Market news round up, upgrades & downgrades courtesy of Cantor Index

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Monday, November 19, 2012

UK Corporate Announcements

Mitie reports an H1 adjusted operating profit of £52.9m on revenues of £1.03bn and states that 98% of the full year budget has been secured end September and stays confident on its outlook

Intertek announces that its full year adjusted operating profit margin is expected to be stable

Lamprell states that it sees a gradual return to profitability in 2013 with broadly flat revenues seen, but does detail that is now sees a much greater loss for the full year than previously anticipated

Costain announces that it continues to perform well

Chime Communications stated that trading profits for the full year will be in line

Majestic Wine announces an H1 pre-tax profit of £9.2m with 6 week same store sales up 1.2%

Diploma reports a full year adjusted pre-tax profit of £52.6m with full year sales up 13% and states that it is well placed to make further progress

UK Market News

The FT suggests that one in ten UK businesses are ‘zombies’ being kept artificially alive due to ‘ultra-loose’ monetary policy and the lender reluctance to write off bad loans

UK carriers will be eyed after reports that Virgin Atlantic is set to announce today a move into short haul flights from Heathrow

The Sunday Times suggests that BP plans to buy back as much as £3.7bn of its own stock, and as the group is increasingly being mentioned as a potential takeover target

The paper also suggests that the network of 300 RBS branches could be nationalised and turned into a new lender, if a buyer was not found

While HSBC details that it is in talks to sell its stake in Ping An Insurance, worth around $9bn

The Association of British Insurers is expected to detail that political interference, regulatory changes and opaque accounts were making British banking shares ‘’uninvestible’

The Bank of England’s Miles has stated that the central bank is able to do more to boost growth, if the current slow conditions were to persist

UK Analyst Upgrades

Diageo Pt Raised To 2,050P Vs 1,900P At Socgen, Stays Buy

Genus Added To Conviction Buy List At Goldman

Next Added To Credit Suisse’S Focus List

Next Rated New Outperform At Credit Suisse, Pt 4,200P

Paragon Pt Raised To 280P Vs 230P At Berenberg, Stays Buy

Premier Oil Pt Cut To 500P Vs 525P At Socgen, Stays Buy

Premier Oil Raised To Hold From Sell At Liberum

Wolfson Microelectronics Pt Raised To 230P Vs 200P At Liberum

Buy IMI, Remains Top UK Engineering Pick, Citi Says

Eurasian Natural Resources Raised to Outperform at RBC Capital

Lonmin Raised To Buy From Reduce At Nomura

Diageo Raised To Overweight From Equalweight At Barclays

UK Analyst Cuts

Pennon Cut To Underperform Vs Neutral At Bofaml

Pennon Group Cut to Equalweight from Overweight at Barclays

UK Insider Buying

None detailed

UK Insider Selling

Sell Bwin, Short-Term Trends Weak, Citi says

G4S Cut To Neutral Vs Outperform At Credit Suisse

Serco Cut To Neutral Vs Outperform At Credit Suisse

Invensys Pt Cut To 254P Vs 270P At Morgan Stanley

Major European Companies Reporting

AHufvudstaden AB, Q3, 0.815,  Mitie Group PLC, S1, 0,  Subsea 7 SA, Q3, 0.409

European Market Summary

The FT writes that EU officials have started to work on a long term budget that did not include Britain, as frustrations continue the UK and its stance on required much needed reforms, while David Milliband states that the UK risks sleepwalking toward an EU exit

After the close Fugro announces that it was cutting its full year outlook and that its CEO is to leave

SAS Group states that it may shutdown its activities if talks with labor unions were to drag on, with crews on all outbound flights informed to carry enough cash to meet their own expenses

Nokia sells Nok3bn in bonds at 11:10, while France sells up to €7bn in bills at 15:00

Major US Stock Movers After Hours

Applied Materials gained around 1% in late trading despite announcing forecast just under the consensus, but stayed relatively optimistic for 2013

S&P 500 Companies Reporting

Agilent Technologies Inc, Q4, 0.799,  Lowe’s Cos Inc, Q3, 0.35,  Tyson Foods Inc, Q4, 0.439,  Urban Outfitters Inc, Q3, 0.414

US Market News

The US corporate reporting season continues to wind down, ahead of Thanksgiving this Thursday and half day trading on Friday

The recent sell off in the US has brought the S&P 500 price-earnings ratio down to historically low levels, with some analysts suggesting that fears over the fiscal cliff have now been largely priced in, with current levels looking extremely attractive for the longer term

Yahoo has reportedly held talks with Facebook which could end Yahoo’s relationship with Microsoft

Tim Geithner has stated that a deal to avert the fiscal cliff was ‘within out grasp’

Cisco announces that it is buying Meraki for $1.2bn in cash

Barron’s suggest that Bank of New York Mellon and JP Morgan could gain on expected share buy back increases seen ahead

The paper also highlights analysts that see Lear Corp as potentially more than doubling in the next few years, citing a potential windfall of its 23% stake in IAC Group with may list 

Barron’s also writes that Leucadia National looks positive following its acquisition of Jefferies

JPMorgan agrees to pay $297 to settle an SEC lawsuit into home loans

Cablevision has reportedly hired JP Morgan to advise on a sale of its Bresnan Broadband unit

Despite the recent market sell off VIX stays at relatively low levels, at 16.41 yesterday and at its lowest for a few weeks

Overnight Market News

Billabong America’s president is reportedly looking at a possible leveraged buyout, with the stock gaining 10% on the story

New home prices in China gained in October in more cities than in September, 35 out of 70, with 17 seeing falls

President Obama is in Myanmar, (formerly Burma) the first such visit for a US president on a three day visit to the region

Major Global IPOs Due Today

Alon USA Partners LP, (ALDW), 10m, USD 19 – 21

FX Summary

The yen moved down to a seven month low today, as the Bank of Japan starts its two day meeting as the market continues to price in a new government at next months general elections

China’s central bank governor has stated that the next step in the overhaul of the exchange rate system will yuan convertibility

Economic Data Due

00:01 UK November Rightmove House Prices, 3.5% previous

15:00 US October Existing Home Sales, 4.74m exp. 4.75m previous

Economic Events

08:30 EU Foreign, Defence Ministers Meet in Brussels

09:00 WTO Dispute Settlement Body Meets

10:30 UK Business Secretary Cable speaks at CBI Conference

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