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 13-02-2007
02/13/2007
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ADVFN III |
Morning Euro Markets Bulletin |
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Daily world financial news from AFX/Associated Press |
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London |
London shares remain up in early trade ahead of CPI data; miners in focus
London shares remained higher in early deals, rebounding from yesterday's losses, as investors await the latest CPI figures, with miners in focus on the back of sector consolidation hopes, dealers said. At 9.08 am, the FTSE 100 was up 12.2 points at 6,365.7, while the wider market was also higher. Volume was average, with 208 mln shares trading hands in 33,751 deals. Overnight on Wall Street, the DJIA extended its losses as investors awaiting a stream of key economic data this week were disappointed by the collapse of several closely watched acquisition deals. The Dow Jones industrial average fell 28.28 points to 12,552.55. Broader stock indicators also declined. The Standard & Poor's 500 index was down 4.69 points at 1,433.37 and the Nasdaq composite index retreated 9.44 points, or 0.38 pct, to 2,450.38. The markets, which pulled back last week amid concern about inflation's impact on interest rates, traded cautiously, with Federal Reserve Chairman Ben Bernanke set to testify about the economy before Congress tomorrow. In Asia, the Hang Seng ended the session down 461.16 points at 20,132.25, while Japan's Nikkei 225 finished the day up 117.12 points at 17,621.45. Oil prices were marginally higher in Asian trade after sliding by more than 2 usd overnight, which was sparked by Saudi Arabian comments there is no need for the OPEC cartel to cut output again, dealers said. New York's main oil futures contract, light sweet crude for delivery in March, climbed 0.06 usd to 57.87 usd a barrel after falling by 2.08 usd to 57.81 usd a barrel in US trading. Brent North Sea crude for March was up 20 cents at 56.80 usd. On the economics front, the Bank of England's latest round of projections will take centre-stage today, but a busy data calendar will also give investors plenty to consider.
UK inflation figures will be key, with most analysts betting the CPI rate will not surpass the BoE's 3.0 pct upper tolerance threshold. The BoE had access to the inflation numbers when it decided to keep interest rates unchanged at its February meeting, leading analysts to believe inflation has not edged above the crucial 3.0 pct level, which would have triggered a mandatory letter of explanation from governor Mervyn King to the Treasury.
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Among company news, a buzz surrounded the mining sector on the back of news that BHP Billiton, up 9 pence at 1,058, and Rio Tinto, better by 23 pence at 2,709, are considering making separate 40 bln-usd bids to take over Alcoa, The Times reported, quoting unidentified sources. The UK newspaper said neither mining company had yet approached the board of the US aluminum firm. The newspaper said BHP Billiton, which produces about 1.3 mln tonnes of aluminum a year, was understood to have done the groundwork for a bid for Alcoa. Across the sector, Vedanta topped the gainers, up 17 pence at 1,216, Lonmin increased 15 pence to 3,184 while Antofagasta was up 3 pence at 465. However, the market was generally quiet as many traders left the City for half-term school holidays. Some old M&A stories helped to lift Intercontinental, up 7 pence at 1,295, on the back of a 1,400 pence a share bid rumour, while Barclays, which put on 3 pence at 769, was assisted by brokers suggesting Bank of America may bid for the group. Meanwhile, broker comment after the close yesterday helped to buoy sentiment in ICI, climbing 4-1/2 pence to 471-1/2. Cazenove reiterated its 'outperform' recommendation and said the chemicals group has roughly 500 mln stg cash to spend on acquisitions as the company looks to fend off predators. Sticking with broker comment, shares in Next were 21 pence higher at 2,050, bolstered by bullish words from Sanford Bernstein, which raised its target on the fashion retailer to 2,170 pence from 1,875. On the downside, investors were not impressed with British Energy, down 33 pence at 1,646, after the stock was reiterated as a 'sell' at Citigroup after the nuclear power group posted a rise in nine-month EBITDA alongside news repair work at two of its power plants should be completed by March. The group said this morning nine-month EBITDA rose to 775 mln stg from 462 mln stg, with EPS of 27.1 pence, up from 13.6 pence. At the same time, it cautioned nuclear output could fall by 9 terawatt hours because problems with cracks at some of its stations' boilers but confirmed reports it is seeking partners for new build nuclear power stations. Elsewhere, shares in British Land, down 38 pence at 1,641, led the property sector lower in early deals following a poorly received set of third-quarter results. Slough Estates was 15-1/2 pence lower at 767-1/2, Liberty International was 30 pence lower at 1,296 and Hammerson was down 32 pence at 1,595.
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British Land, which converted to real estate investment trust (Reit) on Jan 1, reported pretax profit of 381 mln stg for the third quarter to end-Dec, down from 617 mln a year earlier, reflecting the charges and provisions required for Reit entry costs. The net asset value per share at the end of December was 1,610 pence, compared with 1,624 pence at the end of September. In reaction, Merrill Lynch told clients the group's pre-REIT NAV of 1,685 pence came in slightly below its expectations and feels the stock has virtually closed the relative discount to other UK major property stocks. The broker said the main risk to the shares is a deterioration of letting market conditions, although feels these results clearly show momentum for now is still "firmly up". On the second tier, among the winners, Halfords benefited from an 'outperform' rating at Credit Suisse, which initiated coverage of the stock with a price target of 435 pence. The stock was up 9-1/2 pence at 385. In a note this morning, Credit Suisse said Halfords' defensive positioning provides the group with a level of resilience to an economic downturn. The broker said Halfords offers a degree of earnings momentum even in a testing consumer environment as well as limited downside risk to earnings downgrades relative to its peers. Finally, shares of London Stock Exchange, up 6 pence at 1,271, were resumed as 'neutral' at Merrill Lynch after Nasdaq's failed bid for the UK bourse. The broker said that, at current levels, LSE shares are trading on 20 times March 2008 earnings, and thinks the shares can support the rating. However, the broker does not see sufficient value for anything other than a 'neutral'. In Merrill's view, management's volume target for full-year 2008 appears to rely largely on an increase in activity following the roll-out of a new platform.
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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Frankfurt |
German shares AFX at a glance outlook
Forthcoming Events Today German preliminary GDP for Q4 (07.00) ThyssenKrupp Q1 results Infineon's Qimonda AGM Bilfinger Berger FY results MLP FY results (0630), conference call (0900) IDS Scheer FY results
Tomorrow VW Works Council Meeting, Lower Saxony Chief Minister Christian Wulff is guest, Wolfsburg
Commerzbank fy 2006 results and annual news conference (0930)
DaimlerChrysler fy results and annual news conference, Detroit
Douglas Holding Q1
Macroeconomic News German Q4 preliminary GDP growth 0.9 pct VS Q3; consensus 0.6 pct Market News DaimlerChrysler seen up on report of possible Chrysler separation Premiere much lower pre-bourse; CEO plans to sell 11 pct stake in co Fraport seen opening higher on positive January passenger numbers ThyssenKrupp seen higher after raises pretax and sales targets TUI upped to 'outperform' from 'underperform' by Exane BNP-Paribas; tgt 23 eur
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Amsterdam |
AMSTERDAM - Market data at 10.23 am Major indices AEX 506.26, up 2.49 points AMX Midcap 713.37, down 0.12 point Government bonds slightly lower
Major gainers: Hagemeyer led blue chip gainers, up 3.01 pct at 3.77 after ING added the stock to its 'Focus list' Fortis rose 1.56 pct at 33.96 in an extension of yesterday's gains on UBS raising its target to 40 eur from 36.30 on valuation grounds and increased its rating to 'buy 1' from 'buy 2'. ING climbed 0.9 pct at 34.61 KPN firmed 0.88 pct at 11.49 Randstad advanced 1.32 pct at 53.70 after ING raised its price target on the staffing group to 62 eur from 57, while Vedior rose 0.63 pct at 15.99 Ordina put on 1.05 pct at 17.30 after saying late yesterday it won a ten-year, 85 mln eur contract for its BPO (Business Process Outsourcing) activities from Robeco
Major losers: Crucell slumped 6.47 pct at 20.10 after the biotechnology company posted disappointing fourth-quarter results Fellow biotech stock Pharming fell 1.05 pct at 3.78 Akzo Nobel, due to report fourth-quarter results on Thursday, was down 0.17 pct at 47.17, while Royal Dutch Shell shed 0.2 pct at 25.47 -- the only blue chip fallers
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*Source The Times, December 15th 2006
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Forex |
Singapore 0726 GMT |
Sydney 0325 GMT |
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US dollar |
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yen 121.44 |
unchanged |
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sfr 1.2508 |
down from |
1.2528 |
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Euro |
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usd 1.2988 |
up from |
1.2963 |
sfr 0.6664 |
up from |
0.6651 |
yen 157.74 |
up from |
157.43 |
stg 1.6664 |
up from |
1.6651 |
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Sterling |
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usd 1.9487 |
down from |
1.9492 |
yen 236.65 |
up from |
236.64 |
sfr 2.4376 |
up from |
2.4411 |
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Australian dollar |
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usd 0.7737 |
up from |
0.7726 |
stg 0.3968 |
up from |
0.3964 |
yen 93.97 |
up from |
93.830 |
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