ADVFN III Morning Euro Markets Bulletin
Daily world financial news from Thomson Financial News Supplied by advfn.com
28 May 2008 09:55:37
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London
London shares open higher; NY closes firmer; RBS, Friends Provident gains
London shares open firmer after Wall Street closed higher following a retreat in oil prices with positive broker comment helping shares in Royal Bank of Scotland, Friends Provident and WM Morrison gain.
At 8:52 a.m., the FTSE 100 index was 11.4 points higher at 6,069.9 after closing down 28.8 points at 6,058.5 on Tuesday, while the FTSE 250 index was off 19 points at 10,015.2.
"There has been a little bit of bounce today following oil having a weak day yesterday, although a couple of points have been knocked off by stocks going ex dividend," said Mark Priest, head of equity sales at Tradindex. "However, generally it is a pretty quiet day today," added Priest.
In the United States, Wall Street advanced after a drop in oil prices and an unexpected gain in new home sales encouraged investors to put money back into the market.
The DJIA rose 68.72 to 12,548.35, while the S&P 500 index rose 9.42 to 1,385.35 and the Nasdaq composite index rose 36.57 to 2,481.24.
Looking at U.S. economics, U.S. durable goods data is expected to show a fall of 1.1 percent in April following a 0.3 percent decline in the previous month.
Excluding transportation, durable goods are expected to have fallen by 0.7 percent in April after a 1.5 percent increase in the previous month.
Asia markets were lower as the fall in oil price prompted a sell-off in resource stocks. The Nikkei 225 index was down 177.42 points at 13,715.89 while the Hang Seng index ended the morning 78.94 points weaker at 24,203.10.
Oil prices in Asian trade fell further from record levels on profit-taking after fresh data triggered concerns the U.S. economy will slow down markedly, dampening oil demand.
New York's main oil futures contract, light sweet crude for July delivery, shed 5 cents to $128.80 per barrel. The benchmark contract had closed at $128.85 on Tuesday, down $3.34 from Friday, the last trading day before the U.S. Memorial Day holiday on Monday.
London's Brent North Sea crude for July slipped 12 cents to $128.19 per barrel, after settling $4.06 lower at $128.31 on Tuesday.
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Turning to the UK blue chips on the upside, Royal Bank of Scotland gained 4-3/4 at 246 after Credit Suisse upgraded the group to 'neutral' from 'underperform' in a banking review.
However peer, Lloyds TSB retreated 3-3/4 at 389-3/4 as Credit Suisse downgraded the group to 'underperform' from 'neutral' in the same review.
Elsewhere in financials, insurer Friends Provident ticked up 2.1 at 118 as JP Morgan raised its recommendation on the group to 'overweight' from 'neutral'. Its peer Prudential was 8 firmer at 652.
Sticking with broker news, WM Morrison was up 6-1/4 at 291-1/2 after Credit Suisse upgraded the group to 'outperform' from 'neutral', while raising its price target to 340 pence from 320 pence. Its peer J Sainsbury was 7 higher at 292-1/4.
Turning to the downside, around 30 points were knocked off the FTSE with stocks trading ex dividend including Marks & Spencer, Next, Cobham and British Energy.
Meanwhile, after earning news, British Energy fell back 10 at 727 after reporting a slump in full year EBITDA from 1.2 billion pounds last year to 882 million pounds, the result of lower full year nuclear output as well as lower achieved power prices.
Elsewhere, commodity stocks were lower following the sell off in Australia and the retreat in oil prices.
Oil heavyweight BG Group was down 7 at 1,283 and Royal Dutch Shell was off 8 at 2,144, while exploration and production groups Tullow Oil fell back 4-1/2 at 905-1/2 and Cairn Energy was 1 weaker at 3,370.
Out of the miners, BHP Billiton was down 15 at 1,957, Eurasian Natural Resources was 26 weaker at 1,384, Vedanta Resources lost 23 at 2,575 and Kazakhmys fell back 8 at 1,670.
Looking at the midcaps, in earning news QinetiQ Group gained 4-1/2 at 200 after it reported higher revenues and underlying pretax profit for the full year, reflecting the benefits of the highly differentiated business in the United Kingdom and North America, even as pretax profit fell.
The defence and security technology company said pretax profit for the full year to March 31 fell to 51.4 million pounds from 89.3 million pounds last year, while revenues rose to 1.37 billion pounds from 1.15 billion pounds.
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And, Intermediate Capital Group was 32 higher at 1,496 as it posted a 2 percent higher full year pretax profit and said it is confident of achieving its objective to double in size every five years.
The company said pretax profit for the year to end-March 2008 rose to 229.5 million pounds from 224.0 million pounds, and said 36 million pounds of the pretax profit relates to fair value movements on derivatives held for hedging purposes. Funds under management increased 25 percent to 7.3 billion pounds.
Meanwhile, Speedy Hire ticked up 13 at 694-1/2 as it reported a profit -- before tax, amortisation and exceptional integration costs -- of 48.1 million pounds for the year to March 31, 2008, compared with 40.5 million a year earlier.
The group also said it has bought Carillion Asset Management Ltd.'s accommodation business for a total 12.5 million pounds as part of a new partnership agreement with Carillion.
Turning to the downside, Shaftesbury lost 17-1/4 at 472-3/4 after the group said its adjusted diluted net asset value per share for the first half to end-March was down 10.5 percent to 5.78 pounds. The property investment group said its first-half adjusted pretax profit was up 7.4 percent to 7.2 million pounds compared with the year-ago period.
And, Electrocomponents was off 3 at 170 as it said it has maintained its final dividend at 18.4 pence a share in line with its prior commitment and reported a 9 percent increase in its full-year reported pretax profit on a 12 percent rise in its headline pretax profit for the period.
The company posted a pretax profit of 95.4 million pounds for the year to March 31, 2008, from a restated pretax profit of 87.2 million pounds earlier. Headline pretax profit rose to 96.4 million pounds for the year from 86.4 million pounds reported a year ago.
Finally, Northgate fell back 30 at 558-1/2 after Citigroup cut its stance on the group to 'hold' from 'buy', also reducing its price target on the stock to 640 pence from 870 pence.
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
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Milan
MILAN - Market data at 9.32 a.m.:
Main indices;
Mibtel at 25,295 points, up 0.26 percent
S&P/Mib at 32,855 points, up 0.34 percent
Main S&P/Mib gainers
Assicurazioni Generali up 1.34 percent at 26.50 euros with reports saying that Italy's largest insurer pulled out of the race to buy the insurance assets of Royal Bank of Scotland as it considers the asking price to be too high. WestLB upgraded the stock to 'add' from 'hold
STMicroelectronics up 1.03 percent at 8.205 euros, still benefiting from comments made at Tuesday's shareholders meeting in which the group confirmed its guidance of doing better than the market this year
Fiat up 0.87 percent at 14.41 euros recovering from recent weakness. The auto group will start producing its Alfa Romeo brand in North America by 2011 and is in talks to choose a partner for the process
Tenaris up 0.85 percent at 18.87 euros
Geox up 0.71 percent at 7.84 euros, recovering from recent weakness. Since the start of the year, the share has lost almost 42 percent of its value, with only two shares faring worse in the period
Main S&P/Mib losers
Seat Pagine Gialle down 3.01 percent at 0.1064 euro as Citigroup downgraded the stock to 'sell' from 'hold' and trimmed the price objective to 0.1 euros from 0.15 euros
Impregilo down 0.93 percent at 4.07 euros, recovering from earlier lows. The stock is still weak after news Tuesday that the CEO and other employees and former employees of its Fibe and Fibe Campania units were arrested in a new probe over waste management activities in the Campania region, where the city of
Naples is located
A2A down 0.30 percent at 2.5075 euros
Eni down 0.35 percent at 25.91 euros
Banco Popolare down 0.34 percent at 13.03 euros
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Frankfurt
FRANKFURT - Market data at 10:14 a.m.
DAX - up 26.35 points, or 0.38 percent, at 6,985.01
MDAX - up 46.25 points, or 0.49 percent, at 9,475.30
TecDAX - down 5.42 points, or 0.64 percent, at 836.44
DAX futures - down 13.50 points, or 0.19 percent, at 7,005.00
MAJOR GAINERS:
SAP up 0.90 euros, or 2.70 percent, at 34.25, as traders pointed to a boost from an upgrade from Cheuvreux to its 'selected list' from 'underperform' and said the stock was being supported on technical grounds.
Deutsche Boerse up 1.14 euros, or 1.22 percent at 94.66, recovering some of its recent losses as market trading activity appeared to be picking up
Lufthansa up 0.19 euros, or 1.0 percent at 16.04, helped as oil prices eased
Deutsche Post up 0.20 euros, or 0.93 percent, at 21.79
Deutsche Bank up 0.53 euros, or 0.74 percent, at 72.62
MAJOR DECLINERS:
Hypo Real Estate down 0.38 euros or 1.77 percent at 21.08 as the shares trade ex-dividend after it paid out 0.50 euros per share to investors
TUI down 0.16 euros, or 0.95 percent, at 16.62
Deutsche Postbank down 0.53 euros, or 0.86 percent, at 60.81, easing slightly as excitement over a possible sale of the Post unit in autumn seemed to wane
Volkswagen, down 1.52 euros, or 0.84 percent, at 179.50
Metro down 0.36 euros, or 0.75 percent, at 47.57, continuing Tuesday's drop after a 0.7 points drop in GFK consumer sentiment survey for May showed a lowered willingness of German consumers to buy.
OTHER STOCK IN THE NEWS:
MDAX-listed Vossloh down 2.89 euros, or 3.18 percent, at 88.11 after Societe Generale initiated its coverage on the rail infrastructure and rail technology specialist with a 'sell' rating and a price target of 79 euros per share
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Amsterdam
AMSTERDAM - Market data at 10.31 a.m.
MAJOR INDICES
AEX 477.06 points, up 3.22 points or 0.68 percent
AMX 659.88 points, up 3.35 points or 0.51 percent
Government bonds lower
MAJOR GAINERS
Aegon up 1.92 percent at 9.67 euros to lead peer financial higher
Randstad up 1.38 percent at 27.22 euros
Corio up 1.31 percent at 55.61 euros
ArcelorMittal up 0.42 percent at 61.96 euros; UBS ups its price target to 75 euros from 67
Ordina up 3.76 percent at 11.59 euros
Logica up 2.61 percent at 1.57 euros; to cease trading on OMX Nordic Exchange in summer 2008
OPG up 0.34 percent at 14.82 euros as ABN Amro speculates in broker note company could be target of future M&A
Nieuwe Steen Investments up 0.80 percent at 17.71 euros as it said CEO Anka Reijnen has decided to take up the role of chief financial officer. NSI to seek new CEO externally
MAJOR DECLINERS
TomTom down 0.91 percent at 22.89 euros
Royal Dutch Shell down 0.65 percent at 26.87 euros
KPN down 0.35 percent at 11.49 euros; pressured by reports telecoms watchdog Opta will investigate whether regulation is needed to ensure competition in the business sector, where KPN holds a large majority market share
Heijmans down 1.20 percent at 19.00 euros
Arcadis down 1.02 percent at 14.49 euros
Forex
London 0835 GMT Tokyo 0400 GMT
U.S. dollar
yen 104.27 up from 104.05
Swiss franc 1.0304 down from 1.0313
Euro
U.S. dollar 1.5718 up from 1.5692
yen 163.90 up from 163.28
Swiss franc 1.6198 up from 1.6189
pound 0.7939 down from 0.7943
Pound
U.S. dollar 1.9792 up from 1.9750
yen 206.36 up from 205.49
Swiss franc 2.0397 up from 2.0368
Australian dollar
U.S. dollar 0.9595 down from 0.9605
pound 0.4848 down from 0.4862
yen 100.06 up from 99.90
