UK/Euro Financial Market Daily Morning Briefing 27-11-2007

FREE Guaranteed Stop Loss.  Start spreadbetting with Spreadex. Click here for terms and conditions. www.spreadex.com/freestop

London shares lower in early deals; Dow fall offsets Barclays reassurance

By 9.00 am, the FTSE 100 index stood 25.4 points lower at 6,155.1 having finished off 81.6 points during the previous session. The broader FTSE 250 stood 121.5 lower at 10,330.4.
 
Early volume was moderate with 258 mln shares changing hands in 83,752 deals. Looking at key support and resistance levels today, Trading Central, a technical analysis service, sees support at 6,100, 6,043 and 6,000 with resistance seen at 6,230, 6,275 and 6,350.
   
Last night on Wall Street, US shares sold off sharply as concerns about a weakening credit market wiped out investors' enthusiasm about strong retails sales over the holiday weekend.
   
By the close the Dow was off 237.44, or 1.83 pct, to 12,743.44, closing at the lows of the session. The Standard & Poor's 500 index declined 33.48 to 1,407.22, and the Nasdaq composite index fell 55.61 to 2,540.99.
   
Over in Asia, Hong Kong's Hang Seng finished lower following HSBC's decision to bail out two of its structured investment vehicles (SIVs). A short while ago the index closed off 416.41 at 27,210.21, although Japan's Nikkei closed up 87.6 points at 15,222.8.
   
Among early UK movers, Barclays rose 7-1/2 pence to 505 after reassuring investors that it expects 2007 profit to meet analysts' expectations, helped by robust growth at its Barclaycard credit card unit. In a trading statement, Barclays said it expects its earnings per share for the year to Dec 31 2007 to be "broadly in line" with the 68.8 pence currently expected by analysts.
   
Cazevove said the trading statement confirms the bank is on track to meet analyst expectations for earnings growth of 4 pct and pre-tax profit of 7.1 bln stg in 2007.

Let Matt Shaw, Alan Rich and Mike Wright teach you the things you Must Master to Succeed Massively trading Fixed Odd Free entry, Wed 5th Dec, 6.45pm Holiday Inn, Kensington. click here to register now

It added that Barclays' comments on liquidity and the capital position of the group are reassuring given pressures within the sector. Another trader said: "Barclay's announcement appears fundamentally fine and
if it had any real bad news to relay they would had every opportunity to do so this morning - but they haven't and the business seems as strong as ever".
   
Peers Royal Bank of Scotland added 5 to 418, HBOS 10 to 753 although news of yesterday's 35 bln usd SIV bail out plan knocked HSBC's shares a further 13 pence to 797.

Continuing the earnings theme, water supplier Severn Trent rose 18 to 1480 after posting a 13.5 pct rise in profit for the first half of 2007 and reiterated that it expects summer flooding costs to remain in line with previous estimates.
   
Elsewhere, Associated British Foods slid 18-1/2 to 862 after UBS cut its rating for the food group to 'neutral', cut its target to 955p from 990 and lowered earnings estimates for 2008 and beyond as a consequence of the weaker US dollar.
   
Miners also acted as a drag on the index, mirroring falls among Asian listed counterparts. Sentiment in the sector was further dented after S&P's Ratings Services said a significant slowdown in Chinese economy will have an adverse effect on the Australian mining companies, which have been the major beneficiaries of the China growth story in recent past.
   
Vedanta dipped 54 pence to 2,002, Xstrata fell 71 to 2,992, Rio eased 95 to 5,138 and BHP dropped 15 to 1,526. Northern Rock continued its yo-yo performance by giving up initial gains to trade 3.7 lower at 106.4 after UBS cut its target for the lender to 125 pence from 195.

Over the next 10 years the UK will grow as much as it has in the last 30 years, effectively adding the population of Ireland! But the next 25 years will see the equivalent of Belgium's population added to the UK!

People = Housing = Land = Profit!

Click here to learn more.

Early on investors had taken heart from news that Sir Richard Branson, the chairman of Virgin, was prepared to put 200 mln stg of his own money into the rescue of Northern Rock as part of the deal, according to a report in the Times.
   
United Utilities also drifted lower, down 13 at 710 after HSBC cut its rating in the group to 'neutral' from 'overweight' ahead of this Thursday's H1 earnings.Turning to the second line, earnings news helped lift WS Atkins and De La Rue to the top of the midcap index.
   
WS Atkins rose 65 to 1,232 after the design and engineering consultancy group reported a 46 pct increase in pretax profit to 42.7 mln stg, beating market expectations, as it announced it would start a 100 mln stg buy-back programme.
  
De La rue ticked up 34 to 815 after saying it will continue returning cash to shareholders via dividends and special dividends following the launch of a strategic review of the company. Finally, Invensys dipped 11-1/4 to 235 after Goldman Sachs cut its target to 270 pence from 325 and reiterated its 'neutral' rating.

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

Precision Dow Trader is a one day Dow training workshop offering a unique combination of retail and institutional Dow trading experience. Learn to trade Dow Jones futures with technical, fundamental and trading psychology strategies from the experts. You will take home high probability trading strategies with precision entry and exit points to apply immediately! FREE gifts when you register today. Click Here!

Major indices:
CAC-40 up 9.04 points or 0.17 pct at 5,467.43
SBF-80 down 14.39 or 0.23 pct at 6,205.54
SBF-120 up 3.86 or 0.10 pct at 3,955.90

13 CAC-40 stocks up
27 CAC-40 stocks down

Major gainers:
BNP Paribas, up 2.56 eur or 3.63 pct at 73.06; Societe Generale, up 2.51 or 2.61 pct at 98.50. Banks are rebounding across Europe, spurred by reassuring profit forecasts from UK bank Barclays
   
Air France-KLM, up 0.66 or 2.72 pct at 24.91. Shares in the air carrier tumbled nearly 5 pct in yesterday's bearish market Theolia, 0.69 or 3.24 pct ahead at 21.99. The group announced today it has acquired Maestrale Green Energy, an Italian wind energy developer, for 5 mln eur plus a further payment depending on the number of megawatts of wind power it develops in the next three years
   
Major losers:
PPR, down 3.05 or 2.65 pct at 112.18. Credit Suisse cut its stance on the stock to 'neutral' from 'outperform' and slashed its price target to 105 eur from 144 Clarins, 2.04 or 3.34 pct lower at 59.01. French daily Le Figaro reported today that PPR has already held talks with Clarins to exchange its Yves Saint Laurent Beaute business for a minority stake

Most active stocks:
Alcatel-Lucent, up 0.05 or 0.98 pct at 5.13. 3.95 mln shares traded
Axa, up 0.35 or 1.35 pct at 26.25. 2.35 mln shares traded

Projected ROI of between 7-8% in this World renowned resort in St Lucia

Superb buy to let opportunity that allows you to enjoy the benefits of a holiday resort, with a share of room profits.  For more information click here.

Milan shares TFN market data at 9.57 am; Prysmian, Alitalia, Eni lead decline

Main indices
Mibtel at 28,884, down 0.32 pct
S&P/Mib at 37,598, down 0.37 pct

Main S&P/Mib losers
Alitalia down 1.65 pct at 0.804 after being briefly suspended for excessive fall. Dealers say they think it will be difficult for the government to finalize the sale of a controlling stake in the ailing airline by the end of this year even if the government rules out a delay to 2008
   
Prysmian down 1.42 pct at 16.24, retracing gains made yesterday Eni down 1.26 pct at 23.53 as ING cut the target on the stock to 29.9 eur from 31.4 eur while keeping its 'buy' stance and considering the group as its top pick Enel down 0.99 pct at 8.015  STMicro down 0.91 pct at 10.16

Main S&P/Mib gainers
Banca Monte dei Paschi di Siena up 1.02 pct at 3.7275 Italcementi up 0.99 pct at 13.84 after yesterday's memorandum of understanding with the Egyptian government to study the feasibility of building a wind farm in Egypt with reports saying investments in the project could total some 600 mln eur. According to dealers the move would allow Italcementi to cut its energy costs in Egypt, where it making significant investments
   
Mediobanca up 1.12 pct at 15.10 Fondiaria-SAI up 0.80 pct at 29.03 after announcing it won the auction to
buy 83.32 pct of Serbia's second largest insurance group DDOR Novi Sad for 220 mln eur Unipol up 0.85 pct at 2.37

Tiscali up 1.23 pct at 2.2675 after the release of its updated business plan which sees full year sales rising to more than 2 bln eur in 2012 from 1.3 bln in 2008. Gross operating profits should exceed 600 mln eur in 2012 from 290 mln in 2008

Open a Selftrade Dealing account, pay a flat £12.50 for all transactions.
UK and international equities, funds, bonds, covered warrants and Listed CFDs. Instant account funding via debit card. No account or inactivity fees. Click here for more information.

Amsterdam shares TFN market data at 10.11 am - AEX up at German IFO relief

MAJOR INDICES
AEX 492.78, up 0.99 points
AMX Midcap 642.99, up 1.62 points
Government bonds higher

MAJOR GAINERS
TomTom rose 2.21 pct to 63.33 eur
Unibail-Rodamco added 2.11 pct to 151.80 eur

SBM Offshore rose 1.56 pct to 23.48 eur after being upgraded to 'buy' from 'hold' at ABN Amro Boskalis put on 2.51 pct to 38.03 eur

KPN rose 1.48 pc to 12.32 eur after an upgrade to 'add' from 'neutral' at KBC Akzo Nobel rose 0.77 pct to 50.75 eur amid reports that it may have to sell 3 paints plants in the UK to allow the ICI takeover to succeed

MAJOR DECLINERS
Binckbank fell 4.27 pct to 14.34 eur
Reed Elsevier shed 0.93 pct to 11.72 eur
Unilever lost 0.96 pct to 23.61 eur

Forex:

ADVFN Services