| | | | | | | Bargain Blue Chips While many in the industry suggest that the stock market is 'overvalued', it may in fact represent the perfect time to consider stocks that are trading significantly below their 2017 highs. This report covers at 5 stocks that you should be looking at right now - covering the Oil, Banking, Pharmaceutical and Tobacco sectors. Losses can exceed deposits Download the report here | | |
| | London Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | London close: FTSE higher on the day, investors wait for Fed statement Shares finished higher on Tuesday as the pound gave up early gains against the dollar.
The FTSE 100 was up 0.30% to 7,275.25, having fallen in early trade.
A good day was had by all as European bourses also closed in the black with the DAX up 0.02% to 12,561.79, the CAC 40 0.16% higher at 5,237.44 and the IBEX up to 10,378.40.
Sterling initially weighed on the blue chip index as it surged above 1.3550 against the dollar before falling back to trade below 1.3500 by noon. By the London close, cable was trading 0.13% up at 1.3512.
Tuesday saw currency traders looking towards the US Federal Reserve as it begins its two-day meeting ahead of a policy announcement on Wednesday as well as mulling various opinions on the overnight speech at the International Monetary Fund from Bank of England governor Mark Carney.
"The tone used by BoE Governor Carney at his speech at the IMF yesterday doused some of the hawkishness that had spread across sterling markets last week," said analysts at Rabobank.
Having already absorbed last week's message that the Bank feels that the time is nearing for a withdrawal of some monetary stimulus, Rabobank felt the main takeaway from the talk was that "any prospective increases in Bank Rate would be expected to be at a gradual pace and to a limited extent, and to be consistent with monetary policy continuing to provide substantial support to the economy".
Barclays agreed, feeling that markets saw the overall tone as being "less hawkish than Vleighe's speech on Friday", pointing to Carney's focus on the considerable risks to the outlook and indication that rate hikes were likely to be limited and gradual.
"However, the near-term inflationary risks are clearly emphasised through a number of channels. We believe the views expressed in the speech are consistent with our forecast of a rate hike in November."
HSBC chipped into the sterling chat as the bank's strategists have changed their opinion in light of the more hawkish BoE and cyclical factors driving the currency.
"[We] revise our year-end 2017 forecast for GBP-USD higher, from 1.20 to 1.35... But GBP is likely to weaken in 2018 as the market questions the merit of rate hikes and politics belatedly gets a grip on it."
Meanwhile, ahead of the Fed announcement, the US dollar had been swinging between the bulls and the bears, adding another factor to the pound's bumpy progress so far this week.
"Analysts expect the Fed to keep the possibility of a December interest rate hike on the table. There could be discussions on the balance sheet normalisation as well," said Ipek Ozkardeskaya, an analyst at London Capital Group.
The probability of a December rate hike rose to 50%, which Ozkardeskaya said was too low to trigger a panic across the stock markets yet too high to be ruled out by the currency and money markets.
In other macro data, Germany's ZEW economic sentiment figures smashed expectations to come in at 17.0, and while the region-wide reading missed estimates, it still improved to 31.7 from 29.3 month-on-month.
In the UK, Kantar Worldpanel released data on the food retail industry showing sales had risen 3.6% in the 12 weeks to 10 September, the sixth consecutive period in which sales rose by more than 3% but down slightly from the 4% announced in August. Marks & Spencer, Sainsbury's, Morrisons and Tesco were all among the top risers.
Sales at online grocery specialist Ocado have also been strong, but its shares were trading lower as the company's third-quarter update included comments about a spike in costs as it completes the construction of its fourth and largest 'customer fulfilment centre'.
Easyjet and IAG investors were enjoying the grimaces over at Ryanair as the Dublin carrier admitted to a "mess-up" on pilot rostering that forced it to write to 400,000 passengers to tell them that their flights were cancelled.
Tullow Oil was higher after analysts at Credit Suisse rejigged their recommendations for European exploration and production outfits, telling clients the sector was better positioned to emerge from the cycle, while its year-to-date de-rating had made it more attractive.
Medical products and technology company ConvaTec was modestly higher, after announcing the European introduction of its new "intermittent catheter".
GlaxoSmithKline was down slightly even though it announced that the US Food and Drug Administration has approved once-daily, single inhaler triple therapy under the brand name Trelegy Ellipta for the long-term treatment of patients with chronic obstructive pulmonary disease. |
| | Don't leave your pension on autopilot. | | 
Take control of your retirement with The Share Centre’s low cost fixed fee Self-Invested Personal Pension today. Capital at risk Click here |
| Market Movers
FTSE 100 (UKX) 7,275.25 0.30%
FTSE 250 (MCX) 19,535.48 0.50%
techMARK (TASX) 3,431.23 0.37%
FTSE 100 - Risers
Marks & Spencer Group (MKS) 340.00p 3.47%
International Consolidated Airlines Group SA (CDI) (IAG) 606.50p 2.62%
Sainsbury (J) (SBRY) 243.10p 2.57%
Johnson Matthey (JMAT) 2,976.00p 2.27%
Ferguson (FERG) 4,677.00p 2.25%
Morrison (Wm) Supermarkets (MRW) 235.70p 1.99%
G4S (GFS) 277.70p 1.76%
Smurfit Kappa Group (SKG) 2,413.00p 1.69%
Centrica (CNA) 190.30p 1.60%
Barratt Developments (BDEV) 590.00p 1.55%
FTSE 100 - Fallers
TUI AG Reg Shs (DI) (TUI) 1,287.00p -2.20%
Carnival (CCL) 4,760.00p -1.61%
Antofagasta (ANTO) 939.50p -1.42%
Coca-Cola HBC AG (CDI) (CCH) 2,540.00p -1.40%
Mondi (MNDI) 2,032.00p -1.26%
British American Tobacco (BATS) 4,648.50p -1.18%
NMC Health (NMC) 2,719.00p -1.16%
Whitbread (WTB) 3,624.00p -1.09%
BT Group (BT.A) 285.00p -0.90%
Smith & Nephew (SN.) 1,333.00p -0.89%
FTSE 250 - Risers
FDM Group (Holdings) (FDM) 1,002.00p 5.81%
Tullow Oil (TLW) 165.80p 5.54%
Cairn Energy (CNE) 180.80p 3.43%
Indivior (INDV) 310.00p 3.37%
Vesuvius (VSVS) 580.00p 3.20%
Metro Bank (MTRO) 3,488.00p 2.68%
Melrose Industries (MRO) 205.30p 2.65%
Domino's Pizza Group (DOM) 275.10p 2.61%
Rotork (ROR) 257.50p 2.59%
CLS Holdings (CLI) 207.20p 2.48%
FTSE 250 - Fallers
Hikma Pharmaceuticals (HIK) 1,150.00p -3.60%
NewRiver REIT (NRR) 336.10p -2.18%
Safestore Holdings (SAFE) 396.40p -2.12%
Ocado Group (OCDO) 296.10p -1.95%
TBC Bank Group (TBCG) 1,620.00p -1.82%
Kier Group (KIE) 1,085.00p -1.81%
Entertainment One Limited (ETO) 250.30p -1.73%
Stobart Group Ltd. (STOB) 290.00p -1.66%
Kaz Minerals (KAZ) 744.50p -1.59% |
| | Barclays Vs Lloyds - Which is a better Buy? | | Barclays and Lloyds are two of the UK’s most popular stocks.
But which is the better buy?
In this Complimentary Guide we explain in plain English what’s really going on at these key British Banks.
Find out:
Are Lloyds shares set to rocket?
Why Barclays has a ‘secret weapon’ that could unlock serious value
How do they compare in value and safety?
What you’re about to find out may surprise you…
Click here for your Complimentary Guide |
| | Europe Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | Europe close: Stocks end with slight gains ahead of Fed Stocks finished slightly higher as investors listened-in on a speech by US president Donald Trump at the United Nations and waited on the result of the US central bank's policy decisions the next day.
By the closing bell, the benchmark Stoxx 600 was edging higher by 0.04% or 0.17 points to 382.12, with the German Dax almost unchanged at 12,561.70 and up by just 2.40 points, while the Cac-40 was 0.16% or 8.12 points higher and trading at 5,237.44.
Meanwhile, the FTSE Mibtel gained 0.27% to 22,425.42 and Spain's Ibex 35 rose 0.39% or 40.0 points to 10,378.40.
In parallel, euro/dollar was ahead by 0.29% to 1.1987.
Speaking at the UN's New York headquarters, US president Donald Trump would tell the General Assembly "much more" needed to be done on North Korea and labelled Tehran a "murderous regime".
Commenting on Trump's remarks, Joshua Mahony at IG said: "Donald addressed his UN appearance to address the existence and support of 'rogue regimes', including the likes of North Korea, Iran, Cuba, and Venezuela. However, for the markets perspective, the focus is clearly on the potential repercussions from Pyongyang following Trump's declaration that US would be willing to 'totally destroy' North Korea. The subsequent risk-on move for gold and the yen highlights that there was little to make markets believe a military response is anywhere near."
Regarding the Federal Reserve's deliberations, by and large analysts expected rate-setters in Washington DC to announce the start of their balance sheet taper but there was far less unanimity when it came to what the Fed's exact guidance on interest rates in 2018 might be.
For their part, analysts at Barclays Research expected the Fed's so-called 'dot-plot' to be consistent with one further interest rate hike in 2017 and two more in the following year.
Over at HSBC, expectations were for another rate hike in December followed by another 25bp increase in the Fed funds rate in 2018.
As of Tuesday morning, Fed funds futures were assigning odds of roughly 56.9% to a December 2017 hike.
Back in Europe, but still on the economic front, the ZEW institute's economic sentiment gauge for Germany increased by 7.0 points in September to reach 17.0 (consensus: 12.0).
In parallel, Eurostat reported that construction output in the single currency was up by 0.2% in July.
The Eurozone's seasonally-adjusted current account surplus rose from €22.8bn in June to €25.1bn for July, according to the ECB.
German chemicals giant BASF agreed to purchase rival Solvay's Polyamide unit for €1.6bn.
IAG has joined the fray for all or part of bankrupt German peer Air Berlin, according to a report that was later confirmed to Digital Look by a spokesperson at the British Airways owner.
Mexico's FEMSA sold a 5.24% stake in Heineken valued at €2.5bn. |
| | US Market Report | | US open: Merger speculation sends telecoms names higher Stocks were holding slightly higher ahead as investors listened in on a speech by the American president to the United Nations's general assembly and ahead of the US Federal Reserve's policy decision the next day.
As of 1505 BST, the Dow Jones Industrials was higher by 0.09% or 23.75 points to 22,359.33, alongside a gain of 0.07% or 1.80 points for the S & P 500 to 2,506.01 and an advance of 0.06% or 3.97 points to 6,458.04 on the Nasdaq Composite.
Giving sentiment a boost, a CNBC report reignited speculation of a potential merger between Sprint and T-Mobile, lighting a fire under the entire telecoms space.
Against that backdrop, the best performing areas of the market were: Mobile Telecommunications (4.11%), Telecommunications (1.87%) and Non-ferrous metals (1.80%). Aerospace & Defence was also higher, gaining 1.39%.
In the background, in a speech at the UN's New York headquarters US president Donald Trump told the General Assembly "much more" needed to be done on North Korea and labelled Tehran a "murderous regime".
Looking out to the next session, following their two days of meetings rate-setters at the US central bank were expected to announce the start of their balance sheet tapering, which many analysts appeared to believe would go largely unnoticed because it had been clearly 'telegraphed' for some time now.
However, there was slight uncertainty about by just how much the Fed would adjust its guidance for interest rate increases over the next two years, although quite a few analysts appeared to be rather skeptical that it would be able to raise the Fed funds rate by more than twice or thrice by year-end 2018.
On a related note, perhaps, Jim Reid at Deutsche Bank told clients: "there are a number of areas of the global financial system that look at extreme levels. This includes valuations in many asset classes, the unique size of central bank balance sheets, sky high debt levels, ultra-low interest rates and even the level of potentially game-changing populist political support around the globe.
"If there is a crisis relatively soon (within the next 2-3 years), it would be hard to look at these variables and say that there was no way of spotting them in advance."
Economic data on Tuesday came in mixed, with US housing starts printing at an annualised pace of 1.18m for August, according to the Department of Commerce, as economists correctly forecast.
Meanwhile, according to the Bureau of Economic Analysis over the three months to June the country's shortfall on its current account deficit grew from -$113.5bn one year ago to -$123.1bn (consensus: -$110.5bn).
In other corporate news, Toys R' Us vied with telecoms shares for investors' attention after the toy retailer succumbed to pressure from its digital rivals, forcing it to file for Chapter 11.
The news was also dragging down rivals such as Mattel.
In parallel, Walgreen's announced plans to buy 1,932 establishments and three distribution centres from rival Rite Aid for $4.38bn.
Post Holdings was also in the headlines after disclosing it would buy Bob Evans Farms's equity for roughly $1.5bn.
Shares in AutoZone were also likely to find a bid after posting better-than-expected top and bottom line figures for its fiscal fourth quarter.
Dow Jones - Risers
Verizon Communications Inc. (VZ) $49.12 2.14%
American Express Co. (AXP) $88.54 0.76%
Intel Corp. (INTC) $37.24 0.65%
Procter & Gamble Co. (PG) $93.73 0.63%
Chevron Corp. (CVX) $115.91 0.63%
Goldman Sachs Group Inc. (GS) $228.94 0.62%
Caterpillar Inc. (CAT) $124.47 0.52%
United Technologies Corp. (UTX) $113.26 0.43%
JP Morgan Chase & Co. (JPM) $93.30 0.41%
Apple Inc. (AAPL) $159.10 0.27%
Dow Jones - Fallers
Unitedhealth Group Inc. (UNH) $196.55 -0.83%
Nike Inc. (NKE) $53.21 -0.54%
Johnson & Johnson (JNJ) $134.76 -0.46%
Merck & Co. Inc. (MRK) $65.77 -0.33%
General Electric Co. (GE) $24.39 -0.29%
Coca-Cola Co. (KO) $46.01 -0.22%
Pfizer Inc. (PFE) $35.47 -0.21%
3M Co. (MMM) $213.52 -0.11%
Boeing Co. (BA) $252.82 -0.10%
International Business Machines Corp. (IBM) $144.54 -0.01%
S&P 500 - Risers
Kohls Corp. (KSS) $46.86 4.39%
Leucadia National Corp. (LUK) $24.22 3.62%
Mattel Inc. (MAT) $15.38 3.43%
Hasbro Inc (HAS) $96.24 3.22%
NetApp Inc. (NTAP) $41.89 3.10%
Progressive Corp. (PGR) $47.56 2.70%
CF Industries Holdings Inc. (CF) $36.00 2.56%
Verizon Communications Inc. (VZ) $49.12 2.14%
Gap Inc. (GPS) $28.49 2.11%
Wynn Resorts Ltd. (WYNN) $146.40 1.78%
S&P 500 - Fallers
Best Buy Co. Inc. (BBY) $53.07 -7.46%
Centene Corp. (CNC) $89.91 -4.94%
Seagate Technology Plc (STX) $31.93 -4.74%
Sealed Air Corp. (SEE) $41.71 -2.75%
Crown Castle International (CCI) $101.82 -2.56%
Kellogg Co. (K) $66.87 -2.54%
AutoZone Inc. (AZO) $550.40 -2.31%
American Tower Corp (Reit) (AMT) $141.54 -2.23%
Advance Auto Parts (AAP) $96.70 -1.91%
Signet Jewelers Ltd (SIG) $66.25 -1.85%
Nasdaq 100 - Risers
T-Mobile Us, Inc. (TMUS) $63.94 3.46%
Mattel Inc. (MAT) $15.38 3.43%
Hasbro Inc (HAS) $96.24 3.22%
Wynn Resorts Ltd. (WYNN) $146.40 1.78%
KLA-Tencor Corp. (KLAC) $102.59 1.66%
Liberty Global plc Series A (LBTYA) $33.64 1.57%
Liberty Global plc Series C (LBTYK) $32.78 1.52%
Micron Technology Inc. (MU) $35.82 1.10%
Paypal Holdings Inc (PYPL) $63.52 0.95%
Vodafone Group Plc ADS (VOD) $28.88 0.91%
Nasdaq 100 - Fallers
Seagate Technology Plc (STX) $31.93 -4.74%
Walgreens Boots Alliance, Inc. (WBA) $81.01 -1.92%
Tesla Inc (TSLA) $377.81 -1.87%
Western Digital Corp. (WDC) $87.53 -1.85%
O'Reilly Automotive Inc. (ORLY) $206.44 -1.73%
NetEase Inc. Ads (NTES) $288.32 -1.70%
Expedia Inc. (EXPE) $139.93 -1.57%
Henry Schein Inc. (HSIC) $79.70 -1.48%
Regeneron Pharmaceuticals Inc. (REGN) $429.25 -1.24% |
| | 
Top of the stocks Number of Deals Bought Number of Deals Sold |
| | Broker Tips | | Broker tips: Debenhams, Gym Group, Tullow Oil, Ophir Energy Investec reiterated its 'sell' recommendation on Debenham's on the back of expectations for foreign exchange headwinds, unanswered questions around execution and profitability and the ongoing shift towards 'on-line'.
Indeed, the dividend might not be "sustainable".
In a research report published following a visit to the outfit's new store in Stevenage, which they dubbed a 'work-in-progess' lab, analysts Kate Calvert and Alistair Davies said the company's fiscal year results on 26 October were unlikely to be a share price trigger.
On a more positive note, they admitted that profits before tax might come in ahead of company guidance of "towards the bottom of the market range if volatility continues".
However, they added that: "Many unanswered questions around execution and profitability mean it is difficult to forecast with any confidence."
As well, the company's hedging policy meant FX headwinds would be at their worst in the first half of 2018, they wrote.
Barclays Research upped its target on shares of Gym Group from 230p to 250p following its first acquisition since the group floated, purchasing 18 gyms from Lifestyle Fitness.
On the downside, the transaction was seen diluting the company's overall return-on-capital-employed, with 20% expected from the deal versus a target EBITDA ROCE of 30% on those sites which it added organically.
There were also potential integration risks which management might have to navigate.
Offsetting those were numerous potential positives, including adding a year's-worth of organic growth "instantly", significant earnings accretion on a per share basis, and attractive rents on the new sites which should bolster EBITDA.
Hence, Barclays retained its 'overweight' stance on the stock, adding that the EBITDA ROCE on offer was still attractive, while highlighting that by buying assets the company would reach cash payback more quickly than if it opted to build out organically.
Analysts at Credit Suisse rejigged their recommendations for European Exploration and Production outfits, telling clients the sector was better positioned to emerge from the cycle, while its year-to-date de-rating had made it more "attractive".
On the basis of the above, shares of Tullow Oil were lifted to 'outperform' (with a target 210p, versus 205p previously) on valuation grounds and due to catalysts now lying closer on the horizon.
Cairn (CS's 'top-pick' with an unchanged target of 260p), Nostrum and Aker BP (target steady at 170p)were all kept at 'outperform'.
However, Nostrum's target was cut from 545p to 460p.
As a group, companies in the space were facing off against two challenges, worsening investor sentiment despite an improved oil price outlook and the need to position themselves operationally on the global cost curve relative to US shale rivals.
"International E&Ps are pricing in a long-term oil price of $57/bbl, on our estimates, vs. the forward curve at $54/bbl. Valuations have become more attractive compared to when we initiated on the sector," the Swiss broker observed. | | | | 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