ADVFN III Evening Euro Markets Bulletin ( December 4, 2012 ):

ADVFN III Evening Euro Markets Bulletin Daily world financial news

Tuesday, 04 December 2012

London Market Report

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

London close: US and Eurozone uncertainty keeps stocks flat Market Movers techMARK 2,108.13 -0.09% FTSE 100 5,869.04 -0.04% FTSE 250 12,053.26 +0.21% - Democrats, Republicans wrangle over 'fiscal cliff' - Europe talks about bank supervisor - Defensives gain, resources fall The FTSE 100 swung between gains and losses for most of Tuesday's session to finish the day broadly flat as ongoing concerns about the US budget and developments in the Eurozone weighed on investors' minds. "It's been a rather slow day on equity markets today as markets tread water as uncertainty prevails over what's going on in the US with respect to arguments between Democrats and Republicans over spending cuts relative to tax rises, before year end," said market analyst Michael Hewson from CMC Markets. In a letter to President Barack Obama, House Speaker John Boehner presented a deficit-reduction proposal that included $1.4tn in spending cuts and $800bn in new revenue. However, the plan was rejected by the Obama administration as it didn't include higher tax rates for top earners. Market analyst Craig Erlam from Alpari said this afternoon: "At this stage there are very few people who are underestimating the potentially devastating effects that the fiscal cliff could have, apart from maybe the people in charge of avoiding it who appear to be very relaxed on the subject. Market volatility is likely to remain low until we start to see some progress here." Markets were also still digesting weak manufacturing figures Stateside which dampened equities on Monday. The US Institute for Supply Management (ISM) purchasing managers' index fell from 51.7 to 49.5 in November, well below the 51.4 forecast. Any figure below 50 represents a contraction. Closer to home, the Ecofin met in Brussels today to discuss proposals on bank supervision and take stock of negotiations with the European Parliament on bank capital requirements. FTSE 100: Shire leads defensive stocks higher Shire was leading the defensive stocks after investors exercised caution as budget uncertainty in the US continues to weigh on sentiment. British Gas owner Centrica rose after partner EDF Energy announced that it has extended the life of two UK power stations by seven years. Tesco was on investors' shopping lists this afternoon ahead of its third-quarter trading update tomorrow. Shares were making gains after Jefferies said that the grocer is "gaining traction ahead of Christmas". Heading the other way was Tullow Oil after it admitted commercial hydrocarbons have not been found at the Zaedyus-2 appraisal well in offshore French Guiana after the company completed drilling. However, the group said it is confident the French Guiana block remains "highly prospective". The stock was joined in the red by Randgold Resources and Fresnillo, as gold, silver and platinum prices all fell. Just weeks after it published its third-quarter results, BP has told investors they can expect more than 50% growth in operating cash flow by 2014 at $100 per barrel. In an investor presentation held on Monday, the group unveiled details of expected production and capital expenditure planned for the coming years, but shares declined today. International Airlines Group (IAG), which owns British Airways, has warned that it has entered talks with unions to discuss plans to cut jobs within the airline's cabin crew based at Heathrow airport. Morrisons fell after Espirito Santo cut its target from 265p to 230p and downgraded the stock to 'sell'. FTSE 250 movers: ITE exhibits positive figures ITE Group led the charge after it said revenues were up 11% in the last year and good trading conditions had continued into the new financial year. Westhouse Securities raised its target for the conference and exhibition organiser from 245p to 261p, while Numis raised its target from 288p to 294p. Both have a 'buy' recommendation on the stock. Paragon Group of Companies was a strong riser a day after it announced a potential deal that would grant the buy-to-let lender a banking licence. The mortgage provider confirmed on Monday that it was thinking about acquiring small private bank Hampshire Trust, which would give it the chance to offer savings accounts for its customers. Kenmare continues its slide following last week's announcement that it will produce up to 10% less of its key products this year than previously expected. When it made that announcement shares dropped 8%, but any recovery in the price has been muted and easily outstripped by falls, leaving the price down 6.6% in the last week. Among the following pack was Anite, which fell despite reporting a 30% increase in half-year profit and saying it was increasingly confident in meeting full-year forecasts. However, that didn't seem to be enough for investors who pushed the shares down 1.4% by the end of the day. FTSE 100 - Risers Shire Plc (SHP) 1,855.00p +2.43% Admiral Group (ADM) 1,148.00p +1.50% Aviva (AV.) 355.50p +1.34% Tesco (TSCO) 326.65p +1.30% Centrica (CNA) 332.70p +1.28% RSA Insurance Group (RSA) 120.70p +1.17% Royal Bank of Scotland Group (RBS) 295.70p +1.06% British American Tobacco (BATS) 3,319.00p +1.03% Hargreaves Lansdown (HL.) 744.00p +1.02% Eurasian Natural Resources Corp. (ENRC) 270.60p +0.97% FTSE 100 - Fallers Tullow Oil (TLW) 1,292.00p -5.76% Carnival (CCL) 2,445.00p -3.05% Randgold Resources Ltd. (RRS) 6,480.00p -2.78% Johnson Matthey (JMAT) 2,353.00p -1.84% Fresnillo (FRES) 1,958.00p -1.56% BP (BP.) 424.30p -1.36% Tate & Lyle (TATE) 761.50p -1.10% ARM Holdings (ARM) 762.00p -1.10% Sage Group (SGE) 311.20p -1.05% Polymetal International (POLY) 1,050.00p -1.04% FTSE 250 - Risers ITE Group (ITE) 213.50p +8.27% Paragon Group Of Companies (PAG) 253.10p +4.59% TUI Travel (TT.) 278.10p +3.38% Brown (N.) Group (BWNG) 370.80p +3.00% PayPoint (PAY) 860.00p +2.99% Domino Printing Sciences (DNO) 593.00p +2.95% Kentz Corporation Ltd. (KENZ) 382.80p +2.93% Euromoney Institutional Investor (ERM) 807.00p +2.74% KCOM Group (KCOM) 70.00p +2.56% New World Resources A Shares (NWR) 265.50p +2.43% FTSE 250 - Fallers Kenmare Resources (KMR) 29.96p -3.35% JD Sports Fashion (JD.) 695.00p -2.80% Imagination Technologies Group (IMG) 400.00p -2.79% Ruspetro (RPO) 82.55p -2.60% Raven Russia Ltd (RUS) 61.50p -2.15% Dechra Pharmaceuticals (DPH) 575.00p -1.96% Man Group (EMG) 75.50p -1.95% Senior (SNR) 194.20p -1.87% Anite (AIE) 135.00p -1.82% Supergroup (SGP) 599.00p -1.80% Europe Market Report FTSE 100 Euronext Dax perf CAC 40 Europe midday: Authorities bicker over bank regulator -Merkel: Nobody can tell when crisis will be overcome -Schaeuble: If all banks supervised Parliament may not approve -Markets waiting on results of ECOFIN meeting -Baxter acquires Gambro for 4bn dollars FTSE-100: 0.05% Dax-30: 0.33% Cac-40: 0.76% FTSE Mibtel 30: 1.13% Ibex 35: 0.50% Stoxx 600: 0.24% Markets have turned around to trade higher and are now registering slight gains. That as investors look to the result of tonight's meeting of European Union finance ministers, also known by its acronym ECOFIN. Ahead of that Germany's Finance Minister, Wolfgang Schaeuble, has been cited as saying that if the new proposed bank supervisor then it will be harder to pass the needed legislation through the German parliament. Tonight's meeting is supposed to reach a final agreement on the roadmap for the single supervisory mechanism, ahead of next week's European summit, which should endorse this agreement. Nevertheless, economists at Barclays wrote this morning that, "we think this is probably too ambitious given the disagreements between member states." Banks lead gains Nokia Siemens Networks will announce the closing of a German services unit tomorrow, with as many as 1,000 jobs lost, after failing to renew a contract with Deutsche Telekom, two people familiar with the matter told Bloomberg. Nokia also agreed on Tuesday to sell and lease back its head office as it works to improve profitability by selling non-core assets. Banks were doing the best Continent-wide, with shares of Spanish lender Bankia shooting up by 7% in early afternoon trading. EADS is rumoured to be planning the announcement of a shareholder shake-up after the close of today's session. From a sector stand-point the best performers now on the DJ Stoxx 600 are: Banks (0.77%), Insurance (0.67%) and Financial services (0.60%). Better than expected economic data Spain's unemployment worsened by 76,000 in November (Consensus: 90,000). Eurozone producer prices increased at a 0.1% month-on-month pace in October (Consensus: 0.0%). Small moves in other asset classes The euro/dollar is now rising by 0.15% to the 1.3079 dollar mark. As a curiosity, or not, Bloomberg points out how year-to-date the single currency is up by just 0.1%. Front month Brent crude futures were down by 0.553 dollars to the 110.32 dollar mark on the ICE. US Market Report US open: Stocks slightly mixed -Stocks mixed in absence of data -White House rejects Republican offer Dow Jones Industrials: 0.01% Nasdaq Comp.: -0.67% S&P 500: -0.25% The major New York equity benchmarks were still trading in a mixed fashion an hour after the opening bell. This in a light day in terms of economic data. Despite appearances, investors were somewhat anxious ahead of Friday's monthly employment report and next week's Federal Open Market Committee (FOMC) meeting. In more immediate matters, the White House has rejected Republican's most recent offer, $2.2trn of spending cuts and new revenue, as the measures do not include higher tax rates for top-earning Americans. Verizon Communications has indicated it is expecting to carry out a share buy-back in between 12 and 18 months. Shares of Darden Restaurants plummeted by 9% after the company cut its quarterly earnings view. US Redbook sales dropped by 0.3% month -on- month in the week up to December 4th. 10 year US Treasury yields were down by 2 basis point to the 1.61% level.