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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: Stocks brush-off Italian referendum vote Stocks in London reversed early losses following the unexpectedly poor showing for Italy's Prime Minister, Matteo Renzi, in the country´s referendum on constitutional reform overnight.
As of 0838 GMT, the Footsie was up by 0.84% or 56.80 points and trading at 6,787.52.
In a speech early on Monday morning, Renzi said he would tender his resignation after roughly 60% of voters rejected his proposals.
Not only was that a much weaker outcome than expected - although polls carried out several weeks beforehand had hinted at such a possibility - it came amid an unexpectedly high voter turnout of nearly 70%.
"In Italian politics, no one ever wins," Renzi told his supporters.
The European single currency was initially sent sharply lower, falling to 1.0506 against the US dollar, its March 2015 lows, but had since completely recovered its losses after Renzi announced he would be stepping down.
In the very short-term, some analysts believed that a new government might be in place even before Christmas, helping to forestall any risk of instability for the time being.
However, other pointed out how the medium-term implications of the referendum result were yet to be determined.
"The actual outcome of the referendum goes beyond what the polls anticipated and keeps uncertainty high. Investors will need to assess the medium-term implications of the referendum outcome for politics, growth, banks, ratings, etc. Moreover, this outcome weakens Renzi's political strength significantly," analysts at UniCredit said in a research note sent to clients.
Commenting on the immediate impact the vote might have on those Italian banks which were looking to raise fresh capital, Morgan Stanley said: "Political uncertainty post the 'No' vote in the referendum reduces visibility on economic growth and the run down of NPL portfolios. A low take-up of Monte Paschi's LME raises the chances of it needing state aid. We stay cautious on Italian banks and expect volatility."
On the data front, the UK services purchasing managers' index is scheduled for release at 0930 GMT, while in the US, the ISM's own non-manufacturing gauge is expected at 1500 GMT.
In corporate news, AstraZeneca has completed the sale of rights to its nasal spray outside of the US with Swiss pharmaceutical Cilag for $330m.
The FTSE 100 company sold the rights for Rhinocort Aqua, a nasal spray to treat allergic and nonallergic rhinitis and polyps, for use outside of the US to a subsidiary of Johnson & Johnson.
Global specialist healthcare company BTG announced the inclusion of treatment with its PneumRx Coils product in guidelines for the management of chronic obstructive pulmonary disease on Monday, as published by the Global Initiative for Chronic Obstructive Lung Disease (GOLD).
The FTSE 250 firm also said that at the same time, the French Ministry of Health published its positive recommendations regarding PneumRx Coils on its website.
Royal Bank of Scotland said it had agreed payouts to some shareholders to settle allegations that it misled them ahead of a £12bn rescue rights issue in 2008 at the outbreak of the financial crisis.
RBS said it had concluded "a full and final settlement with three out of the five shareholder groups representing 77% of the claims by value".
"In total, RBS is willing to make available settlement sums of up to £800m assuming settlement of all claims, to be split among all five shareholder groups, subject to agreement and claim validation," RBS said in a statement. |
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| Market Movers
FTSE 100 (UKX) 6,793.33 0.93%
FTSE 250 (MCX) 17,519.98 0.49%
techMARK (TASX) 3,249.07 0.96%
FTSE 100 - Risers
BHP Billiton (BLT) 1,341.00p 2.84%
Antofagasta (ANTO) 713.00p 2.81%
Rio Tinto (RIO) 3,083.00p 2.58%
Anglo American (AAL) 1,240.00p 2.56%
Burberry Group (BRBY) 1,447.00p 2.48%
Glencore (GLEN) 284.45p 2.36%
Rolls-Royce Holdings (RR.) 676.00p 2.27%
Wolseley (WOS) 4,781.00p 2.18%
Barclays (BARC) 217.35p 2.07%
Tesco (TSCO) 210.85p 1.98%
FTSE 100 - Fallers
Randgold Resources Ltd. (RRS) 5,630.00p -3.35%
Fresnillo (FRES) 1,169.00p -2.42%
Polymetal International (POLY) 738.50p -1.07%
Babcock International Group (BAB) 944.50p -0.58%
Standard Chartered (STAN) 642.00p -0.47%
Centrica (CNA) 207.60p -0.29%
BT Group (BT.A) 357.70p -0.25%
Intertek Group (ITRK) 3,244.00p -0.09%
HSBC Holdings (HSBA) 627.20p 0.02%
United Utilities Group (UU.) 883.00p 0.06%
FTSE 250 - Risers
CMC Markets (CMCX) 188.10p 3.98%
Polypipe Group (PLP) 314.80p 3.72%
Rotork (ROR) 247.20p 3.52%
Vedanta Resources (VED) 872.00p 3.07%
Countrywide (CWD) 175.60p 3.05%
Cobham (COB) 171.70p 2.94%
Kaz Minerals (KAZ) 386.10p 2.88%
Paysafe Group (PAYS) 370.00p 2.81%
Laird (LRD) 141.90p 2.75%
Bodycote (BOY) 590.50p 2.61%
FTSE 250 - Fallers
Acacia Mining (ACA) 388.40p -3.07%
Grafton Group Units (GFTU) 516.00p -3.01%
Hastings Group Holdings (HSTG) 211.00p -2.99%
Allied Minds (ALM) 363.30p -2.34%
Sports Direct International (SPD) 301.80p -2.24%
Hochschild Mining (HOC) 219.10p -2.14%
CYBG (CYBG) 276.10p -2.13%
Henderson Group (HGG) 227.30p -1.86%
G4S (GFS) 238.80p -1.77% |
| | UK Event Calendar | | Monday December 05
INTERIMS
Evgen Pharma, Plastics Capital, Purplebricks Group, ReNeuron Group
INTERIM DIVIDEND PAYMENT DATE
Balfour Beatty, First Derivatives, International Consolidated Airlines Group SA (CDI)
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
ISM Non-Manufacturing (US) (15:00)
Retail Sales (EU) (10:00)
Q4
GW Pharmaceuticals
FINALS
GW Pharmaceuticals
SPECIAL DIVIDEND PAYMENT DATE
TR European Growth Trust
EGMS
PJSC Lukoil ADR
FINAL DIVIDEND PAYMENT DATE
BlackRock Greater Europe Inv Trust, NWF Group, TR European Growth Trust
|
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| | Europe Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Italian banks slump but European investors shrug off Renzi resignation European stocks shrugged off the resignation of Italian PM Matteo Renzi on Monday after he suffered a heavy defeat in a referendum on constitutional reform, although Italian banks remained in the doldrums.
At 0840 GMT, Italy's FTSE MIB was down 1.3%, with banks under the cosh as investors worried that political instability would make the task of sorting out non-performing loan issues even more difficult. The FTSE Italia All-Share Bank index was down 3.9%.
Monte dei Paschi di Siena was 4% amid concerns about risks to the troubled lender's €5bn cash call, which was due to start this week. Banco Popolare di Milano and Banco Popolare were sharply lower, as was UniCredit, which was reported to have started exclusive talks with France's Amundi to sell its asset management arm Pioneer Investments. Amundi gained 3% on the news.
At the same time, the yield on Italy's 10-year government bond rose above 2%. Yields move inversely to prices.
Elsewhere in Europe, it was a pretty cheery picture, with the benchmark Stoxx Europe 600 index up 1%, Germany's DAX 1.6% higher and France's CAC 40 up 0.9%.
In currency markets, the euro had steadied by the European open, trading down just 0.1% against the dollar at 1.0646, having fallen to a 20-month low during the Asian session.
Neil Wilson, senior market analyst at ETX Capital, said: "So far it's been a fairly orderly response from the markets to Italy's referendum result. The FTSE MIB opened over 2% lower but is still well within its recent trading range. Italian banks are sliding 4-5% as they come under the most pressure, as expected.
"A 'No' vote had already been priced in although the scale of the defeat for Matteo Renzi has surprised and leads to the prospect of fresh elections next year. A new election brings with it the prospect of anti-EU, anti-eurozone parties coming to power and all that could mean for the single currency. At present however it doesn't look like the markets are seriously considering Italy's future in the Eurozone is in any doubt.
He added that while Italian bond yields have spiked, they're only at levels seen ahead of the referendum, with the prospect of the European Central Bank accelerating Italian bond purchases likely to be lending some support. |
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| | US Market Report | | US close: Wall Street finishes on mixed note after November jobs report US stocks ended the week on a mixed note following the release of a somewhat unsatisfactory report on the state of the US jobs market and as traders pulled in their horns ahead of potentially market-moving news on the political front in the euro area over the upcoming weekend.
The Dow Jones Industrial Average erased 0.11% or 21.51 points to close at 19,170.42 points, but the S&P 500 rose 0.04% or 0.87 points to 2,191.95 points, and the Nasdaq edged higher by 0.09% or 4.55 points to 5,255.65 points.
For the week as a whole, the S&P 500 finished down by 1%, for its first weekly retreat since the 8 November elections.
The yield on the benchmark 10-year US Treasury note down by seven basis points to 2.38% by the closing bell.
Mixed November jobs report
Non-farm payrolls grew by 178,000 in November, more than the 142,000 jobs created in the previous month and just slightly below the 180,000 consensus forecast.
In parallel, the unemployment rate fell to 4.6% from 4.9% in October, which was the lowest level since 2007, but in part because the labour force participation rate slipped to 62.7% from 62.8%.
Hourly earnings were down 0.1% month-on-month, weaker than 0.2% rise expected, lowering the year-on-year rate of increase from 2.8% to 2.5% (consensus: 2.8%).
Ian Shepherdson, chief economist at Pantheon Macroeconomics, said: "On the face of it, the combination of falling unemployment and sluggish-looking wage numbers appears to support the idea that perhaps the Fed can allow the economy to run hotter for longer without taking undue inflation risks. But we are very skeptical."
He added: "The bottom line here is that these data don't change the outlook for the December Fed committee; rates will rise. But if unemployment really is at 4.6%, the next question is just how far wage growth will accelerate next year, and how much more the Fed will have to do in order to cap it."
Meanwhile, in Europe the main indices were all in the red as investors grew jittery ahead of Sunday's Italian referendum on constitutional reform. Market participants were concerned that if the outcome was a 'no' vote then political uncertainty would ensue, making the task of sorting out non-performing loan issues at the country's banks more difficult.
Oil prices were higher following OPEC´s agreement to cut production by 1.2m barrels a day to 32.5m for six months from January.
West Texas Intermediate crude oil futures jumped 67 cents to $51.68 on NYMEX.
In corporate news, Ulta Salon Cosmetics & Fragrance's shares were on the back foot after it lifted its outlook for the year late on Thursday.
Shares in Big Lots gained as the discount retailer reported that third quarter sales were flat and revenue unexpectedly declined, but raised its profit outlook.
Sales were flat around 2%, while revenue slipped 1% to $1.11bn, just below the $1.12bn expected by analysts. It expects adjusted earnings per share to be between $3.55 to $3.60 in the final quarter.
From a sector standpoint, the best performance was seen in the following industrial groups: Gold (3.88%); Coal (3.42%); Mining (3.37%).
Dow Jones - Risers
Intel Corp. (INTC) $34.16 1.18%
United Technologies Corp. (UTX) $108.22 0.69%
Procter & Gamble Co. (PG) $82.40 0.66%
Merck & Co. Inc. (MRK) $61.13 0.61%
Pfizer Inc. (PFE) $31.63 0.54%
Johnson & Johnson (JNJ) $111.96 0.52%
Coca-Cola Co. (KO) $40.36 0.47%
Visa Inc. (V) $75.72 0.38%
Apple Inc. (AAPL) $109.90 0.37%
Home Depot Inc. (HD) $129.87 0.31%
Dow Jones - Fallers
Goldman Sachs Group Inc. (GS) $223.36 -1.44%
Caterpillar Inc. (CAT) $95.14 -1.14%
American Express Co. (AXP) $71.86 -0.92%
Cisco Systems Inc. (CSCO) $29.25 -0.68%
E.I. du Pont de Nemours and Co. (DD) $73.13 -0.67%
Walt Disney Co. (DIS) $98.50 -0.44%
Nike Inc. (NKE) $50.46 -0.38%
Chevron Corp. (CVX) $113.00 -0.26%
JP Morgan Chase & Co. (JPM) $81.60 -0.23%
Exxon Mobil Corp. (XOM) $87.04 -0.23%
S&P 500 - Risers
United States Steel Corp. (X) $33.61 4.93%
Applied Materials Inc. (AMAT) $31.44 4.45%
Newmont Mining Corp. (NEM) $33.58 4.06%
eBay Inc. (EBAY) $28.42 3.76%
Iron Mountain Inc (New) (IRM) $33.72 3.69%
Tesoro Corp. (TSO) $84.91 3.28%
Hess Corp. (HES) $57.92 3.23%
Netflix Inc. (NFLX) $120.81 3.06%
Western Digital Corp. (WDC) $63.35 2.82%
Williams Companies Inc. (WMB) $30.83 2.70%
S&P 500 - Fallers
PVH Corp. (PVH) $102.45 -5.13%
Alliance Data Systems Corp. (ADS) $218.71 -4.15%
Harley-Davidson Inc. (HOG) $59.71 -3.80%
Southwestern Energy Co. (SWN) $11.67 -3.79%
AutoNation Inc. (AN) $44.67 -3.60%
AFLAC Inc. (AFL) $68.29 -3.11%
Gap Inc. (GPS) $24.30 -2.99%
Vertex Pharmaceuticals Inc. (VRTX) $75.50 -2.98%
Twenty-First Century Fox Inc Class A (FOXA) $27.40 -2.84%
Ametek Inc. (AME) $48.01 -2.81%
Nasdaq 100 - Risers
Applied Materials Inc. (AMAT) $31.44 4.45%
eBay Inc. (EBAY) $28.42 3.76%
Netflix Inc. (NFLX) $120.81 3.06%
Western Digital Corp. (WDC) $63.35 2.82%
QUALCOMM Inc. (QCOM) $65.84 2.62%
Shire Plc Ads (SHPG) $174.80 2.23%
Skyworks Solutions Inc. (SWKS) $73.34 2.17%
CA Inc. (CA) $31.05 2.10%
Incyte Corp. (INCY) $102.02 2.09%
Seagate Technology Plc (STX) $38.87 1.99%
Nasdaq 100 - Fallers
Sirius XM Holdings Inc (SIRI) $4.30 -5.60%
Vertex Pharmaceuticals Inc. (VRTX) $75.50 -2.98%
Twenty-First Century Fox Inc Class A (FOXA) $27.40 -2.84%
Twenty-First Century Fox Inc Class B (FOX) $27.37 -2.53%
Starbucks Corp. (SBUX) $57.21 -2.22%
Liberty Global plc Series C (LBTYK) $28.65 -2.22%
Charter Communications Inc. (CHTR) $266.67 -2.16%
Discovery Communications Inc. Class A (DISCA) $26.60 -2.03%
Viacom Inc. Class B (VIAB) $36.52 -1.99% |
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| | Newspaper Round Up | | Monday newspaper round-up: Monte dei Paschi di Siena, Brexit, arms companies A last-gasp rescue for Monte dei Paschi di Siena, the world's oldest surviving bank, has been thrown into doubt after reformist prime minister Matteo Renzi decisively lost a referendum on constitutional reform on Sunday. MPS and advisers JPMorgan and Mediobanca will meet as early as Monday morning to decide whether to pull a plan to go ahead with a €5bn recapitalisation, according to people informed of the plan. - Financial Times
Britain's Supreme Court will start to hear arguments in one of the most politicised cases for decades on Monday, to decide whether Theresa May has the right to trigger Brexit without a parliamentary vote. All 11 Supreme Court justices will hear the case, so that there can be no accusations that the court would have delivered a different decision if the panel had been constituted differently. - Financial Times
One of the key business groups in British corporate governance has urged the Government to stick to its guns on putting workers on company boards, despite the signal last week that it would row back from this plan. Theresa May is due to meet with business groups on Monday to discuss her proposals to make businesses answerable to the rest of society, which she announced during her leadership campaign over the summer. - Telegraph
Formula One is locked in a dispute with authorities in India over �41.1m ($51.4m) of unpaid Grand Prix fees dating back to 2012, according to company documents. The Indian Grand Prix only took place three times, from 2011 to 2013, and was held on a track near New Delhi. - Telegraph
Britain's rapidly growing army of agency workers is as serious an issue as zero-hours contracts, with full-time agency staff earning hundreds of pounds a year less than employees doing the same jobs, according to a new report into the issue. The Resolution Foundation thinktank warns that agency staff are the new 'secret agents' in the UK labour market, as it begins an 18-month investigation into the whole area of agency work. - Guardian
Arms companies in the UK and elsewhere in western Europe bucked the downward trend in sales in much of the rest of the world by recording a 6.6% rise last year, according to data compiled by the Stockholm International Peace Research Institute (SIPRI). UK companies listed in the top 100 arms companies were among those who reversed the trend, with sales up 2.8% in 2015. Arms sales by western European companies had dropped in 2013 and 2014. - Guardian
Thousands of restaurant businesses in Britain could go bust because the fall in sterling since the Brexit vote has sharply raised the cost of imported food and wine, an accountancy firm has warned. Moore Stephens says that 5,570 restaurant businesses have at least a 30% chance of insolvency in the next three years, due to inflationary pressures and stagnating disposable incomes. - Guardian
Theresa May is facing a cabinet split over plans to offer "cash for access" to the single market when Britain leaves the European Union. Boris Johnson yesterday appeared to reject a proposal by David Davis, the Brexit secretary, and Philip Hammond, the chancellor, for the government to pay into EU coffers in return for preferential terms for business. - The Times
A last-gasp rescue for Monte dei Paschi di Siena, the world's oldest surviving bank, has been thrown into doubt after reformist prime minister Matteo Renzi decisively lost a referendum on constitutional reform on Sunday. MPS and advisers JPMorgan and Mediobanca will meet as early as Monday morning to decide whether to pull a plan to go ahead with a €5bn recapitalisation, according to people informed of the plan. - Financial Times
Britain's Supreme Court will start to hear arguments in one of the most politicised cases for decades on Monday, to decide whether Theresa May has the right to trigger Brexit without a parliamentary vote. All 11 Supreme Court justices will hear the case, so that there can be no accusations that the court would have delivered a different decision if the panel had been constituted differently. - Financial Times
One of the key business groups in British corporate governance has urged the Government to stick to its guns on putting workers on company boards, despite the signal last week that it would row back from this plan. Theresa May is due to meet with business groups on Monday to discuss her proposals to make businesses answerable to the rest of society, which she announced during her leadership campaign over the summer. - Telegraph
Formula One is locked in a dispute with authorities in India over �41.1m ($51.4m) of unpaid Grand Prix fees dating back to 2012, according to company documents. The Indian Grand Prix only took place three times, from 2011 to 2013, and was held on a track near New Delhi. - Telegraph
Britain's rapidly growing army of agency workers is as serious an issue as zero-hours contracts, with full-time agency staff earning hundreds of pounds a year less than employees doing the same jobs, according to a new report into the issue. The Resolution Foundation thinktank warns that agency staff are the new 'secret agents' in the UK labour market, as it begins an 18-month investigation into the whole area of agency work. - Guardian
Arms companies in the UK and elsewhere in western Europe bucked the downward trend in sales in much of the rest of the world by recording a 6.6% rise last year, according to data compiled by the Stockholm International Peace Research Institute (SIPRI). UK companies listed in the top 100 arms companies were among those who reversed the trend, with sales up 2.8% in 2015. Arms sales by western European companies had dropped in 2013 and 2014. - Guardian
Thousands of restaurant businesses in Britain could go bust because the fall in sterling since the Brexit vote has sharply raised the cost of imported food and wine, an accountancy firm has warned. Moore Stephens says that 5,570 restaurant businesses have at least a 30% chance of insolvency in the next three years, due to inflationary pressures and stagnating disposable incomes. - Guardian
Theresa May is facing a cabinet split over plans to offer "cash for access" to the single market when Britain leaves the European Union. Boris Johnson yesterday appeared to reject a proposal by David Davis, the Brexit secretary, and Philip Hammond, the chancellor, for the government to pay into EU coffers in return for preferential terms for business. - The Times | | |
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