ADVFN III Evening Euro Markets Bulletin (January 2nd, 2012).

ADVFN III Evening Euro Markets Bulletin

Daily world financial news

 Wednesday, 02 January 2013

Thursday preview

Next benefits from festive shopping sales

Hot off the heels of festive trading Next is scheduled to report a strong fourth quarter performance. The UK’s second-biggest clothing retailer will Thursday unveil its sales results for the Christmas period.

The full year profit before tax estimate was put at £598m by Nomura Equity Research. The broker predicted the company would deliver full year brand sales of up to 4%, based on data which showed clothing sales were up 6% in November.

Next's trading update follows reports of average trading across the wider retail sector in the run up to Christmas.  Results were boosted by Boxing Day sales as an estimated 10m UK consumers scrambled get their hands on good deals. Next stores opened doors as early as 06:00 on December 26th to deal with demand.

Online sales also soared to unprecedented levels this year with shoppers searching for bargains on retail websites.  “The Next ‘formula’ is likely to continue - modest space growth, supplemented by good online sales, margin management and share buy-backs imply double-digit total shareholder returns, in our opinion,” Nomura said.

FINALS
Sinclair (William) Holdings

TRADING ANNOUNCEMENTS
Next

INTERIM DIVIDEND PAYMENT DATE
Hogg Robinson Group, Homeserve, Sepura, VP

QUARTERLY PAYMENT DATE
GlaxoSmithKline

UK ECONOMIC ANNOUNCEMENTS
Consumer Credit (09:30)
M4 Money Supply (09:30)
M4 Sterling Lending (09:30)
Mortgage Approvals (09:30)
PMI Construction (09:30)

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Unemployment Rate (GER) (08:55)
M3 Money Supply (EU) (09:00)
MBA Mortgage Applications (US) (12:00)
Continuing Claims (US) (13:30)
Initial Jobless Claims (US) (13:30)
Auto Sales (US) (15:00)
FOMC Interest Rate Minutes (US) (19:00)

London Market Report

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

FTSE 100 breaks 6,000 after US budget deal     Market Movers     techMARK 2,150.87 +1.97%     FTSE 100 6,027.37 +2.20%     FTSE 250 12,611.85 +1.91% The FTSE 100 surged past the psychologically-important level of 6,000 on Wednesday as stock markets across the globe celebrated the last-minute deal by US politicians to avert the fiscal cliff. While the budget saga Stateside is far from over - talks over spending cuts go on while concerns over the government’s debt ceiling have resurfaced - the House of Representatives passed a Senate-backed bill in the early hours of Tuesday morning to stop massive tax rises and spending cuts, by 257 votes to 167. A day before it had cleared the Senate by a majority of 89 votes to 8. The fiscal cliff - scheduled tax rises of around $536bn and spending cuts of $109bn - was widely expected to throw the US economy back into recession if politicians couldn't break months of impasse. Major benchmark indices across Europe finished today’s session up 2-3%, while markets on Wall Street opened around 2% higher. London’s blue-chip index gained 130 points, or 2.2%, to finish at 6,027. The last time the Footsie closed higher was at the end of April 2011. Nevertheless, the largest technical hurdle will come in towards the 6,100 point level, according to analysts at Digital Look. "Immense New Year relief rally for global financial markets following the passage of a bill in the US to avert the full force of the fiscal cliff," said market strategist Ishaq Siddiqi from ETX Capital. "2013 has kicked off with a bang with bulls in full control of price-action – the risk rally sees all your traditional investments in vogue (stocks EUROSTOXX making 16-month high, euro, commodities, peripheral bond yields, banks, miners et al) while core government bonds and US Treasuries take a beating." Gains on stock markets were cemented in afternoon trade following a series of upbeat manufacturing figures. Manufacturing purchasing managers’ indices (PMIs) in the UK, Italy and US managed to beat expectations today, though the Eurozone PMI number missed forecasts slightly. FTSE 100: Miners lead the way higher Mining stocks were putting in an impressive performance today as risk appetite increased. Steel producer and diversified mining group EVRAZ was among the best performers on the UK benchmark rising 7.2%, while commodities trader Glencore and diversified metals producer Xstrata finished with gains of around 7%. Burberry was also making decent gains, which may be linked to comments by the luxury retailer's Chief Executive, Angela Ahrendts, who said the company is increasing its efforts to its customers through digital media. Banks were also in demand with Barclays the standout performer after Investec hiked its target from 260p to 285p and hailed the lender as its "preferred UK domestic bank". Despite an impressive 79% rally over the past five months, the broker said that the shares are still trading "only in line with loss-making RBS and at a peculiar discount to Lloyds". These latter two banks are rated 'sell' by Investec. Oil giant BP rose after announcing the "successful start of production" at the Skarv field in the Norwegian Sea, adding new output from one of its core higher-margin areas. However, sector peer Shell was flat on reports that its Kulluk drilling rig has ran aground off the coast of Alaska after being caught in a storm. Engineering support services firm Babcock was higher after saying that it has acquired liquid gas plant unit LGE Process from Weir for £23m. Just three stocks on the blue-chip index were in the red today as defensive sectors like tobacco and supermarkets bear the brunt of the increase in risk appetite. British American Tobacco, Morrison and Sainsbury were all stuck in the red. Sainsbury was off after analysts at Oriel Securities warned this morning that “things have got much tougher here since the interims”. The broker said that the decision to offer 10p a litre off petrol for £60 spenders from December 27th to January 2nd “is a response to an uninspiring Christmas”. FTSE 250: Dunelm falls despite positive write-up from Panmure Dunelm was a poor performer despite Panmure Gorden highlighting the stock as one of its 'conviction buys' in the UK retail sector ahead of the critical Christmas reporting season in the next few weeks. The broker said: "Our top large cap general retail sector pick is category killer and number one UK homewares market share holder Dunelm [rated 'buy']. Our model suggests that Dunelm could return another £80m-90m to shareholders by FY2016E." Meanwhile, Caledonia Investments was a strong riser after reporting that it has sold its stake in Celerant Consulting Investments, the global operations management consultancy, to Hitachi Consulting Corporation. AIM/Small Cap Report FTSE 100 - Risers Evraz (EVR) 277.60p +7.22% Glencore International (GLEN) 376.50p +7.17% Xstrata (XTA) 1,129.50p +6.66% Eurasian Natural Resources Corp. (ENRC) 302.60p +6.55% Kazakhmys (KAZ) 825.50p +6.11% Anglo American (AAL) 2,003.50p +5.78% Vedanta Resources (VED) 1,222.00p +5.62% Meggitt (MGGT) 402.80p +5.36% Rio Tinto (RIO) 3,691.00p +5.11% Barclays (BARC) 275.60p +5.03% FTSE 100 - Fallers Sainsbury (J) (SBRY) 336.00p -2.64% Morrison (Wm) Supermarkets (MRW) 257.40p -2.13% British American Tobacco (BATS) 3,091.00p -0.96% FTSE 250 - Risers Bank of Georgia Holdings (BGEO) 1,108.00p +7.57% Ferrexpo (FXPO) 268.50p +6.89% Kenmare Resources (KMR) 33.00p +6.11% Fenner (FENR) 419.70p +5.90% Premier Oil (PMO) 355.20p +5.56% Domino's Pizza Group (DOM) 525.00p +5.55% Oxford Instruments (OXIG) 1,500.00p +5.41% Afren (AFR) 138.10p +5.34% Unite Group (UTG) 290.10p +4.99% Inmarsat (ISAT) 613.00p +4.88% FTSE 250 - Fallers New World Resources A Shares (NWR) 319.50p -5.28% KCOM Group (KCOM) 70.45p -3.56% Computacenter (CCC) 409.10p -3.06% Stobart Group Ltd. (STOB) 101.90p -2.95% Diploma (DPLM) 539.00p -2.80% Telecom Plus (TEP) 900.00p -2.65% WH Smith (SMWH) 653.50p -2.46% Ocado Group (OCDO) 84.75p -2.19% Jardine Lloyd Thompson Group (JLT) 773.50p -2.09% Dunelm Group (DNLM) 683.00p -2.08% Europe Market Report FTSE 100 Euronext Dax perf CAC 40 Stocks at 19-month high after US budget deal FTSE 100: 2.13% Dax-30: 2.15% Cac-40: 2.37% FTSE Mibtel 30: 3.81% Ibex 35: 3.12% Stoxx 600: 1.97% European equities rocketed to a 19-month high Wednesday after the US breathed a sigh of relief as they reached a budget deal. Lawmakers passed a bill Tuesday that avoided most tax hikes and postponed spending cuts by raising taxes for higher earners. The legislation brought an end to a year-long impasse over how to avert the so-called fiscal cliff.  President Barack Obama will sign off the bill after the House voted 257-167. "Thanks to the votes of Democrats and Republicans in Congress I will sign a law that raises taxes on the wealthiest 2% of Americans while preventing a middle-class tax hike that could have sent the economy back into recession and obviously had a severe impact on families all across America," he said in a press conference. However, the bill has left a number of problems unresolved with some strategists saying it was merely a short-term fix which did nothing to prevent future budget conflicts. Swedish regulator cracks down on traders The Swedish Financial Supervisory Authority will step up pressure on traders who break rules that require them to report company bond prices. The watchdog will crack down on corporate debt traders to abide by existing rules in a bid to improve transparency in a growing market. Traders will have to file trade reports including volumes and closing prices no later than 9:00 the following day.  The krona strengthened 0.23% at 6.4877 to the dollar at 16:30 Wednesday. Market shakers Lamprell shares soared 21% to 113.5p, its highest in six weeks, after the oil rig maker received banking waivers for its debt facilities. The company said it had succeeded in negotiating waivers to its banking covenants which were due to be tested on December 31st. Silence Therapeutics shares rose 10.29% to 4.82p after the medical company announced the appointment of Chief Medical Officer Michael Khan who will oversee a cancer research project. Mining heavyweight Rio Tinto Group gained 5.4% to 3,700.00p, the highest price in 10 months. Automaker Volkswagen climbed 3.26% to €168.20 as Chinese manufacturing expanded for a third month in December. ArcelorMittal rose to its highest in 11 weeks after selling a stake in its Canadian unit for $1.1bn. The world’s biggest steelmaker increased 4.4% to €13.505. Euro falls against dollar The euro dropped 0.07% to the 1.3195 dollar despite a positive start to the day.  Front month Brent crude futures increased 1.130 to 112.370 on the ICE. US Market Report Stocks Holding On To Strong Gains After Early Rally After moving sharply higher at the start of trading, stocks have continued to perform well over the course of morning trading on Wednesday. The major averages have not seen much follow-through on their initial upward moves but remain firmly positive. The rally on Wall Street comes as traders breathe a sigh of relief after both the House and the Senate approved legislation that allows the U.S. to avoid the fiscal cliff. The agreement calls for the expiration of the Bush-era tax rates for individuals earning more than $400,000 and households earning more than $450,000. Payroll taxes and taxes on capital gains and dividends also go up under the agreement, which also extends unemployment benefits. Meanwhile, the legislation delays the automatic spending cuts that were due to go into effect for two months, meaning that there are future budget negotiations ahead. With the news eliminating some of the uncertainty about the outlook for the economy, steel stocks have moved substantially higher on the day. The NYSE Arca Steel Index is up by 3.5 percent after reaching its best intraday level in eight months. Semiconductor stocks are also seeing considerable strength, with the Philadelphia Semiconductor Index up by 3.1 percent. Earlier in the session, the index reached a three-month intraday high. Most of the other major sectors have also shown strong moves to the upside, with housing, biotechnology, railroad, and telecom stocks posting standout gains. The major averages have moved roughly sideways in recent trading, holding on to strong gains. The Dow is up 249.23 points or 1.9 percent at 13,353.37, the Nasdaq is up 71.70 points or 2.4 percent at 3,091.21 and the S&P 500 is up 27.00 points or 1.9 percent at 1.453.19.