Friday 8 June 2012
QUOTE OF THE DAY
One of the funny things about the stock market is that every time one person buys, another sells, and both think they are astute
- William Feather
THIS MORNING IN LONDON
FTSE 100
5,398.17
-49.62 -0.91%
FTSE 250
10,642.25
-102.87 -0.96%
FTSE 350
2,865.72
-26.53 -0.92%
FTSE All Share
2,803.94
-25.43 -0.90%
AIM 100
3,085.88
-41.47 -1.33%
AIM All Share
683.95
-6.01 -0.87%
11:50 am
Stocks weighed down by Spain, Bernanke
- Bernanke comments weigh on markets
- Investors nervous ahead of Chinese data this weekend
Blue chips were off their intraday lows but still firmly in the red by Friday lunchtime as concerns over Spain continued to dampen the mood.
Spain and the European Union has denied reports of an imminent petition by Spain for bank rescue funds. According to earlier reports, Eurogroup finance ministers were to hold a conference call tomorrow to discuss the details and issue a statement thereafter.
Fitch Ratings said last night that the "likely 'fiscal cost'" of restructuring and recapitalising the Spanish banking sector would be between EURO60bn and EURO100bn in a worst-case scenario. This came as the ratings agency downgraded its sovereign debt rating for the country from A to BBB.
Also weighing on sentiment today were yesterday's comments from Federal Reserve Chairman Ben Bernanke who "performed his usual trick of depressing the markets", according to Craig Erlam from Alpari. Analysts were hoping for hints of imminent stimulus measures but Bernanke failed to say whether the Fed would be embarking on QE3 any time soon.
Investors will still be digesting the recent interest rate cut from China, which initially spurred impressive gains for equity markets on Thursday. However, ahead of some key inflation and industrial production figures due out this weekend from the world's second-largest economy, some analysts are questioning whether the rate cut was a pre-emptive move ahead of what could be some disappointing data.
In other news, German exports decreased for the first time this year in April, falling 1.7% from March. Producer prices in the UK came in below expectations in May, showing an 0.2% month-on-month drop (consensus: +0.1%) in factory gate inflation, while input prices fell by 2.5% month-on-month (consensus: -1.6%).
FTSE 100: Resources out of favour as commodity prices drop
Metals prices were retreating on Friday morning, pressuring mining stock lower: Vedanta, Kazakhmys, Antofagasta, Xstrata, Rio Tinto, Glencore and ENRC were among the worst performers. A stronger dollar was making greenback-denominated commodities more expensive early on with crude prices also taking a tumble, denting the likes of Tullow Oil and BP.
BHP Billiton was among the fallers after Bank of America Merrill-Lynch reduced its profit forecasts for the group on the back of lower oil prices estimates. A hold recommendation was maintained.
Power systems group Rolls-Royce fell after announcing that it is to take full control of Aero Engine Controls (AEC), the engine controls joint venture it established in January 2009 with US aerospace giant Goodrich.
Heading the other way was the defensive utilities sector as investors fled from risk and into 'safer' assets, including Severn Trent, Centrica, United Utilities, SSE and National Grid.
FTSE 250: Lamprell plummets after profit warning
Energy markets-focused engineer Lamprell was battered after sneaking out a profit warning on Thursday after the London market closed, saying that it now expects to make a half-year loss of between $15m and $20m, compared with earlier guidance of "a small loss". The group also said that Chairman Jonathan Silver would step down.
"We continue to believe that management's credibility has fundamentally deteriorated," Nomura said in a research note this morning.
Budget airline easyJet edged higher after revealing that passenger numbers in May were 14.4% higher than a year ago. Traffic has been steadily increasing since February.
FTSE 100 - Risers
Capita (CPI) 645.00p +2.14%
Severn Trent (SVT) 1,759.00p +1.38%
Diageo (DGE) 1,595.50p +1.17%
Centrica (CNA) 311.60p +1.04%
United Utilities Group (UU.) 675.00p +0.97%
Next (NXT) 3,050.00p +0.93%
Reckitt Benckiser Group (RB.) 3,486.00p +0.87%
Shire Plc (SHP) 1,867.00p +0.86%
GlaxoSmithKline (GSK) 1,439.50p +0.66%
National Grid (NG.) 657.50p +0.61%
FTSE 100 - Fallers
Vedanta Resources (VED) 932.50p -5.38%
Rio Tinto (RIO) 2,865.00p -4.98%
Eurasian Natural Resources Corp. (ENRC) 421.90p -4.37%
Evraz (EVR) 276.40p -4.16%
Kazakhmys (KAZ) 699.00p -3.98%
BHP Billiton (BLT) 1,753.00p -3.68%
Anglo American (AAL) 2,055.50p -3.63%
Petrofac Ltd. (PFC) 1,530.00p -2.98%
Barclays (BARC) 187.35p -2.85%
Xstrata (XTA) 943.30p -2.43%
FTSE 250 - Risers
Bumi (BUMI) 358.00p +9.78%
RPS Group (RPS) 206.00p +4.57%
Atkins (WS) (ATK) 682.00p +4.36%
Kier Group (KIE) 1,256.00p +2.11%
Grainger (GRI) 89.00p +1.83%
New World Resources A Shares (NWR) 318.60p +1.79%
Synergy Health (SYR) 880.00p +1.79%
Brown (N.) Group (BWNG) 232.50p +1.48%
PayPoint (PAY) 712.50p +1.28%
Bellway (BWY) 753.50p +1.28%
FTSE 250 - Fallers
Lamprell (LAM) 83.40p -23.28%
Kesa Electricals (KESA) 49.49p -8.52%
Afren (AFR) 110.60p -5.63%
Anglo Pacific Group (APF) 238.80p -5.50%
Essar Energy (ESSR) 118.10p -4.99%
Lonmin (LMI) 755.50p -4.61%
Heritage Oil (HOIL) 121.50p -4.56%
Home Retail Group (HOME) 70.70p -4.27%
Hays (HAS) 72.30p -3.66%
Investec (INVP) 338.80p -3.61%
TIP OF THE DAY
A report from Growth Equities & Company Research
Conygar Investment Company (Conygar), the AIM listed real estate investment and development group, announced on 6th June that the Isle of Anglesey County Council has resolved to grant planning permission for its marina development at Holyhead, Anglesey in Wales. The project is a joint venture between Conygar and Stena Line Ports Limited, called Conygar Stena Line Limited.
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:
Falkland Oil & Gas
Conygar Investment
Minera IRL
Concurrent Technologies
Running trading thread
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BOOK OF THE WEEK
By Johan Stenebo
A book review by Aaron Padgham of t1ps.com
Johan Stenebo was a leading director at IKEA for more than two decades during a period in which it rapidly transformed into a leading flatpack retailer, generated billions of pounds of revenue across 38 countries. Working directly beneath Ingvar Kamprad, owner of the Swedish furniture giant, Stenebo was pivotal in the opening and running of the Leeds store, that soon went on to break company records, and was for some time Kamprad's personal assistant. John left the group in early 2009, after disputes with other members of management, and a few months later this book was released.
Click here to view the rest of the article
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