London open: Stocks gain as German GDP beats forecasts
- German Q2 GDP above forecasts
- Japanese stimulus could be on the agenda
- Standard Life impresses as profits jump
London's FTSE 100 advanced on Tuesday morning after German growth data
beat expectations and investors hoped that policy-makers in Japan would
step up to boost its economy.
German economic growth
slowed down from 0.5% to 0.3% in the second quarter of 2012, but
economists were expecting gross domestic product (GDP) to increase by
just 0.2%.
France, on the other hand, registered its
third consecutive quarter of zero growth although this was better than
the 0.1% contraction that the experts were expecting.
Optimism was also being driven by the results of the latest Bank of Japan
policy-setting meeting which showed that some board members wouldn't be
against future policy options to combat a slowdown. It was revealed
yesterday that annualised Japanese GDP increased by 1.4% in the second
quarter, well below the 5.5% growth the previous quarter and under the
2.3% expansion expected.
Investors will also be looking ahead retail sales
due out in the US later today. According to market analyst Michael
Hewson from CMC Markets, the figures "will be scrutinised for any
evidence of a change in consumer spending patterns. After seeing retail
sales number slide for the last three consecutive months, it would
appear that the US consumer is remaining reticent when it comes to
parting with their cash dollars."
FTSE 100: Standard Life surges after first-half results
Life assurance behemoth Standard Life
jumped as it saw profits rise in the first half after a strong
performance in the UK, its biggest market. Operating profit before tax
was up 15% to £302m with the firm reporting group assets under
administration (AUA) of £204.2bn, up 3% from £198.4bn the year before.
Anglo-Swedish drugs colossus AstraZeneca raised earnings guidance a tad after signing a deal with US pharmaceuticals titan Pfizer, pushing shares higher early on.
Building materials group CRH
dropped after poor weather and tough economic conditions in Europe saw
earnings slip in the first half of the year. EBITDA fell 1% year-on-year
in the six months to June 30th, more or less in line with the company's
guidance in May of "close to last year's level".
FTSE 250: Centamin up after record output
Egypt may not have been the most restful place in which to operate in 2012 but Egyptian gold miner Centamin is sticking with its production guidance after second quarter output hit record levels. Shares rose early on.
Scottish distribution firm John Menzies
was out of favour after seeing revenues fall in the first half as the
firm was hit by tough economic conditions and a weak euro.
FTSE 100 - Risers
Standard Life (SL.) 271.00p +5.57%
United Utilities Group (UU.) 718.50p +4.28%
Severn Trent (SVT) 1,757.00p +2.87%
Evraz (EVR) 275.00p +2.42%
Pennon Group (PNN) 753.00p +2.38%
Johnson Matthey (JMAT) 2,291.00p +1.87%
Vedanta Resources (VED) 995.00p +1.84%
Barclays (BARC) 186.30p +1.78%
Standard Chartered (STAN) 1,356.50p +1.72%
ITV (ITV) 84.45p +1.69%
FTSE 100 - Fallers
CRH (CRH) 1,154.00p -5.33%
Wolseley (WOS) 2,411.00p -1.51%
Kingfisher (KGF) 285.80p -1.07%
Pearson (PSON) 1,222.00p -0.81%
Lloyds Banking Group (LLOY) 31.45p -0.58%
Tate & Lyle (TATE) 663.00p -0.23%
Royal Bank of Scotland Group (RBS) 221.90p -0.22%
Petrofac Ltd. (PFC) 1,484.00p -0.13%
Weir Group (WEIR) 1,726.00p -0.12%
Randgold Resources Ltd. (RRS) 6,275.00p -0.08%
FTSE 250 - Risers
Petra Diamonds Ltd.(DI) (PDL) 101.00p +3.06%
JD Sports Fashion (JD.) 685.00p +2.70%
Savills (SVS) 383.40p +2.40%
Paragon Group Of Companies (PAG) 184.20p +2.33%
Carpetright (CPR) 618.00p +2.32%
Centamin (DI) (CEY) 70.10p +2.11%
Gem Diamonds Ltd. (DI) (GEMD) 194.90p +2.04%
Soco International (SIA) 348.00p +1.81%
Ladbrokes (LAD) 167.80p +1.70%
Barr (A.G.) (BAG) 445.50p +1.69%
FTSE 250 - Fallers
Daejan Holdings (DJAN) 3,105.00p -2.20%
Menzies(John) (MNZS) 620.50p -1.51%
Aquarius Platinum Ltd. (AQP) 36.77p -1.42%
Bumi (BUMI) 358.20p -1.38%
Ruspetro (RPO) 150.00p -1.32%
Bank of Georgia Holdings (BGEO) 1,136.00p -1.22%
Lonmin (LMI) 733.50p -1.01%
Heritage Oil (HOIL) 165.49p -0.96%
Restaurant Group (RTN) 317.00p -0.94%
UK Event Calendar
Tuesday August 14
INTERIMS
Anglo Pacific Group, CRH, Dragon Oil, JKX Oil & Gas, Menzies(John), SDL, Standard Life, Tribal Group
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Business Inventories (US) (13:30)
GDP (Flash Estimate) (EU) (10:00)
Gross Domestic Product (GER) (07:00)
Industrial Production (EU) (10:00)
Manufacturing Inventories (US) (15:00)
Producer Price Index (US) (13:30)
Retail Sales (US) (13:45)
Retail Sales Inventories (US) (15:15)
ZEW Survey (EU) (10:00)
ZEW Survey (GER) (10:00)
Q2
Anglo Pacific Group
FINALS
NWF Group
ANNUAL REPORT
Baltic Oil Terminals
AGMS
ADC African Development Corporation GmbH, Baltic Oil Terminals, Castings, Eredene Capital
UK ECONOMIC ANNOUNCEMENTS
Consumer Price Index (09:30)
Retail Price Index (09:30)
FINAL DIVIDEND PAYMENT DATE
Amati VCT
| Europe Market Report |
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| FTSE 100 | Euronext | Dax perf | CAC 40 |
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Europe open: GDP figures a pleasant surprise
European
markets have bounced back after yesterday's poor showing, encouraged by
indications that the mainland's two biggest economies are in better
shape than feared.
Positive numbers
Both German and French GDP figures came in better-than-expected at 0.3% and 0% respectively.
The German pace of growth slowed compared to the first quarter but the
outcome was slightly better than the expected figure of 0.2%.
"The robust consumer demand so far this year is very encouraging and
should also provide some support to the German economy going forward,"
said Thomas Harjes at Barclays Capital.
"However, the
risk of another soft patch in the second half of 2012 is significant as
most parts of Southern Europe remain in recession and overseas demand
has also softened lately."
The French economy had been expected to fall back into negative territory.
Although it's slightly depressing to hail such anaemic numbers, it's
nice for the beleaguered market to have a positive surprised for a
change.
Stat deluge
After Monday was a ghost
town in terms of statistical releases, Tuesday will more than make up
for the feeling that things were 'quiet...a little too quiet' yesterday.
Traders will turn their attention towards the release of the
German ZEW Index of economic sentiment, which recently showed sustained
and sharp weakness.
The most recent set of data is expected not to show any major further declines.
Then there will be the Euro-zone GDP and industrial production figures.
Markus Huber at ETX Capital said both were likely to paint a rather
somber picture concerning the state of the European economy at the same
time increasing the pressure on the ECB to do even more to support
growth.
Then in the afternoon US retail sales will take centre
stage with the consumer being expected to have staged a moderate
rebound after last month's decline.
Company movers
Merck KGaA led the DAX up after the German drugmaker beat forecasts for quarterly adjusted earnings.
It also predicted faster growth in underlying core profit this year based on higher pharmaceutical sales and a strong dollar.
Danish shipping giant AP Moeller-Maersk
steamed ahead after it revealed its container line returned to profit
in the second quarter on the back of improved freight rates. Sector peer
Aker Solutions bobbed higher in sympathy.
DAX - Risers
Merck KGaA 85.40 +3.52%
SAP AG 52.53 +1.43%
Daimler AG 41.38 +1.35%
DAX - Fallers
ThyssenKrupp AG 16.15 -0.52%
RWE AG 32.62 -1.00%
HeidelbergCement AG 39.68 -1.22%
CAC 40 - Risers
ST Microelectronics (STM) € 4.86 +1.72%
Accor (AC) € 27.38 +1.39%
Renault (RNO) € 37.76 +1.38%
Carrefour (CA) € 15.98 +1.33%
France Telecom (FTE) € 11.41 +1.29%
Michelin (ML) € 57.66 +1.25%
Schneider Electric (SU) € 49.53 +1.17%
Air Liquide (AI) € 95.49 +1.13%
Total (FP) € 40.21 +1.13%
Essilor International (EI) € 68.53 +1.08%
CAC 40 - Fallers
PPR (PP) € 127.05 -0.43%
EADS (EAD) € 30.25 -0.40%
| US Market Report |
US close: Tech stocks shine on mixed day
Dow Jones: -39 at 13,169
S&P 500: - 2 at 1,404
NASDAQ Composite: +2 at 3,023
The winning streak of the S and P 500 index came to an end on Monday
but the tech heavy NASDAQ finished marginally higher on a mixed day for
equities.
Tech stocks defy the weaker trend
Apple
was among the tech stocks making headway as reports of price cuts for
its iPhone range pumped up speculation that a new release of the
lucrative hand-held communications device is on the way.
Google,
which recently bought Motorola Mobility in a move which some saw as an
attempt to go head-to-head with Apple in the smartphone market, was
another stock on the rise after it announced it would make 4,000 workers
at the recently acquired unit redundant.
Two-thirds of the
cuts will take place outside of the United States, the firm explained,
saying it expects severance-related costs of no more than $275m.
"These changes are designed to return Motorola's mobile devices unit to
profitability," Google said in a regulatory filing and added that the
unit will place more emphasis on more innovative and profitable mobile
devices.
The Internet advertising giant also announced it is
to acquire all of the travel-related assets of journals publisher John
Wiley, among them the Frommer's brand of travel books. The news was seen
as potentially damaging to the business of online travel resource Trip Advisor.
Oil refiner Tesoro
has been shopping at BP's garage sale, paying around $2.5bn for BP's
refinery and related assets in Carson, California. The shares were the
best performers among S&P 500 constituents.
Bank of America
failed to hold on to the morning's gains. The stock had initially
hardened after the bank it is selling its non-US wealth management
operations to Swiss operator Julius Baer.
Retailer JC Penney
was off the pace after Piper Jaffray cuts its rating on the stock to
"neutral" from "overweight". Broker commentary also weighed on drinks
maker Monster Beverage; Goldman Sachs lowered its rating on the
beverages sector to "neutral" from "attractive".
Solar panel First Solar was friendless after German peer SolarWorld lowered full-year guidance and reported a big second quarter loss.
Other markets
Crude
oil futures had a quiet day, with the September contract for West Texas
light sweet crude finishing just 3 cents lower at $92.70 a barrel in
New York.
S&P 500 - Risers
Tesoro Corp. (TSO) $38.87 +9.49%
Sears Holdings Corp. (SHLD) $54.36 +5.72%
Sysco Corp. (SYY) $30.14 +4.51%
Salesforce.Com Inc. (CRM) $145.15 +3.80%
International Paper Co. (IP) $33.94 +3.19%
Campbell Soup Co. (CPB) $34.35 +3.12%
eBay Inc. (EBAY) $45.32 +3.02%
Nabors Industries Ltd. (NBR) $15.69 +3.02%
Google Inc. (GOOG) $660.01 +2.81%
Sprint Nextel Corporation (S) $5.05 +2.64%
S&P 500 - Fallers
Brown Forman Corp. Class B (BF.B) $61.48 -33.30%
TripAdvisor Inc. (TRIP) $33.52 -4.50%
First Solar Inc. (FSLR) $20.49 -4.39%
Cliffs Natural Resources Inc. (CLF) $43.30 -3.58%
QEP Resources Inc (QEP) $26.97 -3.51%
Helmerich & Payne Inc. (HP) $48.30 -3.25%
Denbury Resources Inc. (DNR) $15.33 -3.16%
Chesapeake Energy Corp. (CHK) $19.06 -3.15%
Alpha Natural Res (ANR) $7.12 -3.13%
J.C. Penney Co. Inc. (JCP) $22.67 -3.12%
Dow Jones I.A - Risers
American Express Co. (AXP) $56.13 +0.50%
Walt Disney Co. (DIS) $49.86 +0.42%
Dow Jones I.A - Fallers
Alcoa Inc. (AA) $8.83 -1.67%
E.I. du Pont de Nemours and Co. (DD) $50.23 -1.66%
Cisco Systems Inc. (CSCO) $17.34 -1.14%
Nasdaq 100 - Risers
Sears Holdings Corp. (SHLD) $54.36 +5.72%
eBay Inc. (EBAY) $45.32 +3.02%
Google Inc. (GOOG) $660.01 +2.81%
Intuitive Surgical Inc. (ISRG) $508.31 +1.95%
VeriSign Inc. (VRSN) $47.49 +1.56%
Apple Inc. (AAPL) $630.00 +1.34%
Fiserv Inc. (FISV) $70.81 +1.33%
Nvidia Corp. (NVDA) $14.81 +1.29%
Bed Bath & Beyond Inc. (BBBY) $63.54 +1.21%
Starbucks Corp. (SBUX) $46.11 +1.18%
Nasdaq 100 - Fallers
Research in Motion Ltd. (RIMM) $8.07 -2.65%
Avago Technologies Ltd. (AVGO) $36.27 -2.37%
NetApp Inc. (NTAP) $31.81 -2.36%
Check Point Software Technologies Ltd. (CHKP) $50.71 -2.09%
Monster Beverage Corp (MNST) $53.27 -1.84%
Nuance Communications Inc. (NUAN) $23.12 -1.74%
Wynn Resorts Ltd. (WYNN) $100.13 -1.67%
Electronic Arts Inc. (EA) $12.87 -1.61%
Randgold Resources Ltd. Ads (GOLD) $97.89 -1.53%
F5 Networks Inc. (FFIV) $100.72 -1.48% |
| Newspaper Round Up |
Tuesday newspaper round-up: StanChart, Facebook, G4S...
Peter Sands, the chief executive of Standard Chartered,
has flown to New York in a last ditch bid to secure a settlement and
avoid a public showdown with US regulators over Iranian money laundering
charges. The bank boss decided to intervene personally after a weekend
of intense negotiations failed to persuade Benjamin Lawsky of New York
State Department of Financial Services to water-down his ferocious
attack on Standard Chartered. Ms Sands set off to America even though Mr
Lawsky continued to leave the bank in limbo over the format of
Wednesday's hearing and which executive he wants to appear. [The Telegraph]
Investors in Facebook,
still reeling from the social network's disastrous stock market debut,
are braced for further losses as the ban on early backers selling their
shares begins to lift this week. In a staggered process which begins on
Thursday and peaks in November, about 1.9bn shares – four times the
current publicly traded number – will begin to be released from
"lockup". Facebook's high-profile owners, from Microsoft and Goldman
Sachs to U2 frontman Bono's venture capital fund Elevation Partners,
will be free to sell the billions' worth of securities they held back
from the initial public offering in May. [The Guardian]
G4S's
failure to provide enough Olympic security guards has taught ministers
that private firms are unsuited to providing many public services, the
Defence Secretary has admitted. In an interview with The Independent,
Philip Hammond said the G4S saga had caused him to rethink his
scepticism towards the public sector – and made him appreciate there
were some things that only state organisations like the Army could be
relied upon to do. [The Independent]
Ministers are preparing to unveil a new package of measures to stimulate the flagging house-building
sector next month, in an attempt to help drag Britain out of recession.
The plan has been drawn up by Oliver Letwin, the prime minister's head
of policy, along with Grant Shapps, housing minister, and Danny
Alexander, chief secretary to the Treasury. It comes amid an
unprecedented drive to stimulate housebuilding. Downing Street and the
Treasury have instructed officials to come up with initiatives which
could boost building by using the government's balance sheet, rather
than by putting money upfront. [Financial Times]
Hotel operators
across Europe are being forced to cut room rates to attract guests as
the eurozone crisis hits corporate budgets. According to a biannual
survey by Hogg Robinson Group, one of the world's biggest business
travel companies, average room rates fell in several leading cities in
the first half of this year, with Barcelona down 22 per cent and Munich
down 15 per cent. Other eurozone cities under pressure included Dublin
and Madrid, where the price of a room fell by 6 per cent and 2 per cent,
respectively. Hotels in several destinations reported rates no better
than flat. [The Times]
Inflation fell further in
July, easing the pressure on household budgets, official figures are
expected to show on Tuesday morning. The Office for National Statistics
is forecast to say at 9.30am that annual inflation fell to 2.3pc in July
from 2.4pc in June, driven lower by food and petrol prices. [The Telegraph]
Senior executives of pan-European defence group EADS
were alerted five years ago about questionable payments made by one of
its subsidiaries in Saudi Arabia to an account in the Cayman Islands
that is now the subject of a criminal probe by the UK's Serious Fraud
Office. [Financial Times]
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