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 14-02-2006
02/14/2006
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ADVFN III |
Morning Euro Markets Bulletin |
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Daily world financial news from AFX/Marketwatch |
Supplied by advfn.com | | |
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London
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London shares open higher as British Land Q3 boosts sector; miners rally
The FTSE 100 rose in early deals as strong results from British Land pushed property stocks higher, while heavyweight mining stocks rebounded from yesterday's weakness, traders said. At 8.42 am, the FTSE 100 was up 14.4 points at 5,807.9, with the broader indices also higher. Volume was moderate, with 159.0 mln shares changing hands in 17,003 deals. On Wall Street last night, the major indices closed in negative territory as investors remained cautious ahead of new Fed Chairman Ben Bernanke's impending testimony before Congress tomorrow. The DJIA fell 26.73 points to 10,892.32, the Nasdaq Composite closed down 22.07 points at 2,239.81, while the S&P 500 Index dropped 4.13 points to 1,262.86. In Asia, the Hang Seng Index ended the morning up 42.96 points or 0.28 pct at 15,355.05, while the Nikkei 225 ended the day up 307.21 at 16,184.87. Back in London, British Land shares jumped 25 pence to 1,211 after the property group reported a better-than-expected net aseet value in the third quarter. The company also said its property assets are well positioned to perform well in the years ahead. Peers Hammerson and Land Securities rose 4-1/2 pence to 1,093 and 29 pence to 1,797, respectively.
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Mining stocks were in favour this morning, mirroring solid gains in Australia last night, following weakness yesterday. Rio Tinto was also lifted by positive comments from UBS following a meeting with the company's finance director. UBS noted that while costs will remain challenging in 2006, Rio believes them to be manageable. Moreover, Rio's management was more upbeat than at the results presentation from a week earlier and UBS added that the company sees plenty of opportunities for value-added growth. Rio Tinto was up 54 pence to 2,788, Xstrata gained 24 to 1,632, BHP Billiton, which reports full year results tomorrow, rose 13 pence to 959-1/2 and Antofagasta was up 24 at 1,998. Financial stocks also attracted buyers, as The Financial Times reported that Merrill Lynch could announce it has purchased a near 50 pct stake in BlackRock, the fixed-income manager, as early as today. Yesterday, shares in both Merrill and BlackRock rose strongly on speculation of the merger. Amvescap gained 4-3/4 pence to 545, while Schroders was up 5 pence at 1,130-1/2. On the broker front, Cadbury Schweppes has been upgraded to 'buy' from 'hold' at Citigroup, with an increased target price of 620 pence from 565. Citigroup highlighted several key positives in the Cadbury investment case, including, structural improvement in sales growth, consistent share gain in chewing gum at Adams and improving cash flow dynamics. Citigroup also sees potential for earnings accretive acquisitions, signs of improvement in non-carbonated beverages, de-merger and bid speculation likely to return and potential surprises on cost savings and revenues. Cadbury rose 9 pence to 557-1/2. A bullish research report from Merrill Lynch pushed Rolls Royce up 4-3/4 pence to 432-1/4.
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Merrill upgraded Rolls Royce to 'buy', arguing that it should be treated as a non-cyclical growth company and should be rated accordingly. Merrill believes that the best comparisons are the business services companies and using Capita and Serco as comparisons, the broker estimates valuations for Rolls Royce of between 501-609 pence per share. On the downside with blue chips, water stocks came under presure, as Lehman Brothers downgraded Severn Trent to 'equalweight' from 'overweight' and United Utilities and Kelda to 'underweight'. JP Morgan also turned cautious on the UK water sector today. Severn Trent fell 8 pence to 1,164 and United Utilities dipped 0-1/2 to 684. Among the midcaps, Kelda rose 4 pence to 811-1/2 while AWG , Pennon (all rated 'overweight' by Lehman) gained 3 to 1,109 and 14 to 1,301, respectively. Among the retailers, MFI surged 9-1/4 pence, or 82-3/4, after the troubled group announced the surprise sale of its French business, Hygena Cuisines SA, to Nobai AB for 92 mln stg. The much-needed proceeds will be applied to reducing its debt. The two deals would appear to significantly reduce the need for a rights issue which the market has been speculating on for weeks. In reaction, Seymour Pierce upgraded MFI to 'underperform' from 'sell', noting that it now estimates MFI will have enough cash to complete a restructuring. Evolution Securities upgraded MFI to 'reduce' from 'sell' and raised its sum-of-the-parts valuation to 60 pence from 50. On the economic front, inflation data (due 9.30 am) is expected to show the annual CPI measure rising to 2.1 pct in January, taking it back above the Bank of England's 2.0 pct target after it dropped to that level in December for the first time since June. A rise in petrol prices and household energy bills during the month are expected to have provided the main upward pressure on prices, as well as increases in rail and air fares. Deflationary pressures on the high street will still be evident but most expect that this will not be sufficient to offset increases elsewhere.
Diary of Events
For a look at key financial 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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Amsterdam
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AMSTERDAM - Market data at 09.08 GMT
Major indices: AEX index 459.05, down 0.43 point AMX Midcap index 580.90, up 3.24 points Government bonds unchanged to slightly higher
Major gainers: Stork shot up 13.32 pct to 45.76 after saying it is considering taking the company private following supervisory board approval for an investigation into the idea VNU climbed 2.47 pct at 27.75 on a report big shareholders are pressing the firm to break itself into three divisions and sell the pieces, rather than agreeing a deal with private equity firms Financials advanced, with Aegon rising 0.6 pct to 13.52, ING up 0.46 pct at 30.81 and ABN Amro firming 0.32 pct at 24.80 Fugro gained 0.96 pct at 30.49 as ING raised its price target to 37.0 eur from 27.50 Aalberts put on 2.37 pct at 58.25 as ABN Amro upped its price target on the stock
Major losers:
TomTom fell 1.33 pct at 28.17 in profit-taking after the company posted better-than-expected results for the fourth quarter SBM Offshore lost 0.61 pct at 81.50, Royal Dutch Shell was down 0.53 pct at 26.26 Buhrmann was down 0.52 pct at 13.47 KPN gave up 0.35 pct at 8.49
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Frankfurt
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FRANKFURT - Market data at 08.58 GMT
Major indices: DAX 30 - 5,769.58, up 13.25 points or 0.23 pct MDAX - 8,140.93, down 13.11 points or 0.16 pct TecDAX - 711.74, up 4.29 points or 0.61 pct DAX future - 5,780.50, up 15.00 points or 0.26 pct
Major gainers: Deutsche Boerse, up 1.21 eur or 1.21 pct to 101.49, as investors bought into European exchanges in expectation of strong fourth quarter sales figures from rival Euronext, dealers said. Deutsche Telekom, up 0.15 eur or 1.11 after rival France Telecom's full-year sales figures came in at the top of analysts consensus, dealers said. BASF, up 0.48 eur or 0.75 pct to 64.29, as investors cheered a report stating the chemicals giant is seeking to reduce its exposure to liabilities at Degussa's construction chemicals ops. It is currently in negotiations to acquire the business. MAN AG, up 0.39 eur or 0.79 pct to 49.79. Munich Re, up 0.84 eur or 0.74 pct to 114.14.
Major losers: VW, down 1.36 eur or 2.33 pct, to 56.91 on profit taking following the shares 5.18 pct rise yesterday. BMW, down 0.89 eur or 2.19 pct to 39.74. DaimlerChrysler, down 0.40 eur or 0.80 pct to 49.60. Metro, down 0.23 eur or 0.54 pct to 42.44. Fresenius Medical Care, down 0.43 eur or 0.46 pct to 93.16.
Forex
London 0910 GMT |
Singapore 0801 GMT |
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US dollar |
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yen 117.24 |
down from |
117.28 |
sfr 1.3062 |
up from |
1.3061 |
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Euro |
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usd 1.1914 |
up from |
1.1913 |
stg 0.6838 |
up from |
0.6829 |
yen 139.66 |
down from |
139.68 |
sfr 1.5564 |
up from |
1.553 |
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Sterling |
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usd 1.7420 |
down from |
1.7435 |
yen 204.27 |
down from |
204.44 |
sfr 2.2756 |
down from |
2.2766 |
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Australian dollar |
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usd 0.7374 |
up from |
0.7373 |
stg 0.4232 |
up from |
0.4228 |
yen 86.450 |
up from |
86.480 |
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