Morning Euro Markets Bulletin October 21, 2013.

ADVFN III Morning Euro Markets Bulletin

Daily world financial news Monday, 21 October 2013

London Market Report

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

London open: Stocks edge higher as focus turns towards US data UK equites opened slightly higher on Monday morning, following a recent strong run and as traders awaited key economic data from the US later this week. London's FTSE 100 opened just a few points higher than Friday's close of 6,622.59, though this was still the highest finish for the benchmark index since mid-September. Financial Trader Shavaz Dhalla from Spreadex said that investors are now putting the concerns over the US budget behind them following last week's short-term agreement to raise the debt ceiling. "Furthermore, since this matter has been put to bed for now, traders will be hoping that volumes will slowly return to normality as many have argued that the thin volumes as of late have largely been attributed to uncertainties in the US," he said. Both the S&P 500 in the US and DAX 30 in Germany closed at all-time highs on Friday, while Australia's S&P/ASX 200 reached fresh five-year highs overnight, as analysts predicted that the prolonged government shutdown in America would delay plans by the Federal Reserve to taper its quantitative easing programme. Markets will now be looking ahead to the delayed release of the September US employment report on Tuesday, which may be a big factor in the Fed's next move. Consensus forecasts are pointing to a 180,000 increase in US non-farm payrolls last month, higher than the 169,000 gain seen in August. However, the unemployment rate is expected to have remained unchanged at 7.3%. As for today, US existing home sales data is the only notable economic release due out and is expected to show a fall of 3.3% month-on-month in September, reversing sharply after the previous 1.7% increase. Defence stocks provide a lift Stocks exposed to the defence outsourcing markets were making gains this morning, including G4S, Babcock, BAE Systems and Smiths Group, as investors celebrated the end of the government shutdown in the US. Aerospace and defence engineer Senior rose after saying strong order books at Airbus and Boeing had helped it keep profits on track since early July. The stock was also upgraded this morning by N+1 Singer to 'buy'. Hedge fund manager Man Group was also higher after Exane BNP Paribas raised its rating for the shares to 'buy'. Banking and financials stocks were among the worst performers with RBS, Barclays, Prudential, Old Mutual and Legal & General trading in the red. Meanwhile, miners including Vedanta, Antofagasta, Centamin and Polymetal edged higher as metal prices advanced.

FTSE 100 - Risers G4S (GFS) 248.90p +2.85% Babcock International Group (BAB) 1,233.00p +2.15% BAE Systems (BA.) 452.90p +1.80% Burberry Group (BRBY) 1,548.00p +1.38% Vedanta Resources (VED) 1,053.00p +1.35% Weir Group (WEIR) 2,323.00p +1.31% Aggreko (AGK) 1,471.00p +1.17% Amec (AMEC) 1,116.00p +1.09% Smiths Group (SMIN) 1,416.00p +1.00% Antofagasta (ANTO) 907.50p +0.95% FTSE 100 - Fallers Royal Bank of Scotland Group (RBS) 350.60p -5.93% Barclays (BARC) 273.00p -1.75% Kingfisher (KGF) 379.70p -1.43% Morrison (Wm) Supermarkets (MRW) 279.10p -1.20% SABMiller (SAB) 3,122.00p -1.14% Marks & Spencer Group (MKS) 490.50p -0.93% Prudential (PRU) 1,257.00p -0.55% Shire Plc (SHP) 2,523.00p -0.55% Old Mutual (OML) 199.40p -0.55% Legal & General Group (LGEN) 206.20p -0.53% FTSE 250 - Risers Centamin (DI) (CEY) 52.70p +2.93% QinetiQ Group (QQ.) 198.90p +2.58% Morgan Advance Materials (MGAM) 306.50p +2.27% UDG Healthcare Public Limited Company (UDG) 325.00p +2.20% Go-Ahead Group (GOG) 1,704.00p +2.16% Regus (RGU) 217.00p +2.12% Howden Joinery Group (HWDN) 327.90p +2.09% Polymetal International (POLY) 613.50p +2.08% Daejan Holdings (DJAN) 4,008.00p +1.96% Crest Nicholson Holdings (CRST) 371.90p +1.89% FTSE 250 - Fallers Betfair Group (BET) 1,006.00p -1.85% IP Group (IPO) 135.00p -1.68% Perform Group (PER) 549.00p -1.61% Alent (ALNT) 350.80p -1.32% Wetherspoon (J.D.) (JDW) 745.00p -1.13% AL Noor Hospitals Group (ANH) 830.50p -1.07% Dialight (DIA) 1,195.00p -0.99% Cranswick (CWK) 1,078.00p -0.92% Bank of Georgia Holdings (BGEO) 1,981.00p -0.90%

UK Event Calendar

INTERIMS Booker Group, Etalon Group Ltd GDR (Reg S) INTERIM DIVIDEND PAYMENT DATE Melrose Industries, Netplay TV, RPS Group, Standard Chartered QUARTERLY EX-DIVIDEND DATE Caterpillar Inc. INTERNATIONAL ECONOMIC ANNOUNCEMENTS Balance of Payments (EU) (09:00) Bloomberg Consumer Confidence (US) (14:45) Building Permits (US) (13:30) Capacity Utilisation (US) (14:15) Continuing Claims (US) (13:30) Current Account (EU) (09:00) Housing Starts (US) (13:30) Industrial Production (US) (16:15) Initial Jobless Claims (US) (13:30) Philadelphia Fed Index (US) (15:00) Speech President New York Fed (17:45) Speech President Kansas City Fed (17:45) Speech President Minneapolis Fed (19:45) IMSS Cairn Energy, Dechra Pharmaceuticals, Diageo, Jupiter Fund Management , Man Group, Rank Group, Renishaw EGMS Zhejiang Expressway Co 'H' Shares AGMS Brooks Macdonald Group, Dechra Pharmaceuticals, IG Group Holdings, Monitise, Rank Group, Renishaw TRADING ANNOUNCEMENTS Britvic, Mothercare, Rank Group, SABMiller UK ECONOMIC ANNOUNCEMENTS Internet Retail Sales (09:30) Retail Sales (09:30) FINAL DIVIDEND PAYMENT DATE Coral Products, Volex Q1 British Sky Broadcasting Group

Europe Market Report

FTSE 100 Euronext Dax perf CAC 40

Europe open: Traders hold off ahead of US employment report - Stocks in holding pattern ahead of US non-farm payrolls data - Euro/dollar near technical resistance - Moody's sees positive elements in Capitol Hill agreement FTSE-100: 0.76% Dax-30: -0.08% Cac-40: -0.11% FTSE Mibtel 30: -0.29% Ibex 35: -0.07% Stoxx 600: 0.14% European equities traders seem to be opting to watch and wait ahead of tomorrow's release of delayed US non-farm payrolls data for the month of September. That comes after some of the Continent's main equity benchmarks on Friday reached fresh five-year highs and as the euro/dollar exchange rate approaches technical resistance towards 1.3710. Worth pointing out, ratings agency Moody's has stated that the short-term agreement on the debt ceiling holds several "credit positive" elements for the US. Nevertheless, it raised the possibility of another political stand-off in the not-too-distant future. For some observers the fiscal uncertainty on Capitol Hill may do more permanent damage. "The problem has not been solved and the hopes for a grand bargain are in tatter... the lack of visibility is very damaging," Caxton Associates Chief Andrew Law told the Financial Times on Monday. Corporate heavyweights report earnings German business software maker SAP on Monday morning reiterated its full-year outlook but warned that its revenues and core operating profit may be negatively impacted by volatile exchange rates. Dutch conglomerate Philips has reported a near tripling in its third-quarter net profits. Light economic data calendar Dutch house prices were off by 0.2% month-on-month in September. Swiss money supply slowed in September, to a 9.7% year-on-year pace of advance, versus 10.4% in the month before. German producer prices moved higher in September by 0.3% on the month (consensus: 0.1%). Single currency steady below technical resistance The euro/dollar is down by 0.09% to 1.3672. Front-month Brent crude futures were lower by 0.246 dollars to the 109.68 dollar per barrel mark on the ICE.

US Market Report

S&P 500 hits another record as Google jumps Dow Jones: 0.18% Nasdaq: Nasdaq: 1.32 S&P 500: 0.66% Upbeat corporate earnings and hopes over a continuation of monetary stimulus gave markets a boost on Friday, helping the S&P 500 to a fresh all-time high. Sentiment was lifted after a host of companies beat quarterly forecasts, including Google which surged 14% past $1,000 for the first time. This boosted the S&P 500 to its second record close in as many sessions, up 0.7% at 1,744.50. The index rose 2.4% on the week, its best weekly gain since July. As the dust begins to settle following the last-minute deal on Wednesday to extend the debt ceiling and reopen the US government, markets are hoping that the Federal Reserve could delay tapering stimulus until early 2014, given that the shutdown is likely to have dampened growth in the fourth quarter. "US politicians struck a last-minute debt deal but some damage to US activity has already been done. Combined with this year's sharp fiscal tightening and significant rise in bond yields, this could leave H2 growth clearly weaker than expected," said analysts at Danske Bank. Investors are now looking ahead to the delayed release of the September US employment report next Tuesday, which will be a key factor in the Fed's next move. According to the median of 40 responses in a Bloomberg News survey of economists, the Fed will trim the rate of asset purchases from $85bn to $70bn a month at its meeting in March. Google sets new highs Google's share price high a record high of $1,011.41 after third-quarter results released after-hours on Thursday beat expectations. The internet giant reported adjusted earnings of $10.74 a share on sales of $11.92bn in the quarter, ahead of consensus forecasts for $10.36 and $11.7bn, respectively, helped by strong growth in advertising. Banking heavyweight Morgan Stanley swung to a better-than-expected profit in the third quarter, reporting a net income of $906m, up from a loss of $1.02bn the year before. US conglomerate General Electric was also higher in pre-market trade after adjusted earnings totalled 40 cents a share in the third quarter, ahead of the 35 cents estimate. Chipotle Mexican Grill, Align Technology, Paker-Hannifin and Baker Hughes were also making gains after their earnings reports. Internet retailer Amazon.com jumped after analysts at UBS upgraded the stock from 'hold' to 'buy', saying they expect a pick-up in revenue growth in the fourth quarter. However, UnitedHealth and Intuitive Surgical fell after failing to meet estimates. S&P 500 - Risers Chipotle Mexican Grill Inc. (CMG) $509.74 +16.10% Google Inc. (GOOG) $1,011.41 +13.80% First Solar Inc. (FSLR) $49.97 +8.70% Baker Hughes Inc. (BHI) $55.55 +7.28% Amazon.Com Inc. (AMZN) $328.93 +5.84% Ingersoll Rand Ltd. (IR) $66.85 +5.24% Parker-Hannifin Corp. (PH) $112.41 +5.23% NRG Energy Inc. (NRG) $29.30 +4.79% Pioneer Natural Resources Co. (PXD) $224.95 +4.25% Stanley Black & Decker Inc. (SWK) $77.16 +3.75% S&P 500 - Fallers Intuitive Surgical Inc. (ISRG) $376.52 -5.66% Interpublic Group of Companies Inc. (IPG) $16.04 -5.03% J.C. Penney Co. Inc. (JCP) $7.00 -4.76% People's United Financial Inc. (PBCT) $14.37 -4.64% Tyson Foods Inc. (TSN) $28.45 -4.43% Unitedhealth Group Inc. (UNH) $68.76 -3.66% CIGNA Corp. (CI) $74.95 -3.27% Mylan Inc. (MYL) $38.55 -2.92% Humana Inc. (HUM) $91.23 -2.79% Lowe's Companies Inc. (LOW) $47.66 -2.77% Dow Jones I.A - Risers General Electric Co. (GE) $25.55 +3.53% Verizon Communications Inc. (VZ) $50.01 +2.27% Nike Inc. (NKE) $75.93 +1.86% Caterpillar Inc. (CAT) $87.34 +1.74% Walt Disney Co. (DIS) $67.15 +1.10% Visa Inc. (V) $200.45 +1.09% Pfizer Inc. (PFE) $30.51 +0.83% Cisco Systems Inc. (CSCO) $22.96 +0.79% Travelers Company Inc. (TRV) $86.58 +0.65% Coca-Cola Co. (KO) $38.78 +0.60% Dow Jones I.A - Fallers Home Depot Inc. (HD) $74.69 -1.39% Merck & Co. Inc. (MRK) $46.61 -1.06% International Business Machines Corp. (IBM) $173.78 -0.60% Johnson & Johnson (JNJ) $91.63 -0.37% McDonald's Corp. (MCD) $95.20 -0.28% United Technologies Corp. (UTX) $107.74 -0.26% Intel Corp. (INTC) $23.88 -0.19% Wal-Mart Stores Inc. (WMT) $75.71 -0.09% E.I. du Pont de Nemours and Co. (DD) $59.62 -0.03% Procter & Gamble Co. (PG) $79.41 -0.01% Nasdaq 100 - Risers Google Inc. (GOOG) $1,011.41 +13.80% Baidu Inc. (BIDU) $165.91 +7.85% Amazon.Com Inc. (AMZN) $328.93 +5.84% Facebook Inc. (FB) $54.22 +3.85% Green Mountain Coffee Roasters Inc. (GMCR) $64.41 +3.60% Sears Holdings Corp. (SHLD) $56.39 +3.47% Seagate Technology Plc (STX) $50.04 +3.27% Liberty Interactive Corp (LINTA) $27.10 +2.92% Fossil Group Inc (FOSL) $121.75 +2.22% F5 Networks Inc. (FFIV) $87.81 +2.20% Nasdaq 100 - Fallers Intuitive Surgical Inc. (ISRG) $376.52 -5.66% Mylan Inc. (MYL) $38.55 -2.92% Alexion Pharmaceuticals Inc. (ALXN) $108.43 -2.13% Regeneron Pharmaceuticals Inc. (REGN) $303.56 -1.40% DIRECTV (DTV) $61.65 -1.20% Nuance Communications Inc. (NUAN) $17.14 -1.04% O'Reilly Automotive Inc. (ORLY) $133.93 -0.93% Comcast Corp. (CMCSA) $47.03 -0.92% Altera Corp. (ALTR) $37.48 -0.91% Biogen Idec Inc. (BIIB) $244.90 -0.89%

Newspaper Round Up

Monday newspaper round-up: Lloyds, Hinkley Point, Housing market David Cameron is planning to build on the huge popularity of the Royal Mail privatisation by prioritising retail investors for the sell-offs ahead of the general election in 2015. Attracting retail investors will be a key aim as the government prepares to complete the sales of Royal Mail and Lloyds Bank next year, according to people close to the situation, the Financial Times writes. Ministers are to subsidise a French company to build Britain's first nuclear power station in a generation, guaranteeing to pay twice the level of today's wholesale energy price. The decision, to be publicised today, will provoke a new row over rising energy bills, with gas and electricity suppliers expected to announce further price increases this week. Under a deal with French company EDF Energy, the Government will guarantee to pay £92.50 for each megawatt hour of electricity generated by the Hinkley Point plant for 35 years, according to The Times. The number of profit warnings issued by British companies in September has shot to its highest level since 2008, according to research released today by top accountant Ernst & Young (EY). The figure for September was a shock after a strong performance so far this year, in which the number of companies warning of lower-than-expected profits has fallen sharply, suggesting the economic recovery was well under way. A profit warning is a statement issued by a stock market-listed company when it realises its profits are not going to hit the levels expected by the City's analysts, The Daily Mail says. London's booming housing market is rising at an unsustainable rate, the UK's largest property website warned on Monday, with the average asking price of a home in the capital surging by more than £50,000 last month. Such is the acceleration in the capital's property market, according to Rightmove, that many buyers will need help from deep-pocketed parents despite the expansion of George Osborne's Help to Buy scheme. Rightmove said the average asking price in London rose to £544,232 in October from £493,748 the previous month – an increase of more than 10%, The Guardian explains. Fresh questions about Jamie Dimon's continued tenure at the head of JP Morgan were raised at the weekend after America's biggest bank reached a tentative $13 bn settlement with the US Department of Justice. The deal, which relates to the conduct of its mortgage-backed securities business in the run-up to the financial crisis, would be the largest settlement that the US government has reached with a single company. Part of the penalty relates to activities by Bear Stearns and Washington Mutual, which were rescued by JP Morgan in 2008, The Times reports. Sir Brian Souter is eyeing a range of new investments of up to £30m each after building a "sizeable" war chest during the economic downturn. The Stagecoach co-founder said he had benefited from having access to capital "when many investors were avoiding risk". A newly published review for his Souter Investments vehicle reveals a record performance over the three years to the end of March, with an annual return averaging 21% per annum, The Scotsman says.