ADVFN Morning Euro Markets Bulletin - May 31st 2011

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London Market Reports


FTSE 100 builds on gains

Market Movers
techMARK 1,965.20 +0.58%
FTSE 100 5,990.14 +0.86%
FTSE 250 12,017.58 +0.49%
The top share index is adding to the gains it made ahead of the long weekend and homing in on the 6,000 point mark around which it has been flitting since the start of the year.

On a relatively quiet day for company news, Serco, the outsourcing company whose activities include running prisons and London’s Docklands Light Railway, has announced the acquisition of India-based service provider Intelenet for up to £385m.

Elsewhere in the sector, outsourcing specialist Capita has acquired specialist healthcare recruitment firm Team24 for £24m, with up to £2m more payable depending on the firm's performance in the year to 31 March, 2012. Team24 made a pro forma operating profit for its financial year to 31 March 2011 of £4.2m on turnover of £32.7m.

In the FTSE 250, pace is higher after it announced that the chairman of set-top box maker is stepping down after a troubled end to his five years in charge of the company. Mike McTighe will be replaced by Allan Leighton, former non-executive chairman of the supermarket Asda. Leighton joins the board today and is expected to take over as chairman in summer.

Sweden-focused mineral exploration company Beowulf Mining endured a harsh winter of epic proportions but remains on course to complete its drilling programme by the end of the second quarter of 2011. In the first three months of 2011 it lost £0.13m before tax, compared to a loss of £0.01m in the first quarter of last year.

FTSE 100 - Risers
Experian (EXPN) 803.00p +3.48%
Essar Energy (ESSR) 461.30p +2.22%
Aggreko (AGK) 1,850.00p +1.98%
Johnson Matthey (JMAT) 2,064.00p +1.93%
IMI (IMI) 1,050.00p +1.84%
Serco Group (SRP) 567.50p +1.79%
Wolseley (WOS) 2,026.00p +1.76%
Burberry Group (BRBY) 1,312.00p +1.71%
Royal Dutch Shell 'B' (RDSB) 2,180.50p +1.61%
Weir Group (WEIR) 2,015.00p +1.56%

FTSE 100 - Fallers
Cairn Energy (CNE) 439.30p -0.70%
GlaxoSmithKline (GSK) 1,313.50p -0.27%
Hargreaves Lansdown (HL.) 626.50p +0.08%
British Sky Broadcasting Group (BSY) 835.50p +0.12%
Vodafone Group (VOD) 169.90p +0.30%
United Utilities Group (UU.) 626.00p +0.32%
Inmarsat (ISAT) 604.50p +0.33%
Rio Tinto (RIO) 4,282.00p +0.35%
Morrison (Wm) Supermarkets (MRW) 307.00p +0.36%
John Wood Group (WG.) 636.50p +0.39%

FTSE 250 - Risers
Britvic (BVIC) 450.00p +3.95%
Barratt Developments (BDEV) 116.40p +3.47%
Pace (PIC) 118.50p +3.13%
Homeserve (HSV) 529.00p +2.72%
Exillon Energy (EXI) 440.40p +2.42%
AZ Electronic Materials SA (WI) (AZEM) 320.00p +2.33%
Talvivaara Mining Company (TALV) 491.80p +2.27%
FirstGroup (FGP) 346.70p +2.03%
Soco International (SIA) 386.90p +1.90%
JPMorgan Russian Securities (JRS) 651.00p +1.80%

FTSE 250 - Fallers
Renishaw (RSW) 1,651.00p -2.88%
Moneysupermarket.com Group (MONY) 97.30p -2.60%
Helical Bar (HLCL) 258.70p -2.19%
Grainger (GRI) 123.80p -1.75%
Euromoney Institutional Investor (ERM) 644.00p -1.68%
Booker Group (BOK) 67.90p -1.59%
Cable & Wireless Worldwide (CW.) 49.15p -1.42%
Carpetright (CPR) 700.50p -1.34%
COLT Group SA (COLT) 143.70p -0.96%
Greggs (GRG) 521.00p -0.86%


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UK Event Calendar
INTERIMS
GCP Infrastructure Investments Ltd., Majedie Investments

INTERIM DIVIDEND PAYMENT DATE
Wolseley

QUARTERLY PAYMENT DATE
Bankers Inv Trust

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Chicago PMI (US) (13:45)
Consumer Confidence (US) (15:00)
International Reserves (EU) (11:00)
Unemployment Rate (EU) (10:00)
Unemployment Rate (GER) (08:55)

GMS
Edinburgh New Income Trust, Global Special Opportunities Trust Capital Shares, Global Special Opportunities Trust Income Shares, Global Special Opportunities Trust Units

ANNUAL REPORT
Hansen Transmissions International NV (DI)

EGMS
MobileWave Group

AGMS
Alba Mineral Resources, Instem Life Science Systems, KDD Group NV (DI), Kellan Group, Marshall Wace TOPS Global Alpha UCITS Fund, Marshall Wace TOPS Global Alpha UCITS Fund EUR, Marshall Wace TOPS Global Alpha UCITS Fund USD, MCB Finance Group, Network Group Holdings, Norman Broadbent , Oxford Advanced Surfaces Group, Parseq, Pinewood Shepperton, Saltus European Debt Strategies Ltd., Titanium Asset Management Corp. (Reg S)

UK ECONOMIC ANNOUNCEMENTS
PMI Retail (09:30)

FINAL DIVIDEND PAYMENT DATE
Henry Boot, Lookers, Northbridge Industrial Services, Ocean Wilsons Holdings Ltd., Old Mutual, Senior, SR Europe Inv Trust, Travis Perkins


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European Market Reports
Greek progress lifts markets

European markets are making a bold advance in the early going with most major indices notching up gains in excess of one per cent, as hopes rise of the current Greek financial crisis being settled by the end of June.

The talks between auditors from the European Union (EU), the International Monetary Fund (IMF) and the European Central Bank (ECB) about new rescue measures for Greece have dragged on into the fourth week, but could be concluded by Wednesday, Greece's finance minister, George Papaconstantinou, said Monday.

Any agreement would most likely be discussed at the summit meeting of European heads of state on June 23 and 24 in Brussels. "We will try to resolve the Greek problem by the end of the month of June," said Luxembourg prime minister Jean-Claude Juncker, the chairman of the committee of euro zone finance ministers.

The CAC 40 in France is up 53 at 3,996, the DAX 30 in Germany is 126 points firmer at 7,286 and the Swiss Market Index is 90 points heavier at 6,561.

There was mixed news on the economic front in Gerrmany, with retail sales recovering in April, advancing 0.6% after sliding 2.7% in March. The rise was below expectations of a 1.7% rise, however.

Meanwhile, German unemployment declined in April, with the unemployment rate easing to 6% from 6.5% in March.

German supermarket Metro was firmer following the retail sales data, though its rise was in line with that of the DAX index. Chemicals companies BASF and Bayer, plus engineer Siemens, were the top three risers among DAX constituents.

Steel maker ThyssenKrupp is also going well. Its Swiss peer, Voestalpine's net income rose to SFr.512.7m last year from SFr.108.4m the year before. “Further positive economic development in the second half of calendar year 2011 can be expected,” the company said.


CAC 40 - Risers
Alstom (ALO) € 42.88 +2.38%
Schneider Electric (SU) € 113.40 +2.35%
PPR (PP) € 120.20 +2.30%
Saint Gobain (SGO) € 45.70 +2.25%
Vinci (DG) € 44.37 +1.99%
Air Liquide (AI) € 96.09 +1.98%
Total (FP) € 40.22 +1.95%
BNP Paribas (BNP) € 54.24 +1.94%
ST Microelectronics (STM) € 8.05 +1.93%
Credit Agricole (ACA) € 10.64 +1.92%

CAC 40 - Fallers
Societe Generale (GLE) € 41.38 -1.48%
France Telecom (FTE) € 15.77 -0.13%


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US Market Reports

Dow Jones NASDAQ NYSE AMEX

Please click on the images to view our interactive charts

Stocks up on day, down on week

US stocks finished the week on a firm note in light trading ahead of the extended Memorial Day week-end, clawing back some of the losses seen earlier in the week.

The Dow Jones industrial average climbed 38 points to 12,441 while the broader based S&P 500 moved up 5 points to 1,331. The tech-heavy NASDAQ Composite advanced 13 points to 2,796.

Medco Health Solutions was the biggest faller among blue-chips after the healthcare firm lost a major pharmacy benefit contract to rival CVS Caremark. The Blue Cross Blue Shield Association intends to move its postal and speciality pharmacy benefit coverage for the Federal Employee Program (FEP) to CVS. The FEP contract churns out almost $3bn in annual revenue, Medco said.

The contract is the second high profile gig that Medco has lost in recent months; in March, the California Public Employees’ Retirement System decided not to renew its contract with Medco Health Solutions to manage the pharmacy benefits of its members.

Computer Sciences beat expectations with its fourth quarter earnings per share (EPS) of $1.01; analysts had been expecting EPS of around 96 cents. Revenue was barely changed from a year earlier at $4.20bn. The company, which provides services for the UK's National Health Service, said it expects to win more than $17bn in new business in the current fiscal year, while full year revenue is expected to fall in the range of $16.22 to $17.0bn. EPS are expected to fall somewhere in the range of $4.70 to $4.80, a range that disappointed some market observers.

NASDAQ OMX group got a lift from Goldman Sachs, which has turned bullish on the stock now the bourses operator is no longer in the running to buy rival NYSE Euronext.

Marvell Technology was the pick of the NASDAQ listed stocks after it announced better than expected figures and an upbeat revenue forecast after the bell on Thursday.

Network products chip maker Broadcom was another high-flying tech stock, after FBR Capital Markets added the stock to "top picks" list. The broker believes Broadcom is well placed to benefit from the explosion demand in smartphones.

On the economic front, personal earnings and spending for April both rose by 0.4% on month. The spending data for the previous two months has been revised slightly downwards. The core PCE (Personal Core Earnings) deflator has come in at 1.0% on year, as expected.

The final University of Michigan consumer confidence index for the month of May has risen to 74.3 points (Consensus: 72.4), from 69.8 last month. Income expectations are still low, but consumers´ expectations for the economy and jobs have improved. As well, inflation expectations have fallen back.

The National Association of Realtors said its pending home sales index fell 11.55% to 81.9 from a downwards revised 92.6 in March.

The sharp fall brought to an end a short sequence of monthly gains, stretching back to March. Consensus has been for a 1.0% fall.

S&P 500 - Risers
Ralph Lauren Polo Corp. (RL) $126.43 +6.85%
Broadcom Corp. (BRCM) $36.52 +5.40%
F5 Networks Inc. (FFIV) $112.85 +5.30%
PulteGroup Inc. (PHM) $8.20 +4.33%
Computer Sciences Corp. (CSC) $40.04 +4.33%

S&P 500 - Fallers
Medco Health Solutions Inc. (MHS) $58.66 -8.97%
Weyerhaeuser Co. (WY) $20.87 -5.44%
Eastman Kodak Co. (EK) $3.40 -4.76%
AFLAC Inc. (AFL) $48.00 -3.21%

Dow Jones I.A - Risers
Bank of America Corp. (BAC) $11.69 +2.01%
Johnson & Johnson (JNJ) $66.77 +1.92%

Dow Jones I.A - Fallers
Intel Corp. (INTC) $22.21 -1.29%
McDonald's Corp. (MCD) $81.62 -0.98%

Nasdaq 100 - Risers
Marvell Technology Group Ltd. (MRVL) $16.17 +11.06%
Broadcom Corp. (BRCM) $36.52 +5.40%
Millicom International Cellular S.A. (MICC) $110.18 +4.57%

Nasdaq 100 - Fallers
VeriSign Inc. (VRSN) $35.37 -2.67%
Express Scripts Inc. (ESRX) $58.48 -1.76%


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Newspaper Round-up
Morrisons, executive pay, Northern Ireland

Morrisons is aggressively outbidding its rivals to secure new stores, particularly in the southern England, signalling the scale of its ambitions under chief executive Dalton Philips. The Bradford-based grocer is on a mission to grab property for both standard supermarkets and conveniences stores, with its recent acquisitions of sites in Dorking and Croydon cited as examples of how it is splashing the cash, according to sources, reports the Independent.

The bosses of Britain’s 100 biggest companies have banked huge pay increases despite the economic crisis. The average earnings of chief executives in the FTSE 100 jumped 32% in 2010, and the heads of blue-chip firms such as Marks & Spencer andTesco took home an average of £3.5m each, according to a report by City consultancies MM&K and Manifest, reports the Daily Mail.

Northern Ireland's recession-hit economy will lag behind most of the UK this year, according to a key business survey that is expected to prompt further calls from Belfast politicians for cuts in corporation tax rates to compete with the south. The Northern Bank's quarterly economic forecast predicts that the growth rate for the economy will struggle to reach 1.1% this year compared with a UK average of 1.7%, reports the Guardian.

Britain’s energy regulator has been accused of misleading consumers when it claims that suppliers are too quick to raise prices and too slow to cut them. Ofgem has come under pressure on the issue after an independent report commissioned by the trade body Energy UK said that the regulator’s analysis “cannot be relied upon”, calling into question its methodology, reports the Times.

The beleaguered care homes operator Southern Cross is cutting its rent by 30% and remains locked in negotiations with its landlords to find a longer-term solution as it struggles to stay afloat. The group, which owns about 750 care homes, said that it would pay nearly a third less rent than it is contractually obliged to for the next four months, according to the Times.

Representatives of some of the UK’s largest corporate pension schemes are pressing the Take­over Panel to ensure that acquiring companies take account of a target company’s retirement plan when making a bid. They want the panel to force bidders to set out in formal documents how an offer will affect a pension scheme and its members, the Financial Times reports.

Sovereign control of financial regulation is under threat from European moves to harmonise rule books across member states, the three men at the heart of the future Bank of England have warned. Paul Tucker, the Bank's Deputy Governor for financial stability, and Hector Sants, chief executive of the Financial Services Authority (FSA) who will become Deputy Governor for prudential regulation, told The Telegraph that the UK's proposed regulatory system risks becoming little more than a local police force applying a one-size-fits-all set of European rules. Andrew Bailey, the Bank's chief cashier, who will become Mr Sants' deputy at the Prudential Regulation Authority (PRA), a subsidiary of the Bank, also said the UK could lose discretion over how it regulates its banks, the paper reports.

Argos, the catalogue specialist owned by Home Retail Group, has been forced to reshuffle its top management team for the second time in just over a month. John Douglass, the director of operations at Argos, is to retire and will hand over the reins to Stephen Carson, a senior director at the DIY chain Homebase, which is also owned by Home Retail, according to the Independent.

The Government could start selling its 83% stake in Royal Bank of Scotland as early as next year, a senior executive said yesterday. Taxpayers have owned 83 per cent of RBS since a £45bn bailout during the financial crisis but there is intense speculation about when some of the state’s holding will be sold off, according to the Daily Express.