ADVFN III Morning Euro Markets Bulletin
Daily world financial news from Thomson Financial News Supplied by advfn.com
21 May 2008 09:52:31
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London
London shares up early on; commodities gain; FTSE 100 boosted by IFO
UK blue chips were higher early on, driven by strength among commodity stocks and given a fillip by better-than-expected IFO figures out of Germany, with weakness in Asia and Wall Street shrugged aside.
Investors are likely to be slightly cautious ahead of the release of the minutes from this month's Bank of England Monetary Policy Committee meeting.
At 9:09 a.m., the FTSE 100 index was 38.9 points ahead at 6,230.5, while the FTSE 250 index had added 20.2 points to 10,270.5.
"The German IFO is the kind of news the market is looking for at the moment after yesterday's sell-off," said Mic Mills of tradindex.com.
Overnight on Wall Street, the DJIA closed 199.48 points weaker at 12,828.68, while the S&P 500 index shed 13.23 points to 1,413.40 and the Nasdaq composite index dropped 23.83 points to 2,492.26.
U.S. stocks tumbled on Tuesday after oil prices spiked to a fresh record and stronger-than-expected wholesale inflation numbers, which look to have dashed many vague hopes of further U.S. rate cuts.
In Asia, the mood was mixed, with the Nikkei 225 index closing 233.79 points lower at 13,926.30, with the Hang Seng index turning higher, closing up 290.83 points at 25,460.29.
Centre stage on Wednesday's UK economics calendar are the minutes to the last meeting of the Bank of England's rate-setting Monetary Policy Committee, which are likely to show a fairly resounding 8-1 vote in favour of leaving interest rates on hold at 5.00 percent in May.
Arch-dove David Blanchflower is likely to be the only dissenter among MPC members in calling for a second successive cut in rates.
The U.S. Federal Reserve will also release on Wednesday minutes from its last FOMC meeting.
Back with UK equity movements, oil majors lent their considerable support to the FTSE 100 index, as oil stayed above $129 a barrel in Asian trade on Wednesday, driven by concerns over tight global supplies amid strong demand.
Royal Dutch Shell added 30 pence to 2,142 while BP was 10 pence firmer at 638. Tullow Oil, meanwhile, took on 22-1/2 pence to 956, while Cairn Energy was up 89 pence at 3,608.
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And mining issues were helped by firm metals prices. Vedanta Resources was the best off in the sector, adding 51 pence to 2,688, buoyed also by a UBS price target hike to 3,100 pence from 2,600 pence, with Kazakhmys climbing 31 pence to 1,823, Xstrata ticking up 26 pence to 4,183, BHP Billiton rising 23 pence to 2,046, and Rio Tinto 29 pence ahead at 6,625.
In M&A news, Tesco added 0.5 pence to 423.4, as the UK's largest retailer made a 1,200 pence a share cash offer for Dobbies Garden Centres. The supermarket giant, which already owns 65.5 percent of Dobbies, said its offer values the AIM-listed Edinburgh-based garden centre retailer at 124.5 million pounds.
Turning to the fallers, Wolseley lost half a penny to 535-3/4, after the plumbing and building materials distributor issued an interim trading update that Landsbanki said revealed growing pressure in the UK and Europe.
Meanwhile, the world's largest credit checking company Experian reversed initial gains made after reporting full-year figures that topped expectations, with London-based traders pointing out it refused to give a full-year forecast in a conference call.
The shares slipped nearly 2 percent, or 7-3/4 pence to 391, having risen over 2 percent in opening deals after FY numbers which Seymour Pierce said were ahead of expectations, buoyed by acquisitions, which offset the rapid slowing of growth in core markets.
On the second tier, Britvic gained in early deals as investors cheered the soft drinks producer's first-half results, which also showed improving growth trends in the early weeks of the second half, with Altium Securities reiterating its 'buy' recommendation. The shares added 8 pence to 332-1/2.
Meanwhile, Unite Group climbed 4 pence to 305-1/4 after announcing the planned sale of assets for 54 million pounds Wednesday, with Landsbanki offering support by repeating its 'buy' stance in reaction.
And QinetiQ took on 2 pence to 191, as HSBC initiated coverage on the defence contractor with an 'overweight' rating and 230 pence price target, saying it thinks near-term concerns in Europe, the Middle East and Africa mask a wealth of long-term growth opportunities.
Turning to casualties, there were a number of companies trading ex-dividend Wednesday, including Taylor Wimpey, down 11 pence at 110-1/2, Bellway 24-1/2 pence weaker at 665, Inchcape 12-1/4 pence lighter at 427-1/2, and WH Smith off 9 pence at 392-1/2.
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UK Diary of Events:
For a diary of key financial and corporate events in the UK today, click here
US Summary
For a summary of US stocks at yesterday's close of trade, click here
Milan
MILAN - Market data at 9.48 a.m.:
Main indices:
Mibtel at 25,485 points, down 0.07 percent
S&P/Mib at 33,084 points, down 0.10 percent
Main S&P/Mib losers
Unipol down 2.92 percent at 1.66 euros
Fiat down 1.79 percent at 14.97 euros. CEO Sergio Marchionne said Tuesday that the Italian car market was weak in May but that his group is maintaining its market share. According to dealers, Merrill Lynch has confirmed its 'buy' stance on the stock but cut the price objective to 18 euros from 21 euros
Buzzi Unicem down 1.45 percent at 18.83 euros
Mondadori down 1.33 percent at 4.9275
Impregilo down 1.27 percent at 4.42 euros. Wednesday prime minister Silvio Berlusconi will hold a first cabinet meeting in Naples that should also address the waste emergency. Impregilo currently has waste management facilities in the area, from which it plans to exit, which are being carried out under the supervision of a government appointed commissioner
Main S&P/Mib gainers
Seat Pagine Gialle up 1.83 percent at 0.1167 euros. Standard & Poor's Tuesday affirmed its 'BB' long-term corporate credit rating on the Italian directory publisher and kept it on negative outlook
Saipem up 1.45 percent at 30.11 euros
Eni up 1.15 percent at 26.45 euros
Pirelli up 0.99 percent at 0.5625 euros
Parmalat up 0.59 percent at 1.875 euros
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Paris
PARIS - Market data at 10:21 a.m.:
Major indices:
CAC-40 up 11.55 points or 0.23 percent at 5,066.43
SBF-80 up 18.82 points or 0.32 percent at 5,894.27
SBF-120 up 8.54 points or 0.24 percent at 3,678.12
20 CAC-40 stocks up
19 CAC-40 stocks down
1 CAC-40 stock unchanged
Major gainers:
Total up 0.93 euros or 1.63 percent at 57.88 after oil hit fresh record highs on Tuesday
Veolia Environnement up 0.59 or 1.28 percent at 46.73, and Sanofi-Aventis up 0.45 or 0.94 percent at 48.15, as defensive stocks outperformed.
Broadcasters TF1, up 0.69 or 4.95 percent at 14.63, and M6, up 0.43 or 2.85 percent at 15.50
Major losers:
Peugeot down 0.81 or 1.85 percent at 43.00, Renault down 0.80 or 1.19 percent at 66.15. In a review of the auto sector, Merrill Lynch stressed pressures on earnings due to higher material costs. The broker cut its targets for all its 'buy' recommendations in the sector, reducing its Renault target to 90 euros per share from 100.
Pernod Ricard, down 1.56 or 2.13 percent at 71.47
Theolia, down 0.97 or 4.17 percent at 22.29, after SG Securities downgraded the stock to 'sell' from 'hold' on valuation grounds, saying the speculative appeal of the renewable energy producer looks priced in at current levels.
Most active stocks:
Alcatel-Lucent, unchanged at 4.65; 2.7 million shares traded
France Telecom, up 0.13 or 0.65 percent at 20.17; 2.3 million shares
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Brussels
BRUSSELS - Market data at 10.01 am
Main index
Bel 20 down 3.29 points or 0.09 percent at 3,793.56
Bel 20 fallers
Nyrstar drops 0.13 euros or 0.93 percent to 13.90
Mobistar down 0.85 euros or 1.55 percent at 53.95
Fortis falls 0.14 euros or 0.84 percent to 16.56 after it said on Tuesday that it is in talks to take over Delta Lloyd's 51 percent stake in an insurance joint venture with ABN Amro. The full acquisition of the insurance the joint venture "should result in higher than expected revenue synergies from the ABN AMRO deal", says Bank Degroof's Ivan Lathouders.
Agfa-Gevaert loses 0.07 euros or 1.36 percent to 5.43
KBC 0.56 euro or 0.69 percent lower at 80.53
Dexia slides 0.06 euros or 0.37 percent to 16.04
Bel 20 gainers
UCB up 0.43 euros or 1.66 percent at 26.56 after it said fresh data reaffirms long-term effectiveness and safety of Cimzia in treating Crohn's disease
Omega Pharma gains 0.44 euros or 1.54 percent at 28.99
Suez up 0.32 euros or 0.71 percent at 45.56
Outside the Bel 20
Telenet adds 0.07 euros or 0.44 percent to 16.08; Liberty Global, which owns a 51.7 pct stake in the company and is its largest shareholder, has no plans to bid for Mobistar, says Liberty Global CEO Mike Fries in an interview with Belgian daily De Tijd
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Zurich
Swiss shares market data at 10:10 a.m.
Major Indices:
Swiss Market Index 7,609.03 points, down 17.55
Swiss Performance Index 6,401.35 points, down 4.25
Major losers:
Swatch down 4.50 or 1.5 percent at at 288.50, in line with a weak luxury goods sector
Richemont down 0.90 Swiss francs at 65.50, still affected by a Morgan Stanley downgrade on Tuesday
ABB down 1.12 at 32.32 francs on profit-taking
Major gainers:
Novartis up 0.40 at 54.90 francs, still benefiting from recent positive trial results
Forex
London 0741 GMT Hong Kong 0500 GMT
U.S. dollar
yen 103.29 up from 103.17
Swiss franc 1.0367 up from 1.0360
Euro
U.S. dollar 1.5656 down from 1.5665
yen 161.71 up from 161.62
Swiss franc 1.6232 up from 1.6227
pound 0.7965 up from 0.7955
Pound
U.S. dollar 1.9650 down from 1.9680
yen 202.97 up from 203.09
Swiss franc 2.0375 down from 2.0392
Australian dollar
U.S. dollar 0.9586 unchanged 0.9586
pound 0.4877 up from 0.4870
yen 99.03 up from 98.93
