Morning market commentary & day ahead
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UK Corporate Announcements Arm Holdings announces Q2 adjusted EPS of 3.58p on revenues of $422m up 12%, just ahead of the forecasts BT reports a Q1 adjusted EBITDA of £1.46bn, in line with the forecasts, although Q1 revenues of £4.48bn came in just under the forecasts and states it is making good progress in faster growing economies British American Tobacco announces H1 adjusted operating profit of £2.84bn, in line, on revenues of £7.45bn E2V Technologies states that its trading forecasts are unchanged Informa reports an H1 loss of £41.9m and expects to meet its full year estimates Capita announces H1 sales of £1.61bn from £1.4bn and states that it is well positioned for further growth, and has clear visibility for the full year Tullow Oil announces H1 revenues gained 10% to $1.17bn and a basic EPS of 60.3 cents up 63% Mecom Group reports an H1 pre-tax profit of €43.1m from a loss of €10.1m and states that its restructuring program is ahead of the plan British Land announces it is buying Clarges Estate in London for £129m and confirms its dividend of 6.6p Easyjet announces full year pre-tax profit ahead of the estimates and states that Olympics have hurt demand for London services Cookson announces H1 pre-tax profit of £1.3bn, largely in line with the expectations, on revenues of £1.3bn, and states its strategic review is proceeding as planned Renishaw announces full year revenues of £331.9m from £288.7m and a full year adjusted operating profit of £83.2m from £79.3m and states that all geographic areas saw good progress Johnson Matthey states that it has seen continued weakness in precious metals, but that its balance sheet remains strong, with Q1 sales to £657m up 6% |
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UK Market News The ONS detail UK GDP numbers this morning, and is expected to show a continued double dip recession The FSA chair Adair Turner stays in the news after he signalled yesterday that he would be interested in the chairman role at Barclays LME shareholders vote today on the offer from Hong Kong Exchange State owned Rosneft stays in the news as it detailed yesterday it would be interested in buying into TNK BP, while Russia’s Supreme Court orders a review of the conviction of former Yukos Oil billionaire Mikhail Khodorkovsky The UK Dept. of Energy has detailed revised subsidies for renewable energy |
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UK Dividends FTSE 100 Ex dividends (net): SSE, SSE, (56.10) FTSE 100 Ex dividend impact estimate: 1.4 points FTSE 250 Ex dividends (net): Bankers Investment Trust PLC/The, BNKR, (3.30), Fenner PLC, FENR, (3.50), Investec PLC, INVP, (9), London Stock Exchange Group PLC, LSE, (19), WS Atkins PLC, ATK, (20.75) FTSE Small Share Ex dividends (net): Artemis Alpha Trust PLC, ATS, (1.75), Throgmorton Trust PLC/The, THRG, (.62), Volex PLC, VLX, (.03) |
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UK Analyst Upgrades Croda International, PT rasied 25 to £20.6, at Exane, Kept at Neutral |
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Major European Companies Reporting Abertis Infraestructuras SA, S1, 0, Acciona SA, S1, 0, ArcelorMittal, Q2, 0.303, Banco de Sabadell SA, S1, 0, Daimler AG, Q2, 1.283, Elan Corp PLC, Q2, 0.016, Iberdrola SA, S1, 0.23, Jeronimo Martins SGPS SA, S1, 0.26, Kesko OYJ, Q2, 0.418, Konecranes OYJ, Q2, 0.369, Lonza Group AG, S1, 1.87, MTU Aero Engines Holding AG, Q2, 0.99, Nexans SA, S1, 0.915, Peugeot SA, S1, -0.882, SEB SA, S1, 0, Temenos Group AG, Q2, 0.107, Thales SA, S1, 1.02, Verbund AG, Q2, 0.24, Wacker Chemie AG, Q2, 1.003, Wolters Kluwer NV, S1, 0.645 |
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European Market Summary The Telegraph writes on how a UK government report suggests that Greece could move to bankruptcy as early as August 20th, as it also writes that economists fear that the eurozone continues to ‘sleepwalk to disaster’ Moody’s has today amended its stance on the European Financial Stability facility (EFSF) outlook to negative European politicians continue to state that the strength of the European economy is not reflected in the current borrowing costs, the markets however have continued to filter out political spin and focus on the hard numbers, Spanish 10 year yields moved to yet another record yesterday to 7.64%, with some asking if we can even get to 8% European carmakers will be eyed as Peugeot and Daimler report today, Citroen details it has plans to makes cost cuts worth €1.5bn by 2015, while Daimler reports Q2 EBIT largely in line |
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S&P 500 Companies Reporting ACE Ltd, Q2, 1.912, Airgas Inc, Q1, 1.152, Akamai Technologies Inc, Q2, 0.371, Alexion Pharmaceuticals Inc, Q2, 0.364, Allegheny Technologies Inc, Q2, 0.548, Assurant Inc, Q2, 1.411, AvalonBay Communities Inc, Q2, 1.342, Boeing Co/The, Q2, 1.117, Bristol-Myers Squibb Co, Q2, 0.49, Caterpillar Inc, Q2, 2.287, Citrix Systems Inc, Q2, 0.595, Cliffs Natural Resources Inc, Q2, 1.766, ConocoPhillips, Q2, 1.266, Cooper Industries PLC, Q2, 1.119, Corning Inc, Q2, 0.311, CR Bard Inc, Q2, 1.639, Crown Castle International Corp, Q2, 0.173, Eli Lilly & Co, Q2, 0.759, Equifax Inc, Q2, 0.715, Equity Residential, Q2, 0.675, Ford Motor Co, Q2, 0.285, General Dynamics Corp, Q2, 1.741, Hess Corp, Q2, 1.391, Lam Research Corp, Q4, 0.653, Lorillard Inc, Q2, 2.318, LSI Corp, Q2, 0.174, MeadWestvaco Corp, Q2, 0.386, Motorola Solutions Inc, Q2, 0.686, NASDAQ OMX Group Inc/The, Q2, 0.601, Northrop Grumman Corp, Q2, 1.607, O’Reilly Automotive Inc, Q2, 1.144, Owens-Illinois Inc, Q2, 0.758, PepsiCo Inc, Q2, 1.095, Praxair Inc, Q2, 1.423, Rockwell Automation Inc, Q3, 1.307, Southern Co/The, Q2, 0.681, Stericycle Inc, Q2, 0.798, Symantec Corp, Q1, 0.375, T Rowe Price Group Inc, Q2, 0.806, TE Connectivity Ltd, Q3, 0.783, Teradyne Inc, Q2, 0.578, Thermo Fisher Scientific Inc, Q2, 1.161, Torchmark Corp, Q2, 1.304, Varian Medical Systems Inc, Q3, 0.934, Visa Inc, Q3, 1.452, WellPoint Inc, Q2, 2.079, Western Digital Corp, Q4, 2.448, Whole Foods Market Inc, Q3, 0.606, Wyndham Worldwide Corp, Q2, 0.843 S&P 500 Ex Dividends (Gross):- ConAgra Foods Inc, CAG, (.24), Tyco International Ltd, TYC, (.25), Fastenal Co, FAST, (.19) |
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Major US Stock Movers After Hours Apple fell 6% after hours after only its second miss in the past decade, citing users putting off purchases on iPhone 4, waiting for the iPhone 5, although analysts are concerned that it is as much due to the tough global consumer environment, it also forecast revenues of around $34bn in Q4, down from $38bn NetFlix came off 14% as stays cautious on user growth and details possible losses ahead RiverBed Technology gained 23% after hours as it announced revenues were expected to gained 15% for the full year, ahead of the forecasts TripAdvisor fell 16% as it detailed Q2 revenues under the estimates, despite revenues gaining 16% to $197m Buffalo Wild Wings slumped 14% as it cuts its outlook citing higher costs Juniper gained 3% as it announces Q2 profit and sales ahead of the forecasts |
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US Market News The FT reports that Google has agreed the broad outlines of a settlements deal with EU authorities to avoid formal antitrust charges The FT also writes on how a group of wealthy ‘pro-Republican hedge fund managers’ are attempting to shuffle some republican feathers buy backing moves to legalise same sex marriage Apple suppliers will be eyed today after the miss yesterday evening The WSJ suggests that Federal Reserve officials are seen increasingly to be impatient with the sluggish growth, and are moving closer to QEIII News Corp is in the news itself as the actors in its most watched TV programme ‘Modern Family’ are suing the Fox unit, alleging their contracts break Californian contract law, as they look to increase pay after the enormous success of the programme Bloomberg writes on how markets are pricing in that the Fed next week could state that it is prepared to keep rates low until at least mid 2015 The SEC is seen drawing up plans to force US companies to disclose whether they buy metals from central African warlords, in an effort to stop the financial support of ongoing atrocities Ancestry.com gained 16% after hours on reports that it is in talks over a possible buyout Geithner is due to deliver testimony to the House committee this morning
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Overnight Market News The Securities and Futures Commission has proposed imposing curbs on electronic trading, DMA and algorithmic trading China’s Harbin Genshi Electricity states that it plans to hold its IPO in Hong Kong, but gives no specific timeline Li Ka-Shing, the richest man in Hong Kong, has paid £645m to buy Wales & West Utilities Ltd, increasing his portfolio presence in the UK, Wales & West serves around 6.7m people in England Canon has just announced a Q2 net income of 51.7bn against estimates of around 67.6bn yen seen, and also sees a full year operating profit of 390bn under forecasts of around 445bn yen seen |
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FX Summary The euro stays down towards 11 year lows as fears mount that Germany is starting to wilt under the pressure, with German business confidence data out this morning likely to set the tone for the morning session The pound has moved to its strongest level since 2008 against the euro as the safe haven flows continue, while Gilts out performed Bunds after the Moody outlook downgrade on Germany yesterday Singapore’s Central Bank states that its growth could fall below 1% should slowdowns in US and China materialise and details that it was increasing reserves to counter the market turmoil |
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Commodity Summary Chinese steel exports gained to 8.7% of domestic output in June, as traders look to avoid the local market which has seen prices soften, the move could put pressure on the likes of ArcelorMittal which is already closing some of its plants due to the global slowdown and states today that European construction remains depressed Oil has stayed under $90 for the third day as global stockpiles have stayed strong Corn prices initially eased a touch on reports of rain due in the drought regions in the US, however they rallied somewhat after concerns that the forecasted rain would be too little too late |
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Economic Data Due 09:00 Eurozone July IFO, 104.7 exp. 105.3 previous 09:30 UK Q2 GDP, -0.2% exp. -0.3% prev. 11:00 UK July CBI Trends, -9 exp. -11 previous 15:00 US June New Home Sales, 370k exp. 369k previous |
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Economic Events EU Commission holds last meeting, pre vacation WTO General Council Meets |
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