UK/Euro Financial Market Daily Morning Briefing 18-03-2014

London open: Stocks fall ahead of Putin speech on Crimea

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Tuesday March 18

INTERIMS
Quoram

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Balance of Trade (EU) (10:00)
Building Permits (US) (12:30)
Consumer Price Index (US) (12:30)
Housing Starts (US) (12:30)
New Car Registrations (EU) (10:00)
Wholesale Price Index (GER) (07:00)
ZEW Survey (EU) (10:00)
ZEW Survey (GER) (10:00)
Central bank Policy Meeting (Turkey) (12:00)

FINALS
Antofagasta, Bango, Bioquell, Cairn Energy, Capital Drilling Ltd. (DI), Charlemagne Capital Ltd., Clarke (T.), Gem Diamonds Ltd. (DI), Mears Group, Mecom Group, Resolution Ltd., SDL, Source BioScience, UTV Media, Xaar, Zotefoams

ANNUAL REPORT
Dialight, Foreign and Colonial Inv Trust, Ladbrokes, Taylor Wimpey, Vitec Group, William Hill

IMSS
Berkeley Group Holdings (The), IG Group Holdings

EGMS
Hiscox Ltd

AGMS
Brunner Inv Trust, Ground Rents Income Fund, Wynnstay Group

TRADING ANNOUNCEMENTS
Sainsbury (J), Asos, Sainsbury, Spirit Pub Company

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Europe open: Stocks fall as Russia moves towards absorbing Crimea

- Putin signs decree on Crimea
- Eurozone and German economic confidence data out
- US inflation and housing starts released
- Fed begins policy meeting

FTSE 100: -0.32%
DAX: -0.75%
CAC 40: -0.33%
FTSE MIB: -0.32%
IBEX 35: -0.52%
Stoxx 600: -0.44%

European stocks moved into the red as Russian President Vladimir Putin signed a decree recognising Crimea as a sovereign state.

The decree paves the way for the region to leave Ukraine and rejoin Russia. It follows a referendum on Sunday in which officials said 97% of voters backed breaking away from Ukraine.

The European Union and US said the referendum was illegal and imposed sanctions on 21 officials from Russia and Ukraine.

"Europeans understand that broader economic sanctions such as on energy exports or Russian banking could eventually hit them as hard as the Russians," Barclays said.

The EU will follow-up the issue at its summit on March 20th to 21st.

On today's agenda, will be a batch of economic data in the Eurozone and the US.
ZEW's economic sentiment index for the Eurozone and Germany in March will be released at 10:00 GMT.

In the US later on in the session, the attention will turn to reports on US inflation and housing starts as the Federal Reserve kicks off its two-day policy meeting.

The central bank is widely expected to announce a further reduction to monetary stimulus measures when it wraps up its meeting tomorrow.

Scania, Sainsbury

Scania declined as a board committee reviewing Volkswagen's takeover offer said the bid was too low.

Sainsbury declined after the UK supermarket said sales at stores open at least a year fell 3.1%, excluding fuel, in the 10 weeks ended March 15th.

Kuoni advanced as the Swiss travel company posted 2013 profit that beat analysts' forecasts.

The euro fell 0.06% to $1.3914.

Brent crude futures rose $0.263 to $106.520 per barrel, according to the ICE.

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US close: Stocks rise strongly after Crimea referendum

- Crimea votes to join Russia
- Industrial production beats forecasts
- Yahoo gains on Alibaba IPO news

Dow Jones: 1.13%
Nasdaq: 0.81%
S&P 500: 0.96%

US stocks recovered strongly on Monday after investors applauded a better-than-expected reading of industrial production, shrugging off the weekend's vote by Crimea to join the Russian Federation.

Yahoo was a high riser on Wall Street after part-owned e-commerce giant Alibaba announced its intention to list on the stock market.

The Dow Jones Industrial Average rose 1.1% to 16,247, the Nasdaq finished 0.8% higher at 4,280, while the S&P 500 increased 1% to 1,859, turning positive for the year to-date.

The gains followed a tough week for global financial markets during which sentiment was dampened by ongoing concerns about the Ukraine crisis and a slowdown in China.

"The geopolitical situation hit global markets quite hard last week so it looks like investors are taking this opportunity to claw back the losses whilst tensions have slightly eased," said Financial Sales Trader Samuel Fox from Spreadex.

Nevertheless, investors were still watching developments closely after European Union and US leaders sanctioned several Russian and Ukrainian officials in retaliation for what they see as an unconstitutional vote in Crimea. These sanctions included freezing assets and imposing visa travel bans.

Closer to home, US industrial production figures showed that output rose 0.6% in February.

This compared with a revised 0.2% fall in January and ahead of the 0.2% growth expected, which "suggests that the economy is waking up after hibernating during the past few months of unusually bad weather," according to Senior US Economist Paul Dales from Capital Economics.

The degree of capacity utilisation rose to 78.8% from 78.5% the previous month, ahead of the consensus estimate of 78.6%.

In other news, the so-called Empire State manufacturing index rose from 4.48 to 5.61 in March but came in under the 6.50 forecast.

Yahoo rises on Alibaba listing

Yahoo! surged following reports Chinese e-commerce company Alibaba Group Holding, in which it holds a 24% stake, may file for an initial public offering in the US as soon as next month in a transaction which may value Alibaba at $100bn.

Car hire firm Hertz Global Holdings climbed after the Financial Times reported that the company will spin off its equipment-rentals unit in a deal expected to value the unit at around $4.5bn.

Keurig Green Mountain advanced after S&P Dow Jones Indices said the coffee maker will join its benchmark index for US stocks.

Intercept Pharmaceuticals declined after the drug maker said "serious adverse events" occurred in a drug trial for its liver-disease treatment.


S&P 500 - Risers
First Solar Inc. (FSLR) $56.52 +4.61%
Yahoo! Inc. (YHOO) $39.11 +4.02%
Biogen Idec Inc. (BIIB) $345.60 +3.86%
Helmerich & Payne Inc. (HP) $101.10 +3.22%
Parker-Hannifin Corp. (PH) $119.83 +3.13%
QUALCOMM Inc. (QCOM) $77.02 +3.05%
CONSOL Energy Inc. (CNX) $39.75 +3.01%
Coca-Cola Enterprises Inc. (CCE) $47.87 +2.95%
Fastenal Co. (FAST) $49.91 +2.86%
F5 Networks Inc. (FFIV) $110.37 +2.70%

S&P 500 - Fallers
VeriSign Inc. (VRSN) $51.68 -5.78%
Weyerhaeuser Co. (WY) $29.33 -1.77%
Tesoro Corp. (TSO) $52.29 -1.73%
Cabot Oil & Gas Corp. (COG) $33.39 -1.68%
Denbury Resources Inc. (DNR) $16.00 -1.60%
Newmont Mining Corp. (NEM) $25.77 -1.57%
Chesapeake Energy Corp. (CHK) $24.69 -1.36%
Rowan Companies plc (RDC) $31.31 -1.26%
Reynolds American Inc. (RAI) $53.69 -1.20%
Juniper Networks Inc. (JNPR) $25.36 -1.01%

Dow Jones I.A - Risers
International Business Machines Corp. (IBM) $185.81 +1.98%
3M Co. (MMM) $132.27 +1.88%
Boeing Co. (BA) $125.42 +1.88%
Walt Disney Co. (DIS) $81.39 +1.65%
United Technologies Corp. (UTX) $114.41 +1.61%
Unitedhealth Group Inc. (UNH) $76.76 +1.40%
JP Morgan Chase & Co. (JPM) $57.58 +1.37%
Visa Inc. (V) $223.78 +1.36%
General Electric Co. (GE) $25.43 +1.27%
AT&T Inc. (T) $32.89 +1.23%

Dow Jones I.A - Fallers

Nasdaq 100 - Risers
Yahoo! Inc. (YHOO) $39.11 +4.02%
Biogen Idec Inc. (BIIB) $345.60 +3.86%
QUALCOMM Inc. (QCOM) $77.02 +3.05%
Fastenal Co. (FAST) $49.91 +2.86%
F5 Networks Inc. (FFIV) $110.37 +2.70%
Check Point Technologies Ltd. (CHKP) $69.02 +2.53%
PACCAR Inc. (PCAR) $66.51 +2.32%
Garmin Ltd. (GRMN) $53.37 +2.24%
Texas Instruments Inc (TXN) $45.27 +2.17%
Keurig Green Mountain Inc (GMCR) $115.56 +2.04%

Nasdaq 100 - Fallers
Illumina Inc. (ILMN) $159.72 -3.04%
Liberty Global plc Series A (LBTYA) $42.76 -1.16%
Express Scripts Holding Co (ESRX) $76.69 -0.87%
Vertex Pharmaceuticals Inc. (VRTX) $77.70 -0.79%
Catamaran Corp (CTRX) $45.51 -0.78%
Sirius XM Holdings Inc (SIRI) $3.42 -0.58%
Sba Communications Corp. (SBAC) $94.51 -0.47%
Dollar Tree Inc (DLTR) $53.68 -0.45%
Regeneron Pharmaceuticals Inc. (REGN) $328.09 -0.43%
Netflix Inc. (NFLX) $422.72 -0.42%

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Tuesday newspaper round-up: Barclays, China, Budget

Criticism of Barclays and other investment banks risks leaving both Britain and Continental Europe dependent on their US peers, Robert Talbut, Chief Investment officer at Royal London Asset Management and Chairman of the Association of British Insurers' investment committee has said. In what amounts to a cautious defence of Barclays, Talbut argued that a 10 per cent increase in bonuses, while disappointing, did indeed make sense, The Times reports.

Credit curbs in China threaten the largest property default ever in the country, possibly breaking the housing boom and leaving a string of ghost towns across the country in their wake. The company in question, according to Chinese newspaper Economic Daily News, is XinGrun properties, near the coastal city of Ningbo. It owes banks 570m dollars. Local authorities have set up a working group to contain the fallout, The Daily Telegraph says.

In the debate ahead of the Budget Labour leader Ed Miliband argues that the failure to solve the increasing inequality means the recovery will only favour the "privileged few" and is therefore prone to flounder. Yes, the recovery means that living standards will improve this year, but they will do so by the most for the rich, he wrote in The Guardian.

The Bank of England may today announce a management shake-up, the largest in years. Thus, the Chancellor is thought to be preparing to name a successor for Charlie Bean, the monetary authority's Deputy Governor, before this evening's speech from Governor Carney at the annual Mais lecture, The Times says.

HBM Sayers, the Scottish litigation firm, yesterday unveiled a merger with Berrymans Lace Mawer. The transaction will create BLM, a £100m business focused Britain and Ireland. It will have 1,550 employees, including 170 partners and 630 lawyers working out of 12 offices, The Scotsman reports.

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