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 |  Subject: ADVFN Morning Euro Market Bulletin : April 7th  Wed Apr 07, 2010 10:13 am | |
| by ADVFN.comADVFN offer FREE streaming stocks and shares data form around the world. SEE | London Market Report | Blue chips drift lower
Market Movers
FTSE 100 5,759.44 -0.36%
techMARK 1,661.62 -0.17%
FTSE 250 10,436.00 +0.02%
Blue chips have opened lower following an indecisive performance in the US last night as concerns over the financial health of Greece resurfaced.
Hedge fund giant Man is one of the few strong risers alongside property giants Land Securities and Hammerson.
Mobile phone giant Vodafone is to launch a customised version of Opera, the popular Internet browser, to run on low-cost handsets on 2G networks in a move aimed at developing markets. Prudential tops the list of companies going ex-dividend today.
Specialist insurer and reinsurer Beazley has announced its preliminary estimate of its exposure to claims arising from the Chilean earthquake and the European windstorm Xynthia. The company expects the losses from the earthquake to be in the range of $55m to $75m, though uncertainty still surrounds the full scale of the losses.
Food sales from its managed pubs continued to lead growth at pub group and brewer Marston’s in the half year to April 3. The company remains on track to meet expectations for the full year.
Power peripherals supplier Chloride enjoyed a satisfactory fourth quarter and expects to meet expectations for the year to March. Orders at the year-end were 16% higher than the previous year.
Balfour Beatty has announced its second contract win in as many days, and this time it is for work on a terminal at Dallas Fort Worth airport. The infrastructure specialist contractor said a joint venture of which it is a member, along with Azteca Enterprises, H J Russell and CARCON Industries, has been selected to carry out preconstruction and construction services for the seven-year terminal development programme at the airport.
Electrical parts distributor Electrocomponents has seen sales put on a growth spurt in February and March, which should see full year profits come in ahead of expectations. The company thinks profit before tax in the year to 31 March 2010 will be around £73m.
Heritage Oil is going the other way on a mixed report from Kurdistan. Heritage Oil is to dig its Miran West-2 test well in Kurdistan deeper than originally planned after results proved much less productive than its first test well, though it says it has identified areas that could add significantly to reserves. |
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| | UK Event Calendar for today | INTERIM DIVIDEND PAYMENT DATE
Carclo, Diageo, Phoenix IT Group
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Consumer Confidence (US) (21:00)
Crude Oil Inventories (US) (20:30)
Leading Indicator Index (JPN) (05:00)
PMI Construction (EU) (09:00)
PMI Construction (GER) (08:55)
RBA Interest Rate (AUS) (00:00)
GMS
Avisen, Egdon Resources
FINALS
Brightside, Novolip Regswi GDS (Reg S)
ANNUAL REPORT
Bovis Homes Group
EGMS
Infrastructure India
AGMS
Just Car Clinics Group, Xploite
TRADING ANNOUNCEMENTS
Printing.com
UK ECONOMIC ANNOUNCEMENTS
BRC Shop Price Index (23:01)
PMI Construction (09:30)
FINAL EX-DIVIDEND DATE
Phoenix Group Holdings |
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| | European, Currencies Market | No surprises in Fed minutes
Last nights publication of the minutes of the FOMC meeting indicated that the Federal Reserve still has concerns about the robustness of the economic recovery currently underway in the US.
They went on to indicate that interest rates would remain at record lows “for an extended period” with Kansas Fed President Hoenig remaining the sole dissenter to the retention of this phrase. The Fed remains concerned about unemployment and tight credit conditions, while concerns about inflation remain on the sidelines for now, though they did say they would be ready to act on interest rates if the need arose.
Market concerns about China removing some of its stimulus measures appear to have been shrugged off by the market for the moment; however that may change on reports that the Chinese central bank may look to drain off liquidity in the coming days, ahead of the next release of inflation figures. Any figure near or above 3% will make the prospect of further tightening inevitable.
On this side of the Atlantic yesterday’s announcement that the UK election is scheduled for 6th May was almost treated as a minor footnote by the market. As far as the pound is concerned it will continue to move between its broad ranges of 1.4850/1.5350 on the whims of the opinion polls, slipping back from its highs after an ICM poll put the Tory lead at 4 points over Labour, contrasting with weekend poll leads in double digits.
The Euro continues to look poorly on fears that Greece could find itself shut out from the money markets on speculation that it wants to bypass IMF help as part of any bail-out package. As a result the spread between German and Greek 10 year bonds has widened out to near the January highs of 390 basis points.
EURUSD - The failure at the key resistance level at 1.3570 trend line resistance from the highs at 1.5145 yesterday has seen the Euro slip back. While below here the risk is for further weakness. A break above could well target the March highs around 1.3800. A break below the lows of 1.3270 brings the risk of further declines towards 1.3000.
GBPUSD - the 1.5370/80 highs in March continue to rebuff sterling gains. This is also where the 50 day moving average comes in and should act as resistance. However a break above these highs could act as a catalyst for further gains towards the 8th February lows at 1.5530. While below 1.5370/80 the broader range remains intact with support around 1.5120.
EURGBP – yesterday’s rally faltered at 0.8860 just below the 200 day moving average at 0.8875. This should continue to cap the Euro and push the cross lower, and the euro now looks as if it could well test towards the January lows at 0.8602 in the longer term. There is also support around the February lows around 0.8660.
USDJPY – yesterday’s yen strength and dollar weakness could well be a temporary measure after the yen declines of the last few days. The 7 month dollar high yesterday at 94.78 has provoked a fall-back towards the previous highs at 93.65/75 area.
Support should now come in around these previous highs, while below that the dollar should also find support around 93.30 and 92.80. The next target remains at 95.10 which is 61.8% retracement of the down move from 101.45 to 84.80. |
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| | US Market | Mixed finish for stocks
US stocks were mixed at trading’s close as minutes from the Federal Reserve’s latest meeting showed interest rates are unlikely to rise anytime soon, reassuring investors.
Some Fed policy makers warned against raising interest rates too soon given unemployment levels.
The Dow hit fresh highs on Monday thanks to a rise in US non-farm payrolls but fell back a little today, though the other indices edged higher.
Across the markets, the Dow Jones fell three points to 10,969, while the Nasdaq moved 7 points higher to 2,436. The S&P 500 gained two points to 1,189.
Shares in US coal miner Massey Energy fell sharply after at least 25 of its workers died in an explosion at one of its mines.
In addition to the deaths at Massey’s Upper Big Branch mine in West Virginia, two miners were transported to hospitals and four are missing.
Sticking with coal, Peabody Energy has sweetened its offer for Macarthur Coal from A$3.3bn to A$3.6bn as it turned up the heat in the takeover battle with Hong Kong-based rival Noble Group for control of the Australian miner.
Takeover target Macarthur Coal rejected the $3.3bn bid last week and said it would go ahead with a vote on April 12 on a rival plan which would see Noble swap its stake in Gloucester Coal, a smaller Australian miner, for shares in Macarthur.
Financials are strong thanks to an upgrade of the sector to market weight by analysts at Wells Fargo. JP Morgan Chase, Bank of America and American Express are all risers in the Dow. Regions Financial Corp, Zions Bancorporation and Huntington Bancshares are some of the top performers in the S&P.
CA Inc, a supplier of software for mainframes, has warned that its 2010 profit will be at the lower end of expectations.
Toyota Motor is recalling 12,984 cars in South Korea for potential defects that could trap the gas pedal under the floor mat. The Japanese carmaker has recalled more than 8 million vehicles globally following a string of safety problems.
The news came just after the US government announced plans to fine the car group $16.4m for holding back information about faulty accelerator pedals. |
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| | Wednesday paper round-up |
Election, BSkyB, Prudential
Britain's business leaders have warned of a month of market volatility ahead of the General Election unless the political parties offer more coherent plans on cutting the £167bn deficit.
The pound fell against the dollar and the euro on Tuesday as the openingelection moves failed to convince traders that there will be a clear winner. Analysts also warned that sterling could come under further pressure over the next month unless the polls start to discount the possibility of a hung Parliament, the Telegraph reports.
BSkyB has lost the exclusive rights to show Premier League football highlights on mobile phones to rival ESPN. The Disney-owned channel will be able to send instant clips of every Wayne Rooney header, John Terry tackle and contentious refereeing decision to smartphone phone owners after it secured the mobile rights to all 380 Premier League matches over the next three seasons, starting in August, the Telegraph reports.
Tim Geithner, US Treasury secretary, this week made a fresh plea to European governments not to “discriminate” against US fund managers as they negotiate new rules for the hedge fund and private equity industries. “I understand that the draft . . . would discriminate against third country funds and fund managers by denying them the opportunity to access the European Union single market via a passport approach, which would be limited solely to EU funds and fund managers,” Mr Geithner said in an April 5 letter to Alistair Darling, chancellor, that was obtained by the Financial Times.
A sudden sell-off in Greek sovereign bonds yesterday has pushed up the cost of borrowing for the embattled state to record levels, casting doubts on its ability to refinance up to €15bn of debt over the next two months. The surge in Greek bond yields, which reached 7.1%, prompted the Finance Minister to warn that the present interest rate burden was unsustainable. The renewed fears about the Greek finances hit the euro, which fell against the dollar, the Times reports.
The Prudential has allocated its chief executive bonus shares worth just under £3 million at today’s prices. The shares are part of a rolling three-year incentive scheme that could leave Tidjane Thiam with shares worth more than £9m by 2013. The award, revealed yesterday, is on top of a £1m annual bonus and a salary of £875,000, which are expected to be detailed in the insurer’s annual report, the Times reports.
Britain’s largest private employer has snubbed the business campaign against the Government’s rise in national insurance. A leading Tesco executive said yesterday that the supermarket chain would not oppose “whatever measures are considered right” to put the public finances back in good order, the Times reports.
Copper prices crossed the key $8,000 a tonne barrier on Tuesday, leading other metals to their highest levels in 20 months amid signs that demand, already strong in China and the rest of Asia, is improving now in the US, Europe and Japan, the FT reports.
Alan Greenspan, the former chairman of the Federal Reserve, is on Wednesday expected to admit that the American central bank did little to address the dramatic growth in financial institutions which in part fuelled the global financial crisis. However, it is believed Mr Greenspan, who chaired the Fed from 1987-2006 and is blamed by many for fuelling the US housing bubble, will stop short of taking personal responsibility for the crisis, the Telegraph reports.
Food prices tumbled to a three-year low in March, handing household budgets a fillip ahead of the general election. The odds on retailers stepping up their current fierce promotional activity also shortened after non-food inflation also fell last month for the first time since VAT returned to 17.5 per cent on 1 January 2010, the Independent reports.
The struggling internet company AOL plans to sell or shut down the online social network Bebo only two years after buying it for $850m. Bebo has failed to gain more users as it fought more popular rivals such as Facebook. AOL said that Bebo needed "significant investment" to become competitive, adding that it was not in a position to provide such funding, the Times reports. |
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