Monday's Stock Market Report from UK-Analyst: featuring Centrica, HSBC, Telecity, Ultrasis and Eckoh

From UK-Analyst.com: Monday 4th November 2013 The Markets UK construction grew at the quickest rate since 2007 according to new data released today. The Markit/CIPS construction purchasing managers' index rose to 59.4 in October, up from 58.9 in September, edging even further away from the 50 mark which separates contraction and expansion. The figures mark the latest in a succession of positive numbers on the UK economy and come after a strong reading for the UK manufacturing sector on Friday. Markit economist Tim Moore commented: "UK construction output continues to rise like a phoenix from the ashes, with housing, commercial and civil engineering activity all seeing strong rates of expansion at the start of the fourth quarter." The Instistute of Chartered Accountants in England and Wales (ICAEW) predicts that the UK economy is set to grow by 1.3% in the final three months of 2013 and goes as far as to say that the UK will pave the way in Europe in terms of growth next year. The ICAEW explained that its estimates are fuelled by the fact that confidence amongst UK businesses is at its highest level for the 10 years. Michael Izza, chief executive of ICAEW, said: "This quarter's report shows that the UK economic recovery is well underway. If it continues at this rate, the UK economy will be one of the fastest growing economies in the western world going into 2014." ADVERTISEMENT Interested in trading forex? Join us at our free educational seminar on Friday 1st November For more information CLICK HERE At the London close the Dow Jones was down by 24.91 points at 15,590.64 and the Nasdaq was down by 3.91 points to 3,375.85. In London the FTSE 100 closed up by 28.88 points at 6,763.62 and the FTSE 250 was up by 47.37 points to 15,503.06. The FTSE All-Share inched up by 15.27 points to 3.601.26 while the FTSE AIM Index grew by 1.87 points at 812.91. Broker Notes Westhouse Securities lowered its "add" recommendation to a "hold" stance on broadcaster BSkyB (BSY), leaving its target price unchanged at 985p. The broker notes that the shares are up by 16% since it initiated coverage back in May and are 8% higher since the company published its third-quarter results earlier this month. On this basis, Westhouse feels that now is a perfect time for investors to hold the stock rather than add any more to their portfolios. The shares inched up by 0.5p to 943.5p. Canaccord Genuity downgraded its recommendation from "buy" to "hold" for asset management firm Polar Capital (POLR), leaving its target price frozen at 550p per share. Although the broker admits that Polar's 4% dividend yield represents an enticing feature for would-be investors, the broker is cautious given the fact that the shares rose by just under 16% in October alone. The shares were up by 9p to 514p. Investec cut its "add" recommendation to "reduce" on British Gas Owner Centrica (CNA), cutting its target price from 375p to 325p. The Investment Bank - which is now sceptical on the UK energy industry as a whole - feels that it is right that forecasts should now reflect the increased level of political risk in terms of the implicit cost of capital of the sector. The shares crept upwards by 0.3p to 355.1p. Blue Chips Engineering firm Weir Group (WEIR) warned that full-year profits would likely come in at around 413 million pounds, well down on the 446 million pounds which had been previously expected. The company - which predominately works within the energy sector - attributed the downgrade to delays to certain mining projects and slower than expected conditions in the oil and gas sector. The update comes after HSBC retained its "neutral" recommendation on the shares last week. The shares slipped by 83p to 2,173p. On the subject of HSBC (HSBA), the bank today revealed that it generated a 10% increase in underlying pre-tax profits to $5,056 million (3,168 million pounds) over the three months ended 30th September. The largest bank on the FTSE 100 by market capitalisation attributed the improvement to a pick-up in both the UK and Hong Kong, the latter of which benefited from its close economic relationship with mainland China. Looking ahead, the bank maintained that it is in a good position to capitalise on improving market conditions within the markets it operates. The shares increased by 15.7p to 703p. Mining giant Anglo American (AAL) confirmed that it has completed the sale of its Amapa iron ore operation to fellow mining company Zamin Ferrous for an initial cash consideration of $134 million (84.09 million pounds). Zamin will go on to pay a further $130 million (81.46 million pounds) over the next 5 years. Anglo said that it would use these proceeds to pay down debt. The update comes after Deutsche Bank retained its "buy" recommendation and 1,780p target last week. The shares swelled by 34.5p to 1,494.5p. Mid Caps Insurance Group Hiscox (HSX) saw its UK gross written premiums increase by 10.5% to 312.8 million pounds over the first nine months of the year. The firm was quick to stress that it has also benefited from a low level of catastrophe and attritional losses and that it does not expect to suffer "material losses" in relation to the recent St Jude storm which battered the south of England. On a forward looking basis, Hiscox argued that its product and geographic diversity holds it in good stead to perform well in 2014 and beyond. The shares were up by 2.5p to 676p. Data centre firm Telecity (TCY) claimed that it is in line to meet full year expectations after it performed particularly well over the third quarter of 2013. The company - which provides data services to large institutions - said that its products and services had gained particular traction in the European cities of Amsterdam and Dublin. The update should provide some relief to a set of investors who are wary of industry conditions and slower than expected trading conditions in the European data hub of Frankfurt. The shares fell by 19.5p to 740p. Oil producer SOCO International (SIA) said that it has entered into an agreement with PA Resources Congo SA to farm-in to a 60% working interest in the Mer Profonde Sud permit, offshore the Republic of Congo. SOCO will assume a 60% working interest in the Mer Profonde Sud exploration area as operator and will drill an exploration well in the remaining licence period. Management argued that the move was a positive step for the company and stressed that it has recognised an untested prospect in a different structural setting from that already tested. The shares jumped by 2.5p to 403.6p. Small Caps Mental health specialist Ultrasis (ULT) revealed that it has won a second US contract for its "beating the blues" depression treatment in the space of three days. This latest agreement involves providing its product - a computerized congnitive behavioural therapy - to the California Institute for Mental Health. The deal follows a similar agreement with the Mental Health Association of Southeastern Pennsylvania which was announced on Friday. On both occasions the financial details of the agreements were not disclosed to the market. The shares surged by 0.14p 1.18p. Speech recognition technology developer Eckoh (ECK) revealed that it has secured a ten-year contract worth a minimum of 11 million pounds to provide "self-service applications" to a large tier 1 UK telecoms operator. The contract is the largest ever secured by Eckoh and management boasted that the contract win re-affirms its market leading position in providing complex speech recognition services. The shares were up by 2.13p to 26.62p. Clean energy firm Turbo Power Systems (TPS) posted a pre-tax loss of 200,000 pounds, for the third quarter of 2013, well lower than the 1.7 million pounds loss which was recorded in the prior year period. The improvement was driven by the stripping out of a large chunk of administrative costs coupled with the fact that the firm's year-to-date order intake increased 282% to 14.6 million pounds. The shares were ticked upwards by 0.03p to 0.58p. ADVERTISEMENT Get free trading guides from Evil Knievil (How to successfully short stocks), Zak Mir (Top AIM market picks for 2013) and other top financial commentators by CLICKING HERE Investment firm Tavistock Investments (TAVI) revealed that it has raised 230,000 pounds before expenses by placing just under 330 million shares at 0.07 pence per share. The 0.07 pence placing price represents a 50% discount to Friday's closing price of 0.14 pence per share. Tavistock explained that the proceeds would be used for for ongoing working capital and to meet the costs of due diligence on potential investments and acquisitions. The shares plummeted by 0.058p to 0.088p. Software firm Grafenia (GRA) reported pre-tax profits of 0.31 million pounds for the six month period ended 30th September, down 11% on the prior-year period as revenues slid by 4.4% to 10.08 million pounds. The company blamed the deterioration on the delay of shifting its business model to capitalise on the growing stature of the SaaS market as the company looks to become less reliant on the sale of printing. The shares dropped by 1.25p to 19.75p. Biome Technologies (BIOM), a bioplastics technology specialist, conceded that revenues generated within its radio frequency technologies division are likely to come in below expectations. Biome explained that this shortfall is due to subdued demand in the optical fibre furnace market in Asia. However, management maintained that this shortfall in anticipated revenues has been largely offset by continued cost reductions including the termination of the leases of the surplus buildings in May this year. The shares slid by 18.5p to 162.5p.

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