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UK Corporate Announcements IAG announces H1 revenues of €8.53bn up 9.8% and a Q2 EBIT loss of €42, largely in line with the forecasts, and details it now sees a small loss for 2012, and states that Iberia’s problems are ‘deep and structural’ Inmarsat reports an H1 EBITDA of $381m from $427m on revenues of $684.2m and maintains its revenue guidance RBS announces an operating profit of £650m from £833m , largely in line, and states that the Ulster Bank computer glitch has been ‘largely rectified’ and details it has plans for an IPO of its Direct Line insurance unit, and details it has dismissed some employees for Libor misconduct Rentokil announces Q2 revenues of £632m just ahead of the forecasts, and states it has a reasonable expectation that the group has adequate funds, and continues to operate on a going concern basis |
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UK Market News The Bank of England rate announcement was rather a sideshow yesterday with little unexpected news flow coming from the MPC, and as global markets remain more preoccupied with events across the channel The Times writes that Virgin may be off the UK railways after a ‘an increasingly bitter’ competition for the West Coast Main Line has been branded ‘a shambles’ NIESR states that the economic deterioration has been even more pronounced that forecasts and expects the UK economy to contract 0.5% in 2012, which will force Chancellor Osborne to miss the budget deficit targets London luxury homes gained by just 0.5% in July, the slowest rate for over 18 months, with agents citing the recently increased sales tax, up to 7% from 5% and on talk that the government may create a 15% tax for offshore companies buying property Glaxo confirms today that it has completed its purchase of Human Genome Sciences The UK sells up to £2.5bn in Bills today at 11:10 |
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UK Analyst Upgrades Segro Pt Raised 4% To 250P At Exane; Kept At Neutral Willis Group Raised To Buy Vs Neutral At Citi |
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UK Analyst Cuts Morgan Crucible Cut To Neutral Vs Buy At Goldman Sabmiller Cut To Hold From Buy At Socgen Thomas Cook Pt Cut 25% To 15P At Exane; Kept At Underperform |
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UK Insider Buys Atkins (Ws) Plc, (ATK), 2 insider(s) bought 11,450 shares, £6.73 Devro Plc, (DVO), 1 insider(s) bought 2,500 shares, £3 F&C Asset Management P, (FCAM), 1 insider(s) bought 100,000 shares, £0.87 Jardine Lloyd Thompson, (JLT), 1 insider(s) bought 5,000 shares, £7.36 Qinetiq Group Plc, (QQ/), 1 insider(s) bought 10,000 shares, £1.69 Rolls-Royce Holdings P, (RR/), 1 insider(s) bought 7,500 shares, £8.76 |
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UK Insider Sells Rathbone Brothers Plc, (RAT), 1 insider(s) bought 5,000 shares, £12.9 |
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Major European Companies Reporting Allianz SE, Q2, 2.683, Amadeus IT Holding SA, S1, 0.77, AXA SA, S1, 0.93, Davide Campari-Milano SpA, S1, 0.14, Givaudan SA, S1, 28.523, Inmarsat PLC, S1, 0.32, International Consolidated Airlines Group SA, S1, -0.15, Intesa Sanpaolo SpA, S1, 0, Logica PLC, S1, 0.043, Meda AB, Q2, 1.116, OC Oerlikon Corp AG, S1, 0, Rentokil Initial PLC, S1, 0.032, Royal Bank of Scotland Group PLC, S1, 0.125, UniCredit SpA, S1, 0 |
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European Market Summary European markets came off into the close yesterday as Draghi was not able to live up to the speculation that mounted over the recent days, with the press highlighting how he has demanded that eurozone governments use existing rescue funds before any intervention by the ECB Late in yesterday’s trading session S&P cut its ratings on ArcelorMittal to junk, to BB+/B from BBB-/A-3 as it expects the steel industry environment to continue to weaken The IMF and EU have criticised Serbia for a draft law that threatens the independence of its central bank, and moves which have resulted in the current governor of the central bank to step down SAP has agreed to pay $300m to settle a lawsuit that it infringed upon Oracle’s patents Siemens announces that it plans to buy back as many as €3bn of shares by the end of the year and cancel some 33m shares held in treasury |
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S&P 500 Companies Reporting Consolidated Edison Inc, Q2, 0.594, EOG Resources Inc, Q2, 0.941, Goodrich Corp, Q2, 1.72, Leucadia National Corp, Q2, 0, Monster Beverage Corp, Q2, 0.608, NYSE Euronext, Q2, 0.501, Procter & Gamble Co/The, Q4, 0.77, Viacom Inc, Q3, 0.999 |
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Major US Stock Movers After Hours Blue Nile gained over 25% after hours as it announces Q3 net sales ahead of the forecasts Activision came off 2.5% in late trading after it reports a Q2 EPS ahead of the forecasts, but then guided lower on Q3 |
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US Market News As expected Knight Capital stated after hours that it is to open its books to potential buyers, and details it is to work with Goldman Sachs as advisor, as counterparties have been pulling away from the market maker after yesterday’s trading error losses thought to be around $450m, at the firm which now has a market cap of $250m, closing at $2.58 yesterday, having ended July over $10/share The Knight Capital trades will force the authorities to take yet another look at high frequency trading on US exchanges and the dominance they have on intraday moves CBS after hours announced Q2 profit gained 8.1% ahead of the expectations, buoyed by higher affiliate revenues and subscription fees JPMorgan is to close a fund that was marketed as a fund that would invest in line with Catholic beliefs The IMF states that the US budget outlook for 2013 is ‘extraordinarily uncertain’ as Congress is yet to resolve the ‘Fiscal Cliff’ of around $600bn in higher taxes and reduced government spending programs due to take effect from 2013 Knight Capital was the largest market maker on ETFs in the US, reports out detail that the average spread on some of the more illiquid ETFs has widened to 1.5%, from around 0.5% in July With the slide in Facebook’s share price since its IPO Mark Zuckerberg is now out of the Top 10 list of technology billionaires, the stock is now off 47% from its IPO price of $38 |
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Overnight Market News Asian markets opened lower following the negativity in the US, but have attempted to rally from these lows as the selloff was more due to the Eurozone concerns than its local situation Sharp has fallen another 25% overnight, compounding the losses already posted in recent months, as it once more reduces its full year outlook, and cuts an additional 5,000 jobs, the stock is now trading back at levels not seen since 1975 Sony also came off quite sharply today as it cuts its full year net income forecasts In Australian trading ResMed was up 10% as the medical devices maker detailed results ahead of the forecasts Japan’s FSA Minister has stated that Nomura has been ordered to improve its actions on leaks, and needs to implement reforms to restore trust China announces that it has cut the fees on trading equities by 20% as authorities attempt to increase demand as the indices have come off around 15% so far in 2012 and also is reportedly considering a cut in stamp duty fees on share trading The South China Post estimates that the total advertising spend in China next year will total around $53bn, up from $46bn estimated for this year, and to take it to the second largest market behind the US, and ahead of Japan in third Japan Airlines is to relist in Tokyo in September, in an IPO worth around $8.5bn, after moving into bankruptcy three years ago |
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Major Global IPOs Due Today Echeverria Izquierdo SA, (EISA), 151.341m, N.A. FDT System Holding AB, (FDT), 0.46m, SEK 4.45 |
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FX Summary The yen strengthened as safe haven buying continues yesterday afternoon The euro initially spiked higher on the Draghi press conference yesterday but quickly reversed these gains as once again the detail failed to live up to the expectations US Non Farm payrolls will of course be the major focus this afternoon, with 100k expected, from 80k previously |
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Economic Data Due 09:30 UK July PMI Services, 51.6 exp. 51.3 previous 10:00 June Eurozone ratail Sales, -0.1% exp. 0.6% previous 13:30 US July Change in Non Farm Payrolls, 100k exp. 80k previous 13:30 US July Unemployment, 8.2% exp. 8.2% previous 15:00 US July Non Manufacturing ISM, 52.0 exp. 52.1 previous |