Scalpuman
Admin
Posts : 1174
Join date : 2009-05-13
 |  Subject: ADVFN Evening Euro Markets Bulletin - Aug. 11th 2010  Wed Aug 11, 2010 5:34 pm | |
| By ADVFN.comADVFN offer FREE streaming stocks and shares data form around the world. SEE | London Markets Report |
Triple digit losses for FTSE 100
Market Movers
techMARK 1,626.61 -2.66%
FTSE 100 5,245.21 -2.44%
FTSE 250 9,854.49 -2.24%
An already downbeat Footsie’s woes were compounded by a poor start on Wall Street and the leading share index closed with triple-digit losses.
The day started badly and investors were given a reminder of economic difficulties when the Bank of England lowered its forecasts for economic growth in 2011 while raising inflation expectations. The Bank is now predicting economic growth of 2.5% in 2011, down from a previous forecast of 3.4%. He predicted that inflation would remain above the 2% target for much of next year.
Some blue-chips defied the trend and make headway today. Smiths Group leads the small band of risers as speculation about a break-up continues to simmer.
Banks were out of favour in the wake of the BoE's gloomy outlook. Barclays and Lloyds were the worst hit.
Hot on the heels of TUI Travel’s slump yesterday, package tour operator Thomas Cook has warned that full-year profits will be at the low end of forecasts due to softer UK bookings and the weak euro.
"As we enter the final quarter, it is apparent that trading in the UK business is softer than expected and, at current rates, the recent weakening of the euro will have an adverse impact on translation of our euro-based earnings,” said chief executive Manny Fontenla-Novoa.
TUI and Thomas Cook were both in the red.
Standard Life has increased half-year profit in line with forecasts as a big increase in net inflows boosted assets under management. IFRS operating profit before tax from continuing operations rose 10% to £182m and European Embedded Value (EEV) profit grew 11% to £364m. Net inflows soared 71% to a record £5.3bn.
Panmure Gordon called the results a good set of figures but said they “could see the gap to our target narrow further, and we are downgrading from ‘Buy’ to ‘Hold’.”
The investment banking business of Barclays is preparing to sack several hundred staff in reaction to a sharp downturn in activity during the second quarter.
Back office and administration jobs at Barclays Capital (BarCap) are most likely to disappear, people close to the action have said.
Private equity group 3i said the assets in its portfolio continue to perform well operationally and financially, generating good income. Dividends and interest received in the first quarter to 30 June resulted in a cash inflow of £15.2 million.
Speciality pharmaceuticals group Shire has agreed to sell its attention deficit hyperactivity disorder (ADHD) treatment Daytrana to Noven Pharmaceuticals.
First half profits rose at support services group and building contractor Balfour Beatty despite lower revenues at its core construction businesses. Pre-tax profits rose to £81m from £65m in the half year to June on revenues of £4.6bn, up from £4.39bn as US acquisition Parsons Brinckerhoff kicked in strongly.
Legacy software specialist Micro Focus has slumped after it slashed its sales forecasts for this year after a sluggish first quarter and slow licence sales, though earnings guidance is unchanged.
Property repair and maintenance company Rok has suspended its CFO with immediate effect after 'serious failings' at its Plumbing Heating & Electrical business, which will bring underlying pre-tax profit for the year significantly below market expectations.
Residential property firm Grainger is trading well, despite slowing house price growth in the last few months. The group said £49.4m of residential sales were completed during the four month period to 31 July 2010, taking total sales in the ten months to 31 July to £128.4m.
Embattled social housing firm Connaught is the best performer in the second-tier, up by around a third on the day but still down 95% over the last year. The rally has been written off as a “bear squeeze” by traders.
Nautical Petroleum has raised £30.35m from a placing to help fund its planned exploration, appraisal and pre-development activity until the end of 2011, including work on the potentially lucrative Catcher field in the UK Central North Sea.
Flowers and gifts retailer Flying Brands has cheered investors with half-year profit in line with expectations and the resumption of dividend payments. |
| | A Truly Green Investment |
Teak is a beautiful, durable and valuable wood; it is far more expensive than oak and is in huge demand for boat building. Once established in the forest it is almost indestructible. Even if the price of teak never increases £30,000 becomes £182,940 within 15 years. Find out how by clicking here for your free brochure. |
|
Healthcare group Nestor admitted today it has rejected an unsolicited bid approach worth 90p a share in cash from the owners of the AA and Saga. The possible offer, which valued the business at £102m, was made by Acromas Holdings Limited.
Energy and mineral investor Xtract Energy has had to stop production at the Sarikiz-2 well operated by its Turkish business Extrem Energy after suffering problems with the pump.
Consumer and motor finance provider S & U traded in line with expectations in the six months to 31 July 2010.
IT firm Triad said it continues to be affected by uncertainty in levels of client spending, particularly in the public sector.
‘Efforts to strengthen the group's customer base continue and we have seen some signs of improvement in activity in the private sector ,’ the company said.
Shares in public sector consultant Tribal jumped after it reacted to ‘recent press speculation’ by confirming that it has ‘received preliminary expressions of interest which may or may not lead to an offer being made for the company.’
The company has, like Triad, been affected by uncertainty over public sector spending, but reiterated that it thinks it will benefit from the government’s penny-pinching measures.
FTSE 100 - Risers
Smiths Group (SMIN) 1,195.00p +4.09%
Randgold Resources (RRS) 5,465.00p +0.46%
Imperial Tobacco Group (IMT) 1,809.00p +0.22%
Serco Group (SRP) 543.50p +0.09%
SEGRO (SGRO) 273.90p +0.04%
British Sky Broadcasting Group (BSY) 709.00p -0.07%
Smith & Nephew (SN.) 573.00p -0.26%
Diageo (DGE) 1,098.00p -0.36%
Shire Plc (SHP) 1,491.00p -0.47%
British American Tobacco (BATS) 2,211.50p -0.56%
FTSE 100 - Fallers
Lloyds Banking Group (LLOY) 70.05p -6.75%
TUI Travel (TT.) 190.80p -6.06%
Barclays (BARC) 313.60p -6.01%
Kazakhmys (KAZ) 1,168.00p -5.88%
BT Group (BT.A) 137.80p -5.87%
Royal Bank of Scotland Group (RBS) 46.00p -5.06%
Vedanta Resources (VED) 2,357.00p -4.96%
Inmarsat (ISAT) 702.50p -4.81%
Cable & Wireless Worldwide (CW.) 62.05p -4.76%
Man Group (EMG) 212.40p -4.71%
FTSE 250 - Risers
Connaught (CNT) 15.61p +16.49%
Gartmore Group (GRT) 121.80p +4.10%
UK Commercial Property Trust (UKCM) 76.25p +1.94%
F&C Commercial Property Trust (FCPT) 89.50p +1.70%
Cranswick (CWK) 858.00p +0.94%
Dexion Absolute GBP Shares (DAB) 138.00p +0.73%
BH Macro GBP Shares (BHMG) 1,762.00p +0.69%
Premier Foods (PFD) 18.97p +0.69%
Electra Private Equity (ELTA) 1,310.00p +0.61%
Great Portland Estates (GPOR) 312.00p +0.58%
FTSE 250 - Fallers
Micro Focus International Plc (MCRO) 300.00p -28.40%
Heritage Oil (HOIL) 353.90p -21.36%
Melrose Resources (MRS) 294.00p -6.67%
Ferrexpo (FXPO) 282.30p -6.46%
DS Smith (SMDS) 133.90p -6.17%
Enterprise Inns (ETI) 91.75p -6.04%
Carpetright (CPR) 712.00p -5.94%
Yell Group (YELL) 21.28p -5.88%
JD Sports Fashion (JD.) 736.00p -5.64%
Wellstream Holdings (WSM) 487.70p -5.58% |
| | Make 150+ points profit in one day |
Trendsignal clients made 153 points trading Sterling/US Dollar in one day. You could have done the same. Come to a free online seminar and learn how. Click Here. |
| | European Market Reports |
Bourses battered as gloom deepens
Europe’s main markets were firmly in the red at trading’s close as investors digested gloomy statements from the Bank of England and the US Federal Reserve.
Bank of England governor Mervyn King has lowered the Bank's forecasts for economic growth in 2011 while raising inflation expectations.
The Bank is now predicting economic growth of 2.5% in 2011, down from a previous forecast of 3.4%. He predicted that inflation would remain above the 2% target for much of next year.
The US Fed held interest rates near 0%, but it gave its gloomiest assessment for over a year of the health of the US economy.
"The pace of recovery in output and employment has slowed in recent months," the Federal Reserve said in its statement, adding the recovery will also be "more modest in the near term than had been anticipated".
The Dax in Frankfurt fell 132 points to 6,154, while the Cac in Paris fell 102 points to 3,628.
Dutch financial services company ING Groep posted a better than expected rise in second-quarter profits thanks to a good performance in its banking division.
Net profit soared to €1.09bn in the three months period ended 30 June from €71m last year after the group’s banking division swung to a profit, offsetting weaker trading at its insurance business. The Amsterdam-based group said it will not pay an interim dividend for the first half of the year.
Bank of Ireland posted sharply higher underlying losses as bad debts continued to hurt the embattled Irish bank.
Underlying losses in the half year to June rose to €1.25bn, up from €668m. Operating profits fell to €553m from €811m as UK-derived profits almost halved to €122m. Total income was 17% lower driven by a significant reduction in net interest income. Net interest margins fell to 1.41% from 1.7%.
Other banking shares were also lower, with Deutsche Bank, Societe Generale and Credit Agricole among the worst performers.
Swiss food and beverage group Nestle reported a 7.5% rise in net profit for the first six months of the year to 5.5 billion Swiss francs but said the second half will be more difficult. |
| | Open a Selftrade Dealing account... |
...and pay a flat £12.50 per trade. Deal in UK and International Equities, Funds, Bonds, Covered Warrants and Listed CFDs. Instant account funding via debit card. No dealing fee on fund purchases. Annual Management Fee of £35 + VAT. Click here |
| | US Markets Report |
Stocks Lingering Near Lows After Initial Sell-Off
Stocks are posting steep losses in mid-morning trading on Wednesday, bouncing around near their lows of the session after falling sharply at the opening bell. The major averages are lingering firmly in negative territory.
Uncertainty about the economic recovery with the Federal Reserve seemingly low on stimulus options has prompted a considerable flight to safety in today's session, leading to a drubbing in the global equity markets.
Traders were spooked after the Fed said Tuesday that it sees "more modest" economic growth in the near-term than previously expected and symbolized its lack of confidence in the recovery by saying that it would reinvest funds from maturing mortgage-backed securities into U.S. treasury bonds.
On the economic front today, the Commerce Department reported that the U.S. trade deficit for June unexpectedly widened to reach its highest level in well over a year.
The report showed that the trade deficit widened to $49.9 billion in June from a revised $42.0 billion in May. The wider deficit came as a surprise to economists, who had expected the deficit to narrow modestly to $42.2 billion from the $42.3 billion originally reported for the previous month.
In the afternoon, the Treasury Department will release its July budget, with economists estimating a deficit of $169 billion for the month, slightly lower than the $180.7 billion deficit reported for June. The report will be made public at 2:00 p.m. ET.
With earnings season winding down, Macy's, Inc. (M) reported second-quarter net income of $0.35 per share, above the $0.29 per share forecast by analysts for the quarter. Sales totaled $5.537 billion, up 7.2 percent from the same period last year and above analyst consensus for revenues of $5.50 billion.
After the markets closed for trading on Tuesday, diversified media and entertainment conglomerate Walt Disney Co. (DIS) said that its third quarter profit rose 40 percent from last year, helped by strong growth at ESPN and a turnaround at its film division. The company's quarterly earnings came in above analysts' expectations as did its quarterly revenue.
The major averages have all seen choppy movement in recent dealing, remaining near their lows of the day. The Dow is down 195.18 points or 1.8 percent at 10,449.07, the Nasdaq is down 55.03 points or 2.4 percent at 2,222.14 and the S&P 500 is down 23.99 points or 2.1 percent at 1,097.07.
Sector News
Semiconductor stocks are extending yesterday's steep losses amid fears that the tepid economic recovery will hurt profits for tech firms. The Philadelphia Semiconductor Index is down by 4 percent, slipping to its lowest level in six weeks.
Considerable weakness is also visible among steel stocks, with the NYSE Arca Steel Index posting a loss of 4.3 percent. The decline has driven the index down to its lowest intraday price in nearly two weeks.
Railroad, networking, airline and oil service stocks are also under pressure along with most other market segments, further evident of the day's broad based selling. The NYSE Arca Oil Service Index is down by 3.5 percent as the price of crude oil is down by $1.33 to $78.92 a barrel.
Stocks Driven By Analyst Comments
Atheros Communications (ATHR) is under pressure after analysts at Stifel Nicolaus lowered their rating on the stock from Buy to Hold. The stock is down by 4.2 percent, slipping to a nine-month intraday low.
TW Telecom Inc. (TWTC) is also posting a steep loss after being downgraded to Neutral from Buy at Bank of America based on recent valuation. The stock is posting a loss of 3.6 percent after setting a three-week intraday low.
Monolithic Power (MPWR) is also notably lower after Stifel Nicolaus downgraded the stock from Buy to Hold. Shares are currently down by 8.5 percent, slipping to its worst intraday price in fifteen months. |
| | Learn how to trade |
Our "Value Packed" online trading seminar will show you how you can
Click Here To Find Out More |
| | Broker tips |
InterContinental, Vodafone, Micro Focus
The share price slide on Tuesday in the wake of interim results that were ahead of expectations provides an excellent opportunity to buy shares in hotels group InterContinental Hotels Group (IHG), according to Panmure Gordon.
The broker has increased its full year earnings per share estimate by 10.1% to 92.6 cents to reflect improved revenue per available room (RevPAR) assumptions, lower interest costs and a marginally lower tax rate.
Earnings forecasts for 2011 have also been revised upwards, and using these new estimates the stock is trading on 16.1 times projected 2011 earnings and is supported by a 2.7% yield.
This has prompted the broker to upgrade the stock from “hold” to “buy” and increase its price target to 1235p from 1085p.
With Vodafone trading at a 52-week high Nomura Securities sees several reasons for profit-takers to emerge over the summer.
The broker cited the company’s exposure to the US dollar, which could prove a drag on earnings, as a reason to sell, as well as the widening revenue underperformance in Europe, the mobile termination rates regulatory risk and the deferred update on portfolio optimisation.
On top of that, the broker notes, Vodafone’s discount to its discounted cash flow valuation is now below 10%, compared to a discount of 14% for the sector, and the stock “is no cheaper than the sector” on a ratio of 5.3 of enterprise value to earnings before interest, tax, depreciation and amortisation.
Though Nomura is bullish on the sector it is agnostic on Vodafone and thinks that with the strategy update from the company not due until autumn “excitement may not be sustained”.
The broker has a price target of 168p for the stock.
Business software group Micro Focus saw its shares slump by almost a third on Wednesday morning as the company announced that some large deals have been delayed and organic revenue growth this year would therefore be lower than previously expected.
KBC Peel Hunt has downgraded its organic revenue growth forecast for the current year from 5.5% to 2%, but is provisionally maintaining its profit before tax forecast, which would imply earnings before interest, tax, depreciation and amortisation margins of 41%, upgraded from 40%.
“With confidence already fragile and an H2 [second half] weighted year, Micro Focus’s rating will not start to reflect ambitions for double digit growth in the medium term,” concedes KBC analyst Alex Jarvis.
The broker has cut its recommendation from “buy” to “hold”, with the share price supported by a 3.7% yield and projected price/earnings ratio of 11. |
| |
|
