ADVFN III Morning Euro Markets Bulletin for Wednesday, August 29 2012

	ADVFN III	Morning Euro Markets Bulletin
	Daily world financial news

Wednesday, 29 August 2012

London Market Report

FTSE 100 Euronext Dax perf CAC 40 Please click on the images to view our interactive charts

London open: Glencore leads fallers early on Market Movers techMARK 2,089.87 -0.38% FTSE 100 5,741.83 -0.59% FTSE 250 11,348.30 -0.24% - Spain a concern as Catalonia needs aid - Markets await Bernanke - Ex-div Glencore a heavy faller early on Ex-div stocks and miners were weighing heavily on the FTSE 100 index in early trading on Wednesday morning with worries about Spain weighing on sentiment. It was revealed yesterday that the recession in Spain was deeper than first thought in the second quarter, with concerns intensifying after reports that the regional government of Catalonia would be requesting around €5bn from Spain's liquidity fund. "Catalonia also seems stubborn on political conditions relating to the emergency funds, causing some anxiety for potential future lenders to Spain as a whole. This is pretty big news for the Eurozone as any seemed resistance to conditions relating to any emergency funds could cause a pretty big headache down the line," said trader Simon Furlong from Spreadex. Economists at FxPro said in an e-mailed note this morning that investors are now waiting for Ben Bernanke for a lift: "As the Chairman of the US Federal Reserve gets up to speak on Friday, his words will determine whether markets are imbued with hope or despair ahead of the next US monetary policy meeting in September." FTSE 100: Ex-div stocks, miners down early on Ex-dividend stocks were providing a drag this morning, including heavyweights Croda International, Glencore, Legal & General and Xstrata. Nevertheless, Glencore and Xstrata were being pressured lower by reports that Xstrata shareholder Norges Bank Investment Management has raised its stake in the miner in the last few weeks. The Norwegian fund is expected to join forces with Qatari Holdings to vote to block the merger between the two groups. Copper producer Antofagasta was also lower despite beating EPS estimates in the first half as a decrease in copper prices was offset by higher levels of production. Outsourcing group Serco was higher after saying that it expects good growth in full-year organic revenues in 2012 despite a 2.1% fall in the first half. FTSE 250: RusPetro drops after swinging into the red West Siberia-focused oil and gas firm RusPetro was a heavy faller in the opening hour after reporting a pre-tax loss of $26.4m, compared with a profit of $0.6m in the first half of last year. Revenues, however, tripled as production ramps up. UK and Continental property investment firm Hansteen gained after reporting a sharp rise in half-year profit despite adverse currency movement. On a like-for-like basis, occupancy, values and rent all improved. A host of second-tier stocks went ex-dividend today and were trading in the red, such as African Barrick Gold, Devro, Ferrexpo, Henderson, Hikma, Hochschild Mining, Lancashire Holdings, Rotork, Wood Group, Micro Focus, Rank Group and Stagecoach. UK Event Calendar Wednesday August 29 INTERIMS 21st Century Technology, 888 Holdings, Chime Communications, Corin Group, DP World Limited, Grafton Group Units, Hansteen Holdings, IQE, OJSC Pharmstandard GDR (Reg S), Paddy Power, Serco Group, Zhaikmunai LP GDR (Reg S) INTERIM DIVIDEND PAYMENT DATE Arden Partners INTERIM EX-DIVIDEND DATE Acencia Debt Strategies Ltd., African Barrick Gold , Croda International, Devro, Downing Income VCT 3 E Shs, Ferrexpo, Glencore International, Henderson Group, Hikma Pharmaceuticals, Hochschild Mining, Kingspan Group, Lancashire Holdings, Legal & General Group, Low & Bonar, LPA Group, Mobeus Income & Growth Vct, Robinson, Rotork, Wood Group (John), Xstrata QUARTERLY EX-DIVIDEND DATE Anglogold Ashanti Ltd., Energy XXI (Bermuda) (Di), Premier Energy & Water Trust, Real Estate Credit Investments PCC Ltd, Schlumberger Ltd. INTERNATIONAL ECONOMIC ANNOUNCEMENTS Beige Book Fed Survey (US) (19:00) Crude Oil Inventories (US) (15:30) GDP (Preliminary) (US) (13:30) MBA Mortgage Applications (US) (12:00) FINALS Mattioli Woods AGMS Coral Products, Green Compliance, Ingenious Media Active Capital Ltd. FINAL EX-DIVIDEND DATE Bloomsbury Publishing, City of London Group, Downing Absolute Income VCT 2, Downing Distribution VCT 1, Downing Income VCT 3, ECO Animal Health Group, Falkland Islands Holdings, Fletcher King, Micro Focus International, NCC Group, Park Group, Rank Group, Stagecoach Group Europe Market Report FTSE 100 Euronext Dax perf CAC 40 European shares are likely to open on a mixed note on Wednesday, as cautious optimism prevails ahead of revised second-quarter U.S. GDP growth numbers due later in the day and Fed chairman Ben Bernanke's speech at Jackson Hole on Friday before the Fed's September 12-13 policy meeting. Asian markets are trading mostly lower, commodities such as crude and copper are down modestly and the euro remains flat against major currencies. Traders are reluctant to make big bets after the Spanish region of Catalonia, the most indebted of Spain's 17 autonomous regions, sought a financial rescue from the government in Madrid. Catalonia requested for a EUR 5 billion bailout from the EUR 18-billion rescue fund, set up by Madrid to support its debt-ridden regions. Valencia was the first Spanish region to ask for a bailout, followed by Murcia. Meanwhile, both Prime Minister Mariano Rajoy Rajoy and European Union Council President Herman Van Rompuy denied that Spain is in talks for a broader bailout. Speculation about ECB action is gaining ground after ECB President Mario Draghi chose to stay away from this week's annual Jackson Hole Symposium in Wyoming, citing "heavy workload foreseen for the next few days". The ECB will hold its next Governing Council meeting in Frankfurt on Sept. 6 and investors expect hints on the proposed bond-buying program from troubled eurozone countries such as Italy and Spain in order to reduce borrowing costs. European Central Bank Governing Council member Erkki Liikanen suggested in an interview with Finnish daily Aamulehti that ECB should be more transparent in decision making and should make more information public than was the case earlier. The message on the irreversibility of the euro is very important and policymakers should be careful not to create uncertainty while speaking out on the euro crisis, he said. In corporate news, French cosmetics giant L'Oreal SA said its profit for the first half of fiscal 2012 increased 10.8 percent from a year ago, helped by robust sales of its beauty and cosmetics products in North America as well as new markets of Asia Pacific, Eastern Europe and Latin America. Bouygues SA posted first half 2012 net profit attributable to the Group of 278 million euros, down 29 percent from 391 million euros last year. Hotel group Accor SA posted first-half net loss, Group share of 532 million euros, as against a profit of 41 million euros a year ago. European stocks fell across the board on Tuesday after Japan lowered its growth forecast and Catalonia became the third Spanish region to ask for a bailout, fanning fresh worries over Europe's debt crisis. The Euro Stoxx 50 index of eurozone bluechip stocks slid 0.8 percent and the Stoxx Europe 50 index, which includes some major U.K. companies, lost 0.6 percent, while around Europe, the German DAX, France's CAC 40 and Switzerland's SMI fell between 0.6 percent and 1.1 percent. The U.K.'s FTSE 100 ended little changed with a negative bias. U.S. stocks ended a lackluster session flat overnight, as investors digested a mixed batch of economic data and looked forward to the Fed statement for clues on future monetary policy. The tech-heavy Nasdaq inched up by about 0.1 percent, while the Dow slipped 0.2 percent and the S&P 500 edged down 0.1 percent. US close: Stocks tread water Market movers Dow Jones: -22 at 13,103 S&P 500: -1 at 1,409 NASDAQ Composite: +4 at 3,077 US stocks marked time as investors feel inclined to sit on their hands ahead of Friday's speech by Federal Reserve Chairman Ben Bernanke at the central bankers conference in Jackson Hole. Markets will be looking for any signs that Ben Bernanke is tempted to increase stimulus by means of quantitative easing, until then it seems they are happy to keep their powder dry. Data from the Conference Board on consumer confidence was not conducive to chasing equity prices higher after the benchmark S&P 500 hit a four-year high last week. Confidence among US consumers fell in August, with the Conference Board's index falling to 60.6 from 65.4 in July, its lowest level since November of last year. The median forecast among a range of predictions from economists was for an August reading of 66. Also weighing on market sentiment was Japan's Cabinet Office decision to downgrade its assessment for the country's economy. Back in the USA, a survey of house prices in 20 US cities in June showed a year-on-year gain in prices in almost two years. Lexmark hopes to cut down on red ink Printer manufacturer Lexmark was the top blue-chip after revealing it would be slashing 1700 jobs and shutting a factory in the Philippines. Baked beans and tomato ketchup giant Heinz rose after it reported profits ahead of analysts' forecasts. AK Steel declined after UBS downgraded the stock to "sell" from "neutral". On a sector basis, raw materials, telephones, utilities and industrials were most out of favour; energy stocks improved in line with the oil price whule consumer stocks were also wanted. Other markets US Treasuries advanced on the back of the disappointing consumer confidence data, as a result of which the yield on the benchmark 10-year Treasury eased to 1.63% from 1.65% the day before. A US auction of $35bn of two-year notes got away successfully, with a yield of 0.273%, slightly less than the projected yield in pre-auction trading. The bid-to-cover ratio was a relatively healthy 3.94 versus an average ratio of 3.75 in the preceding 10 auctions. Hurricane Isaac, currently affecting oil production in the Gulf of Mexico, had its effect on the oil price, with the October contract for West Texas intermediate crude rising 0.9% to $96.33 a barrel on the New York Mercantile Exchange. S&P 500 - Risers Lexmark International Inc. (LXK) $21.62 +13.73% Tyson Foods Inc. (TSN) $15.62 +4.55% Juniper Networks Inc. (JNPR) $18.34 +3.32% Carnival Corp. (CCL) $34.98 +3.00% J.C. Penney Co. Inc. (JCP) $25.30 +2.64% Nike Inc. (NKE) $98.87 +2.53% E*TRADE Financial Corp. (ETFC) $8.60 +2.50% Autodesk Inc. (ADSK) $31.23 +2.36% Phillips 66 Common Stock (PSX) $41.96 +2.17% VF Corp. (VFC) $152.94 +2.14% S&P 500 - Fallers Salesforce.Com Inc. (CRM) $145.12 -2.64% Hudson City Bancorp Inc. (HCBK) $7.26 -2.55% KLA-Tencor Corp. (KLAC) $51.66 -2.49% Deere & Co. (DE) $73.81 -1.94% Peabody Energy Corp. (BTU) $22.36 -1.93% Dell Inc. (DELL) $10.91 -1.88% CONSOL Energy Inc. (CNX) $31.61 -1.86% Southwestern Energy Co. (SWN) $31.32 -1.82% Hewlett-Packard Co. (HPQ) $16.90 -1.80% Alpha Natural Res (ANR) $6.09 -1.77% Dow Jones I.A - Risers Intel Corp. (INTC) $25.00 +0.64% Chevron Corp. (CVX) $112.35 +0.55% Exxon Mobil Corp. (XOM) $88.10 +0.41% Kraft Foods Inc. (KFT) $41.86 +0.31% American Express Co. (AXP) $57.56 +0.24% Alcoa Inc. (AA) $8.50 +0.24% Boeing Co. (BA) $71.52 +0.20% United Technologies Corp. (UTX) $80.64 +0.10% Johnson & Johnson (JNJ) $67.51 +0.03% Dow Jones I.A - Fallers Hewlett-Packard Co. (HPQ) $16.90 -1.80% Bank of America Corp. (BAC) $7.96 -1.36% Cisco Systems Inc. (CSCO) $19.22 -0.72% Caterpillar Inc. (CAT) $86.01 -0.72% AT&T Inc. (T) $36.64 -0.62% Travelers Company Inc. (TRV) $64.84 -0.52% Merck & Co. Inc. (MRK) $42.83 -0.51% McDonald's Corp. (MCD) $89.14 -0.45% Coca-Cola Co. (KO) $38.00 -0.45% International Business Machines Corp. (IBM) $194.87 -0.42% Nasdaq 100 - Risers Baidu Inc. (BIDU) $120.62 +3.18% Autodesk Inc. (ADSK) $31.23 +2.36% Altera Corp. (ALTR) $37.07 +1.62% Avago Technologies Ltd. (AVGO) $36.27 +1.40% Expedia Inc. (EXPE) $52.88 +1.34% Google Inc. (GOOG) $677.25 +1.20% Vertex Pharmaceuticals Inc. (VRTX) $54.09 +1.08% Bed Bath & Beyond Inc. (BBBY) $67.24 +1.08% Amazon.Com Inc. (AMZN) $246.11 +0.90% Netflix Inc. (NFLX) $62.95 +0.90% Nasdaq 100 - Fallers KLA-Tencor Corp. (KLAC) $51.66 -2.49% Dell Inc. (DELL) $10.91 -1.88% Sandisk Corp. (SNDK) $42.31 -1.49% Monster Beverage Corp (MNST) $59.48 -0.92% Warner Chilcott Plc (WCRX) $16.90 -0.88% Yahoo! Inc. (YHOO) $14.72 -0.88% Randgold Resources Ltd. Ads (GOLD) $98.98 -0.84% Maxim Integrated Products Inc. (MXIM) $26.85 -0.81% Adobe Systems Inc. (ADBE) $32.06 -0.80% Fiserv Inc. (FISV) $70.05 -0.79% Newspaper Round Up Wednesday newspaper round-up: Xstrata, Spain, Heathrow Pressure on Glencore over its $65bn merger with Xstrata intensified yesterday after a third party was revealed to be potentially muddying the waters for the commodities trader. Norges Bank Investment Management (NBIM) has been steadily buying shares in Xstrata over the past few weeks and its most recent foray into the market triggered a regulatory announcement that showed that it now has just over 88 million shares. Combined with a small number of derivative instruments, the acquisition took NBIM's stake in the mining company to the 3 per cent that forces an investor to show its hand. NBIM, which is responsible for Norway's Government Pension Fund, said that it had a "general policy of not commenting on individual investments", and Glencore was unable to comment. Xstrata was also unavailable for comment. Reports claimed yesterday that the Norwegian move was replicating the policy of Qatar Holding, which has increased its stake in the miner and also opposed the deal in an attempt to force better terms, The Times says. Spain has suffered the worst haemorrhaging of bank deposits since the launch of the euro, losing funds equal to 7% of GDP in a single month. Data from the European Central Bank shows that outflows from Spanish commercial banks reached €74bn (£59bn) in July, twice the previous monthly record. This brings the total deposit loss over the past year to 10.9%, replicating the pattern seen in Greece as the crisis spread. The Bank of Spain said the fall is distorted by the July effect of tax payments and by the expiry of securitised funds. On the other hand, Julian Callow from Barclays Capital said the deposit loss is €65bn even when adjusted for the season: "This is highly significant. Deposit outflows are clearly picking up and the balance sheet of the Spanish banking system is contracting," The Telegraph reports. The Group of Seven nations last night said they "stand ready" to release emergency supplies of oil into the market, as Hurricane Isaac shuts down US oil production in the Gulf of Mexico. The extreme weather has intensified policy-makers' concerns around the oil price, which has climbed more than 20 over the past three months as sanctions on Iran stifle supplies. Finance ministers from the G7 group, which includes the US, Britain, Germany and France, last night urged the world's oil-producing nations to up their output and warned they were ready to sanction the release of strategic reserves to boost supplies, The Telegraph says. Scotland's first Alternative Investment Market (Aim) flotation of the year is to take place next week as an Aberdeen oil and gas group prepares to raise funds for a major acquisition. Shares in Eland Oil & Gas are due to begin trading on Aim next Monday and the group plans to use the £118m proceeds to buy a stake in an onshore mining lease in Nigeria. Eland began operations in May 2010 with the aim of identifying and acquiring interests in oil and gas assets in west Africa. Last April, the firm and its partner, Starcrest Nigeria Energy, successfully bid for a 45% stake in the Oil Mining Lease (OML) 40 licence following an auction by the Nigerian Agip Oil Company, Shell and Total E&P Nigeria. Canaccord Genuity has been appointed as the nominated adviser and broker. The shares are to debut at 100p. The move, first revealed by Scotland on Sunday in June, would see Eland valued at about £135m, The Scotsman says. The embattled chief executive of G4S said he was still unable to provide answers about why the company's Olympics security contract went so badly wrong as he revealed associated losses could run beyond £50m. Nick Buckles said he was taking "each week at a time" as he battles to save his job and repair the reputation in Britain of the FTSE 100 company after it failed to provide all 10,400 security guards it had agreed to under its contract with the Government. Commenting as G4S booked a £50m loss against the contract, he admitted the debacle could have a major impact on G4S's ability to win future contracts from the Government. But Mr Buckles claimed he could not comment on what happened – despite the end of the Olympics – until PricewaterhouseCoopers (PwC) has completed a review on behalf of the company's board, which is due in the second half of September, according to The Telegraph. Nick Clegg has called for a new emergency "wealth tax" on richer Britons during the economic downturn. The Deputy Prime Minister said that "people of very considerable personal wealth have got to make a bit of an extra contribution" towards what he describes as the "national effort". Mr.Clegg will outline plans for his new wealth tax - which he suggests is necessary to ensure that British society remains "cohesive" - at the Liberal Democrats' party conference next month. The Coalition has already announced that the austerity program of public spending cuts, including pay freezes in the public sector, will last for at least another two years until 2017. The deputy Prime Minister says today that this is only fair if accompanied by higher taxes on the wealthy, The Telegraph reports. Only 8% of Lonmin's South African miners showed up for work yesterday, worried that they would be attacked by militant, striking colleagues if they clocked in. Miners attempting to go to work were physically threatened and in some cases searched by colleagues, who stole their clocking-in cards. Intimidation centred on the free buses that brings employees to work, several of which had been set alight in the run-up to this month's violence. The company is losing production of 15,000 ounces of platinum a week during the shutdown and expects to breach the conditions of its bank loans next month. Lonmin is unlikely to reissue an ultimatum to workers that they face the sack if they do not return to work. Instead, the company plans to deploy its security guards on buses today in an attempt to thwart militant workers, The Times writes. Efforts by HM Revenue & Customs to clamp down on alcohol tax fraud have been lambasted as inadequate by an influential House of Commons watchdog. The Public Accounts Committee, chaired by Margaret Hodge, the Labour MP for Barking, said that although alcohol fraud was costing as much as £1.2bn in uncollected duty, HMRC lacked reliable information on the most cost-effective ways of tackling the issue and seemed "reluctant to prosecute offenders". In its conclusions, published today, the committee says that although alcohol fraud is "big business", the strategy begun by HMRC in April 2010 to combat the fraud was "being seriously hampered by a lack of information," according to The Times. Greece is in talks with the European Commission to establish several special economic zones offering tax breaks to attract investors and help reinvigorate its economy after five years of recession, development minister Kostis Hatzidakis said on Tuesday. The proposal is one of 10 priorities, from accelerating EU-backed infrastructure projects to reducing bureaucracy for potential investors, aimed at creating jobs and putting the country on track for sustained growth from 2014 onwards. Antonis Samaras, the Greek premier, stressed during talks last week in Berlin and Paris with German and French leaders that Greece needs its partners' support to lay the basis for future growth within the Eurozone, following an unprecedented fiscal consolidation, The Financial Times explains. Nick Clegg rushed to the aid of embattled transport secretary Justine Greening on Tuesday, vowing the coalition would "stick to" its agreed policy of blocking a third runway at Heathrow. The deputy prime minister came out fighting after Tim Yeo, a senior Tory backbencher, mocked David Cameron for dithering over the expansion of the west London airport, asking whether the prime minister was "man or mouse," The Financial Times says.