UK/Euro Financial Market Daily Morning Briefing – UK/Euro Financial Market Daily Morning Briefing
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A daily snapshot of the UK, French, German and Dutch markets just after the market open. Including a diary of key financial events across the UK and a summary of U.S after market close. Click here to receive or daily bulletins. News provided by AFX/Associated Press.
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UK/Euro Financial Market Daily Morning Briefing 09-05-2006
05/09/2006
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ADVFN III |
Morning Euro Markets Bulletin |
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Daily world financial news from AFX/Marketwatch |
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London |
London shares slide in midmorning deals as Sage, money managers weigh
Leading shares fell back in early deals as heavy losses across the fund management sector, weakness in Sage and further profit taking across the mining sector outweighed firm retailers, dealers said. By 9.20 am, the FTSE 100 index was down 2.9 points at 6,064.2, while the broader indices were also weaker. Volume was moderate however, with 343.4 mln shares changing hands in 40,029 deals. US stocks closed mixed last night, buoyed by a number of merger deals and a drop in oil prices, although nervousness ahead of this week's Federal Reserve meeting and cautious remarks on the US dollar from investment guru Warren Buffett weighed on sentiment, traders noted. The DJIA closed up 6.80 points at 11,584.54 and the Nasdaq added 2.42 points to 2,344.99, although the S&P 500 slipped 1.10 points to 1,324.66. In today's US economic news, March wholesale inventories should provide some interest, although the main attraction of the week will undoubtedly be tomorrow's Federal Reserve Open Market Committee's rate decision. With a rate hike fully expected, focus will be on the accompanying statement for hints of whether a further move can be anticipated. Across Asia overnight, the Nikkei 225 index was 100.76 points lower at 17,190.91, while the Hang Seng lost 65.52 points to 17,236.27. In the UK today, Sage dropped 1-1/2 pence to 263-3/4, as a slowdown in organic growth offset generally better-than-expected interim results from the software group. The UK's biggest accounting software supplier said pretax profit for the six months to March 31 rose to 113.7 mln stg from 95.8 mln a year earlier, above analysts' forecast for pretax profit of 111 mln stg.
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In reaction, Merrill Lynch reiterated its 'neutral' stance and said although it sees these as good results, the organic growth of 5 pct might be cause for some concern. Elsewhere, the money managers were also weaker, led down by Man Group following news yesterday that its US arm Man Financial was the subject of a lawsuit alleging that it acted improperly in its role as a broker to failed hedge fund Philadelphia Alternative Asset Management Co. The sector was also weaker after it was revealed that New York Attorney General Eliot Spitzer has widened his investigation into US money management group H&R Block. The state attorney general said yesterday that managers of the nation's largest tax preparation company actively penalised those who refused to market money-losing IRAs to its clients. Man Group shares were down 76 pence at 2,649, Amvescap lost 13-1/2 pence to 601-1/2 and Schroders eased 18 pence to 1127. Mining stocks were weaker again, as metal prices continued to pull-back from recent record highs. Xstrata eased 30 pence to 2335 on profit taking after three sessions of triple digit gains as Citigroup pointed out that the shares may suffer if it needs a rights issue to acquire Falconbridge. Xstrata shares shot higher yesterday as news of a bid for Canadian mining group Inco Ltd appeared to leave the way clear for the UK-listed group to buy Toronto-based metals giant Falconbridge. Sector peers Rio Tinto lost 23 pence to 3185, BHP Billiton fell 6 pence to 1171 and Kazakhmys eased 10 pence to 1245.
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Retailers featured heavily on the upside, led by Kingfisher with a gain of 5 pence to 241, after the DIY retailer was upgraded to 'buy' from 'neutral' at UBS with a raised price target of 280 pence. The Swiss owned broker said early indicators of a recovery in housing transactions, a potential reduction in margin pressure and new management initiatives may mean that medium-term forecasts for the UK, and thus the group, could be near a floor. DSG meanwhile, was boosted by bullish comments from Deutsche Bank, which reiterated its 'buy' recommendation and raised its target to 225 pence from 210. "DSGI would be a beneficiary of a TV boom which we believe will last for 3 years," the German owned broker told clients. Sector sentiment was further boosted after a key survey from the British Retail Consortium showed UK retailers enjoyed a bumper month in April, with sales reaching a peak not seen in over four years. Like-for-like sales -- which strips out the impact of changes in floor space -- surged 6.8 pct from the same month a year ago, it revealed. Vodafone was also higher, up 1 pence at 127 following press reports that Verizon has offered 38 bln usd for the UK group's stake in Verizon Wireless. In reaction, Dresdner Kleinwort reiterated its 'buy' recommendation, arguing that a disposal plus cash would be highly free cash flow per share accretive and potentially significantly EPS accretive.
Diary of Events
For a diary of financial and corporate events in the UK today, click here
US Summary
For a summary of US stocks at the close of trade, click here
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Paris |
PARIS - Market data at 10.00 am:
Major indices: CAC-40 down 4.15 points or 0.08 pct at 5,278.25 SBF-80 up 9.02 points or 0.15 pct at 6,217.00 SBF-120 down 1.54 points or 0.04 pct at 3,842.95
Volume: 550 mln eur 16 CAC-40 stocks up 20 CAC-40 stocks down 4 CAC-40 stock unchanged
Major gainers: Infogrames Entertainment, up 0.04 eur or 6.25 pct at 0.68. The chairman of rival Ubisoft indicated a tie-up is possible. Alstom, up 3.10 eur or 3.87 pct at 83.10, building on yesterday's gains after saying it won 470 mln eur in orders for two power plants in Italy. Yesterday, Areva said a tie-up with Alstom remains possible.
Separately, Bouygues moved forward with plans to buy the state's 21 pct stake in Alstom. Arcelor, up 0.77 eur or 2.20 pct at 35.77, after Mittal Steel said it would raise its offer in return for Arcelor's backing.
Major losers: Societe Generale, down 0.80 eur or 0.65 pct at 122.70 Thomson, down 0.13 eur or 0.80 pct at 16.21 Capgemini, down 0.37 eur or 0.78 pct at 47.37
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Frankfurt |
FRANKFURT - Market data at 10.11 am
Major indices: DAX 30 - 6,108.49, down 19.49 points or 0.32 pct MDAX - 9,112.77, down 7.60 points or 0.08 pct TecDAX - 754.10, down 6.22 points or 0.82 pct DAX future - 6,126.50, down 25.50 points or 0.41 pct
Major gainers: TUI, up 0.46 eur or 2.68 pct at 17.64, after the company reported consensus-beating first-quarter results, with market participants particularly impressed by the much smaller-than-expected EBITA and net profit losses Adidas-Salomon, up 3.17 eur or 1.89 pct at 170.57, after the sports goods company reported first-quarter results ahead of consensus and issued an upbeat outlook statement ThyssenKrupp, up 0.38 eur or 1.33 pct at 28.96 Altana, up 0.51 eur or 1.04 pct at 49.38 Lufthansa, up 0.10 eur or 0.68 pct at 14.87
Major losers: Hypo Real Estate, down 1.30 eur or 2.43 pct at 52.10 MAN, down 0.95 eur or 1.40 pct at 66.67 Infineon, down 0.13 eur or 1.31 pct at 9.82 Munich Re, down 1.22 eur or 1.06 pct at 114.33, as initial excitement over its first quarter results, which included a better-than-expected first-quarter combined ratio and a net income figure that came in well-ahead of even the most optimistic estimate, waned. Some market participants expressed concerns over the sustainability of Munich Re's strong performance, as the US Hurricane season begins on June 1. RWE, down 0.75 eur or 1.09 pct at 68.23
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Forex |
London 0822 GMT |
Singapore 0707 GMT |
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US dollar |
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yen 111.63 |
down from |
111.89 |
sfr 1.2298 |
down from |
1.2307 |
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Euro |
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usd 1.2683 |
up from |
1.2675 |
stg 0.6843 |
up from |
0.6837 |
yen 141.60 |
down from |
141.76 |
sfr 1.5598 |
up from |
1.5597 |
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Sterling |
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usd 1.8533 |
down from |
1.8534 |
yen 206.93 |
down from |
207.31 |
sfr 2.2793 |
down from |
2.2798 |
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Australian dollar |
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usd 0.7643 |
down from |
0.7665 |
stg 0.4124 |
down from |
0.4136 |
yen 85.32 |
down from |
85.780 |
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