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 |  Subject: ADVFN Morning Euro Markets Bulletin April 1st 2010  Thu Apr 01, 2010 8:59 am | |
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Miners and retailers in focus
Market Movers
techMARK 1,647.65 +0.06%
FTSE 100 5,703.24 +0.42%
FTSE 250 10,201.19 +0.35%
Miners are leading London’s top stocks higher in early dealings, while investors also ponder a mixed bag of retail-related updates.
Xstrata, Randgold Resources, Rio Tinto and Vedanta Resources are the best performers in the mining sector.
The cold snap in the early part of the year and tougher comparatives contributed to a drop in fourth quarter like for like (LFL) sales at baby products retailer Mothercare. On the positive side, the international division pepped up the group's trading performance in the 11 weeks ended 27 March with a 19.3% jump in overseas retail sales.
The snow failed to dent growth at cash and carry group Booker, which saw sales rise in the quarter to March 26 as its customers braved the wintery weather of much of the period to stock up on supplies. Sales rose by 3.8% from the same period the previous year or by 3.6% on a like-for-like basis (excluding the impact of new openings). Non-tobacco like-for-likes rose by 3.0%, while like-for-like tobacco sales increased by 4.6%.
Britain’s four mobile phone groups have been told to cut their mobile call termination charges by up to 90% over the next four years by telecoms regulator Ofcom. Vodafone, Orange, O2 and 3UK currently charge either 4.6p or 4.3p for ending a call to another network. This will fall to 0.5p by 2015 under today’s proposals.
Tullow Oil announced that the Likonde-1 well, onshore Tanzania, has encountered thick sands with hydrocarbon shows. The well, which is now being plugged and abandoned, is the first of a two-well programme within the prospective Ruvuma delta region. The group said the ‘encouraging results’ will be followed up with detailed technical work prior to selecting the next drilling location.
Scottish and Southern Energy (SSE) has agreed to buy the natural gas assets and infrastructure assets of Hess in three regions of the North Sea for $423m.
Residential property investor Grainger has acquired PHA Limited, which owns 162 homes in Devon, for £15.3m. The properties, comprising 146 houses and 16 flats, were built in the 1950s and 1960s.
Engineer Hamworthy expects to hit targets even though it has seen no improvement in the orders from the shipping business. "The group continues to trade in line with expectations, achieving a high profit-to-cash conversion and maintains a strong balance sheet. It remains confident of meeting full year expectations for the year ended 31 March 2010," the statement said.
Pharmaceutical company BTG said it anticipates results for the year ended 31 March to be ahead of analyst consensus expectations. The firm sees revenues in excess of £95m and cash and cash equivalents of over £75m at 31 March.
Furniture and clothing retailer Laura Ashley said customer confidence is returning but is tempered with a degree of caution as it posted a 3% rise in full year group sales. Total group sales rose to £268.4m for the 52 weeks to 30 January from £260.5m the same time a year before. Total UK retail sales were up 3.6% to £243.6m while like-for-like sales advanced 3.5%.
FTSE 100 - Risers
Lloyds Banking Group (LLOY) 63.98p +1.93%
Xstrata (XTA) 1,271.50p +1.84%
Randgold Resources (RRS) 5,100.00p +1.69%
Rio Tinto (RIO) 3,958.50p +1.37%
Smiths Group (SMIN) 1,150.00p +1.23%
Man Group (EMG) 244.20p +1.12%
ICAP (IAP) 377.90p +1.10%
WPP Group (WPP) 690.50p +1.10%
Vedanta Resources (VED) 2,805.00p +1.04%
Bunzl (BNZL) 728.50p +1.04%
FTSE 100 - Fallers
Inmarsat (ISAT) 751.00p -0.66%
Vodafone Group (VOD) 151.15p -0.56%
Sage Group (SGE) 238.10p -0.42%
Shire Plc (SHP) 1,448.00p -0.41%
Imperial Tobacco Group (IMT) 2,005.00p -0.25%
Legal & General Group (LGEN) 87.85p -0.23%
SEGRO (SGRO) 319.00p -0.19%
Schroders NV (SDRC) 1,145.00p -0.17%
Serco Group (SRP) 600.00p -0.17%
Marks & Spencer Group (MKS) 369.50p -0.16% |
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| | UK Event Calendar for today and tomorrow |
INTERIM DIVIDEND PAYMENT DATE
Abcam, AI Claims Solutions, Alternative Networks, Alumasc Group, Ashmore Group, Begbies Traynor Group, BlueBay Asset Management, BrainJuicer Group, Colefax Group, Craneware, Dechra Pharmaceuticals, Dunelm Group, Go-Ahead Group, Hays, Kesa Electricals, London Finance & Investment Group, Mid Wynd International Inv Trust, Plexus, PZ Cussons, Ricardo Group, St Ives, Thorpe (F.W.)
QUARTERLY PAYMENT DATE
Alpha Pyrenees Trust Ltd.
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Balance of Trade (AUS) (00:00)
ISM Manufacturing (US) (15:00)
ISM Prices Paid (US) (15:00)
PMI Manufacturing(EU) (09:00)
PMI Manufacturing(GER) (08:55)
GMS
Berkeley Resources, Care UK, Hansteen Holdings, Welsh Industrial Inv Trust
FINALS
Dillistone, Prezzo
ANNUAL REPORT
IMI, Logica, Savills
SPECIAL DIVIDEND PAYMENT DATE
Admiral Group, Alternative Networks, Independent Inv Trust, JD Wetherspoon, Moneysupermarket.com
AGMS
Bluehone AIM VCT 2, Telecity Group
TRADING ANNOUNCEMENTS
Booker Group, Hamworthy, IMI, Mothercare
UK ECONOMIC ANNOUNCEMENTS
PMI Manufacturing (09:30)
FINAL DIVIDEND PAYMENT DATE
All Leisure Group, Braime Ord, CareTech Holding, Cenkos Securities, Charter European Trust, Chemring Group, Computacenter, Dillistone, Domino Printing, First Property Group, Future, Greencore Group, Hansteen Holdings, IDOX, Independent Inv Trust, JD Wetherspoon, Law Debenture Corp., Microgen, Moneysupermarket.com, Monks Inv Trust, Morgan Sindall, Rio Tinto, RIT Capital Partners, Shore Capital, TF & JH Braime, TUI Travel, XP Power
Friday April 02
QUARTERLY PAYMENT DATE
Schlumberger
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Non-Farm Payrolls (US) (13:30)
Producer Price Index(US) (13:30)
Unemployment Rate (US) (13:30)
FINAL DIVIDEND PAYMENT DATE
Safestore |
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| | Currencies Market Report |
US dollar continues to slip as risk appetite returns
The dollar continued its slide overnight as bullish sentiment continued to evaporate after US ADP employment data undershot expectations by quite some margin in figures released yesterday.
US equity markets also slipped back, though this was not replicated in Asian markets with economic data in China and Japan reinforcing confidence in the global economic rebound.
China’s manufacturing expanded at a much faster pace than expected, posting a reading of 55 against expectations of 52, while the Bank of Japan Tankan survey showed increasing confidence among the nation’s largest manufacturers as it rose for a fourth straight quarter.
The US ADP employment figures were a surprise to the market yesterday as there was the expectation that this week’s non-farm payroll figures and employment report due this Friday would show the first positive jobs figure since the end of 2007. The market sometimes views the preceding ADP report as a bit of a leading indicator for the payrolls, and expectations had been for a jobs gain of 40k. In any event, much to the markets disappointment, the numbers remained in negative territory at -23k, sending the dollar and equity markets lower.
Expectations for this Friday’s employment report have been in the region of a gain in jobs of between 180k and 200k, but after yesterday’s numbers there must now be some doubt about the accuracy of the forecasts for Friday's numbers and we could well see an undershoot below the 180k-200k expected. There was also disappointment when Chicago Purchasing Manager data for March came in under expectations at 58.8 against an expectation of 61.
In any event the dollar has continued to slip back after its recent gains as we head into the Easter weekend and Friday's jobs report takes on a greater resonance in light of yesterday’s data.
The Euro and sterling have gained some ground on the back of this dollar weakness, as the dollar index slides back towards support around the 80.30 area, where we have a trend line from the December lows and the 50 day moving average.
EURUSD - the Euro continues to find the air a little thin above the highs between the 1.3540/60 area, after the fall below 1.3400 earlier this week. The key resistance levels are at 1.3540/50, and behind that at 1.3650. While below 1.3650 the move towards 1.3200 remains the longer term target.
GBPUSD - we've continued to see sterling remain fairly firm over the last 24 hours squeezing just above the long term trend line from the January highs at 1.6460. The close above 1.5120 now signals the potential for a larger squeeze towards 1.5350.
EURGBP - the Euro sell-off this week has so far managed to hold above the 200 day moving average at 0.8860, a low of 0.8870 so far today, provoking a sharp rebound. A close below the 200 day moving average could well signal further declines towards 0.8830 and 0.8780. The Euro squeezed back to 0.8945 early yesterday morning but needs to hold above the 0.8910/20 area to push on towards 0.8970. The failure to do so overnight, increases the risk of a break of the support at the 200 day MA.
USDJPY - the dollar continues to find the highs around the 93.65/75 area a tough nut to crack for now. While optimism about a recovery in Asia remains expect the yen to continue to remain under pressure.
The January highs of 93.75 remain the key obstacle to further dollar gains. There is still the risk given the recent move to the upside that we could see a slide back towards interim support around 92.15, and while below 93.75 the risk is for further consolidation between 92.15 and these highs as upside momentum continues to look a little stretched. However a break above 93.75 could well signal further dollar gains towards 97.60. |
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| | US Market Report |
Stocks end strong quarter on low note
US stocks ended lower as a surprise drop in private sector employment knocked sentiment, but that still couldn’t dampen what has been a very strong quarter for equity markets.
Across the markets, the Dow Jones finished down 50 at 10,856. Nasdaq fell 12 to 2,397, while the S&P 500 fell 3 to 1,169. Over the past three months, the Dow has gained 4.1%, while the S&P added 4.9% for the quarter. The tech-heavy Nasdaq rose by 5.7% over the period.
Before the opening bell, ADP said 23,000 private-sector jobs were cut during March, much worse than expectations of a 40,000 rise.
The Chicago PMI data for March showed a bigger than expected decline to 58.8, compared with the 61 forecast by economists. The figure was 62.6 in February. The latest figure still signals expansion because it is higher than 50.
Energy companies have been boosted by the higher oil price. Chevron is the best performer in the Dow.
Mortgage insurer Genworth Financial is the best performer in the S&P after the Mortgage Insurance Companies of America reported that, for the first time in almost four years, more borrowers where catching up on their overdue mortgages than those individuals who had became newly delinquent on insured home loans.
Honeywell is in demand after the manufacturing conglomerate upped its first-quarter outlook, thanks to stronger orders and sales.
A health-care trust for United Auto Workers pensioners expects to raise about $1.78bn from the sale of Ford Motor Company warrants. That hit Ford's share price.
Elsewhere on the earnings front, BlackBerry maker Research in Motion will report quarterly figures after the closing bell.
US non-farm payrolls data will be released on Good Friday even though the markets are not open.
S&P 500 - Risers
Jds Uniphase Corp. (JDSU) $12.65 +5.50%
Genworth Financial (GNW) $18.34 +5.10%
Diamond Offshore Drl (DO) $88.81 +3.98%
Rowan Cos Inc. (RDC) $29.11 +3.45%
S&P 500 - Fallers
Saic Inc. (SAI) $17.70 -6.74%
Ford Motor Co (F) $12.57 -5.35%
Limited Brands Inc. (LTD) $24.62 -4.87%
Autonation Inc. (AN) $18.08 -4.69%
Dow Jones I.A - Risers
Chevron Corp. (CVX) $75.83 +0.70%
Bank Of America Corp. (BAC) $17.85 +0.51%
Johnson & Johnson (JNJ) $65.20 +0.46%
JP Morgan Chase & Co. (JPM) $44.75 +0.38%
Dow Jones I.A - Fallers
Cisco Systems Inc. (CSCO) $26.06 -2.21%
Microsoft Corp. (MSFT) $29.27 -1.68%
Du Pont E I De Nemours and Co. (DD) $37.24 -1.43%
Boeing Co. (BA) $72.61 -1.25% |
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| | Thursday paper round-up |
Insider dealing, Gartmore, Apple
Seven men were charged by the Financial Services Authority yesterday in its first prosecution of an alleged insider dealing ring.
Two of those charged worked at leading investment banks — JPMorgan Cazenove and UBS — at the time of the alleged insider trading, which the FSA believes earned the ring £2.5m. A third man worked for City Index, the spread-betting firm. e FSA yesterday named the seven men charged with conspiracy to deal on inside information as Pardip Saini, Paresh Shah, Neten Shah, Bijal Shah, Truptesh Patel, Mitesh Shah and Ali Mustafa, the Times reports.
Britain faces months of walkouts whatever the result of today’s High Court ruling on a national rail strike, the head of the trade union movement has told The Times. Brendan Barber, the General Secretary of the TUC, said that there were “very real risks” of widespread action after the general election if the public sector bore the brunt of spending cuts.
More than a thousand employees of Jarvis, most of them railway workers, were made redundant today as the administrators to the rail maintenance company admitted that the chances of finding a buyer were slim. Jarvis staff from the head office in York and at sites in Doncaster, Glasgow, Leeds, Newcastle and Peterborough were told that they would not be employed after today, the Times reports.
Guillaume Rambourg, the suspended Gartmore fund manager, breached internal rules by ordering dealing desks to use more than a dozen favoured brokers for share trades, it emerged yesterday. Mr Rambourg, who co-manages about £4.4bn of assets at Gartmore with Roger Guy, was suspended on Monday as the fund manager began an internal investigation into the trades. Jeff Meyer, Gartmore’s chief executive, told The Times that the suspect share deals were in “large-cap” company equities and had been discovered on Thursday last week during a routine internal compliance check, the Times reports. “We have an internal rule that fund managers are not allowed to direct dealers on where to place trades. We found that Guillaume was instructing dealers to place a trade with this broker or that broker," Meyer said.
The imminent launch of Apple's iPad continued to reverberate across Silicon Valley yesterday as Kleiner Perkins, one of the Valley's most prominent start-up investors, earmarked $100m to invest in new software applications for the iPad and similar devices. John Doerr, a Kleiner Perkins partner, predicted that Apple's new tablet computer would trigger a second wave of innovation that would match the one generated by the launch of the iPhone three years ago, and could even eventually exceed it, the FT reports.
The timetable for the proposed merger of British Airways and Iberia, the Spanish flag carrier, has slipped because of “technical issues”. The two airlines had hoped to sign terms of agreement for their merger by the end of the first quarter, which ended yesterday. That deadline passed and neither carrier was able to say when the process would get back on track, the Times said.
The US bond fund PIMCO has warned that Britain risks a vicious circle of rising debt costs as global investors demand a penalty fee on gilts to protect against inflation. Bill Gross, the fund's chief and emminence grise of bond vigilantes, said the UK was on its list of "must avoid" countries along with Greece and others in eurozone's Club Med, the Telegraph reports.
A compulsory carbon trading scheme for 5,000 UK businesses will launch today, amid widespread confusion about its complex rules and a bonanza of extra fees for environmental consultants. Under the Government's scheme, an array of businesses from supermarkets to office blocks that spend more than £500,000 per year on energy must conduct an audit of their carbon dioxide emissions, the Telegraph reports.
EMI's attempts to secure a licensing deal with rivals fell apart yesterday, heaping pressure on the struggling label as it seeks to raise £120m in less than two months or face being seized by its creditors. The music group, whose artists include Lily Allen and Robbie Williams, had been locked in separate negotiations over the past week to offer Universal Music Group and Sony Music distribution rights for its artists in the US and Canada, the Independent reports.
European steel and motor industries yesterday accused mining companies of unfair pricing practices following the introduction of a new system for valuing iron ore that will see the cost of the resource nearly double. Eurofer, which represents European steelmakers, has complained to the European Commission about possible pricing abuses, saying there were "strong indications of illicit co-ordination of price increases and pricing models and pressure on individual steel producers to accept these changes," the FT reports.
Cadbury, Mars, Hershey and Nestlé have been served with a lawsuit alleging that they conspired to push up the prices of their chocolate bars over most of the last decade, drawing on claims that senior executives shared secret price information in brown envelopes and via distributors. The suit, served in Hershey's home state of Pennsylvania by a Minnesota grocery chain called Supervalu, adds to a mountain of litigation and regulatory scrutiny over alleged price-fixing, the Independent reports. |
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