Wednesday 21 November 2012
QUOTE OF THE DAY
If all the rich people in the world divided up their money among themselves there wouldn't be enough to go around
- Christina Stead
THIS MORNING IN LONDON
FTSE 100
5,741.83
-6.27 -0.11%
FTSE 250
11,765.03
-55.80 -0.47%
FTSE 350
3,063.62
-4.84 -0.16%
FTSE All Share
2,999.98
-4.54 -0.15%
AIM 100
3,082.05
20.33 0.66%
AIM All Share
687.13
2.55 0.37%
12:21 pm
Stocks pare losses but market cautious
- Eurogroup delays Greek aid
- MPC minutes show 8-to-1 vote in favour of maintaining QE
- Johnson Matthey and Compass lower after results
UK stocks had trimmed losses by Wednesday lunchtime but was trading within a narrow range as investors remain cautious following an inconclusive meeting of Eurozone finance ministers about Greece last night.
The Eurogroup was unable to thrash out an agreement on how to finance a two-year extension in Greece's commitments. "I don't know when [the aid disbursements] will happen," said Eurogroup head Jean-Claude Juncker after the meeting in Brussels. "Greece has delivered, now it is up to us."
While some of the country's lenders - such as Germany, the Netherlands and Finland (the other Troika) - are willing to consider a temporary suspension of interest payments, they refuse to put more money on the table.
"The inability to agree on some of the finer details regarding the deal indicate a much more wide-ranging and long term solution than was first expected by investors and Greek politicians alike," said research analyst Joshua Mahony from Alpari.
"The ability to pass austerity measures and a new 2013 budget were seen as the two stumbling blocks with which the Greek parliament had to pass in order to receive this required funding. Yet it is clear that a number of further measures are being brought to the table to accompany this."
The FTSE 100 was swinging between gains and losses for most of the morning session, while most other benchmarks across Europe were moderately in positive territory. Stateside, stock futures were pointing to a flat start on Wall Street with volumes expected to remain low as investors await a barrage of economic data ahead of the Thanksgiving holiday tomorrow.
MPC voted 8-to-1 in favour of keeping QE unchanged
The minutes of the latest Monetary Policy Committee (MPC) meeting came out this morning, showing that eight of the nine members voted to maintain the size of its asset purchases at £375bn.
Barclays Research analyst Chris Crowe said that the minutes were supportive of the current stance: "standing back from further stimulus for the time being, but ready to do more if the economy continues to disappoint."
In other domestic news, UK public sector net borrowing came in at £8.6bn last month, up from £5.9bn in October 2011, according to the Office for National Statistics. The consensus estimate was for net borrowing to the tune of £6bn.
FTSE 100: Johnson Matthey sinks after cautious outlook
Platinum refiner Johnson Matthey was a heavy faller after reporting a 6% drop in pre-tax profits in the first half and saying that it doesn't expect things to pick up in the latter part of the fiscal year.
Chief Executive Neil Carson said: "Whilst precious metal prices have improved from their lows during the summer, largely due to the labour unrest in South Africa, the outlook in some of our other markets has weakened and visibility remains limited. We therefore expect that the group's performance in the second half will be similar to the first half of the year."
Contract caterer Compass sank early on but had pared losses by lunchtime following the announcement of its full-year results. The company saw profits break through the billion-pound barrier in the 12 months to the end of September though it did caution about the challenging economic environment in Europe.
Heading the other way was United Utilities after water industry regulator Ofwat clarified proposed changes to water companies' licences. "The softening of Ofwat's stance on a Competition Commission referral reduces the near-term risk of negative newsflow," said analysts at JPMorgan Chase & Co. Sector peer Pennon was also in demand.
Real estate peers Land Securities and British land were high risers this morning after Morgan Stanley upgraded its ratings on the stocks to 'overweight'. Meanwhile, the same broker lifted its recommendation for banking group Lloyds to 'equal weight', providing a lift to shares.
Xstrata and Glencore continued to rise after shareholders yesterday voted in favour of their propped merger. The Financial Times reported this morning that the tie-up is expected to win the approval from the European Commission this week, citing people involved in the process.
FTSE 250: Talvivaara to restart production in Finland
Nickel miner Talvivaara Mining rose after announcing that it has received a permit to restart the metals recovery plant at its Sotkamo nickel mine and expects full production to resume by November 25th. Production had been temporarily suspended since November 4th following a gypsum pond leak at the mine.
Sports apparel group JD Sports Fashion was higher after seeing like-for-like sales growth pick up slightly in the third quarter despite seeing what it labelled as a "tough" environment.
Imagination Technologies has said that it has become aware that MIPS Technologies, a US computing company which Imagination is set to acquire, has received an unsolicited proposal from CEVA to acquire all of its outstanding shares. Shares tanked early on.
Car and bike parts retailer Halfords dropped after saying that full-year profits will be slightly below consensus estimates.
FTSE 100 - Risers
United Utilities Group (UU.) 674.50p +2.35%
British Land Co (BLND) 523.50p +1.65%
Xstrata (XTA) 1,001.00p +1.46%
Severn Trent (SVT) 1,569.00p +1.42%
Aviva (AV.) 339.90p +1.40%
Glencore International (GLEN) 336.35p +1.39%
Land Securities Group (LAND) 787.50p +1.35%
ARM Holdings (ARM) 734.50p +1.10%
BG Group (BG.) 1,042.00p +1.07%
Pennon Group (PNN) 609.50p +0.91%
FTSE 100 - Fallers
Johnson Matthey (JMAT) 2,177.00p -6.37%
Vedanta Resources (VED) 1,058.00p -2.31%
Randgold Resources Ltd. (RRS) 6,545.00p -1.87%
Eurasian Natural Resources Corp. (ENRC) 270.40p -1.67%
Fresnillo (FRES) 1,947.00p -1.67%
Kingfisher (KGF) 273.30p -1.66%
Vodafone Group (VOD) 159.60p -1.66%
Evraz (EVR) 227.00p -1.35%
Pearson (PSON) 1,181.00p -1.25%
Rio Tinto (RIO) 2,990.50p -1.24%
FTSE 250 - Risers
Talvivaara Mining Company (TALV) 109.30p +3.41%
JD Sports Fashion (JD.) 730.00p +2.82%
Bumi (BUMI) 275.00p +2.69%
Pace (PIC) 181.10p +1.86%
Telecom Plus (TEP) 877.00p +1.62%
Ted Baker (TED) 969.50p +1.62%
Hansteen Holdings (HSTN) 76.50p +1.32%
Heritage Oil (HOIL) 193.30p +1.20%
PayPoint (PAY) 855.00p +1.18%
Fidessa Group (FDSA) 1,375.00p +1.18%
FTSE 250 - Fallers
Lonmin (LMI) 285.00p -8.27%
Halfords Group (HFD) 325.10p -5.77%
Paragon Group Of Companies (PAG) 232.50p -3.41%
New World Resources A Shares (NWR) 227.10p -3.36%
IP Group (IPO) 109.50p -2.93%
NMC Health (NMC) 172.00p -2.82%
Micro Focus International (MCRO) 570.00p -2.73%
Imagination Technologies Group (IMG) 429.10p -2.65%
HICL Infrastructure Company Ltd (HICL) 122.00p -2.48%
Oxford Instruments (OXIG) 1,300.00p -2.40%
TODAY'S TIP ON SHARECRAZY
WANdisco - Acquisition speeds-up Big Data Entrance
A report by GECR
- In a move to enhance and accelerate its ability to develop new products in the Big Data market, WANdisco has acquired AltoStor, a Silicon Valley based software company with deep expertise in the Big Data market, for a total consideration of $5.1 million.
- We now expect the provider of global collaboration software to launch its first Enterprise ready Big Data product in H1 FY2013 (we initially anticipated that this will happen in H1 FY2014), and have amended our forecasts accordingly.
- With the lucrative Big Data market representing a significant, long-term growth opportunity for the company (Wikibon estimates that the Big Data market will grow to more than $50 billion by 2017), our recommendation remains as speculative buy.
Click here to view the full article
WHAT THE BROKERS SAY
British Land: Morgan Stanley raises target price from 540p to 570p and upgrades to overweight. Jefferies raises target price from 554p to 561p, hold recommendation maintained.
Serco Group: Oriel Securities upgrades to hold with a target price of 500p.
Click here for the rest of the broker recommendations
THE LATEST ON THE CRAZY BOARD
The top 5 hot company threads on the Bulletin Board:
Porta Communications
Centamin
Enterprise Inns
Easyjet
The Running Trading Thread
Click here to discuss shares with other ShareCrazy members
BOOK OF THE WEEK
By Niall Ferguson
A book review by James Faulkner of WatsHot.com
One could be forgiven for lifting an eyebrow at the title of Niall Ferguson's book (and television series) exploring the development of global finance - surely a more apposite title given the current climate would be The Descent of Money, or something along those lines? But the really great thing about historians is that they take a much more eclectic and measured view of present circumstances than most of us can afford by the very nature of our own professions and preoccupations. The recent G20 Summit in London demonstrated how angry many people are at their own financial plight, the apparent greed of bankers and financiers, and the great gulf between the haves, the have-nots and the 'have-yachts' as Ferguson puts it. Yet Ferguson shows us that the problems of today aren't products of the financial system itself, rather they are the products of our own tendency to lurch from irrational exuberance to excessive pessimism.
Click here to view the rest of the article
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