Stocks gain on US budget hopes
Market Movers
techMARK 2,093.45 +0.57%
FTSE 100 5,846.95 +0.75%
FTSE 250 11,987.38 +0.81%
UK
equities opened strongly on Thursday morning with mining stocks leading
the risers on the back of optimism that US policy-makers will
eventually agree on a deal to avert the 'fiscal cliff'.
"European equities are trading higher this morning managing to extend
yesterday’s afternoon late turnaround rally on comments by several US
politicians involved in the budget negotiations who have been painting a
fairly optimistic picture that a deal will be struck and therefore that
the fiscal cliff will be avoided," said Markus Huber, the head of
German HNW trading at ETX Capital.
US Republican Speaker of the House John Boehner
said yesterday that he was “optimistic that we can continue to work
together to avert this crisis sooner rather than later.” He said that
Republicans were willing to put “revenue on the table” as long as it is
accompanied by spending cuts.
Meanwhile, President Barack Obama
told the public in a press conference today to pressure Congress to act
to avert the automatic tax increases, saying: “When the American people
speak loudly enough, lo and behold, Congress listens.
“So
today I’m asking Congress to listen to the people who sent us here to
serve. I’m asking Americans all across the country to make your voice
heard.”
FTSE 100: Miners make gains early on
Mining group BHP Billiton
was in demand after its Chief Executive Officer Marius Kloppers gave a
cautiously optimistic outlook at the company's annual general meeting.
He highlighted the company's diversified portfolio, which he stressed
means it is "poised to capture the opportunities presented by markets in
all stages of the demand cycle".
Mining peers Vedanta, ENRC, Kazakhmys, Anglo American and Rio Tinto
were also making gains. Yesterday's comments from Chinese Commerce
Minister Chen Deming were also providing a lift. He said that China will
definitely hit its growth target of at least 7.5% this year.
DIY group Kingfisher
was lower after seeing like-for-like sales fall 2.8% in the third
quarter. In the UK, Kingfisher's biggest market, total sales declined by
0.7% to £1.05bn, and were down 3.8% in like-for-like terms.
Utilities firm Pennon,
which owns South West Water and waste business Viridor, rose after
delivering a half-year pre-tax profit in line with expectations, up 3.4%
to £111.1m.
Real estate investment trust British Land
edged higher after saying that it has bought the 2.3-acre Canal
Corridor North site in Lancaster and is in talks to acquire the
adjoining land to build a canal side, mixed-use scheme across a 10-acre
site.
Pay-TV and broadband group BSkyB was lower after
Jefferies downgraded its rating on the stock from 'hold' to
'underperform' and cut its target from 700p to 650p, saying: "we no
longer believe Sky's valuation reflects the challenges it faces as the
UK's incumbent pay TV platform as the market matures."
FTSE 250: Invensys continues to soar
Technology group Invensys
extended yesterday's surge after announcing last night that it is to
sell its rail division to Siemens for £1.742bn, pay down its pension
deficit and return £625m in cash to shareholders. Shares rocketed 27%
yesterday and gained a further 12.6% this morning.
Rigid plastic packaging supplier RPC Group dropped after seeing net profit halve in the first half as it was hit by restructuring costs and impairment losses.
William Hill rose
after coming a step closer to buying out its online joint venture
partner Playtech after formally triggering a valuation process for
William Hill Online.
Electrical retailer Dixons was
lower after full-year sales rose 4% to £3.29bn in the first half. The
company's figures reflected the European economic divide as sales grew
in the North, but took a hit in Southern countries.
Brewer and pub operator Marston's edged higher after group revenue gained 5.5% to £720m and underlying profit before tax increased by 9.2%.
| AIM/Small Cap Report |
FTSE 100 - Risers
Burberry Group (BRBY) 1,320.00p +3.61%
Pennon Group (PNN) 617.50p +3.17%
Rio Tinto (RIO) 3,029.00p +3.01%
Smiths Group (SMIN) 1,097.00p +2.91%
Evraz (EVR) 237.80p +2.77%
Kazakhmys (KAZ) 697.00p +2.73%
Eurasian Natural Resources Corp. (ENRC) 272.30p +2.72%
Vedanta Resources (VED) 1,082.00p +2.46%
Standard Chartered (STAN) 1,475.00p +2.18%
Anglo American (AAL) 1,741.00p +1.99%
FTSE 100 - Fallers
Wood Group (John) (WG.) 783.50p -3.87%
Kingfisher (KGF) 276.00p -1.64%
British Sky Broadcasting Group (BSY) 773.50p -0.71%
Pearson (PSON) 1,175.00p -0.25%
Diageo (DGE) 1,876.50p -0.11%
FTSE 250 - Risers
Invensys (ISYS) 315.30p +12.61%
New World Resources A Shares (NWR) 268.30p +7.32%
Kenmare Resources (KMR) 32.80p +6.15%
SDL (SDL) 464.00p +4.62%
Persimmon (PSN) 805.00p +4.27%
Barratt Developments (BDEV) 196.50p +3.31%
Regus (RGU) 98.95p +2.91%
Talvivaara Mining Company (TALV) 96.85p +2.49%
Ocado Group (OCDO) 72.70p +2.39%
Redrow (RDW) 161.10p +2.29%
FTSE 250 - Fallers
RPC Group (RPC) 404.70p -4.98%
NMC Health (NMC) 176.00p -2.22%
JD Sports Fashion (JD.) 720.00p -1.37%
Perform Group (PER) 380.00p -1.30%
Bwin.party Digital Entertainment (BPTY) 107.00p -0.93%
BH Global Ltd. GBP Shares (BHGG) 1,110.00p -0.89%
Savills (SVS) 441.60p -0.74%
Imagination Technologies Group (IMG) 423.30p -0.68%
Wetherspoon (J.D.) (JDW) 540.00p -0.64%
Euromoney Institutional Investor (ERM) 750.50p -0.60%
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| UK Event Calendar |
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| FTSE 100 | Euronext | Dax perf | CAC 40 |
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INTERIMS
API Group, Dixons Retail , Hogg Robinson Group, Mountview Estate, PayPoint, Pennon Group, Phoenix IT Group, WYG
INTERIM DIVIDEND PAYMENT DATE
Moss Bros Group, Prime People
QUARTERLY EX-DIVIDEND DATE
Schlumberger Ltd.
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Bloomberg Consumer Confidence (US) (14:45)
Business Climate Indicator (EU) (10:00)
Continuing Claims (US) (13:30)
Economic Sentiment Indicator (EU) (10:00)
GDP (Preliminary) (US) (13:30)
Initial Jobless Claims (US) (13:30)
Pending Homes Sales (US) (15:00)
PMI Retail (GER) (08:55)
Unemployment Rate (GER) (08:55)
GMS
Media Corporation
FINALS
Marston's, Shaftesbury
AGMS
Avia Health Informatics, Baillie Gifford Japan Trust, Berkeley
Resources Ltd. (DI), BlackRock Greater Europe Inv Trust, Harbourvest
Senior Loans Europe Ltd., Petra Diamonds Ltd.(DI), Red Rock Resources,
Victoria Oil & Gas, Wolseley
TRADING ANNOUNCEMENTS
Impax Asset Management Group, Kingfisher
UK ECONOMIC ANNOUNCEMENTS
CBI Industrial Trends Surveys (11:00)
Consumer Credit (09:30)
M4 Money Supply (estimate) (09:30)
M4 Sterling Lending (estimate) (09:30)
Mortgage Approvals (09:30)
PMI Retail (EU) (09:00)
Trends in Lending (09:30)
FINAL DIVIDEND PAYMENT DATE
Wetherspoon (J.D.)
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| US Market Report |
Comments from Boehner and Obama lift stocks
Market movers
Dow Jones: 12,985 (+0.83%)
Nasdaq: 2,992 (+0.82%)
S&P 500: 1,410 (+0.79%)
Despite
a poor start, US stocks finished with moderate gains on Wednesday after
upbeat comments from Republican Speaker of the House John Boehner and
President Barack Obama boosted sentiment.
Markets
got off to a poor start this morning after Nevada Democrat Harry Reid
said that “little progress” has been made so far on avoiding the fiscal
cliff by year-end.
However, stocks pared losses after Boehner
said that he was “optimistic that we can continue to work together to
avert this crisis sooner rather than later.” He said that Republicans
were willing to put “revenue on the table” as long as it is accompanied
by spending cuts.
Furthermore, Obama told the public in
a press conference today to pressure Congress to act to avert the
automatic tax increases, saying: “When the American people speak loudly
enough, lo and behold, Congress listens.
“So today I’m asking
Congress to listen to the people who sent us here to serve. I’m asking
Americans all across the country to make your voice heard.”
Costco leads retailers higher
Wholesale retailer Costco jumped after unveiling a $3-per-share special dividend .
Its executives - like those at other outfits which have taken similar
decisions of late – were wary of the risk that taxes on dividends could
rise as high as 43% should the US go over the fiscal cliff.
Meanwhile, clothing retailers including American Eagle Outfitters Inc and Ann Inc made impressive gains after revealing that the holiday selling season got off to a good start. Sector peers Express Inc and Calvin Klein parent PVH Corp were also in demand.
Green Mountain Coffee Roasters surged after fourth-quarter earnings per share (EPS) came in at 64 cents, much better than the 48 cents forecast.
Electronic market-maker Knight Capital jumped after being sold to rival Getco in a deal that values it at $1.3bn.
Economic figures miss estimates
US
new home sales fell by 0.3% month-on-month in October, to an annualized
rate of 368,000 homes (Consensus: 390,000). The previous month's tally
was revised down to 369,000 from a preliminary estimate of 389,000.
The Federal Reserve’s latest Beige Book showed that activity expanded
at a measured pace in recent weeks, according to reports from contacts
in the twelve Federal Reserve Districts. However, contacts in a number
of Districts expressed concern and uncertainty about the federal budget,
especially the fiscal cliff.
The Beige book is a compendium
of anecdotal reports on various aspects of the economy in the different
Fed districts compiled roughly two weeks ahead of every Fed policy
meeting, with the aim of assisting policy makers of informing their
judgements.
S&P 500 - Risers
Costco Wholesale Corp. (COST) $102.58 +6.29%
J.C. Penney Co. Inc. (JCP) $18.32 +4.57%
Coach Inc. (COH) $60.15 +4.37%
Advanced Micro Devices Inc. (AMD) $1.96 +4.26%
JDS Uniphase Corp. (JDSU) $11.91 +4.20%
Juniper Networks Inc. (JNPR) $17.79 +4.10%
Genworth Financial Inc. (GNW) $5.85 +4.09%
VF Corp. (VFC) $162.10 +3.95%
Akamai Technologies Inc. (AKAM) $35.88 +3.79%
Autodesk Inc. (ADSK) $33.10 +3.70%
S&P 500 - Fallers
Teradata Corp. (TDC) $59.27 -3.70%
Sears Holdings Corp. (SHLD) $44.48 -3.41%
Western Digital Corp. (WDC) $33.90 -2.28%
R.R. Donnelley & Sons Co. (RRD) $9.49 -2.16%
Principal Financial Group (PFG) $26.80 -1.90%
Avon Products Inc. (AVP) $13.84 -1.70%
Lexmark International Inc. (LXK) $24.09 -1.67%
ONEOK Inc. (OKE) $44.88 -1.54%
Metropcs Communications Inc. (PCS) $10.39 -1.42%
Cliffs Natural Resources Inc. (CLF) $29.61 -1.33%
Dow Jones I.A - Risers
Hewlett-Packard Co. (HPQ) $12.73 +2.99%
Chevron Corp. (CVX) $105.58 +2.13%
American Express Co. (AXP) $55.51 +1.97%
Pfizer Inc. (PFE) $24.67 +1.73%
Merck & Co. Inc. (MRK) $44.60 +1.64%
Mondelez International Inc. (MDLZ) $25.66 +1.54%
Wal-Mart Stores Inc. (WMT) $70.56 +1.53%
Alcoa Inc. (AA) $8.40 +1.45%
Verizon Communications Inc. (VZ) $43.56 +1.35%
General Electric Co. (GE) $21.14 +1.29%
Dow Jones I.A - Fallers
Cisco Systems Inc. (CSCO) $18.83 -0.68%
Boeing Co. (BA) $74.09 -0.54%
E.I. du Pont de Nemours and Co. (DD) $43.24 -0.46%
|
| Thursday newspaper round-up |
BP, Brazil, Comet...
BP
has been blocked from seeking new contracts with the US government
because of the oil firm's lack of business integrity' during the Gulf of
Mexico oil disaster, the Environmental Protection Agency said
Wednesday. The temporary order bans BP from competing for new oil leases
in the Gulf of Mexico – such as the auction of 20m acres taking place
on Wednesday – or from bidding on new contracts to supply the Pentagon
or other government agencies with fuel. While the ban does not affect
existing business, it raises wider questions about the company's future
in a crucial market. [The Guardian]
Brazil’s economy
is expected to have grown at an annualised rate of 4 per cent or above
in the third quarter and is likely to maintain this pace through next
year and into 2014, according to Guido Mantega, finance minister. His
prediction of a strong rebound in Latin America’s largest economy came
as the central bank kept lending rates unchanged for the first time in
more than a year after an easing cycle in which they fell to an all-time
low of 7.25 per cent. [Financial Times]
Comet
is to close a further 125 stores – with the loss of 2,500 jobs – over
the next few weeks, and it may shut down its entire business before the
end of the year unless a buyer can be found, the administrator,
Deloitte, has warned. More than 1,000 jobs have been cut so far across
the 41 stores already shut, and all 5,000 remaining staff are at risk of
being unemployed by Christmas. The 70 stores that remain open will
continue trading until all their stock has been sold and, with a
last-minute takeover looking unlikely, it would be the biggest retailing
collapse since Woolworths, which went into administration four years
ago this week, with the loss of 24,000 jobs. [The Guardian]
David Cameron has been warned that proposals to set a minimum price for alcohol
in England and Wales are illegal under European law. The European
Commission has sent a nine-page legal opinion to the British Government
warning that minimum prices are illegal – and that the Treasury should
increase duty on alcoholic drinks if it wishes to raise the price.
However, ministers appear to have decided to defy the legal warning and
yesterday unveiled proposals to introduce a 45p minimum price for each
unit of alcohol. [The Telegraph]
Barclays is
considering exiting agricultural commodities trading as part of the UK
lender’s attempts to rebuild its battered reputation after a series of
scandals. The possible retreat from the controversial business is part
of a strategic overhaul by the bank’s new chief executive Antony
Jenkins, who is screening the reputational impact of every business line
Barclays operates in. [Financial Times]
Tony Blair has warned that an exit from Europe
would be “hugely destructive” to Britain’s long-term interests and that
an “anxious” business community will now move to make itself heard. In
an impassioned speech to Business for New Europe, a pro-European
coalition of business leaders, hosted by Chatham House in central
London, the former Labour prime minister said London’s leading financial
centre would be damaged if Britain retreated from Europe and warned
that companies would find it less appealing to do business. “Third party
companies often want London as a base for Europe”, he said. [The Times]
Barclays
yesterday said five employees had been sacked as a result of the
Libor-fixing scandal which landed the bank with a £290m fine and cost
its chairman and chief executive their jobs. Rich Ricci, the chief
executive of Barclays' corporate and investment banking division, told
the Parliamentary Commission on Banking Standards that "a lot" of the
individuals identified in its internal probe had left the bank, so it
could not take action against them. He added that eight additional staff
had also been disciplined. [The Independent]
Oil major BP
appears back on track to renew a key Middle Eastern contract following
yesterday’s agreement to sell a package of North Sea assets to the
state-controlled energy firm of Abu Dhabi. Taqa, which is three-quarters
owned by the Abu Dhabi government, will pay more than $1 billion (£625
million) for stakes in five BP oil fields. The deal brings the British
group within touching distance of a targeted $38bn of disposals needed
to shore up its balance sheet ahead of its trial over civil fines for
the Deepwater Horizon disaster in the US. However, the agreement also
suggests that BP might still win back a long-running oil concession that
is the linchpin of its operations in the Middle East.[The Scotsman]
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