UK/Euro Financial Market Daily Morning Briefing 16-02-2006

London shares up in opening deals, following strong showing on Wall St

      
The FTSE 100 was higher in early deals, following a strong session on Wall Street where Congressional testimony from new Fed chief Ben Bernanke reassured investors over inflation concerns, dealers said.
   
At 8.52 am, the FTSE 100 was up 5.6 points at 5,797.1, with the broader indices all higher.
   
Volume was moderate, with 186.6 million shares changing hands, in 19,640 deals.
   
On Wall Street, the Dow Jones Industrial Average closed up 30.58 points at 11,058.97, marking its third close above the 11,000 level this year. The Nasdaq
Composite index closed up 14.26 points at 2,276.43, and the S&P 500 gained 4.47 points at 1,280.
   
Bernanke said more rate increases may be needed because of the threat of higher inflation from a strong economy and higher energy prices, but added that
future increases will become "increasingly dependent" on economic data.
   
Sentiment was also boosted by crude futures closing at under 58 usd a barrel for the first time since November.   
   
Across Asia overnight, the Nikkei 225 closed up 110.84 points at 16,043.67, while the Hang Seng closed up 27.62 at 15,450.88.
   
Back in London, Diageo led the risers, up 18-1/2 pence at 873-1/2, after reiterating full-year guidance of 7 pct organic operating profit growth following a strong operating performance in the first half.
   

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The group raised the interim dividend by 5 pct to 11.95 pence on the back of operating profit before exceptionals of 1.26 bln stg for the half year, up from 1.19 bln.
   
Cadbury Schweppes rose 11-1/2 to 576, as bid speculation persisted. Hershey, Kraft Foods, and Nestle have all been the subject of rumours linking them with a bid.
   
Cairn Energy gained 27 at 1,866, after Credit Suisse upgraded the stock to 'outperform' following the recent share price underperformance versus the oil sector.
   
Cairn's shares have underperformed the oil sector by 9 pct year-to-date, highlighted Credit Suisse in a report to clients. This was largely driven, explained the broker, by uncertainties over the group's Rajasthan field development.
   
Reed Elsevier was the biggest loser, down 9 at 545, following a "disappointing" performance at its US-based textbook business, Harcourt Education, last year.
   
Reed, which counts the Lancet medical journal and New Scientist magazine among its 15,000-plus publications, this morning reported pretax profits of 701
mln stg, up from 631 mln last year as revenues rose 7 pct to 5.166 bln. Both turnover and earnings were in line with expectations.
   
Pearson fell 4 to 722 on the read-across.
   
Kingfisher was another faller, dropping 5-3/4 to 222, after issuing a downbeat trading statement.
   

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Diary of Events

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US Summary

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Paris

PARIS - Market data at 09.01 GMT

   
Major indices:
   
CAC-40 up 11.39 at 4,945.48
SBF-80 down 3.21 at 5,627.96
SBF-120 up 5.45 at 3,583.37

   
Volume: 600 mln eur
30 CAC-40 stocks up
10 CAC-40 stocks down

   
Major gainers:
   
Societe Generale up 3.00 or 2.64 pct at 116.50 on forecast-busting Q4 numbers
   
EDF up 0.72 or 1.94 pct at 38.38, adding to yesterday's gains
   
EADS up 0.45 or 1.45 pct at 31.45, Dassault Aviation gives upbeat outlook for deliveries   

   
Major losers:
   
Ipsos down 4.40 or 3.74 pct at 113.40 on margin concerns after in-line sales
   
Technip down 1.80 or 3.43 pct at 50.65 on disappointing Q4 sales, FY warning
  
Schneider Electric down 1.40 or 1.65 pct at 83.40 hit by profit-taking after in-line earnings
   
Michelin down 0.60 or 1.16 pct at 50.95

Amsterdam

Amsterdam shares AFX at a glance outlook

 
Forthcoming Events
   
Today
   
ING news conference (0830 GMT)
   
Randstad news conference (0800 GMT)
   
Nutreco news conference (0900 GMT)
   
Dutch Nov-Jan unemployment (0830 GMT)

Market Sentiment
   
ING, Reed Elsevier, Randstad and Nutreco will all be in focus after
publishing results

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