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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 dip lower in early trading London stocks were trading slightly lower despite a weaker pound, which fell overnight amid growing concerns about a 'hard' Brexit.
As of 0854 GMT, the FTSE 100 was trading lower by 0.05% or 5.43 points from Friday's close at 7,333.78.
The pound dropped below $1.20 for the first time since the October 'flash crash' following a Sunday Times report that Prime Minister Theresa May will indicate in her speech on Tuesday that she plans to pursue a 'hard' Brexit and quit the European Union's single market to gain more control over migration and the country's laws.
CMC Markets' Michael Hewson said: "It would appear that the main catalyst behind this selloff is speculation that UK Prime Minister Theresa May will set out tomorrow the UK government's position when it comes to coming to deal with the EU with respect to its negotiation position ahead of the expected triggering of article 50 in March, though this could still be derailed by the Supreme Court ruling which is due any day now."
Investors will also be digesting news that US President-elect Donald Trump - who will be formally inaugurated on Friday - has promised a quick trade deal between the US and the UK after he takes office.
Away from Brexit, the latest figures from property website Rightmove showed UK house prices nudged up in January.
Prices were up 0.4% from the previous month to an average £300,245. On the year, prices were 3.2% higher in January.
In London, the average asking price for a property rose 1.4% to £624,953 and Rightmove said homeowners in the capital were showing a "marked reluctance" to put their homes up for sale, partly due to Brexit uncertainty.
In corporate news, emerging markets-focused fund manager Ashmore revealed that assets under management dropped in the second quarter of its financial year after £0.7bn of net outflows and the only period of negative market performance it has endured in 2016.
AUM declined $2.4bn in the three months to 31 December as the relatively minor outflows combined with $1.7bn of negative investment performance.
Britain's largest brick manufacturer Ibstock anticipates earnings to be in line with expectations as revenue rose due to growing house builder activity in the second half of the year, while brick imports declined.
Revenue for the year ended 31 December increased 5% compared to last year, while revenue from clay and concrete products in the UK, which represents about 80% of total revenue, was up 2%.
Power generation equipment supplier Aggreko announced on Monday that the Government of Argentina has extended its fixed site contracts, equivalent to 174MW, until 31 December 2017.
The FTSE 250 company said the original contracts amounted to 180MW.
There are no major data due, but Bank of England governor Mark Carney is scheduled to give a speech at 1830 GMT at the London School of Economics. |
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| | Share tips 2017 Prudential low risk International insurance and investment product supplier Prudential has had a successful 2016 with the company raising its dividend, reporting an increase in profits whilst all the time continuing to benefit from favourable structural opportunities in its key markets, particularly in Asia. Investors should appreciate that although the group’s Asian exposure is a risk due to the volatility of Asian markets, the demographics of many Asian regions, and the rise of the middle class, should provide a good growth story for Prudential for some time to come. Prudential believes it has adequate capital surplus to withstand further significant deterioration in the European market, which should provide some reassurance to investors. Furthermore, the group’s asset management business M&G continues its expansion into Europe and its retail funds are registered for sale in 20 regions. Ultimately, this is a company which has a good mix of business across a number of regions, with a long-term Asia growth story underpinning the investment case. Read More... Capital at Risk |
| | UK Event Calendar | | Monday 16 January
INTERIM DIVIDEND PAYMENT DATE
Babcock International Group, Lazard World Trust Fund, Northgate
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Balance of Trade (EU) (10:00)
EGMS
PJSC PhosAgro GDR (Regs)
AGMS
Kennedy Ventures
TRADING ANNOUNCEMENTS
Etalon Group Ltd GDR (Reg S), OMV Petrom S.A. GDR (REG S)
FINAL DIVIDEND PAYMENT DATE
A&J Mucklow Group, Barloworld Ltd.
|
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| | Europe Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe open: Stocks push lower but Luxottica, Essilor rally on M&A European stocks pushed lower in early trade, although deal news from Luxottica and Essilor provided some cheer.
At 0910 GMT, the benchmark Stoxx Europe 600 index, Germany's DAX and France's CAC 40 were all 0.7% lower. In London, the FTSE 100 was flat, holding up better than its European peers, underpinned by a weaker pound.
The pound fell below $1.20 for the first time since the October 'flash crash' following a Sunday Times report that Prime Minister Theresa May will indicate in her speech on Tuesday that she plans to pursue a 'hard' Brexit and quit the European Union's single market to gain more control over migration and the country's laws.
Meanwhile, oil prices were a touch weaker, with West Texas Intermediate down 0.2% to $52.24 a barrel and Brent crude down 0.3% to $55.30.
James Hughes, chief market analyst at GKFX, said: "For the start of the week it will be Brexit that dominates as Monday sees US markets closed for the Martin Luther King holiday in the US, so with markets closed we are likely to be looking at lower volume across the major markets.
"However the lower volatility does not always mean that we get a quiet day on the markets as lower volume can often breed higher volatility. However today's economic calendar is looking rather light of data, with only trade balance readings from the eurozone at 1000 GMT big enough for traders to take note."
In corporate news, Italian eyewear designer Luxottica and French lens maker Essilor rallied after the two companies announced a merger worth about €46bn.
Fund manager Ashmore advanced as it said it was confident of a strong 2017 despite a drop in quarterly assets under management.
On the downside, Swedish clothing retailer H&M was on the back foot after it reported a 6% jump in year-on-year sales in December, which was the slowest pace since September and weaker than expected.
Royal Bank of Scotland was weaker after Goldman Sachs downgraded the stock to 'neutral' from 'buy' on valuation grounds and removed the stock from its Pan-Europe Buy List.
Vodafone was also under pressure after HSBC cut its rating to 'hold' from 'buy' and trimmed the price target to 240p from 270p. |
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| | US Market Report | | US close: Stocks end on mixed note ahead of long weekend US equity markets finished on a mixed note on Friday as earnings season kicked off amid strong quarterly results from banking heavyweights JP Morgan Chase and Bank of America.
The Dow Jones Industrial Average drifted 0.03% or 5.27 points lower to 19,885.73, the S&P 500 was firmer 0.18% or 4.20 points firmer at 2,274.64, and the Nasdaq gained 0.48% or 26.63 points to 5,574.12.
For the week as a whole the S&P 500 slipped 0.1%. US markets would be closed on 16 January in observance of Martin Luther King Jr. Day.
Meanwhile, oil prices were weaker amid doubts over whether planned production cuts will do enough to curb the supply glut. West Texas Intermediate fell 68 cents to $52.37 per barrel.
Michael Hewson, chief market analyst at CMC Markets, said: "US markets shrugged off yesterday's decline opening higher after a raft of US bank earnings came in broadly better than expected, and with a long weekend coming up US investors might be a little cautious about trying to buy this market too aggressively. Could these bank numbers be the catalyst to propel the Dow to 20k ahead of the US long weekend? We've already seen several failures at this level, another failure could prompt another sharp sell-off."
JP Morgan Chase edged up 0.53% after the lender revealed that fourth quarter income for the corporate and investment banking division jumped 96% from last year to $3.4bn, boosted by better business after President-elect Donald Trump's electoral victory, while the retail arm was more subdued.
Similarly, the Bank of America gained 0.39% after its earnings were also boosted by the Trump rally with a 43% rise in income to $4.7bn.
The lender also said it would buy back £4.3bn of its shares, more than the $2.5bn it had said earlier.
However, Wells Fargo's income dropped 4.4% to $21.9bn as the bank dealt with the fake account scandal. Despite this, its shares rose 1.49%.
Elsewhere, Blackrock and First Republic both reported mixed results as earnings beat expectations but revenue missed forecasts, whereas PNC Financial Services' results exceeded analysts' expectations.
Hewson said what the bank earnings figures tell is, "apart from the contrast to Europe's banks which continue to struggle, is that not only are banks in the US benefitting from a growing US economy, but the steepening of the US yield curve is helping as well, as bond markets price in the prospect of further rate rises".
Aside from earnings, investors also eyed the latest monthly retail sales figures, which rose by a less than expected 0.6% month-on-month in December, coming in below the 0.8% forecast. This followed a 0.2% gain in November.
Meanwhile the producer price index, excluding food and energy, increased 1.6% year-on-year in December, above the 1.5% expected.
The Michigan consumer sentiment index came in at 98.1 in January, from 98.2 in December. This was below forecasts of 98.5.
In other corporate news, shares in Fiat Chrysler Automobiles were down 2.21% after the US Environmental Protection Agency alleged on Thursday that the company had used software to cheat on diesel emissions testing.
Shares in Boeing gained 0.34% after it struck a deal to make 205 airplane's for Indian budget airline SpiceJet for $22bn.
The yield on the benchmark 10-year US Treasury note ended the day three basis points higher at 2.40%.
Dow Jones - Risers
Nike Inc. (NKE) $52.92 0.99%
JP Morgan Chase & Co. (JPM) $86.70 0.53%
Caterpillar Inc. (CAT) $94.48 0.52%
Walt Disney Co. (DIS) $108.06 0.49%
Boeing Co. (BA) $158.83 0.34%
Travelers Company Inc. (TRV) $117.05 0.26%
Intel Corp. (INTC) $36.79 0.22%
Merck & Co. Inc. (MRK) $62.34 0.21%
Procter & Gamble Co. (PG) $84.01 0.20%
Chevron Corp. (CVX) $116.38 0.19%
Dow Jones - Fallers
Wal-Mart Stores Inc. (WMT) $67.13 -1.24%
E.I. du Pont de Nemours and Co. (DD) $73.60 -0.69%
United Technologies Corp. (UTX) $110.22 -0.54%
McDonald's Corp. (MCD) $121.50 -0.49%
International Business Machines Corp. (IBM) $167.34 -0.36%
Unitedhealth Group Inc. (UNH) $161.80 -0.34%
American Express Co. (AXP) $76.62 -0.34%
Verizon Communications Inc. (VZ) $52.55 -0.25%
Visa Inc. (V) $81.17 -0.25%
Pfizer Inc. (PFE) $32.52 -0.25%
S&P 500 - Risers
Netflix Inc. (NFLX) $133.70 3.50%
Monster Beverage Corp (MNST) $44.51 3.25%
Qorvo, Inc. (QRVO) $58.57 3.04%
First Solar Inc. (FSLR) $35.75 2.52%
Pentair plc (PNR) $58.71 2.51%
Patterson Companies Inc. (PDCO) $41.28 2.41%
Molson Coors Brewing Co. Class B (TAP) $97.62 2.29%
Lam Research Corp. (LRCX) $110.54 2.19%
L3 Technologies Inc (LLL) $148.89 2.18%
Kansas City Southern (KSU) $83.89 2.16%
S&P 500 - Fallers
GameStop Corp. (GME) $22.73 -8.05%
Endo International Plc (ENDP) $13.19 -4.90%
Diamond Offshore Drilling Inc. (DO) $18.66 -4.26%
Signet Jewelers Ltd (SIG) $80.78 -4.24%
PVH Corp. (PVH) $89.31 -4.10%
Baker Hughes Inc. (BHI) $60.92 -2.40%
Transocean Ltd. (RIG) $15.48 -2.27%
National Oilwell Varco Inc. (NOV) $37.40 -1.99%
Mallinckrodt Plc Ordinary Shares (MNK) $50.64 -1.90%
Nordstrom Inc. (JWN) $44.20 -1.84%
Nasdaq 100 - Risers
Tesla Motors Inc (TSLA) $237.75 3.55%
Netflix Inc. (NFLX) $133.70 3.50%
Monster Beverage Corp (MNST) $44.51 3.25%
Maxim Integrated Products Inc. (MXIM) $41.47 2.47%
Lam Research Corp. (LRCX) $110.54 2.19%
Skyworks Solutions Inc. (SWKS) $78.33 2.06%
TripAdvisor Inc. (TRIP) $52.92 2.00%
Comcast Corp. (CMCSA) $72.77 1.89%
PACCAR Inc. (PCAR) $67.52 1.79%
Symantec Corp. (SYMC) $26.14 1.71%
Nasdaq 100 - Fallers
Biogen Inc (BIIB) $284.75 -1.05%
American Airlines Group (AAL) $47.65 -0.94%
Norwegian Cruise Line Holdings Ltd. - Ordinary Shares (NCLH) $44.95 -0.88%
O'Reilly Automotive Inc. (ORLY) $279.15 -0.86%
Cognizant Technology Solutions Corp. (CTSH) $56.52 -0.82%
Mondelez International Inc. (MDLZ) $44.60 -0.65%
Baidu Inc. (BIDU) $176.48 -0.61%
Micron Technology Inc. (MU) $22.18 -0.58%
Dollar Tree Inc (DLTR) $77.13 -0.52% |
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| | Newspaper Round Up | | Monday newspaper round-up: May, Hammond, Trump all upbeat on Brexit Ministers are prepared to start a tax and trade war with Europe to ensure Britain's economic prosperity, the chancellor said yesterday. Philip Hammond said that if the EU cut off the UK's preferential access to the single market or tried to impose tariffs and trade restrictions, a "wounded" Britain would not lie down and accept the economic damage. - The Times
Donald Trump has pledged that America and Britain will agree a post-Brexit trade deal "very quickly" and said Brexit was a "great thing" for the UK. In an interview with Michael Gove for The Times, the US president-elect praised Britain for voting to leave the European Union, said Theresa May would visit him "right after" he is sworn in, and predicted that other countries would follow Britain's lead in leaving the bloc. - The Times
The pound fell against the dollar, dropping below $1.20 for the first time since October's flash crash, after reports said that Prime Minister Theresa May will signal plans to quit the European Union's single market to regain control of Britain's borders and laws. Sterling declined against all of its major peers after it was reported that May will prepare to withdraw from tariff-free trade with the region in return for the ability to curb immigration and strike commercial deals with other countries. - Telegraph
Theresa May will aim to strike a defiant tone in her upcoming Brexit speech on the risks to the rest of the EU of giving Britain a raw deal, echoing the combative approach taken by the chancellor. In a speech by the prime minister on Tuesday that will be watched closely in EU capitals, Downing Street is keen to impress that there are potentially lucrative economic opportunities elsewhere, weeks before the UK is expected to trigger article 50. - Guardian
Business activity across England and Wales hit an 18-month high at the end of last year in a further sign that the economy has so far shrugged off the effect of the Brexit vote. Lloyds Bank's regional purchasing managers' index for December showed "strong and accelerated growth", the lender said, led by the east of England, the southwest and the west Midlands. - The Times
The danger of Britain's steel industry plunging back into crisis has eased with the government agreeing further subsidies that reduce the sector's cripplingly high energy bills. A deadline to win European approval to grant British steelmakers to state aid that would bring their energy bills closer to those faced by their continental rivals was missed because of Brussels red tape. Telegraph
Deutsche Börse's €25 billion merger with the London Stock Exchange will trigger a huge grab of business by Frankfurt from the City, a study claims. Research, which was commissioned by the German exchange, says that the merger will give Deutsche Börse the opportunity to relocate billions of pounds of derivatives trading from the UK to Germany. - The Times
O2 and Vodafone are renegotiating their billion-pound deal to share mobile masts in a bid to speed up the rollout of the networks and keep pace with BT's coverage expansion plans. The two operators share infrastructure via a joint venture known as Cornerstone under which O2 is responsible for maintaining and building new masts in the East of the country and Vodafone in the West. - Telegraph
Gambling firms that fail to tackle problem gambling and money laundering face heftier fines and a higher risk of losing their operating licence under a tougher regime to be unveiled by the industry's regulator. The Gambling Commission will lay out its new enforcement strategy this month, detailing how bookmakers, casinos and online gaming companies who are deemed to have breached regulations will be punished. The new stance follows a year in which several major bookmakers reached voluntary settlements for failing to prevent money laundering or problem gambling. - Guardian
Troubled outsourcer Mitie's new chief executive is poised to launch a review of the company's accounts that will cut its revenues and profits further after two profit warnings last year. Phil Bentley, who took over the FTSE 250 business in December after stints heading Cable & Wireless Communications and British Gas, is expected to appoint an external auditor to lead the review in the next few weeks. - Telegraph
The world's largest asset manager is threatening to unleash a fresh wave of shareholder rebellions in the UK unless Britain's largest companies rein in excessive boardroom pay. BlackRock is demanding cuts to director pension entitlements and an end to huge pay rises as UK companies prepare to put their latest pay deals to shareholders. - Guardian
China went on a €35 billion shopping spree for European companies last year with a focus on technology and manufacturing. This 77 per cent increase on 2015 concentrated on Germany where €11 billion was spent buying or taking a share in more than 40 companies, with €7.8 billion going to Britain. - The Times
The health secretary Jeremy Hunt is in line for a windfall of almost £17 million from the sale of an education business he helped set up before becoming an MP. Talks are said to be at an advanced stage between Hotcourses, a listings service that provides information about educational training courses, and an unnamed buyer. - The Times
The number of people in Britain taking out private medical insurance has risen significantly for the first time since 2008, amid fears about the ongoing crisis gripping the NHS. After falling steeply between 2008 and 2011 and then staying flat, demand for private medical insurance cover in Britain rose by 2.1% in 2015 with just over 4 million people insured. - Guardian
A scion of one of Malaysia's wealthiest real estate dynasties has said that plans to build one of the tallest residential towers in London will not be bulldozed by Brexit. Abigail Tan, head of the St Giles Hotels Group, is to press ahead with a £800mto £1bn mixed use development in Blackfriars despite rising costs linked to the collapse in the value of the pound. - Telegraph
The world's eight richest billionaires control the same wealth between them as the poorest half of the globe's population, according to a charity warning of an ever-increasing and dangerous concentration of wealth. In a report published to coincide with the start of the week-long World Economic Forum in Davos, Switzerland, Oxfam said it was "beyond grotesque" that a handful of rich men headed by the Microsoft founder Bill Gates are worth $426bn (£350bn), equivalent to the wealth of 3.6 billion people. - The Guardian
The maker of the world's largest aircraft is planning a London flotation as it seeks funds for its plan to bring about a new dawn for the airship. Hybrid Air Vehicles (HAV) is in talks with Zeus Capital, the investment bank, over advising on a listing to raise up to £50 million, most likely on the Alternative Investment Market. The fundraising for the Bedford-based company is scheduled for late 2017 or early 2018. - The Times
The ranks of the 40-plus energy companies jostling for householders' business will swell on Monday with the launch of a new supplier that delivers electricity from windfarms. Fischer Energy hopes to sign up 40,000 customers in the first year to its single variable tariff, with renewable power bought from Denmark's Dong Energy. - Guardian
Britain's largest graduate employers plan to expand their recruitment of university leavers this year in a further sign of confidence in the economy. The top 100 graduate recruiters are seeking to hire 20,985 to their management programmes, 868 (4.3 per cent) more than last year. - The Times | | |
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