London close: Markets flat after choppy session
Market Movers
- techMARK 2,223.18 +0.01%
- FTSE 100 6,179.17 -0.03%
- FTSE 250 12,958.14 -0.28%
Stock markets finished more or less flat on Tuesday afternoon after a volatile session, in which investors digested policy announcements in Japan and mixed newsflow in Germany.
"A rather choppy morning session in Europe gave way to a rather more
sedate afternoon session as US traders returned to their desks after
their long weekend break," said Michael Hewson, a senior market analyst
at CMC Markets.
After a two-day meeting, the Bank of Japan
set a 2.0% inflation target and pledged to embark on a Fed-style
unlimited asset purchase programme. Meanwhile, the central bank left its
benchmark rate unchanged at the prior range of zero to 0.1%.
However, the promised increase in asset repurchases will not come into
place until January 2014, later than at least some had hoped. This
disappointment prompted a tentative start on the FTSE 100.
German newsflow shakes markets
By mid-morning though, rumours that Bundesbank President Jens Weidmann
had resigned swept through the markets, sending London's benchmark
index firmly into the red. This speculation was later denied by the
German central bank.
Meanwhile, there were reports that the German regulator Bafin had asked lenders (including Deutsche Bank) to estimate what the cost of a hypothetical break-up of their different business segments would be.
CMC's Hewson said: "The nature of this morning's move can also be attributed to the multi-year lows in the VIX
[a volatility index] which suggests that investors are under protected
against sharp market falls, trading at its lowest levels since 2006, and
pre crisis. These lows suggest some complacency amongst market
participants about the likelihood of further stock market gains."
Nevertheless, stocks quickly recovered after a better-than-expected reading from the German ZEW survey.
The economic sentiment index (which canvasses financial market experts)
increased by 24.6 points in January to 31.5 points, thereby reaching
its highest level since May 2010. This beat the consensus estimate,
which had forecast only a 5.1 point increase to 12.
FTSE 100: Fresnillo dragged lower by fourth-quarter results
Precious metals miner Fresnillo
was a heavy faller after fourth-quarter gold production came in 20.6%
lower than 2011. This stood in stark contrast to full-year output, which
totalled 473,034 ounces, up 5.4% year-on-year and above the
460,000-ounce target. Sector peer Polymetal was also lower.
DIY retailer Kingfisher was boosted after Exane BNP Paribas raised its target from 320p to 350p and kept an 'outperform' rating.
Natural gas company BG Group was also higher after Bloomberg speculated that the company is vulnerable to takeover bids as a result of the 26% decline in its share price last year.
Sweeteners and food ingredients group Tate & Lyle got a boost after Berenberg increased its rating on the stock to 'buy'.
Beverages giant SABMiller,
the company famous for Miller Lite and Foster's brands, said that
trading in the third quarter was in line with expectations with revenue
growth accelerating from the first six months of the year, causing
shares to edge higher.
Smiths Group and Shire were in demand after Credit Suisse highlighted that they would benefit as inflation expectations rise.
FTSE 250: Ocado climbs into bed with Rose
Ocado
was the high riser of the second-tier index on the news that it had
bagged Sir Stuart Rose. The former Executive Chairman of retailer Marks
& Spencer will become Ocado's new independent Non-Executive Director
and Chairman Designate, effective from March 11th.
Meanwhile, the pantomime continues at miner Bumi,
pushing the beleaguered firm's shares down. First thing this morning,
the company said its investigation into alleged wrong-doing at its
Indonesian operation, PT Bumi Resources, in which it holds a 29% stake,
had effectively been a waste of time.
PT Bumi Resources is
controlled by Indonesia's Bakrie family, one of the co-founders of
London-listed Bumi. The firm launched the investigation after Nathaniel
Rothschild, co-founder of Bumi, produced evidence of potential misuse of
development funds and other assets at the firm.
Residential landlord Grainger
rose after creating the GRIP unit trust with APG Strategic Real Estate
Pool to acquire a residential property portfolio worth £349.4m.
Gold miner African Barrick Gold edged higher after completing the financing for the expansion of its Bulyanhulu process plant in Tanzania.
FTSE 100 - Risers
BG Group (BG.) 1,145.00p +2.28%
Randgold Resources Ltd. (RRS) 6,020.00p +1.86%
Petrofac Ltd. (PFC) 1,700.00p +1.80%
Smiths Group (SMIN) 1,238.00p +1.73%
Next (NXT) 4,031.00p +1.54%
Kingfisher (KGF) 273.00p +1.52%
Tate & Lyle (TATE) 812.00p +1.50%
CRH (CRH) 1,285.00p +1.34%
SABMiller (SAB) 3,000.00p +1.33%
Associated British Foods (ABF) 1,646.00p +1.04%
FTSE 100 - Fallers
Fresnillo (FRES) 1,725.00p -2.82%
Carnival (CCL) 2,563.00p -1.91%
Polymetal International (POLY) 1,055.00p -1.86%
Pearson (PSON) 1,181.00p -1.75%
Standard Chartered (STAN) 1,637.00p -1.62%
GKN (GKN) 244.50p -1.45%
Prudential (PRU) 922.50p -1.13%
Royal Bank of Scotland Group (RBS) 362.90p -1.09%
Land Securities Group (LAND) 805.50p -0.86%
ITV (ITV) 115.40p -0.86%
FTSE 250 - Risers
Ocado Group (OCDO) 101.00p +6.26%
Rightmove (RMV) 1,599.00p +2.83%
Dignity (DTY) 1,122.00p +2.47%
Stobart Group Ltd. (STOB) 97.20p +2.32%
Grainger (GRI) 128.80p +1.98%
Pace (PIC) 217.80p +1.97%
QinetiQ Group (QQ.) 185.50p +1.81%
Chemring Group (CHG) 286.30p +1.67%
Direct Line Insurance Group (DLG) 217.70p +1.59%
Soco International (SIA) 382.60p +1.59%
FTSE 250 - Fallers
Domino Printing Sciences (DNO) 621.00p -4.31%
Elementis (ELM) 212.00p -4.20%
Enterprise Inns (ETI) 99.25p -3.73%
Persimmon (PSN) 857.50p -3.16%
Henderson Group (HGG) 154.00p -2.96%
JD Sports Fashion (JD.) 738.00p -2.89%
Kenmare Resources (KMR) 34.00p -2.88%
Galliford Try (GFRD) 815.00p -2.86%
Fidessa Group (FDSA) 1,565.00p -2.86%
BTG (BTG) 330.40p -2.82%
| Europe Market Report |
 |
| FTSE 100 | Euronext | Dax perf | CAC 40 |
 |  |  |  |
|
Europe midday: Strong data props up stocks
- German economic confidence rises to May 2010 highs
- German financials hit by report on possible regulatory moves
- Spanish bond yields drop
FTSE-100: -0.09%
Dax-30: -0.74%
Cac-40: -0.48%
FTSE Mibtel 30: 0.35%
Ibex 35: -0.38%
Stoxx 600: -0.17%
The main European equity benchmarks are now trading mixed on what has
turned out to be a rather volatile day. Perhaps worth taking note of, a
handful of strategists seem to have cooled slightly about the market.
Also worth pointing out, the Bundesbank this morning saw the need to
deny rumours regarding the impending exit of its President, Jens
Weidmann.
In turn, those reports came on the back of a rather
lacklustre reaction to the Bank of Japan's latest decision, overnight.
Some traders nevertheless described the selling which ensued as simply
some 'profit taking,' following the last few months' advances in equity
markets.
Also weighing on stocks early on, particularly in Germany, was a report on BorsenZeitung
that the country's financial market regulator, BaFin, has asked lenders
to run simulations on what the cost of a hypothetical break-up of their
different business segments would be.
Compensating for the
above was the release of a much better than expected reading on German
economic confidence, courtesy of the ZEW Institute.
EADS confident
Siemens
fiscal first quarter results were leaked to the press, the firm
obtained profits to the tune of €1.3bn ($1.7bn), which was better than
expected.
French power and transport engineering company Alstom said orders rose 3% in the third quarter.
EADS,
the European aerospace and defence group achieved a "very significant
improvement" in revenue and operating profit in 2012, Chief Executive
Tom Enders said.
From a sector stand-point the worst
performance was to be seen in the following industrial groups:
Construction (-0.76%), Media (-0.70%) and Telecommunications (-0.59%).
Very strong reading on German economic sentiment
The ZEW Institute's economic sentiment index for the month of January
has come in at 31.5 points, up by 24.6, to its highest level since May
2010. Single currency flat
The euro/dollar is now trading 0.02% lower at 1.3310.
Front month Brent crude futures are rising by 0.357 dollars, to the 111.60 dollar per barrel mark on the NYMEX.
| US Market Report |
US mid-morning: Weak housing data weighs on stocks
- Headline existing home sales miss expectations
- Mixed results from corporate heavyweights
Dow Jones Industrials: -0.01%
Nasdaq Comp.: -0.31%
S&P 500: -0.27%
The main Wall Street indices have begun the day on a slightly mixed
footing following the release of similarly contradictory quarterly
results from a batch of corporate heavyweights.
Thus, Johnson&Johnson and Verizon Communications are falling following the release of their latest financials.
Caterpillar
is off after the world's largest maker of construction and mining
equipment said it will take a $580m write-down in relation to accounting
"misconduct" at Zhengzhou Siwei Mechanical & Electrical
Manufacturing Co., a Chinese subsidiary acquired last year.
Travelers and chemical maker Dupont, on the other hand, are moving up. The latter has guided higher than expected on its 2013 revenues.
Results out from Regions Financial handily beat expectations.
Shares of Morgan Stanley were downgraded by analysts at Susquehanna.
UBS has cut its target on Apple to 650 dollars from 700 dollars before.
Important data ahead
The Federal Reserve's national activity index for the month of December has moderated to 0.02 from 02.7 in the previous month.
Existing home sales fell by 1% in December to an annualised rate of 4.94m (Consensus: 5.1m).
Crude futures edge up
West Texas crude futures have begun the day rising by 0.36% to the $95.83 per barrel mark on NYMEX.
10 year US Treasury yields are now rising by 1 basis point to the 1.85%.
S&P 500 - Risers
Western Digital Corp. (WDC) $47.01 +4.90%
Best Buy Co. Inc. (BBY) $15.51 +4.20%
R.R. Donnelley & Sons Co. (RRD) $9.89 +4.00%
Freeport-McMoRan Copper & Gold Inc. (FCX) $34.93 +3.84%
Seagate Technology Plc (STX) $36.49 +3.15%
State Street Corp. (STT) $54.74 +2.59%
International Game Technology (IGT) $15.38 +2.47%
Marathon Petroleum Corporation (MPC) $66.74 +2.36%
Travelers Company Inc. (TRV) $78.11 +2.36%
Pitney Bowes Inc. (PBI) $11.87 +2.15%
S&P 500 - Fallers
Sears Holdings Corp. (SHLD) $45.21 -3.11%
Autodesk Inc. (ADSK) $36.52 -2.61%
Constellation Brands Inc. Class A (STZ) $37.83 -2.35%
J.C. Penney Co. Inc. (JCP) $18.43 -2.33%
Coach Inc. (COH) $60.41 -2.25%
Dean Foods Co. (DF) $17.98 -2.12%
Micron Technology Inc. (MU) $7.72 -2.04%
Salesforce.Com Inc. (CRM) $166.73 -1.94%
Textron Inc. (TXT) $26.70 -1.91%
Goodyear Tire & Rubber Co. (GT) $13.56 -1.81%
Dow Jones I.A - Risers
Travelers Company Inc. (TRV) $78.11 +2.36%
Bank of America Corp. (BAC) $11.30 +1.39%
E.I. du Pont de Nemours and Co. (DD) $47.54 +1.17%
Unitedhealth Group Inc. (UNH) $55.10 +0.99%
Alcoa Inc. (AA) $9.07 +0.81%
Verizon Communications Inc. (VZ) $42.80 +0.61%
Walt Disney Co. (DIS) $52.56 +0.42%
McDonald's Corp. (MCD) $92.57 +0.34%
Home Depot Inc. (HD) $65.65 +0.27%
International Business Machines Corp. (IBM) $194.99 +0.27%
Dow Jones I.A - Fallers
Cisco Systems Inc. (CSCO) $20.68 -1.59%
Boeing Co. (BA) $73.99 -1.40%
Coca-Cola Co. (KO) $37.19 -1.35%
Caterpillar Inc. (CAT) $96.40 -1.25%
Johnson & Johnson (JNJ) $72.54 -0.95%
Intel Corp. (INTC) $21.08 -0.80%
American Express Co. (AXP) $59.37 -0.69%
General Electric Co. (GE) $21.92 -0.52%
Merck & Co. Inc. (MRK) $42.78 -0.48%
JP Morgan Chase & Co. (JPM) $46.26 -0.44%
Nasdaq 100 - Risers
Western Digital Corp. (WDC) $47.01 +4.90%
Facebook Inc. (FB) $30.68 +3.44%
Seagate Technology Plc (STX) $36.49 +3.15%
Randgold Resources Ltd. Ads (GOLD) $95.06 +3.02%
Dell Inc. (DELL) $13.03 +1.52%
Dollar Tree Stores Inc. (DLTR) $39.07 +1.43%
Regeneron Pharmaceuticals Inc. (REGN) $170.18 +1.32%
Activision Blizzard Inc. (ATVI) $11.49 +1.14%
Whole Foods Market Inc. (WFM) $91.48 +1.04%
Virgin Media Inc. (VMED) $38.93 +0.93%
Nasdaq 100 - Fallers
Sears Holdings Corp. (SHLD) $45.21 -3.11%
Autodesk Inc. (ADSK) $36.52 -2.61%
Micron Technology Inc. (MU) $7.72 -2.04%
Cognizant Technology Solutions Corp. (CTSH) $77.93 -1.75%
eBay Inc. (EBAY) $53.29 -1.70%
F5 Networks Inc. (FFIV) $95.28 -1.66%
Baidu Inc. (BIDU) $108.02 -1.66%
Cisco Systems Inc. (CSCO) $20.68 -1.59%
Liberty Global Inc. Series A (LBTYA) $68.36 -1.54%
Comcast Corp. (CMCSA) $39.65 -1.53% |
| Broker Tips |
Broker tips: SABMiller, Insurers, UK equites
Jefferies has retained its 'buy' rating and 3,200p target for beverages giant SABMiller following the company's better-than-expected third-quarter trading update.
While the stock has a premium rating
- trading at 18 times calendar 2013 earnings versus the 15.4 multiple
of peers - the broker said that this is "justified given its superior
growth profile and strong track record of delivery".
In its review of the insurance sector, UBS also cut its recommendation for peers Standard Life and Phoenix from 'neutral' to 'sell' on valuation grounds.
However, the broker raised its rating for St James's Place from
'neutral' to 'buy', saying it expects "positive operational momentum to
drive further multiple expansion, despite market trends".
While Credit Suisse has retained an 'overweight' position
in UK equities, the broker has trimmed its position to pay for its
recent upgrade to Japan and picked out 'what to buy' in its
London-listed coverage.
Credit Suisse said it likes cheap international earners such as Shire and Smiths Group
as they benefit as inflation expectations rise. This also has positive
implications for domestic real assets like real estate investment trusts
and home-builders.
Meanwhile, as equity allocations rise, asset managers such as Aberdeen should also benefit from strong equity flows.
|
| | | | | | | |
|
No comments:
Post a Comment