| Stocks flat as ECB rumours erase losses
Market Movers
techMARK 2,104.09 +0.20%
FTSE 100 5,776.60 0.00%
FTSE 250 11,449.06 -0.15% The Footsie rallied in late trading to finish flat on Friday after rumours that of a European plan for bonds yields.
According to Reuters, the European Central Bank (ECB) is looking at setting yield band targets under its new bond-buying programme. The move would help the ECB to shield its strategy and stop speculators trying to cash in. "That is one of the options that is currently being discussed in the working groups and will then be handled by the Governing Council,” an unnamed Eurozone official told the news agency.
In the Eurozone, German Chancellor Angela Merkel said this afternoon that she wanted to keep Greece in the single-currency region and said that Athens “will do what it takes to solve the problem.” However, there was no mention regarding Greek Prime Minister Antonis Samaras’s plea for a two-year extension to meet its bailout terms.
The state of Britain's economy in the second quarter was bad but not as bad as initially feared, revised figures for GDP show. Having initially estimated that GDP fell 0.7% in the second quarter, the Office for National Statistics (ONS) has revised its numbers which now indicate a 0.5% quarterly decline in GDP, bang in line with market expectations. FTSE 100: M&S jumps late on after takeover rumours
Shares in Marks & Spencer jumped on Friday afternoon on rumours that private equity titan CVC Capital Partners is considering a takeover offer for the High Street group. It is thought that CVC is looking at an bid and has approached executives both inside and outside the firm “about a possible management role under private equity control,” according to Bloombergwhich has spoken to unnamed sources close the matter.
Mining stocks were heavy fallers with Kazakhmys, Rio Tinto, ENRC, Antofagasta, Anglo American, Vedanta, BHP Billiton and Randgold falling sharply.
Anglo American dropped after Jefferies downgraded the stock this morning from 'buy' to 'hold' despite yesterday's news that it had resolved a 10-month dispute with Codelco relating to assets in Chile. "While this outcome should be a modest positive for Anglo, we are increasingly concerned about the fundamental outlook for the company" the broker said.
Financials were also out favour with fund manager Ashmore among the worst performers after Citigroup lowered its rating to 'sell'.
Meanwhile, utilities stocks were benefitting from as risk appetite was scaled back. National Grid gained after Nomura said that the stock remains a top pick in the European utilities sector. It is a "compelling growth story rising visibility". FTSE 250: Berendsen gains; Stobart drops Work-wear and wash-room facilities provider Berendsen rose after increasing profitability in the first half of 2012, despite a small dip in revenues.
Logistics firm Stobart fell after saying its short-term performance in transport is lower than market expectations as the current recessionary climate continues to hurt the sector.
| London Market Report |  | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | Stocks flat as ECB rumours erase losses
Market Movers
techMARK 2,104.09 +0.20%
FTSE 100 5,776.60 0.00%
FTSE 250 11,449.06 -0.15% The Footsie rallied in late trading to finish flat on Friday after rumours that of a European plan for bonds yields.
According to Reuters, the European Central Bank (ECB) is looking at setting yield band targets under its new bond-buying programme. The move would help the ECB to shield its strategy and stop speculators trying to cash in. "That is one of the options that is currently being discussed in the working groups and will then be handled by the Governing Council,” an unnamed Eurozone official told the news agency.
In the Eurozone, German Chancellor Angela Merkel said this afternoon that she wanted to keep Greece in the single-currency region and said that Athens “will do what it takes to solve the problem.” However, there was no mention regarding Greek Prime Minister Antonis Samaras’s plea for a two-year extension to meet its bailout terms.
The state of Britain's economy in the second quarter was bad but not as bad as initially feared, revised figures for GDP show. Having initially estimated that GDP fell 0.7% in the second quarter, the Office for National Statistics (ONS) has revised its numbers which now indicate a 0.5% quarterly decline in GDP, bang in line with market expectations. FTSE 100: M&S jumps late on after takeover rumours
Shares in Marks & Spencer jumped on Friday afternoon on rumours that private equity titan CVC Capital Partners is considering a takeover offer for the High Street group. It is thought that CVC is looking at an bid and has approached executives both inside and outside the firm “about a possible management role under private equity control,” according to Bloombergwhich has spoken to unnamed sources close the matter.
Mining stocks were heavy fallers with Kazakhmys, Rio Tinto, ENRC, Antofagasta, Anglo American, Vedanta, BHP Billiton and Randgold falling sharply.
Anglo American dropped after Jefferies downgraded the stock this morning from 'buy' to 'hold' despite yesterday's news that it had resolved a 10-month dispute with Codelco relating to assets in Chile. "While this outcome should be a modest positive for Anglo, we are increasingly concerned about the fundamental outlook for the company" the broker said.
Financials were also out favour with fund manager Ashmore among the worst performers after Citigroup lowered its rating to 'sell'.
Meanwhile, utilities stocks were benefitting from as risk appetite was scaled back. National Grid gained after Nomura said that the stock remains a top pick in the European utilities sector. It is a "compelling growth story rising visibility". FTSE 250: Berendsen gains; Stobart drops Work-wear and wash-room facilities provider Berendsen rose after increasing profitability in the first half of 2012, despite a small dip in revenues.
Logistics firm Stobart fell after saying its short-term performance in transport is lower than market expectations as the current recessionary climate continues to hurt the sector. |
FTSE 100 - Risers
Marks & Spencer Group (MKS) 371.70p +4.26%
Smith & Nephew (SN.) 668.00p +1.52%
Reckitt Benckiser Group (RB.) 3,615.00p +1.49%
Standard Chartered (STAN) 1,413.00p +1.33%
Centrica (CNA) 327.40p +1.30%
Unilever (ULVR) 2,273.00p +1.16%
Aggreko (AGK) 2,284.00p +1.11%
CRH (CRH) 1,131.00p +1.07%
Associated British Foods (ABF) 1,329.00p +1.06%
Kingfisher (KGF) 285.70p +0.99%
FTSE 100 - Fallers
Ashmore Group (ASHM) 331.50p -4.33%
Eurasian Natural Resources Corp. (ENRC) 338.90p -3.58%
Evraz (EVR) 246.80p -3.06%
Kazakhmys (KAZ) 660.50p -2.94%
Anglo American (AAL) 1,885.00p -2.91%
Weir Group (WEIR) 1,692.00p -2.76%
Royal Bank of Scotland Group (RBS) 222.90p -2.19%
Barclays (BARC) 187.20p -1.99%
Tullow Oil (TLW) 1,370.00p -1.86%
GKN (GKN) 220.10p -1.70%
FTSE 250 - Risers
Dunelm Group (DNLM) 595.50p +6.43%
Computacenter (CCC) 390.00p +4.81%
Perform Group (PER) 380.00p +3.49%
QinetiQ Group (QQ.) 173.90p +3.39%
Phoenix Group Holdings (DI) (PHNX) 498.30p +2.74%
Brown (N.) Group (BWNG) 274.40p +2.54%
Premier Farnell (PFL) 189.00p +2.33%
Millennium & Copthorne Hotels (MLC) 488.10p +2.28%
Imagination Technologies Group (IMG) 566.50p +2.16%
Berendsen (BRSN) 524.50p +2.04%
FTSE 250 - Fallers
Ferrexpo (FXPO) 183.00p -4.59%
Salamander Energy (SMDR) 194.60p -4.47%
Moneysupermarket.com Group (MONY) 131.00p -4.38%
Man Group (EMG) 75.75p -4.17%
Hays (HAS) 77.40p -4.03%
Ocado Group (OCDO) 62.80p -3.53%
Stobart Group Ltd. (STOB) 114.90p -3.53%
Aquarius Platinum Ltd. (AQP) 39.76p -3.26%
Domino Printing Sciences (DNO) 566.00p -3.25%
Bodycote (BOY) 343.60p -3.13%
| FX round-up | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  | | | | | | European Markets Closed Friday With Modest Gains
The Euro Stoxx 50 index of Eurozone bluechip stocks increased by 0.28 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.24 percent.
The DAX of Germany climbed by 0.31 percent and the CAC 40 of France rose by 0.02 percent. The FTSE 100 of the U.K. finished up by 0.01 percent and the SMI of Switzerland gained 0.34 percent.
In Frankfurt, Deutsche Bank fell by 0.65 percent, but Commerzbank gained 0.95 percent.
Volkswagen dropped by 2.26 percent, BMW lost 1.28 percent and Daimler declined by 0.66 percent.
In Paris, Societe Generale finished lower by 0.94 percent. BNP Paribas declined by 1.73 percent and Credit Agricole dropped by 0.77 percent.
Renault declined by 2.30 percent and Peugeot closed down by 4.39 percent.
In London, Anglo American dropped by 2.91 percent. The British miner and Chilean state-owned Corporación Nacional del Cobre de Chile finally reached a settlement on the legal tussle between the two since October 2011 related to stakes in Anglo American Sur SA - the Chilean unit of Anglo American.
Vedanta Resources fell by 1.70 percent and Eurasian Natural Resources lost 3.58 percent. Kazakhmys declined by 2.94 percent and Anotfagasta finished lower by 1.48 percent. BHP Billiton dropped by 1.40 percent and Rio Tinto closed down by 1.59 percent.
HSBC Holdings fell by 0.38 percent after Standard & Poor's downgraded its outlook for the lender to "negative" from 'stable" citing U.S money-laundering investigations and other regulatory issues.
Barclays dropped by 1.99 percent, Lloyds Banking Group lost 0.19 percent and Royal Bank of Scotland decreased by 2.19 percent.
SeaEnergy declined by 7.20 percent after, the company acquired Aberdeen-based Return To Scene LTD or R2S for an initial cash payment of 5 million pounds. The U.K. economy contracted less than initially estimated in the second quarter on smaller declines in construction and production sectors. Gross domestic product shrank 0.5 percent in the second quarter, revised upwards by 0.2 percentage points from the fall of 0.7 percent published on July 25, data from the Office for National Statistics showed Friday.
Output of the U.K. services sector declined sharply in June, following a rebound in the previous month, data released by the Office for National Statistics revealed Friday. The index of services dropped 1.7 percent from May, when it rose 0.9 percent. Economists had expected a 1.8 percent decline. |
| US Market Report | | Stocks Show Turnaround Amid Latest Reports Out Of Europe
Stocks have shown a notable turnaround over the course of the trading day on Friday after showing a modest move to the downside in early trading. The markets have benefited from a positive reaction to the latest reports out of Europe.
After turning higher over the course of the morning, the major averages have given back some ground in recent trading. The Dow currently remains up 62.68 points or 0.5 percent at 13,120.14, the Nasdaq is up 11.54 points or 0.4 percent at 3,064.94 and the S&P 500 is up 5.47 points or 0.4 percent at 1,407.55.
The turnaround by stocks was partly due to a report from Reuters indicating that the European Central Bank is considering setting yield band targets under a new bond-buying program.
Central bank sources told Reuters that setting a band is an option gaining in favor among central bankers, but the decision would not be made before the ECB's next monetary policy meeting on September 6th.
The markets have also benefited from news of a letter Federal Reserve Chairman Ben Bernanke sent to Rep. Darrell Issa, R-Calif., defending the Fed's actions to support the economy.
In the letter, which was obtained by the Wall Street Journal, Bernanke also told Issa there is "scope for further action by the Federal Reserve to ease financial conditions and strengthen the recovery."
The weakness seen earlier in the session was partly due to a negative reaction to the Commerce Department's report on durable goods orders in the month of July.
While the report showed a much bigger than expected increase in durable goods orders, the increase was largely due to strength in the volatile transportation sector.
Traders also continued to express concerns about the situation in Europe, where Greek Prime Minister Antonis Samaras held a meeting with Chancellor Angela Merkel.
In remarks at a joint press conference, Samaras pledged that Greece will "stick to its commitments and fulfill its obligations" but noted that the debt-plagued nation needs "time to breathe" as it undertakes crucial reforms.
Merkel did not immediately respond to the request for more time to implement reforms but stressed that Germany wants to help Greece remain in the eurozone.
Sector News
Biotechnology stocks have shown a strong move to the upside on the day, driving the NYSE Arca Biotechnology Index up by 1.1 percent. Earlier in the session, the index reached its best intraday level in almost a month.
Alexion Pharmaceuticals (ALXN) and Nektar Therapeutics (NKTR) are turning in two of the biotech sector's best performances, advancing by 2.7 percent and 2.4 percent, respectively.
Significant strength is also visible among telecom stocks, as reflected by the 1 percent gain being posted by the NYSE Arca North American Telecom Index. Sprint Nextel (S) and Verizon (VZ) are posting notable gains.
Housing, pharmaceutical, and natural gas stocks have also moved to the upside, while considerable weakness remains visible among steel stocks. The NYSE Arca Steel Index is down by 1.4 percent amid concerns about the outlook for global steel demand. |
| Sector movers | | Marks and Spencer lifts retailers after takeover rumours Retailers were on the up on Friday afternoon after Marks and Spencer jumped on rumours that private equity titan CVC Capital Partners is considering a takeover offer for the High Street group. It is thought that CVC is looking at an offer and has approached executives both inside and outside the firm “about a possible management role under private equity control,” according to Bloomberg which has spoken to unnamed sources close the matter. Shares in M&S fell the day before as analysts at Santander said that the company would be too expensive for private equity funds or sovereign wealth funds given its £8.2bn enterprise value. “While we agree that M&S has a strong brand heritage, we do not believe that there would be an appetite at current levels,” a Santander analyst was quoted as saying. Sector peer Kingfisher was also in demand, the same day that Morgan Stanley reiterated its ‘overweight’ rating and 325p target price for the stock. Pharmaceuticals stocks were also making gains this afternoon with GlaxoSmithKline in the lead after announcing that it has completed, along with partner Theravance, the phase III programme of a 52-week safety study for its UMEC/VI medicine for the maintenance treatment of chronic obstructive pulmonary disease (COPD). This, along with other completed studies, “supports GSK's plans to commence global regulatory submissions for UMEC/VI from the end of 2012,” the firm said. Sector peer AstraZeneca also rose this afternoon, as the pharma sector benefits as risk appetite is scaled back. Top performing sectors so far today
General Retailers 1,831.15 +0.95% Health Care Equipment & Services 3,735.99 +0.82% Household Goods & Home Construction 7,349.86 +0.75% Pharmaceuticals & Biotechnology 9,946.96 +0.61% Food Producers & Processors 5,944.78 +0.56% Bottom performing sectors so far today
Industrial Metals & Mining 2,597.88 -2.94% Automobiles & Parts 5,120.36 -2.19% Mining 17,819.02 -1.99% Electronic & Electrical Equipment 3,289.15 -1.71% Industrial Engineering 7,251.09 -1.58% |
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