UK/Euro Financial Market Daily Morning Briefing 10-02-2014

London open: Markets at two-week high as stocks edge up

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Green Reit, Renewable Energy Generation Ltd.

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Harmonised Competitiveness Indicators (EU) (09:00)

FINALS
Catlin Group Ltd.

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Ashley (Laura) Holding

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Impax Asset Management Group

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ITE Group, Paragon Group Of Companies

How to Know when the Bull Market Ends - Given that the stock market rally has now lasted nearly five years and in view of new all-time highs, many market participants are faced with the question when will there be a top at the major share indexes. After all, everybody wants to exit the market near a high and lock in their profits before the market turns downwards again.   Read more.

Europe open: Stocks mixed after US jobs report

- Fed taper fears soothed after weak US jobs report
- Eurozone investor confidence report out
- Euro strengthens against dollar

FTSE 100: 0.07%
DAX: 0.09%
CAC 40: 0.14%
FTSE MIB: -0.11%
IBEX 35: -0.46%
Stoxx 600: 0.05%

European stocks were little changed as a weaker-than-expected US jobs report fuelled speculation that the Federal Reserve would hold back on a third cut in bond purchases.

US employers added 113,000 jobs in January, the Labor Department revealed on Friday, falling short of the 180,000 forecast.

However, the unemployment rate dropped to 6.6%, the lowest level since October 2008.

Fed policymakers have been closely monitoring the labour market in weighing whether the US is strong enough to handle another monetary stimulus tapering.

The Fed last month decided to scale back monthly asset purchases by $10bn to $65bn.

The central bank will next meet on March 19th to 20th, the first under Chairman Janet Yellen, to consider whether to trim quantitative easing further.

Turning to today's agenda will be the release of Eurozone investor confidence figures. The sentiment index is tipped to fall to 10.1 in February from 11.9 in January.

Nestle, Securitas

Nestle advanced after signalling its intention to reduce its stake in L'Oreal.

Securitas slumped as the world's second-biggest guarding-services provider posted fourth-quarter net income that missed analysts' estimates.

Nokia Oyj gained following news the company and HTC Corp. have agreed to collaborate after ending a patent-infringement dispute.

The euro rose 0.06% to $1.3643.

Brent crude futures fell $0.569 to $108.950 per barrel, according to data from the ICE.

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US close: Stocks rise strongly despite payrolls disappointment

- Non-farm payrolls disappoint but jobless rate falls
- Taper plan called into question
- Apple rises after buying back stock

Dow Jones: 1.06%
Nasdaq: 1.69%
S&P 500: 1.33%

US stocks finished with decent gains for a second day on Friday as worse-than-expected labour-market figures failed to deter optimism about the economic outlook.

However, while the data showed another drop in unemployment, it did spark some uncertainty regarding the future of the Federal Reserve's plan to taper stimulus given two consecutive months of exceptionally weak job reports.

Nevertheless, this did not stop the three main US indices from posting gains of well over 1% each during the session, with the benchmark S&P 500 registering its strongest two-day rally since October.

NFPs rise by just 113k

US non-farm payrolls expanded by 113,000 in January coming in well below the 180,000 forecast by economists, after the meagre 75,000 gain the month before.

However, the unemployment rate ticked lower to hit 6.6% as the labour force participation rate unexpectedly rose – which was welcome news for many economists.

According to Barclays, the figures continued to indicate that moderate job growth remained "in place" in January, which would keep the unemployment rate heading lower and the Fed on track for further tapering at each of its meetings until September.

However, they also said that the data "does increase the likelihood that [the Fed] will refrain from tapering in March, and we will look closely at the February employment report for further signs that labour market improvement is slowing".

Apple, LinkedIn, Expedia

Apple gained after its Chief Executive Tim Cook told The Wall Street Journal that the company has bought back $14bn in stock since disappointing the market with its results two weeks ago.

LinkedIn Corp. declined after the professional-networking site forecast sales that fell short of analysts' estimates amid slowing growth.

Travel company Expedia surged to record highs after beating estimates with a 46% jump in quarterly adjusted earnings; the news also helped sector peers TripAdvisor and Orbitz Worldwide higher.

Media giant News Corp. rallied after reporting quarterly profit that beat market forecasts.


S&P 500 - Risers
Expedia Inc. (EXPE) $74.45 +14.29%
TripAdvisor Inc. (TRIP) $84.45 +9.48%
News Corp Class A (NWSA) $17.41 +8.68%
Gap Inc. (GPS) $42.00 +5.77%
Noble Energy Inc. (NBL) $66.20 +5.73%
Netflix Inc. (NFLX) $429.98 +5.41%
Sealed Air Corp. (SEE) $31.45 +5.32%
Adt Corp (ADT) $31.53 +5.24%
Priceline.Com Inc. (PCLN) $1,195.39 +5.01%
Biogen Idec Inc. (BIIB) $315.54 +4.83%

S&P 500 - Fallers
CIGNA Corp. (CI) $77.47 -9.25%
VeriSign Inc. (VRSN) $52.68 -4.94%
FLIR Systems Inc. (FLIR) $30.71 -4.60%
FMC Technologies Inc. (FTI) $48.37 -3.16%
Wyndham Worldwide Corp. (WYN) $70.34 -2.82%
Diamond Offshore Drilling Inc. (DO) $46.07 -2.62%
Cabot Oil & Gas Corp. (COG) $39.32 -2.33%
Southwestern Energy Co. (SWN) $41.47 -2.31%
WellPoint Inc. (WLP) $84.68 -2.19%
Aetna Inc. (AET) $66.76 -1.71%

Dow Jones I.A - Risers
Boeing Co. (BA) $127.02 +3.55%
Merck & Co. Inc. (MRK) $54.77 +1.86%
Nike Inc. (NKE) $72.69 +1.65%
American Express Co. (AXP) $87.00 +1.53%
International Business Machines Corp. (IBM) $177.25 +1.48%
Johnson & Johnson (JNJ) $90.04 +1.45%
Wal-Mart Stores Inc. (WMT) $73.75 +1.28%
Visa Inc. (V) $221.78 +1.26%
Pfizer Inc. (PFE) $31.22 +1.23%
United Technologies Corp. (UTX) $110.73 +1.17%

Dow Jones I.A - Fallers
Coca-Cola Co. (KO) $37.95 -0.21%

Nasdaq 100 - Risers
Activision Blizzard Inc. (ATVI) $19.64 +14.39%
Expedia Inc. (EXPE) $74.45 +14.29%
TripAdvisor Inc. (TRIP) $84.45 +9.48%
Green Mountain Coffee Roasters Inc. (GMCR) $107.75 +5.53%
Netflix Inc. (NFLX) $429.98 +5.41%
Priceline.Com Inc. (PCLN) $1,195.39 +5.01%
Nxp Semiconductors Nv (NXPI) $52.05 +4.94%
Biogen Idec Inc. (BIIB) $315.54 +4.83%
Celgene Corp. (CELG) $156.88 +4.65%
Tesla Motors Inc (TSLA) $186.53 +4.57%

Nasdaq 100 - Fallers
Staples Inc. (SPLS) $13.07 -1.51%
Akamai Technologies Inc. (AKAM) $56.64 -0.94%
Dish Network Corp. (DISH) $56.80 -0.80%
Fastenal Co. (FAST) $44.23 -0.27%
Paychex Inc. (PAYX) $40.90 -0.27%
Vodafone Group Plc ADS (VOD) $36.58 -0.25%
Costco Wholesale Corp. (COST) $114.04 -0.19%
Catamaran Corp (CTRX) $48.26 -0.17%
CH Robinson Worldwide Inc (CHRW) $52.39 -0.16%

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Monday newspaper round-up: Barclays, BoE, Energy companies...

Barclays is under scrutiny by regulators and could face a hefty fine after thousands of confidential customer files were stolen in a data breach described as catastrophic by an adviser to the business secretary, Vince Cable. The files, containing details on 2,000 individuals including their names, addresses, phone numbers, passport numbers, mortgages and levels of savings, were allegedly sold for use in boiler-room scams, in which vulnerable savers are snared into fraudulent investments. - The Guardian

The Bank of England is to test whether banks and building societies would go bust if house prices crash. A 'stress test' will examine whether banks will need bailing out if prices plunge. It is being drawn up by the Bank's Financial Policy Committee, whose members include Governor Mark Carney. - Daily Mail

The Energy Secretary has questioned the profit margins made on gas by Britain's biggest energy companies, going as far as suggesting that the UK's biggest supplier, British Gas, could be broken up. In a letter to regulators, Ed Davey estimated that margins on gas bills are up to five times those made on electricity. He pointed to evidence indicating that British Gas was using its grip on the market to boost profits, and said the company could face a market investigation. -The Telegraph

A Labour government would introduce quotas to get more directors from ethnic minorities on to the boards of British companies, it was announced today. The intervention into the debate over the profile of Britain's business leaders follows a new report which shows that more than half the boards in the FTSE 100 are all-white. - The Times

The Eurozone's new chief banking regulator has warned that some of the region's lenders have no future and should be allowed to die, heralding a far tougher approach to the supervision across the currency bloc. […] Danièle Nouy also signalled she wants to weaken the link between governments and the bloc's banks that lies at the core of the region's crisis by breaking with tradition and demanding lenders hold capital against their sovereign assets. - Financial Times

Car maker BMW is likely to have sold more vehicles in January compared to the same month last year thanks to rising demand in China, where group deliveries surged more than 20%. Overall deliveries, including the British Mini and Rolls-Royce brands, increased in single-digit terms in the United States and were also up in core European markets, according to the German group's finance chief Friedrich Eichiner. - The Scotsman

George Soros's Quantum Endowment fund had its second-best year ever in dollar terms in 2013, adding $5.5bn to the billionaire's fortune and putting Quantum back in top place among the most successful hedge funds of all time. - Financial Times

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