UK/Euro Financial Market Daily Morning Briefing 21-02-2006

London

London shares open higher after Nikkei gains, with Cadbury higher

    
Leading shares were higher in opening deals, with a strong performance in Japan overnight providing direction after Wall Street was closed for Presidents' Day, dealers said.
   
At 9.00 am, the FTSE 100 was up 12.8 points at 5,875.8. The broader indices were also higher, with the exception of the FTSE Small Cap.
   
Volume was average, with 230.4 mln shares changing hands in 24,887 deals.
   
Japan's Nikkei 225 index closed up 457.01 points at 15,894.94, while Hong Kong's Hang Seng closed up 28.57 points at 15,627.24.
   
Back in London, Cadbury Schweppes was among the leading risers, up 9 pence at 569, after the world's biggest confectioner posted a 13 pct rise in 2005 underlying profit as strong sales offset soaring oil-related input costs. The company expects to deliver 2006 results in line with expectations.
   
Pretax profit before exceptionals came in at 873 mln stg, ahead of the 864 mln stg consensus analysts' forecast.
   
UBS highlighted strong organic sales growth with full year sales rising to 6.5 bln stg, up 6.5 pct, beating the 5.3 pct increase forecast by the Swiss broker.
   
Also gaining was Prudential, up 7 at 612, after increasing its with-profits payments by 18 pct, prompting positive reactions from brokers.

Discover SG Listed CFDs  a new and enhanced way of trading Contracts for Difference

WED 1st March 2006 – 6- 7.30pm  at The London Stock Exchange

All attendees will be eligible for a free £100 trade*

For details visit  www.listedCFDS.com

* Terms & conditions may apply

SocGen increased its target price to 760 pence from 625 pence while reiterating its 'buy' recommendation, noting Prudential is a very attractive investment that combines improving fundamentals and cheap valuation with speculative appeal.
   
Schroders rose 10 to 1,182, after posting an 18 pct gain in full year pretax profit to 250.7 mln stg from 211.6 mln stg a year earlier, buoyed by a 60 pct increase in profits from its Asset Management arm.
   
Analysts were forecasting a pretax profit for the year to Dec 31 2005 of 229 mln stg. Individual analyst forecasts range from 220 mln to 242 mln stg.
   
On the downside, Barclays dropped 6-1/2 after 'in-line' full year numbers failed to inspire.
   
Barclays, the UK's third-biggest bank, said 2005 pretax profit came in at 5.280 bln stg, a 15 pct increase on the previous year, and in line with the 5.1-5.4 bln stg range of analysts' forecasts.
   
Scottish & Newcastle fell 11-1/2 to 502 as investors focused on weak trading in Russia during the first weeks of 2006, where the unusually cold weather had an adverse impact on what is quite a slow month in terms of trading.
   
The group made a pretax profit under new IFRS accounting rules of 392 mln stg, up from 358 mln stg last time.
   
Vedanta Resources led the risers among the mid-caps, rising 28 to 1,038, after Goldman Sachs upgraded the stock to 'outperform' from 'in-line'.
   
Goldman said higher base metals forecasts translate to lower debt estimates at Vedanta, despite the company spending heavily on its next generation of projects in India.

A MASSIVE supply deficit is predicted to send the price of one commodity into a raging bull market - soaring 497% in the next 4 years...

Click here to claim your FREE report..

The broker had been concerned that the high capex spend of 4.2 bln usd over the next four years would leave Vedanta with a highly geared balance sheet.
   
However, on its current commodity price forecasts, Goldman said the extra cash flow generated means that it can now see substantially lower debt building up for Vedanta.
   
Arriva also gained, up 14 at 627, after Morgan Stanley upgraded to 'overweight' from 'equalweight', with an increased target price of 695 pence from 586 previously.
   
Arriva is Morgan Stanley's top pick among the Bus and Rail stocks, given the group's growth opportunities from its European business and the small exposure it has to the risky UK Rail sector.
   
Morgan Stanley advised investors to switch out of Stagecoach, down 1-1/2 at 112-3/4, and FirstGroup, up 2 at 415-1/4, into Arriva.
   
Millennium & Copthorne added 4-1/2 at 438 after 2005 pretax profit came in at 95.8 mln stg, up from 91 mln stg, and ahead of analysts' expectations.
   
BBA was the biggest mid-cap faller, down 7-1/4 at 299-1/2, after a report in the Financial Times suggested the company is considering demerging its materials technology unit Fiberweb after an auction failed to attract high enough bid.
   
Lonmin followed close behind, down 29 at 2,584, after UBS downgraded to 'neutral' from 'buy' on valuation grounds following strong gains on bid speculation.

Diary of Events

For a list of key UK financial and corporate events today, click here

Revealed: The investing secret that now makes this ex-warehouse man £4k a month tax-free!

“In my first year, using this one system, I turned an initial £100 stake into £21,585…”

To discover the most fast-moving, exciting new ‘investment’ system to hit these shores in years click here.

Amsterdam

AMSTERDAM - Market data at 08.40 GMT

   
Major indices:

   
AEX index               466.26, up 1.62 points
   
AMX Midcap  index       601.53, up 4.93 points
   
Government bonds        narrowly mixed

   
Major gainers:
   
Oil industry stocks were among leading gainers, with SBM Offshore adding 0.83 pct to 84.80 and Royal Dutch Shell gaining 0.61 pct to 26.50. Second-liner Fugro advanced 2.66 pct to 31.62 after announcing a new 3D seismic order, with a value of around 40 mln eur. SNS Securities raised its target price for the stock
to 35.50 eur from 32.50
   
Vedior put on 1.02 pct to 16.82. The staffing company announced a small acquisition in the UK
   
Financials were higher, with Fortis up 0.71 pct at 29.93, ING adding 0.58 pct to 31.37 and Aegon advancing 0.43 pct to 13.86 while ABN Amro edged up 0.08 pct to 25.06. Van der Moolen extended yesterday's gains on the back of takeover speculation, putting on 1.35 pct at 9.0 eur
   
LogicaCMG benefited from an upgrade to 'buy' from 'hold' at Deutsche Bank, rising 2.58 pct to 2.78
   

Major losers
   
KPN slipped 0.67 pct to 8.96
   
Reed Elsevier lost 0.09 pct to 11.36 after Moody's put the A3 long-term senior debt ratings under review for possible downgrade. Fellow publisher VNU
shed 0.11 pct at 27.16
   
Ahold gave up 0.29 pct to 6.81

Get a fair deal with Squaregain. Pay a flat £12.50 for online and phone trades. UK and international equities, covered warrants, funds and bonds. Limits and stops at no extra cost.
Click here for more information.

Paris

PARIS - Market data at 09.25 GMT

   
Major indices:
   
CAC-40 up 0.62 pct or 30.92 points at 5,010.86
SBF-80 up 12.60 points at 5,654.83
SBF-120 up 20.90 at 3,628.26

Volume: 628 mln eur
30 CAC-40 stocks up
7 CAC-40 stocks down
3 CAC-40 stocks unchanged

   
Major gainers:
   
Veolia Environnement, up 3.40 pct or 1.44 at 43.80, after JP Morgan raised
its share price target on the stock to 50.0 eur from 40.0 eur before.
   
Suez, up 0.87 eur at 30.55
   
EADS up 0.15 at 31.89 after winning a 10 mln eur missile warning contract
from Australia.
   
Credit Agricole, up 0.14 at 31.88 after saying it will raise its holding in Banco Espirito Santo and take 50 pct stakes in two of of the Portuguese bank's insurance units in deals with a combined value of 300-400 mln eur.
   
Sanofi-Aventis up 0.60 at 72.30, following yesterday's heavy losses triggered by the prospect of a delay to FDA approval of its anti-obesity treatment Acomplia.
   
Iliad, up 2.10 or 3.97 pct at 55.00, after an upgrade to "outperform" from "neutral" by Exane BNP Paribas on valuation grounds.

   
Major Losers
   
EDF, down 0.32 eur at 41.23, after posting strong gains in recent cessions.
   
APRR, down 0.55 at 61.25, after reporting full-year net profit late yesterday of 195 mln eur up 33 pct.
   
Klepierre, down 2.00 at 91.00, after news that BNP Paribas cut its stake in the company to less than 52 pct from 53.1 pct previously.

Forex

The Times Are A-Exchanging!

Now you can enjoy all the thrills and spills of the FTSE without having to take on the Bulls and the Bears or having to wear a ridiculous colour shirt! Paddy Power offer live betting on the movements of the FTSE, DAX, CAC 40 and the ISEQ.
Sell, Sell, Sell the old shirt and Buy, Buy, Buy a new one! Bet Now.

Comments

We welcome any suggestions or comments you may have concerning our bulletin, so please do contact us via comment@advfn.com.

ADVFN Services