Tuesday 4 September 2012
QUOTE OF THE DAY
I used to sell furniture for a living. The trouble was, it was my own
- Les Dawson
ON THE SHARECRAZY BLOG
A new report out today completely discredits the Stern Review, the report on which UK Government policy on climate change is based. Authored by Peter Lilley MP and produced by the Global Warming Policy Foundation it demonstrates clearly that if we continue down the present path, the sole result will be the impoverishment of British taxpayers and businesses. Critically, it does not question the bogus science of climate change, merely the policy response to it.
As you know I do not believe in man made climate change. There were no carbon emissions to speak of when the world warmed up materially between 1100-1400 so why assume that current warming is driven by carbon emissions. And of course the last decade was actually cooler than, say, the 1930s so for me global warming is all hocus pocus. I suspect that Lilley feels the same way but this report is devastating because it starts from the premise that global warming science might actually be a fact.
The failings of Stern (and thus the reason why the entire political class has got this one so utterly wrong) start with the fact that, as Lilley points out there are a series of errors and distortions in the Stern Review "any one of which would have caused it to fail peer review". That is Lilley's little joke as anyone who has studied UAE emails on how "peer review" is conducted will understand.
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THIS MORNING IN LONDON
FTSE 100
5,705.49
-52.92 -0.92%
FTSE 250
11,473.47
-29.66 -0.26%
FTSE 350
3,036.66
-25.49 -0.83%
FTSE All Share
2,972.04
-24.50 -0.82%
AIM 100
3,071.46
-12.70 -0.41%
AIM All Share
681.27
-1.84 -0.27%
12:47 pm
Evraz leads fallers on the FTSE 100
- Investors in 'wait and see mode' ahead of ECB
- Markets await pivotal US ISM data
- Moody's lower EU outlook to 'negative'
The FTSE 100 had slumped to its lowest levels of the day by Tuesday lunchtime as investors were cautious about building positions ahead of some pivotal US economic data this afternoon and a policy decision in Europe later this week.
"Overall, volumes remain thin, with no strong leads as the US was closed for a public holiday yesterday - investors here in Europe are sitting on their hands in a 'wait and see mode', as they don't want to get caught in the event of the European Central Bank [ECB] failing to deliver on a policy that would ease tensions in the debt markets," said ETX Capital market strategist Ishaq Siddiqi.
ECB President Mario Draghi is widely expected to unveil plans on Thursday for buying sovereign debt in order to bring down bond yields in peripheral nations.
Investors were also nervous about some manufacturing data due out Stateside this afternoon. The US ISM manufacturing index is expected to improve from 49.8 last month to 50.0, the level that separates expansion and contraction. A better-than-expected figure may ease the Federal Reserve's concerns about the economy, disrupting hopes that the central bank will launch another round of quantitative easing at its meeting next week.
Meanwhile, credit ratings agency Moody's last night maintained the European Union's 'Aaa' rating but lowered its outlook for the region from 'stable' to 'negative' to reflect "the negative outlooks now assigned to the Aaa sovereign ratings of key contributors to the EU budget: Germany, France, the UK and the Netherlands, which together account for around 45% of the EU's budget revenue".
FTSE 100: Blue chips hit by negative broker commentary
Steel giant Evraz was among the worst performers of the day after Credit Suisse said that downward trend in iron ore and coal prices last week "goes in line with our view that risk for profitability of integrated producers and bulk miners (NLMK, Mechel, NWR, Kumba, Evraz, Severstal) is on the downside." The broker maintained a 'neutral' stance on Evraz today.
Telecoms group Vodafone declined after being downgraded by Bernstein from 'outperform' to 'market perform' on the back of "an increasing number of negative risks".
Real estate investment trust (REIT) Land Securities was a heavy faller after both JP Morgan Cazenove and UBS downgraded their ratings on the stock to 'neutral' this morning. UBS said that the Land Secs' valuation reflects "fair value after a strong run". UBS also cut its recommendation for REIT peers British Land and SEGRO today.
Banking group Royal Bank of Scotland (RBS) was lower as the threat of a bruising legal battle with angry shareholders continues to hang over the company. Investec this morning lowered its recommendation on the shares from 'buy' to 'hold', saying that "after another modest rally, we throw in the towel".
In contrast, oilfield services group Petrofac was performing well after Credit Suisse upped its rating from 'neutral' to 'outperform'. "We believe the stock has performed poorly on a lack of project awards over the summer period and elevated expectations for the IES business. We believe the next few months will be better: awards should step up, thanks to less instability in the Middle East, and the payoff of extensive marketing efforts in southeast Asia and amongst oil majors," the broker said.
FTSE 250: Ashtead leads risers after upping guidance
High-flying plant hire firm Ashtead jumped after raising profits guidance again as its new financial year got off to a strong start. "Given this early stage of the recovery, we see further outperformance from re-rating as well as scope for further positive earnings surprises," said analyst Andrew Nussey from Peel Hunt.
Veterinary pharmaceuticals firm Dechra rose after revealing growing sales across all its major brands and profits ahead of market forecasts for the full year to the end of June.
Recycled packing company DS Smith was in demand after saying it was trading in line with market expectations and expected substantial year-on-year growth in earnings per share.
Also on the rise was Old Speckled Hen brewer Greene King which shrugged off the Olympics and the poor weather to make a robust start to the financial year.
FTSE 100 - Risers
Petrofac Ltd. (PFC) 1,536.00p +1.32%
Pennon Group (PNN) 741.00p +0.68%
Capita (CPI) 726.00p +0.35%
BT Group (BT.A) 223.10p +0.27%
Schroders (SDR) 1,433.00p +0.07%
Serco Group (SRP) 568.50p 0.00%
Resolution Ltd. (RSL) 214.50p -0.05%
Diageo (DGE) 1,750.00p -0.06%
Morrison (Wm) Supermarkets (MRW) 278.00p -0.07%
Reed Elsevier (REL) 598.00p -0.17%
FTSE 100 - Fallers
Evraz (EVR) 220.50p -2.82%
Land Securities Group (LAND) 775.50p -2.27%
Vodafone Group (VOD) 179.05p -2.27%
Xstrata (XTA) 926.00p -2.24%
Rio Tinto (RIO) 2,735.00p -2.16%
Burberry Group (BRBY) 1,326.00p -2.14%
Standard Chartered (STAN) 1,361.00p -2.09%
WPP (WPP) 805.00p -2.07%
British American Tobacco (BATS) 3,265.00p -2.05%
Aggreko (AGK) 2,290.00p -2.01%
FTSE 250 - Risers
Ashtead Group (AHT) 314.60p +11.36%
Heritage Oil (HOIL) 198.90p +4.63%
Greene King (GNK) 583.50p +3.55%
Smith (DS) (SMDS) 167.10p +3.15%
Ophir Energy (OPHR) 603.00p +2.90%
Dixons Retail (DXNS) 18.59p +2.71%
Menzies(John) (MNZS) 626.50p +2.12%
Hansteen Holdings (HSTN) 77.20p +1.78%
Drax Group (DRX) 487.70p +1.75%
SIG (SHI) 101.80p +1.70%
FTSE 250 - Fallers
Bumi (BUMI) 286.10p -5.64%
Talvivaara Mining Company (TALV) 133.80p -4.43%
Taylor Wimpey (TW.) 51.40p -3.47%
Gem Diamonds Ltd. (DI) (GEMD) 160.30p -2.91%
Genus (GNS) 1,336.00p -2.84%
Fenner (FENR) 349.40p -2.84%
Centamin (DI) (CEY) 81.20p -2.46%
Bodycote (BOY) 346.30p -2.20%
Domino's Pizza Group (DOM) 533.00p -2.20%
Ruspetro (RPO) 123.40p -2.06%
WHAT THE BROKERS SAY
FREE SHARE TIP OF THE DAY
from top chartist Zak Mir of Zaks-TA.com
Centamin Egypt (CEY) We have a very promising reversal in the form of Centamin Egypt (CEY). Here the stock has finally cracked a troublesome resistance zone at and just above 70p from June and July. This point is emphasised by the way that a March resistance line at 75p was last week's intraday support. The easy message is that while there is no end of day close back below this level the upside for Centamin looks to be through 90p as an measured move from the June / July bear trap rebound. Clearly, the longer the shares remain above the black 200 day moving average at 77p the better to start September.
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THE LATEST ON THE CRAZY BOARD
The top 5 hot company threads on the Bulletin Board:
Falkland Oil & Gas -
Xcite Energy
Exillon Energy
Greka Drilling
Running trading thread
Click here to discuss shares with other ShareCrazy members
BOOK OF THE WEEK
By Rodney Hobson
A book review by Luka Lukic of t1ps.com
In this book Rodney Hobson aims to provide a straight forward introduction into the world of portfolio management and best practices to employ when selecting what you want to invest in. Thankfully it doesn't pretend to offer a guaranteed, one size fits all, scheme to become a millionaire, but instead attempts to compel the reader to assess what they wants to get out of their investment and then provides guidance to that end.
The book aims to explain the different behaviours of the various market sectors, and the importance of not only holding a range of shares, but diversifying them throughout the sectors to ensure a proper hedge. It also walks the reader logically through a range of factors than can, and most likely will, affect the share price and gives case studies to demonstrate the impact on real companies.
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