Morning Euro Markets Bulletin.

ADVFN III Morning Euro Markets Bulletin

Daily world financial news Thursday, 29 August 2013

London Market Report

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

Stocks rebound after recent falls, Vodafone jumps Strong gains from Vodafone, WPP and Melrose gave markets in London a boost this morning, as stocks rebounded after some recent falls. Markets have been under pressure this week on concerns about a potential Western military intervention in Syria in response to last week's alleged chemical weapons attack that killed over a thousand civilians. The risk of disruptions to oil supplies in the Middle East has sparked a surge in crude prices West Texas futures jumped to its highest level in over two years yesterday which is beginning to erode growth prospects for the global economy. "European markets opened firmly today as investors finished taking as much risk out of their portfolios as they could bear. However, volumes are once again proving painfully thin as many seem to be adopting a wait-and-see-strategy over whether the West will confirm military intervention in Syria," said Financial Trader Shavaz Dhalla from Spreadex. Investors seem to be rattled by reports that energy giants China and Russia have openly expressed their concerns over a military strike whereas the UK and the US have not made a categorical stance regarding their positions." Markets will have their hands full in terms of economic data on Thursday, with a number of closely-watched indicators due for release during today's session, including German unemployment, German inflation, US growth estimates and US jobless claims. FTSE 100: Vodafone surges as talks resume with Verizon Telecoms group Vodafone was a high riser this morning after confirming that it has restarted talks with partner Verizon about the possibility of selling its 45% stake in their US joint venture, Verizon Wireless. Advertising and media giant WPP was also making decent gains after revealing a 19% increase in half year pre-tax profit as slowing growth rates among emerging markets were eclipsed by a strong performance among mature markets like North America and the UK. Engineering investment firm Melrose Industries saw revenues top the £1bn mark in the first half as results were boosted by Elster - the gas, electricity and water measurement business it acquired last year. Shares rose strongly early on. Airline peers IAG and easyJet were higher this morning, rebounding as oil prices edged lower. The recent surge in crude has sparked worries over rising jet fuel costs for the travel industry. Leading the downside was outsourcing group Serco after it was revealed that it is under investigation by the City of London police in regards to a "misreporting of data" by a number of employees. Serco said it will forgo any future profits on the £285m contract. Investors were largely ignoring a strong first-half report by the company this morning which showed a 10.5% rise in first-half adjusted profits. Insurance firm Admiral was also lower after its first-half results as markets were underwhelmed by a 6% rise in profits and an 8% increase in the interim dividend. Falling metal and oil prices were hitting resource stocks this morning with Fresnillo, Randgold, Shell and Tullow Oil among the worst performers.

FTSE 100 - Risers Vodafone Group (VOD) 207.20p +9.46% Melrose Industries (MRO) 295.10p +3.76% WPP (WPP) 1,220.00p +3.57% International Consolidated Airlines Group SA (CDI) (IAG) 296.00p +3.14% Travis Perkins (TPK) 1,599.00p +2.57% easyJet (EZJ) 1,243.00p +2.56% Wolseley (WOS) 3,304.00p +2.54% BT Group (BT.A) 328.60p +1.73% Whitbread (WTB) 3,120.00p +1.63% Aberdeen Asset Management (ADN) 353.30p +1.46% FTSE 100 - Fallers Serco Group (SRP) 547.50p -9.73% Fresnillo (FRES) 1,242.00p -3.57% Randgold Resources Ltd. (RRS) 5,050.00p -2.79% Pearson (PSON) 1,292.00p -1.82% Tullow Oil (TLW) 1,011.00p -1.46% Royal Dutch Shell 'B' (RDSB) 2,193.00p -1.26% Royal Dutch Shell 'A' (RDSA) 2,103.50p -1.24% BG Group (BG.) 1,252.50p -1.18% G4S (GFS) 249.50p -1.15% Eurasian Natural Resources Corp. (ENRC) 225.00p -1.14% FTSE 250 - Risers Evraz (EVR) 132.30p +6.09% Thomas Cook Group (TCG) 139.90p +5.51% Soco International (SIA) 400.10p +3.65% Stagecoach Group (SGC) 317.60p +3.32% Keller Group (KLR) 1,136.00p +2.81% Dixons Retail (DXNS) 41.96p +2.54% Mitchells & Butlers (MAB) 424.20p +2.44% JPMorgan Indian Inv Trust (JII) 288.70p +2.27% Rotork (ROR) 2,760.00p +2.26% Dunelm Group (DNLM) 954.00p +2.09% FTSE 250 - Fallers Hochschild Mining (HOC) 226.40p -3.66% African Barrick Gold (ABG) 173.60p -3.50% Menzies(John) (MNZS) 746.50p -2.42% Ferrexpo (FXPO) 168.50p -2.32% Polymetal International (POLY) 685.00p -1.86% Lonmin (LMI) 344.30p -1.66% Alent (ALNT) 357.80p -1.65% Kazakhmys (KAZ) 303.70p -1.62% Xaar (XAR) 857.00p -1.44% Kenmare Resources (KMR) 26.62p -1.41%

UK Event Calendar

INTERIMS Admiral Group, Anglo Pacific Group, Aseana Properties Ltd., Bumi, Camellia, Cape, Churchill China, Co-operative Bank 9.25% Non-Cumulative Irrd Preference 1, Eurasia Drilling Co Ltd GDR (Reg S), Evraz, Hansteen Holdings, Hardy Oil & Gas, Hellermanntyton Group, Hunting, IFG Group, Integra Group GDR (Each GDR Repr 2 A Com Shr) (RegS), International Public Partnerships Ltd., Irish Continental Group Units, Joint-Stock Company Russian Grid GDR Reg S , Lamprell, Lombard Medical Technologies, Macfarlane Group, Melrose Industries, Molins, office2office, Oxford Biomedica, Petropavlovsk, Playtech, Public Power GDR SA (Reg S), Salamander Energy, Serco Group, Soco International, Unite Group, Vislink, WPP, Xaar INTERIM DIVIDEND PAYMENT DATE Andor Technology, Reed Elsevier INTERNATIONAL ECONOMIC ANNOUNCEMENTS Bloomberg Consumer Confidence (US) (14:45) Continuing Claims (US) (13:30) GDP (Preliminary) (US) (13:30) Initial Jobless Claims (US) (13:30) PMI Retail (EU) (09:00) PMI Retail (GER) (08:55) Unemployment Rate (GER) (08:55) GMS CAP-XX Ltd., Telekomunikacja Polska S.A GDR (Reg S) FINALS Hays ANNUAL REPORT Fastnet Oil & Gas AGMS Hellenic Carriers Ltd., Ten Alps, Ten Alps

Europe Market Report

FTSE 100 Euronext Dax perf CAC 40

Stocks rise ahead of US, German data FTSE 100: 0.63% DAX: 0.37% CAC 40: 0.41% FTSE MIB: 0.67% IBEX 35: 0.11% Stoxx 600: 0.64% European stocks rebounded ahead of a deluge of economic data out in the US and Germany. In the US, gross domestic product figures on Thursday are expected to be revised to show the world’s biggest economy expanded more than initially reported. The report is likely to reveal a 2.2% annualised growth rate in the second quarter, instead of the 1.7% originally posted, consensus showed. US initial jobless claims will also be released for the week ending August 24th. Economists predict claims to come in 331,000, compared to 336,000 a week earlier. The data comes as the Federal Reserve weighs up whether to begin scaling back its $85bn per month in bond purchases. The central bank is anticipated to start trimming stimulus at its next policy meeting in September so long as it deems the economy has showed enough improvement. In Germany, the consumer price index for August is pegged to fall to 1.7% from the previous month’s 1.9%. Europe’s largest economy’s unemployment rate will also be unveiled and is expected to hold steady at 6.8% in August, while the number of jobless is forecast to drop by 5,000 compared to last month’s decline of 7,000. Meanwhile, economists predict Syria will continue to be a key driver of markets on Thursday as Western governments mull over military action. US leaders have accused the Syrian government of using chemical weapons against civilians last week in an attack that killed about 300 people. The US government has said it was ready to intervene with reports on Wednesday saying Obama had called on foreign leaders for support, which sent global stocks tumbling. Spain’s recession eases Spain’s recession eased in the second quarter as exports increased and domestic demand stabilised, the Madrid-based National Statistics Institute revealed. Exports were up 6% following a 3.8% fall in the previous quarter. Household spending contracted 0.1% from the three months through March when it shrank 0.5%. Gross domestic product declined 0.1% in the second quarter compared to a 1.6% drop last year. Vodafone in talks to sell Verizon Wireless stake Vodafone advanced after saying Verizon Communications is in talks to buy its stake in the Verizon Wireless venture. Carrefour SA surged after reporting a 4.9% increase in first-half profit. Serco Group slumped after confirming that the UK Ministry of Justice has called police over the misreporting of data by "a small number of employees" associated with Serco's Prisoner Escort and Custody Services contract.

US Market Report

Oil producers give markets a boost as crude jumps Dow Jones: 0.33% Nasdaq: 0.40% S&P 500: 0.28% US markets registered decent gains on Wednesday with the Dow Jones rebounding after hitting a two-month low the day before as oil producers tracked crude prices higher. Stocks such as Chevron and Exxon Mobil were giving markets a boost as crude oil futures reached their highest level in over two years as nerves about the crisis in Syria kept the spotlight on potential supply disruptions in the Middle East. West Texas crude oil for October delivery rallied $1.09 or 1% to settle at $110.10 a barrel on the New York Mercantile Exchange. Prices added to Tuesday's near 3% surge, despite the latest US data showing a surprise increase in crude supplies over the last week. Crude oil prices have been pushed 4% higher in the last two days as the US and other nations condemn what is believed to be the use of chemical weapons on rebels by Syria's government. Earlier in the week US Secretary of State John Kerry said Syria would be held accountable for the "moral obscenity" of an alleged chemical weapons. US Vice President Joe Biden said there is "no doubt" that the Syrian government used chemical weapons and it must be held accountable. "A further rise in oil prices would threaten to turn a lacklustre global recovery into something approaching stagnation,” said Chief Global Economist Julian Jessop from Capital Economics. “However, the ‘worst-case’ scenario of significant disruption to energy supplies from the region still seems highly unlikely,” he said. Housing-market data disappoints The National Association of Realtors’ pending home sales index for the month of July unexpectedly fell by 1.3% month-on-month in July, worse than the 0.4% decline the month before. The consensus forecast was for no change from June. Meanwhile, the mortgage bankers’ association weekly mortgage application index fell by 2.5% last week, though this was an improvement from the 4.6% decline the week before. Corporate movers Housebuilders PulteGroup and DR Horton were in the red after the poor housing-market figures. Shares of digital-video recorder maker TiVo were on the rise after the firm reported a second-quarter net income of $268.9m, compared with a loss of $27m the year before. Wireless communications firm Avago Technologies jumped after reporting third-quarter results that beat consensus estimates. Jewellery retailer Zale was also a high riser after fourth-quarter revenues came in ahead of forecasts. Tech stocks were performing well this morning with Groupon, Netflix and Apple giving the Nasdaq a lift. S&P 500 - Risers Goodyear Tire & Rubber Co. (GT) $19.84 +4.37% Marathon Oil Corp. (MRO) $34.60 +3.65% Pioneer Natural Resources Co. (PXD) $176.77 +3.31% Cablevision Systems Corp. (CVC) $17.90 +2.93% Gilead Sciences Inc. (GILD) $60.44 +2.89% Cameron International Corp. (CAM) $57.88 +2.82% Hewlett-Packard Co. (HPQ) $22.61 +2.82% Netflix Inc. (NFLX) $283.36 +2.65% Xerox Corp. (XRX) $9.92 +2.59% Chevron Corp. (CVX) $121.81 +2.53% S&P 500 - Fallers Tiffany & Co. (TIF) $77.25 -4.42% J.C. Penney Co. Inc. (JCP) $12.76 -3.11% Lorillard Inc. (LO) $42.07 -2.62% Newmont Mining Corp. (NEM) $31.34 -2.40% Tyson Foods Inc. (TSN) $28.45 -2.30% Molson Coors Brewing Co. Class B (TAP) $48.44 -2.10% Lennar Corp. Class A (LEN) $31.62 -2.01% CF Industries Holdings Inc. (CF) $189.89 -1.84% AGL Resources Inc. (GAS) $43.98 -1.72% Carnival Corp. (CCL) $35.97 -1.64% Dow Jones I.A - Risers Hewlett-Packard Co. (HPQ) $22.61 +2.82% Chevron Corp. (CVX) $121.81 +2.53% Exxon Mobil Corp. (XOM) $88.84 +2.33% McDonald's Corp. (MCD) $96.08 +1.31% Home Depot Inc. (HD) $75.03 +1.23% Pfizer Inc. (PFE) $28.21 +0.77% Coca-Cola Co. (KO) $38.35 +0.52% Intel Corp. (INTC) $22.28 +0.42% Johnson & Johnson (JNJ) $86.53 +0.42% 3M Co. (MMM) $113.00 +0.24% Dow Jones I.A - Fallers Procter & Gamble Co. (PG) $76.85 -1.44% Verizon Communications Inc. (VZ) $46.56 -0.83% Microsoft Corp. (MSFT) $33.02 -0.72% Wal-Mart Stores Inc. (WMT) $72.38 -0.66% AT&T Inc. (T) $33.58 -0.33% International Business Machines Corp. (IBM) $182.16 -0.32% Caterpillar Inc. (CAT) $82.45 -0.30% Cisco Systems Inc. (CSCO) $23.44 -0.17% Merck & Co. Inc. (MRK) $47.09 -0.04% JP Morgan Chase & Co. (JPM) $50.58 -0.04% Nasdaq 100 - Risers Avago Technologies Ltd. (AVGO) $38.28 +4.72% Green Mountain Coffee Roasters Inc. (GMCR) $86.66 +3.23% Gilead Sciences Inc. (GILD) $60.44 +2.89% Baidu Inc. (BIDU) $138.98 +2.86% Netflix Inc. (NFLX) $283.36 +2.65% Facebook Inc. (FB) $40.55 +2.29% Cognizant Technology Solutions Corp. (CTSH) $73.78 +2.20% Sandisk Corp. (SNDK) $55.02 +1.83% Alexion Pharmaceuticals Inc. (ALXN) $107.56 +1.76% Western Digital Corp. (WDC) $62.46 +1.66% Nasdaq 100 - Fallers Nuance Communications Inc. (NUAN) $18.50 -2.01% Costco Wholesale Corp. (COST) $110.46 -1.08% Randgold Resources Ltd. Ads (GOLD) $78.08 -0.89% Charter Communications Inc. (CHTR) $120.00 -0.83% Sigma-Aldrich Corp. (SIAL) $82.26 -0.75% Whole Foods Market Inc. (WFM) $51.48 -0.73% Microsoft Corp. (MSFT) $33.02 -0.72% Liberty Interactive Corp (LINTA) $22.27 -0.71% Kraft Foods Group, Inc. (KRFT) $51.57 -0.71% Applied Materials Inc. (AMAT) $14.97 -0.69%

Thursday newspaper round-up

Vodafone, Brazil, Serco... The Telegraph writes that Verizon has resumed discussions about buying Vodafone's stake in their US joint venture for over 100bn dollars. The paper cites City analysts as saying that the deal could create an 'unrivalled war chest' for the UK telecoms group for making acquisitions, wiping off debt and delivering payouts to shareholders. The Brazilian central bank has raised interest rates for the fourth time since April, reports the Financial Times, in a move to "restore investors' confidence in Latin America's biggest economy". The benchmark Selic rate was hiked by 50 basis points to 9%. The Guardian writes that Serco is under investigation by City of London police over alleged fraud in relation to a £285m contract to transport prisoners to and from courts across the capital and East Anglia. The Co-operative Group reported a first-half loss of £559m due to £496m of writedowns at its troubled banking business. The Co-Op Bank itself reported a pre-tax loss of £709m. The Scotsman cites the latest industry data from Kantar WorldPanel which showed that Sainsbury, Britain's third-largest grocer, grew sales by 4.9% in the 12 weeks to August 18th, outperforming its rivals as it boosted market share from 16.4% to 16.5%. Others in the 'Big Four', Tesco, Asda and Morrisons, all lost market share. The private-equity owners of Burton's Biscuit Company have put the Jammie Dodgers and Maryland Cookies owner up for sale in an auction that could fetch £350m, according to The Times.