| From UK-Analyst.com: Friday 10th May 2013
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The Markets The UK goods trade deficit narrowed to 9.056 billion pounds in March, down from 9.165 billion pounds in February - a slight improvement consistent with analyst expectations. The numbers from the Office For National Statistics also revealed that the goods trade deficit with non-EU countries shrunk to 3.470 billion pounds from 4.208 billion pounds in February, confounding analyst forecasts for an increase to a 4.1 billion pound deficit. Looking ahead, it is thought that British exports may rise as a result of a weakening of the pound. Chris Williamson at Markit said, "Official data and surveys paint an encouraging picture of the UK gaining market share in overseas markets, suggesting the economy is showing signs of rebalancing away from domestic consumption to export-led growth." Another data release from the Office for National Statistics showed that construction output in the UK was down by 2.4% over the first three months of the year. The contraction - which marks the steepest quarterly fall since the last three months of 1998 - is being attributed to a distinct lack of new work, combined with the disruptive bad weather. The amount of new housing work available in the public sector was particularly subdued and suffered a 4.1% decline over the period, while housing repair and maintenance work by public organisations also declined by 3.2%. Jens Larsen, Chief European Economist at RBC Capital Markets in London commented, "Construction has been one of the weakest parts of the economy. Looking ahead, it has the potential to recover, but it really does depend on the government initiatives coming on stream." Elsewhere, G7 finance ministers met to discuss prominent economic issues including banking reform and the aftermath of the Cyprus bailout, as the leaders attempt to outline a strategy to accelerate an economic recovery. The meeting comes on a day which has seen the US warn Japan that it should stick to the "ground rules" in any measures it employs to stimulate its economy to avoid currency devaluations. George Osborne, who is chairing the talks, explained that the meeting was, "an opportunity to consider what more monetary activism can do to support the recovery, while ensuring medium-term inflation expectations remain anchored." 
At the London close the Dow Jones was down by 0.19 points at 15,082.43 and the Nasdaq was 7.36 points higher at 2,968.48. In London the FTSE 100 grew by 32.24 points to 6,624.98; the FTSE 250 finished 34.04 points higher at 14,315.66; the FTSE All-Share swelled by 12.51 points to 3,486.50; and the FTSE AIM Index inched up by 0.66 points to 717.63.  Broker Notes Panmure Gordon again re-iterated its "sell" stance on cinema operator Cineworld (CINE) with a 238p target price. The broker continues to question the medium-term strategy of opening 30 additional multiplexes when industry admissions have essentially been flat for the last four years. Furthermore, Panmure believes that the group is becoming increasingly reliant on on lower-margin blockbuster movies in a structural fault that will see the group struggle in the medium/long term. The shares inched up by 4p to 314.75p. Shore Capital retained its "sell" recommendation on insurance group Direct Line (DLG) with a 198p target price. The broker's concerns for the stock are centered on the plethora of regulatory and other issues that currently surround the industry including the Competition Commission investigation, gender pricing, periodic payment orders and telematics. On this basis Shore Capital sees the stock as fundamentally overvalued given the real risk of the need to change its business model to combat the aforementioned factors. The shares edged up by 1.9p to 200.5p. Cantor Fitzgerald maintained its "buy" stance on iron producer Ferrexpo (FXPO) with a target price of 196.1p. The broker is impressed with the group's Q1 update which insists that the company is on track to achieve its previous full year production guidance of 11Mt of high grade iron. Moreover, Ferrexpo continues to trade at a discount to Cantor's NPV calculation and the broker feels that this, coupled with managements' tight cost control, makes Ferrexpo a stand out investment proposition. The shares slid by 1.5p to 194.6p.
Blue-Chips Airline operator International Consolidated Airlines Group (IAG) recorded an operating loss of 278 million euros (234.7 million pounds) for the first three months of 2013, up on last year's loss of 249 million euros (210.3 million pounds) . This widening of losses was primarily due to restructuring costs of 311 million euros (262.6 million pounds) in relation to the reorganisation of Spanish airline Iberia. However, the group went on to confirm that it is trading in line with full year expectations and is on track to reduce group capacity by 1.8% by the end of the year. The update prompted analysts at Bank of America to retain their "buy" recommendation on the group with a 310p target price. The shares slipped by 4.6p to 275.9p. Communications giant BT Group (BT.A) revealed an 11% increase in pre-tax profits to 2.69 billion pounds for the year ended 31st March despite a 3% dip in underlying revenues. The company, which yesterday revealed it would offer free sports channels to broadband customers, said that its long-term investment programme will generate 3,000 jobs in the UK as it attempts to invest in the foundations for long-term growth. The shares climbed by 33.8p to 309.5p. Package holiday group TUI Travel (TT.) announced a 6% reduction in pre-tax losses to 346 million pounds for the six months ended 31st March 2013 despite a 1% dip in revenues to 5.3 billion pounds. The reduction in losses was attributed to a rise in average selling prices and margins against the backdrop off strong trading in the UK and Nordic markets. In a trend observed across all industries, online sales drove results higher, accounting for 42% of all sales in the UK and 68% of total sales in the Nordics. The shares were up by 6.3p at 346.9p. 
Mid Caps Asset manager F&C Asset Management (FCAM) revealed net outflows of 1.5 billion pounds over the first three months of 2013, impacted by the withdrawal of funds by "strategic partners". However, the group's assets under management grew by 3.6% to 98.8 billion pounds in an increase boosted by improved confidence in the markets, favourable foreign exchange trends and a good investment performance. The update did not change broker Jefferies stance on the company as it retained its "buy" recommendation on the shares, with a 135p target price. The shares fell by 3.35p to 97.45p. Materials group Morgan Advanced Materials (MGAM) claimed that it has been trading in line with expectations over the first four months of the year, with monthly order intake labelled as stable to marginally positive across all territories. The UK manufacturer of carbon and ceramic products went on to reveal that its plans to integrate its ceramics and engineered materials divisions into a single business as part of its " One Morgan" plan is on track. The shares increased by 15.8p to 287.7p. Gold miner Centamin (CEY) conceded that the recommendations made by the Egyptian State Commissioner's Office to the Supreme Administrative Court, regarding claims that Centamin has no legal right to the Sukari mine "were not positive". In response, the company argued that the recommendations "do not address the substantive merits of Centamin's appeal " and remained adamant that it will continue to defend its rights to the Sukari Gold Mine. The shares dived by 7.73p to 37.97p. Small Caps Health and community care specialist Ashley House (ASH) expects to record profits in line with expectations for the year ended 30th April - a year which has particularly benefitted from good traction in the group's new markets. Ashley House admits that the primary healthcare market remains difficult and, as a result, has pledged to continue to diversify revenues in order to safeguard its future. The shares jumped by 3p to 14.5p. Shares in Clear Leisure (CLP), the Italy based leisure asset owner, slipped by 0.25p to 4.375p on no news. However, UK-Analyst believes that the shares may be amongst the most undervalued on the whole of the London market, currently trading at a discount of 64% to net assets as at 31st December 2012. Xenetic Biosciences (XEN), the drug discovery company, revealed that it has successfully completed the initial safety trial for MyeloXen, a treatment for Multiple Sclerosis (MS). Having completed Phase I of the trial on six healthy volunteers without any adverse event, the company's Russian partner, Pharmsynthez, has now started Phase II of the trial with the aim of establishing safe dosage levels. The shares crept upwards by 0.875p to 7.5p. Ideagen (IDEA), the provider of compliance software, revealed that the second year of its contract with US Department of Veterans Affairs has been cancelled. The decision to terminate year two of the software contract was made for budgetary reasons and, according to Ideagen, the group had made "ample contingency within its business plan to ensure that any such cancellation would have minimal effect". Subsequently, Ideagen is adamant that the cancellation of the contract has no effect on market expectations for the current financial year. The shares fell by 1.5p to 21p. 
Miner Solgold (SOLG) revealed that it has appointed Alan Martin as CEO, with current CEO Nicholas Mather set to stay at the company as an Executive Director in a transitional phase over the next 12 to 24 months. Martin has a wealth of experience in the resources industry, having gained 20 years of technical, commercial and financial investment experience in the Australian mining arena. The shares were up by 0.025p at 1.45p. Tangiers Petroleum (TPET) has approved the final terms of its Farm-Out Agreement with CWH Resources Limited and Ansbachall Pty Limited in relation to two of its Australian exploration permits. The Farm-Out Agreement covers the permits WA-442-P and NT/P81, which are located in the southern Bonaparte Basin, 250 km south-west of Darwin. Under the terms of the deal, CWH will fund all costs and expenses associated with exploration drilling within the permit areas up to a cap of A$35 million (22.7 million pounds) . After this threshold, Tangiers will be required to pay 27% of the ongoing costs relating to exploration and operations. The shares gained 0.5p, finishing the day at 15.13p. Marketing services firm Hasgrove (HGV) posted pre-tax profits of 1.5 million pounds for 2012 after recording a loss of 0.7 million pounds in 2011 - a turnaround driven by a revenue hike of 9% to 24.9 million pounds. The group attributed this improvement to the improved operational structure of the business following the completion of the restructuring that began in 2011. Separately. the group confirmed that it intends to de-list its shares from the AIM market as it attempts to "focus its full attention on building the offerings and profitability of its current businesses". The shares ended the day 0.5p higher at 77p. | 
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