From UK-Analyst.com: Thursday 17th January 2013
The Markets Against the backdrop of a deep slump in European vehicle sales, car production in the UK hit a four-year high in 2012, with car exports at their highest ever level. According to the Society of Motor Manufacturers and Traders (SMMT) production levels were up by 9% to 1.46 million while exports were up by 8% to 1.21 million. Head of the SMMT, Paul Everitt commented, "the outlook for 2013 remains positive, with demand in many faster-growing global markets offsetting the continued weakness in European markets." Over In the US, investment banks JP Morgan and Goldman Sachs were able to defy uncertain market conditions and book record levels of profits for the final quarter of 2012. Net profits at Goldman Sachs trebled to 1.8 billion pounds over the last three months of the year while JP Morgan posted a 54% increase in profits to 3.6 billion pounds over the same period. The increases were attributed to a boom in debt underwriting and strong cost controls. Glen Schorr at Nomura Asset Management said, "The fourth quarter reminds us a little of the old days and should give investors confidence in Goldman's future earnings power." Staying in the US, energy giant BP has forecast that the country will become virtually self-sufficient by 2030, boosted by an increase in shale oil and slowing international demand. BP went on to say that the rapid growth of unconventional energy sources would redraw the global energy landscape. It commented, "Strong growth in production from unconventional sources of gas and oil will have a major impact on global energy markets to 2030, redefining expectations for major economies and rebalancing global trade flows."
At the London close the Dow Jones was up by 66.26 points at 13,577 and the Nasdaq grew by 13.17 points to 2,747.90. In London the FTSE 100 increased by 28.38 points to 6,132.36; the FTSE 250 finished 83.97 points up at 12,847.61; the FTSE All-Share gained 15.74 points to 3,216.23; and the FTSE AIM Index crept up by 2.27 points to 737.53..  Broker Notes Canaccord Genuity maintained its "buy" stance on Premier Oil (PMO) with a target price of 475p. The broker believes that the exploration company's recent trading statement indicates steady progress against its estimates and is of the opinion that the company's portfolio continues to offer a visible six year production growth profile backed by existing assets. Furthermore, the shares trade at a 28% discount to Canaccord's valuation of the company. The shares fell by 4.8p to 366.4p. Seymour Pierce reiterated its "sell" stance on retailer Mothercare (MTC) with a 200p target price. The broker acknowledges that the recent 12.9% fall in total sales in the UK can be attributed to its store closure programme but is more cautious on the fact that like-for-like sales fell by 5.9% over the 13 weeks ended 12th January. Seymour Pierce went on to say that Mothercare is out of touch with the modern mother and will continue to find it hard to compete against Amazon and the supermarkets. The shares gained 4.25p to 308.5p. Shore Capital reiterated its "buy" recommendation on Marks & Spencer (MKS) on the back of what it sees as promising Christmas period results. The broker is impressed with the 7.3% increase in sales and believes this will result in a good follow through period well into the new year. The broker does acknowledge that Marks' has some work to do in its General Merchandise division but welcomes the significant gain in market share the food division has made. The shares crept up by 1.8p to 362.8p. 
Blue-Chips Associated British Foods (ABF) reported a 10% increase in group revenues for the 16 weeks ended 5th January, driven by a strong performance by Primark. The budget fashion retailer's growth was built on a substantial increase in retail selling space as well as a good growth in like-for-like sales, a combination which allowed it to deliver a 25% increase in sales on last year. In addition, the group's sugar-sourced revenues were 12% ahead of the previous year, admittedly boosted by abnormally low levels of sugar revenues achieved in 2011. The shares were up by 1.8p at 362.8p. Investment group Aberdeen Asset Management (ADN) increased its funds under management by 3.3% to 193.4 billion pounds in the three months ended 31st December. This increase was helped by an acceleration of inflows into its emerging market debt funds where assets under management grew by 1 billion pounds to 5.5 billion pounds. The company went on to warn that although global stock markets have picked up at the start of this year, uncertainty still persists in the markets which could lead to periods of volatility. The shares decreased by 6.7p to 385p. 
Tom Albanese, Chief Executive Officer of mining giant Rio Tinto (RIO) has stepped down from his position on the back of a 9 billion pounds write down of assets following a string of bad deals. The final straw for the Chief Exec came in the form of a 2 billion pounds write down on Rio Tinto Coal Mozambique, which wiped off most of the value placed on the coal mines which it purchased in the country under 2 years ago. Sam Walsh, head of Iron Ore, will now succeed Albanese as Group CEO. The shares were down by 18.5p at 3,439.5p. Mid Caps Dixons Retail (DXNS) revealed a 7% increase in like-for-like sales for the 12 weeks ended 5th January, boosted by a gain in market share after the demise of competitor Comet. The group traded robustly in the UK and Northern Europe, with sales growth of 8% and 11% respectively, helping the firm to achieve its target underlying pre-tax profit figure of between 75 million pounds and 85 million pounds. The shares crept up by 0.14p to 27.25p. Argos and Homebase owner Home Retail Group (HOME) reported a mixed set of trading results for the 18 weeks ended 5th January, with its two core businesses trading with different fortunes. Sales at Argos grew by 1.7% to 1,744 million pounds over the 18 weeks ended 5th January driven by a strong growth in tablets and white goods which more than offset a poorer performance in homeware and jewellery. However, sales at Homebase fell by 4.5% to 453 million pounds driven by three store closures. The shares soared by 15.1p to 136.6p. 
Russian gold producer Petropavlovsk (POG) announced a 2012 gold production level of 710,400 ounces, a 13% year-on-year increase and ahead of previous guidance of 700,000 oz. The group was also able to realise an average gold sales price of $1,670/oz, up by 3% on the previous year and hiked its 2013 gold production guidence to a level between 740,000 oz and 780,000 oz. The shares climbed by 32.9p to 403.3p. Small Caps & AIM Online fashion retailer Asos (ASC) announced a 41% hike in retail sales to 78 million pounds in December driven by strong international growth. This growth was comprised of a 47% increase in international sales and a 34% uplift in UK revenues as the website improved traffic conversion and re-aligned its proposition and pricing philosophy to suit its target market. The group, which also announced a 40% year-on-year increase in customers to 5.6 million, was positive on the outlook and believes 2013 will be another successful year. The shares gained 46p to 2,700p. Recruitment firm Empresaria (EMR) revealed in a trading update that 2012 profitability levels will be in line with current market expectations. The group stressed that it performed well in Asia and Chile and also exhibited a resilient performance in the UK. However, the group again acknowledged that its re-structuring programme in Germany has resulted in some exceptional costs which will result in lower full year profits than the previous year, in a decline which the market was expecting. The shares soared by 6.5p to 27.5p. Offshore waste specialist Nature Group (NGR) announced that its subsidiary, nature oil and gas, has secured a contract to deploy a Compact Treatment Unit (CTU) to Tanzania in a deal worth a minimum of 1 million dollars (626,000 pounds). The CTU will be used to treat a substantial volume of offshore waste that is currently being stored onshore from previous drilling campaigns, cleaning the water to meet the local discharge criteria. The shares rose by 3p to 24p. Software services company SQS Software Company (SQS) has revealed that revenues will be slightly ahead of market expectations due to an increase in services delivered by its contractors. However, the group has warned that adjusted pre-tax profits will be lower than expectations as some larger clients chose to suspend their extended engagements as they did not want to exceed their minimum contract spend obligation. The shares plummeted by 32.5p to 256.5p. 
Recruitment and technology services firm Rethink Group (RTG) has announced the group's CEO, Jon Butterfield, has stepped down with immediate effect. Butterfield's interim replacement will be Steve Wright, who will move over from his CFO position. Other shuffles in the board include Andrew Lord, MD of the recruitment division, being appointed as COO of the group with immediate effect. The shares were down by 0.55p at 7.45p. Online market researcher Brainjuicer (BJU) confirmed that trading in the last few months of 2012 was "disappointing", in what is normally a strong period for the group. Although year on year revenues for the first 10 months of the year to October was up by 11% this was followed by a sharp 25% year on year decline in revenues for the final two months of the year. Pre-tax profits are now expected to be approximately 1.5 million pounds, a figure well below last year's level of 2.8 million pounds. The shares lost 12.5p to 206.5p. Low cost African airline Fastjet (FJET) announced it has launched a mobile payment product with Tanzania's leading telephone operator Vodacom which will allow customers to buy Fastjet tickets using their mobile phones. This new agreement will give 9 million subscribers the option to buy tickets using this technology. Separately, the firm will soon finalise plans to extend its current routes to encompass Entebbe in Uganda, Johannesburg in South Africa and Moroni in the Comoros Islands. The shares slipped by 0.05p to 4.125p. | 
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