ADVFN Morning Euro Markets Bulletin - August 26th 2011

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London Market Reports

Market Movers
techMARK 1,728.84 -0.61%
FTSE 100 5,107.05 -0.47%
FTSE 250 9,979.99 -0.41%
The FTSE 100 fell into the red in early trading, with heavyweights AMEC, Resolution and ARM Holdings dragging the blue chip index lower, after a poor performance on Wall Street last night and a mixed session in Asia.


Meanwhile, financials were on the rise, with Hargreaves Lansdown, Lloyds, RBSand Standard Life among the better performers. Car insurer Admiral is a high risers, recovering after its recent decline.

Today is the big day of the week, with Federal reserve chairman Ben Bernanke set to make an eagerly awaited speech at the central bankers' conflab in Jackson Hole, Wyoming. Investors seem disinclined to commit themselves ahead of Bernanke's speech.

Mining giant Rio Tinto fell lower despite the independent directors of Australian Stock Exchange-listed miner Coal & Allied having given the green light to plans by Rio and Japanese trading house Mitsubishi Corporation to take full ownership of the company.

Transport logistics firm Stobart Group was a heavy faller on the FTSE 250 after it said its transport and distribution division is back on the right track in August after a difficult period in June and July.

Eastern Europe-focused oil producer Exillon Energy was out of favour despite moving into the black in the first half of 2011, as production hit record levels for the company.

Berendsen, the FTSE 250 workwear textile rental and laundering services firm, also disappointed even though it said it was able to up its adjusted profits by 18% in the six months ended 30 June, as it made good progress in the implementation of its strategic review.

Specialty chemicals producer Yule Catto rose higher after it posted sharp rise in half year pre-tax profit helped by strong demand from Asia and its PolymerLatex acquisition.

Sales at low emission power products developer Ceramic Fuel Cells surged by 81% during the 12 months ended 30 June, but losses widened as operating expenses were increased. Shares fell into the red.

BC

FTSE 100 - Risers
3i Group (III) 213.10p +2.30%
Admiral Group (ADM) 1,308.00p +2.27%
Burberry Group (BRBY) 1,238.00p +1.64%
Hargreaves Lansdown (HL.) 408.50p +1.01%
Kazakhmys (KAZ) 1,005.00p +0.80%
Lloyds Banking Group (LLOY) 31.23p +0.77%
Diageo (DGE) 1,176.00p +0.51%
Randgold Resources Ltd. (RRS) 6,300.00p +0.48%
Scottish & Southern Energy (SSE) 1,241.00p +0.40%
Barclays (BARC) 158.50p +0.38%

FTSE 100 - Fallers
Amec (AMEC) 842.00p -3.88%
Resolution Ltd. (RSL) 247.70p -3.43%
ARM Holdings (ARM) 514.50p -2.65%
Marks & Spencer Group (MKS) 310.70p -1.71%
Rexam (REX) 338.20p -1.69%
Tullow Oil (TLW) 983.50p -1.55%
Aggreko (AGK) 1,738.00p -1.53%
Carnival (CCL) 1,799.00p -1.48%
Cairn Energy (CNE) 290.70p -1.19%
BP (BP.) 381.55p -1.18%

FTSE 250 - Risers
Yule Catto & Co (YULC) 177.50p +4.41%
Computacenter (CCC) 366.80p +3.38%
Anglo Pacific Group (APF) 297.80p +2.69%
Kofax (KFX) 327.90p +2.63%
Electra Private Equity (ELTA) 1,459.00p +2.10%
Dunelm Group (DNLM) 444.00p +1.83%
United Business Media Ltd. (UBM) 443.70p +1.79%
BH Macro Ltd. GBP Shares (BHMG) 1,989.00p +1.53%
Hiscox Ltd. (HSX) 352.80p +1.50%
Pace (PIC) 101.00p +1.41%

FTSE 250 - Fallers
Salamander Energy (SMDR) 218.70p -4.08%
Stobart Group Ltd. (STOB) 127.00p -4.08%
New World Resources A Shares (NWR) 550.50p -3.93%
Aegis Group (AGS) 129.60p -3.14%
AZ Electronic Materials SA (WI) (AZEM) 220.10p -3.00%
Elementis (ELM) 138.80p -2.87%
CSR (CSR) 219.50p -2.36%
EnQuest (ENQ) 105.00p -2.33%
Kenmare Resources (KMR) 42.50p -2.30%
Phoenix Group Holdings (DI) (PHNX) 529.00p -2.22%


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UK Event Calendar for Today
INTERIMS
Aga Rangemaster Group, Independent News & Media, Lavendon Group, Marshalls, New Britain Palm Oil Ltd. (DI), T Clarke, Vimetco GDR NV GDR (Reg S), Yule Catto & Co

INTERIM DIVIDEND PAYMENT DATE
Downing Planned Exit VCT 4, Downing Planned Exit VCT 5, Edinburgh UK Tracker Trust, Independent Inv Trust, Maven Income and Growth VCT 5, Reed Elsevier

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
GDP (Preliminary) (US) (13:30)
U. of Michigan Confidence (Final) (US) (15:00)

GMS
Imaginatik

FINALS
MBL Group

ANNUAL REPORT
Abbey

SPECIAL DIVIDEND PAYMENT DATE
Aberforth Geared Income Trust, Access Intelligence

EGMS
Datang International Power Generation Co Ltd., Thames River Multi Hedge PCC Ltd. EUR Shares, Thames River Multi Hedge PCC Ltd. Realisation Shares, Thames River Multi Hedge PCC Ltd. USD Shares

AGMS
Naspers Ltd. ADR, Plant Impact, Prosperity Minerals Holdings Ltd.

UK ECONOMIC ANNOUNCEMENTS
GDP (output, income & expenditure) (09:30)
Index of Services (09:30)

FINAL DIVIDEND PAYMENT DATE
Aberdeen New Dawn Inv Trust, Heath (Samuel) & Sons, Kewill, Latham (James), Volex


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European Market Report
Investors are sitting on their hands ahead of today's eagerly anticipated speech from the chairman of the US Federal Reserve, Ben Bernanke.

The Fed's head honcho is set to make a pronouncement at the central bankers' symposium at Jackson Hole, Wyoming, on the subject of "Near- and Long-Term Prospects for the US Economy". Equity markets have revived recently on hopes that he might use the occasion to announce another round of fiscal stimulus for the US economy, as he did at last year's Jackson Hole chin-wag session, but those hopes faded yesterday and dragged stock markets lower.

The CAC in Paris crawls a point higher to 3,120 while the DAX in Frankfurt is two points heavier at 5,585. The Swiss Market index retreats 12 to 5,286.

Shipping company Frontline is sinking after its second-quarter net loss was worse than the market had been expecting. Analysts had pencilled in a red figure of 37 cents for loss per share; the company's basic loss per share was 45 cents, versus earnings per share in the corresponding quarter of last year of $1.04.

The underlying net loss was $35.24, compared to net income last year of $81.31m. Total operating revenues slumped to $219.4m from $356.12m the year before.

Essilor, the world's biggest maker of corrective lenses, saw post-tax profit rise 8% year-on-year in the first half of 2011, to €258m. The company maintained its sales growth guidance range for the full year at 6% to 8%.


CAC 40 - Risers
Societe Generale (GLE) € 22.27 +1.48%
Credit Agricole (ACA) € 6.58 +1.04%
BNP Paribas (BNP) € 34.60 +0.71%
Natixis SA (KN) € 2.83 +0.60%
EDF (EDF) € 20.87 +0.14%
Michelin (ML) € 47.70 +0.07%

CAC 40 - Fallers
AXA (CS) € 10.44 -1.46%
Veolia Environnement (VIE) € 11.01 -1.43%
Alcatel-Lucent (ALU) € 2.32 -1.36%
Total (FP) € 32.33 -1.25%
Publicis Groupe Sa (PUB) € 31.58 -1.19%
Peugeot (UG) € 19.26 -1.13%
Technip (TEC) € 61.30 -1.07%
Sanofi (SAN) € 49.44 -1.05%
Cap Gemini (CAP) € 27.36 -1.05%
Accor (AC) € 22.98 -0.97%


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US Market Reports

Dow Jones NASDAQ NYSE AMEX

Please click on the images to view our interactive charts

Wall Street took a tumble on Thursday, ending a three-day winning streak, on the back of concerns over the sovereign debt crisis in Europe. Meanwhile, investors remained cautious ahead of Ben Bernanke's all-important speech at Jackson Hole, Wyoming, in which they are hoping him to announce plans to kick-start the economy.

Federal Reserve chairman Bernanke used his speech at last year's gathering to pave the way for "QEII", the Fed's second round of quantitative easing, the radical policy of pumping electronically created money into the economy to avoid deflation. However, analysts warned that having already announced a two-year interest rate freeze – a move that caused markets to rise for just five days before plunging back into the red – Bernanke may have little new to say.

Meanwhile, there was speculation that ratings agencies are pondering over Germany's AAA credit rating, which could be in for a possible downgrade.

Concerns over global growth were rolling on in the background. Citigroup joined the crowd in lowering its estimates for economic expansion. The US bank now estimates that global gross domestic product in 2011 will only rise by 3.1% instead of the previous estimate of 3.4%. For 2012, it is expected to be 3.2% instead of the previous 3.7%.

Not helping the downwards pressure was some negative US economic data, as unemployment claims unexpectedly rose by 5,000 to 417,000 in the week to 20 August.

The Dow fell 171 to 11,150, the Nasdaq fell 48 to 2,420, while the S&P 500 was 18 lower at 1,159.

Tech giant Apple fell following the previous night's news that its chief executive officer and Sillicon Valley icon, Steve Jobs, announced his departure from the group for health reasons. "I have always said if there ever came a day when I could no longer meet my duties and expectations as Apple's CEO, I would be the first to let you know. Unfortunately, that day has come," Jobs said.

Warren Buffett's Berkshire Hathaway announced plans to invest $5bn in Bank of America. Bank of America's shares leapt almost 25% in early trading. Bank of America lost almost half its value on the New York Stock Exchange yesterday before Buffett stepped in. Citigroup was also in demand.

Elsewhere in the world of tech though, digital video recording group TiVo’s losses were not as bad as analysts had feared.

Applied Materials, which makes equipment used in the manufacture of electronic chips, is lower after it unveiled sales forecasts that fell short of analysts’ expectations.

BC

S&P 500 - Risers
PulteGroup Inc. (PHM) $4.24 +12.77%
Bank of America Corp. (BAC) $7.65 +9.44%
Citigroup Inc. (C) $29.83 +4.85%

S&P 500 - Fallers
Patterson Companies Inc. (PDCO) $26.87 -10.16%
CB Richard Ellis Group Inc. (CBG) $13.76 -9.17%
Hormel Foods Corp. (HRL) $26.36 -7.31%

Dow Jones I.A - Risers
Bank of America Corp. (BAC) $7.65 +9.44%
American Express Co. (AXP) $48.09 +0.02%

Dow Jones I.A - Fallers
Travelers Company Inc. (TRV) $47.99 -3.07%
3M Co. (MMM) $78.19 -2.62%
Caterpillar Inc. (CAT) $83.25 -2.52%

Nasdaq 100 - Risers
First Solar Inc. (FSLR) $96.49 +0.73%
Electronic Arts Inc. (ERTS) $20.40 +0.29%
Logitech International S.A. (LOGI) $10.71 +0.19%

Nasdaq 100 - Fallers
Patterson Companies Inc. (PDCO) $26.87 -10.16%
Urban Outfitters Inc. (URBN) $24.21 -5.58%
Applied Materials Inc. (AMAT) $10.81 -4.84%


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Newspaper round-up: Glencore, Bernanke, Greece
Glencore is eyeing a bid for Optimum Coal, the South African miner, as the world’s largest commodities trading house plans to use the current market turmoil for bargain-hunting, taking advantage of the recent falls in resource stocks. The group said there was a disconnect between fears about a double-dip recession and its own upbeat forecast for commodities prices and demand, according to the Financial Times.

The US Federal Reserve chairman, Ben Bernanke, risks disappointing financial markets if a major policy speech today does not contain hints of additional monetary easing by the US central bank.

Mr Bernanke's annual address to the Federal Reserve Bank of Kansas economic policy symposium in Jackson Hole, Missouri, which opened last night, is being scrutinised this year as never before, but hopes that he might promise a new round of quantitative easing for the world's largest economy faded yesterday and dragged stock markets lower, the Independent writes.

Greece has been forced to activate an obscure emergency fund for its banks because they are running short of collateral that is acceptable to the European Central Bank (ECB). In a move described as the "last stand for Greek banks", the embattled country's central bank activated Emergency Liquidity Assistance (ELA) for the first time on Wednesday night, the Telegraph writes.

Conditions on the high street are the toughest in 40 years, the boss of the ­Co-operative Group warned yesterday. Chief executive Peter Marks said: “I’m normally an optimist but I can’t find anything to be optimistic about when I think about the economy.” The UK’s fifth largest food retailer following the takeover of the Somerfield chain, the Co-op reported ­ a 10 per cent fall in underlying half-year profits to £275.1million, writes the Daily Express.

Hopes that the Bank of England could unleash a new round of quantitative easing to rescue the ailing economy were boosted on Thursday when a member of its monetary policy committee said there was "undoubtedly scope" to restart the recession-busting policy if necessary.

Martin Weale, who until this month was advocating an increase in interest rates, showed how far his thinking had moved by arguing that the Bank could return to so-called QE if oil prices continued to fall and the sovereign debt crisis in the eurozone worsened, according to the Guardian.

Spain is expected to follow France’s example and raise taxes on the rich to cut its deficit and ease pressure from the markets. Elena Salgado, the Finance Minister, hinted that the Socialist Government would announce measures at a Cabinet meeting today to raise the fiscal pressure on the wealthiest. The move would bring badly needed cash for the public coffers, reports the Times.

Millions of Britons will be forced to rely on handouts from their children when they retire, a leading expert at the Bank of England warned yesterday. In an alarming speech, Martin Weale urged Britons to wake up to the fact that their level of saving is too low and they are spending too much, says the Daily Mail.