 'outperform', moving the target to 1,500p from 1,400p. | | |
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