Thursday 28 June 2012
QUOTE OF THE DAY
What's the difference between Investment Bankers and London Pigeons? The Pigeons are still capable of making deposits on new BMWs
- Anonymous
THIS MORNING IN LONDON
FTSE 100
5,468.66
-55.26 -1.00%
FTSE 250
10,663.48
-88.50 -0.82%
FTSE 350
2,898.92
-28.62 -0.98%
FTSE All Share
2,835.94
-27.39 -0.96%
AIM 100
2,936.55
-12.80 -0.43%
AIM All Share
660.20
-2.31 -0.35%
12:00 pm
Banking stocks tank on Libor controversy
- EU summit to begin soon
- UK GDP in line with initial estimates
- Libor scandal hits Barclays, banking stocks
With the heavyweight banking sector extending its earlier losses, the Footsie was trading close to its lowest levels of the day by Thursday lunchtime ahead of the two-day EU summit which begins this afternoon.
The summit of the European Council will start this afternoon at 14:00 _London time) and last until tomorrow; European leaders will be looking to tackle the sovereign debt crisis as they work towards a plan for tighter integration.
"Stocks are trading lower this morning as we get closer to a summit in which expectations are incredibly low. In the past, there's been a lot of optimism leading into these summits, sending stocks and other risky assets higher. With so much experience now of these summits producing nothing, a wait and see approach is now being taken," said analyst Craig Erlam from Alpari.
All signs suggest that France, Italy and Spain have organised their game play to fight for growth, while their respective leaders - Francois Hollande, Mario Monti, and Mariano Rajoy - continue to push for the famous 'eurobonds'. However, on the opposite team, German Chancellor Angela Merkel continues to shout "nein" to the idea of jointly-issued European debt.
In domestic news, UK gross domestic product (GDP) decreased at a 0.3% pace in the first quarter of 2012, in line with the preliminary estimate, according to data published by the Office for National Statistics (ONS).
UK house prices fell by 0.6% month-on-month in June to GBP165,738, according to mortgage lender Nationwide, so that prices are now 1.5% below where they were a year ago and at their lowest level since August 2009.
FTSE 100: Barclays plummets on Libor scandal
Shares in Barclays were under heavy selling pressure after the banking group was found guilty of 'market manipulation' into interbank lending rates, prompting calls for the resignation of Chief Executive Officer Bob DIamond. Several other banks, including HSBC, Royal Bank of Scotland (RBS) and Lloyds, are also facing an inquiry into rigged Libor manipulation, it has been reported.
Barclays was over 9% lower by midday, while RBS, HSBC and Lloyds were also registering steep losses. Lloyds announced last night that it has agreed on the terms of the 632 branch-network sale, otherwise known as Project Verde, to the Co-op.
Mining stocks were also out of favour with ENRC, Vedanta, Xstrata and Glencore firmly in the red. Potential merger partners Xstrata and Glencore were unwanted on the back of rumours that Glencore could walk away from the possible combination after Xstrata shareholder Qatar Holdings demanded a high exchange ratio.
Meanwhile, Polymetal was suffering from a downgrade by UBS from 'buy' to 'neutral' due to the "recent strong share price performance and weaker silver prices".
Consumer products group Reckitt Benckiser fell after Credit Suisse downgraded the stock to 'neutral' and cut its target price from 3,800p to 3,500p. Engineer IMI was lower after UBS cut its target price by 100p and reduced its earnings estimates for 2012 and 2013. "We expect negative organic growth in H1 with the decline accelerating into the second half," the broker said.
Steel giant Evraz was extending losses made yesterday when German peer Salzgitter gave a gloomy outlook for the industry/ Goldman Sachs slashed its target price for Evraz this morning from 700p to just 400p, but kept a 'buy' rating.
FTSE 250: Labrokes leads the fallers after profit warning
Betting firm Ladbrokes dropped after it issued a profit warning for its Digital division, blaming increased technology investment, marketing spend and a poor sportsbook margin in the second quarter of 2012. Peel Hunt downgraded the stock from 'buy' to 'hold' this morning.
Hotels group Millennium & Copthorne was a high riser after Morgan Stanley upgraded the stock to 'overweight' and lifted its target price from 540p to 630p.
FTSE 100 - Risers
United Utilities Group (UU.) 668.00p +1.37%
AstraZeneca (AZN) 2,833.00p +1.21%
Severn Trent (SVT) 1,639.00p +0.99%
Resolution Ltd. (RSL) 191.50p +0.63%
Aggreko (AGK) 1,972.00p +0.56%
Serco Group (SRP) 528.50p +0.48%
Ashmore Group (ASHM) 336.00p +0.48%
Reed Elsevier (REL) 498.10p +0.38%
British Sky Broadcasting Group (BSY) 684.00p +0.37%
Standard Life (SL.) 226.20p +0.35%
FTSE 100 - Fallers
Barclays (BARC) 177.55p -9.44%
Royal Bank of Scotland Group (RBS) 217.30p -6.78%
Lloyds Banking Group (LLOY) 29.24p -6.15%
IMI (IMI) 773.50p -4.33%
HSBC Holdings (HSBA) 557.20p -2.76%
Evraz (EVR) 242.10p -2.73%
Reckitt Benckiser Group (RB.) 3,289.00p -2.61%
Eurasian Natural Resources Corp. (ENRC) 386.50p -2.50%
Standard Chartered (STAN) 1,342.50p -2.36%
ICAP (IAP) 337.50p -2.32%
FTSE 250 - Risers
Millennium & Copthorne Hotels (MLC) 477.70p +2.25%
Ruspetro (RPO) 133.80p +2.14%
Rightmove (RMV) 1,562.00p +1.89%
JD Sports Fashion (JD.) 668.00p +1.75%
Essar Energy (ESSR) 116.20p +1.66%
Moneysupermarket.com Group (MONY) 125.40p +1.37%
Smith (DS) (SMDS) 138.80p +1.31%
Phoenix Group Holdings (DI) (PHNX) 481.50p +1.22%
BH Macro Ltd. USD Shares (BHMU) 18.78 +1.13%
Telecom Plus (TEP) 845.00p +0.96%
FTSE 250 - Fallers
Ladbrokes (LAD) 156.00p -10.24%
Ocado Group (OCDO) 79.75p -6.18%
Aquarius Platinum Ltd. (AQP) 45.96p -5.94%
Bwin.party Digital Entertainment (BPTY) 109.40p -5.77%
New World Resources A Shares (NWR) 292.30p -5.50%
Fenner (FENR) 339.50p -3.63%
Heritage Oil (HOIL) 116.00p -3.41%
Shanks Group (SKS) 77.05p -3.20%
Intermediate Capital Group (ICP) 258.50p -2.67%
Paragon Group Of Companies (PAG) 166.50p -2.63%
ON THE SHARECRAZY BLOG
By Tom Winnifrith
My support of Ascot Mining has not paid of for those who followed me. The shares were once in the 40s. Today they trade on PLUS at 7.5p in the middle valuing Ascot at GBP5 million. I am asked if I can offer a few thoughts before I switch off my phone at Gatwick for a month and go away on my holiday.
The company has not to date delivered on either its move to AIM or on its production targets from its mine at Chassoul. And not only has it not won back the La Toyota mine despite two years of legal wrangling but since Christmas it has faced legal challenges to its Tros Hermanos property as well. Throw in the general ennui with all Plus listed stocks and it is not hard to see where this has gone wrong. So where are we now?
Click here to read the read of the article
TIP OF THE DAY
A report by Growth Equities & Company Researcg
Plastics Capital has announced a set of full-year results which are in-line with our expectations. The company added that it expects to make good progress over the next year as it continues to invest for future growth. Since initiating coverage in February 2010, the niche plastics products manufacturer's share price has risen by more than 200%, which compares to the market's (FTSE All-Share) return of just 20%. With global activity showing signs of improvement, we feel that the company has the potential to reap even greater returns for investors and, accordingly, we reiterate our buy recommendation.
Click here to read the read of the article
WHAT THE BROKERS SAY
THE LATEST ON THE CRAZY BOARD
The top 5 hot company threads on the Bulletin Board:
Ascot Mining
Hambledon Mining
International Power Shares
Mobilewave Group
Running trading thread
Click here to discuss shares with other ShareCrazy members
BOOK OF THE WEEK
By Simon Lack
A book review by Luka Lukic of t1ps.com
Hedge funds have always been the talk of the town. Every year we read about the billions paid to top 10 hedge fund managers and investors rush to give their money to them in the hopes of exceptional return. However, in this brutally honest book, industry insider Simon Lack looks to strip away the facade and reveal the cold truth about the profits hedge funds actually make. In the first sentence of the book he writes: "If all the money that's ever been invested in hedge funds had been put in treasury bills instead, the results would have been twice as good." A staggering statement which leads us to question why they have been placed on a pedestal.
Click here to view the rest of the article
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