FTSE 100	5900.76, +19.89	Dow	12220.59, +50.03
FTSE 250	11629.3, +23.8	Nasdaq	2743.06, +6.64
FTSE All Share	3065.83, +10.06	S&P 500	1313.8, +4.14
Nikkei	9433.34, -102.79	Hang Seng	23008.31, +150.36
Oil (Crude)	$105.4, -$0.20	Gold	$1426.20, -$8.70
Base Rate	0.5%	10 Yr Gilt	3.65%
£/$	1.597	£/€	1.135
1 month LIBOR	0.617	3 month LIBOR	0.815

 

Markets

New York - US indices advanced on Friday following positive corporate and economic news. The Dow Jones gained 50.03 points to 12,220.59, the S&P 500 added 4.14 points to 1,313.80 and the Nasdaq rose 6.64 points to 2,743.06.

The Commerce Department said the U.S. economy grew at a 3.1% annual rate in the fourth quarter, led by a jump in consumer spending that will be hard to match early in the year as energy prices surge. The revised increase in gross domestic product compares with a 2.8% estimate issued last month. Not all the data was positive, but investors chose to ignore the Thomson Reuters/University of Michigan final index of consumer sentiment which decreased to 67.5 from 77.5 in February. The preliminary estimate issued earlier this month was 68.2.

In corporate news, Oracle climbed 1.6% to $32.64 after the company forecast profit excluding acquisition costs and some other expenses of 69 cents to 73 cents this quarter, beating the average analyst estimate of 66 cents. Bristol-Myers Squibb rose 3.3% to $27.29 after winning U.S. approval for ipilimumab, the first drug in a new family of medicines to treat advanced melanoma, the most deadly form of skin cancer.

Tokyo - The Nikkei dropped 102.79 points to 9,433.34 this morning as radiation hampered efforts to cool crippled nuclear reactors in Japan. Tokyo Electric Power Co., the operator of the nuclear plant, tumbled 18% to its lowest since 1977. Acer Inc., the world’s second-largest computer maker, fell 6.9% in Taipei after saying first-quarter sales may miss expectations.

Hong Kong - The Hang Seng is currently 150.36 points lower at 23,008.31 after China Construction Bank Corp. and China Petroleum & Chemical Corp.’s profits missed analyst estimates. China Construction Bank, the world’s second-largest lender by market value, and China Petroleum & Chemical, Asia’s biggest refiner, dropped more than 2.5%. China Pacific Insurance (Group) Co., the nation’s third-largest insurer, climbed 2.1% after reporting results that beat estimates.

London - The FTSE 100 rose 19.89 points to 5,900.76 on Friday. Reckitt Benckiser jumped 3.1% to 3,160p after BofA Merrill Lynch raised its recommendation on the shares to “buy” from “neutral.” African Barrick Gold soared 1.9% to 539p as the company said it has found further gold deposits at its Nyanzaga project. Separately, Citigroup Inc. upgraded the shares to “buy” from “hold.”

Economics

US Personal income & spending (Feb) 13:30 BST/ 08:30 EDT

Analysts expect personal income to rise by 0.6%. Most of the boost to income from this year’s reduction in payroll taxes should have occurred in January, but there may be a further positive impact in February. Personal spending probably rose 0.8%, reflecting improved auto sales as well as higher gasoline and food prices. Based on the details of the latest CPI report, the February core PCE deflator is likely to rise 0.2%, with the y-o-y rate edging up to 0.9%.

US Pending home sales (Feb) 15:00 BST/ 10:00 EDT

Indications of housing demand over the past month have been discouraging. Sales of new homes fell to a multi-decade low in February, and applications for mortgages to purchase homes have remained at a subdued level.

Corporate

Pharmaceutical giant AstraZeneca PLC lifted its full-year earnings targets after reaching a settlement with the U.K. and U.S. tax authorities over transfer pricing arrangements. As a result of the agreements, the company’s effective tax rate is expected to be 6% lower than originally forecast and the group has thus raised its 2011 full year targets for core earnings per share, calculated before exceptional items, to between $6.90-$7.20 per share from $6.45-$6.75 guided previously. Transfer pricing refers to the pricing of assets, services and funds transferred within an organization. The accord with U.S. and U.K. authorities pertain to transfer pricing arrangements for AstraZeneca’s U.S. business for the 13-year period from 2002 to the end of 2014. AstraZeneca has regularly set aside funds for such disputes, and said it will release part of its provision to deal with the settlement, which will result in a $500 million benefit to first-quarter earnings. The company had previously guided for an effective tax rate of 27% in 2011, but now expects this to be 21%. The news gave AstraZeneca shares an early boost Monday and were up 1.1% or 32p at 2906p at 0808 GMT.

---

The above details are provided for information only and are not intended to be construed as solicitation for the sale or purchase of any particular investment nor as specific investment advice.

If you would like to discuss any aspect of financial planning or investment, one of the specialist advisors in Lupton Fawcett’s Asset Management Department would be delighted to help.

 

Posted: March 28th, 2011 under Asset Management.
Comments: none

 

FTSE 100	5880.87, +84.99	Dow	12170.56, +84.54
FTSE 250	11605.52,+158.17	Nasdaq	2736.42, +38.12
FTSE All Share	3055.77, +43.03	S&P 500	1309.66, +12.12
Nikkei	9536.13, +101.12	Hang Seng	23158.67, +243.39
Oil (Crude)	$105.17, -$0.59	Gold	$1439.90, -$3.10
Base Rate	0.5%	10 Yr Gilt	3.6%
£/$	1.611	£/€	1.138
1 month LIBOR	0.617	3 month LIBOR	0.815

 

Markets

London - The FTSE 100 rallied 84.99 points to 5,880.87 yesterday, erasing losses that followed Japan’s March 11 earthquake, after earnings from Kingfisher Plc and Next Plc beat estimates and Deutsche Bank AG recommended British retailers.

Kingfisher jumped 7.2 percent to 261.4p after the retailer reported a 22 percent increase in full-year adjusted pre-tax profit to £670 million. That compared with the average analyst estimate of £667.9 million. The company also said it plans to open more stores in Russia and China and increase common product ranges. Next rallied 4 percent to 2,043p after reporting a 9 percent gain in full-year pre-tax profit to £551 million. That topped analysts’ estimates of £549.3 million. Next also raised its final dividend by 13 percent to 53p. Deutsche Bank named Kingfisher as its “top pick” and said Marks & Spencer “could provide insulation” against rising interest rates. The firm also said that Tesco should perform better than other food retailers because of its “non-food exposure.”

Elsewhere, Premier Oil climbed 4 percent to 1,988p as the company reported a 15 percent rise in full-year profit and forecast production will reach 75,000 barrels of oil equivalent a day in the first quarter of 2012. Chief Executive Officer Simon Lockett also said the oil and gas producer won’t have to bear the burden of higher North Sea production taxes for the next few years because of a $1.1 billion tax allowance. The shares dropped 4 percent the previous day as U.K. Chancellor of the Exchequer George Osborne boosted the supplementary charge on North Sea oil profits to 32 percent from 20 percent. Cable & Wireless Worldwide Plc tumbled 14 percent to 54.2p after the telecommunications company said gross margins in its legacy voice business will decline more next year than previously forecast. Invensys Plc sank 4.5 percent to 341.2p. The maker of controls for Whirlpool washing machines fell the most since January after Chief Executive Officer Ulf Henriksson was replaced by the company’s finance chief.

New York - US stocks advanced yesterday following a bout of strong positive earnings reports and a better than expected government report on jobless claims. The Dow Jones gained 84.54 points to 12,170.56, the S&P 500 climbed 12.12 points to 1,309.66 and the Nasdaq jumped 38.12 points to 2,736.42.

Fewer Americans filed applications for unemployment benefits last week, signalling that the labour market is mending. Jobless claims declined by 5,000 to 382,000, Labour Department figures showed, in line with the median forecast of economists. Furthermore, the total number of people receiving benefits dropped to the lowest level in almost three years.

In corporate news, Micron Technology jumped 8.4% after reporting second quarter sales and profit that beat analysts’ estimates on increasing demand for chips used to store data on mobile phones and tablets. Revenue climbed 15 percent to $2.26 billion in the period that ended March 3. That compared with $2.1 billion predicted by analysts. Red Hat gained 18 percent, the most in the S&P 500, to $47.26. The largest seller of the Linux operating system posted a profit of 26 cents a share excluding some items, beating the 22 cent average of estimates, as customers updating data centres to take advantage of cloud computing boosted billings.

Tokyo - The Nikkei rose 101.12 points to 9,536.13 this morning on the outlook for orders to rebuild following the country’s worst earthquake, and after a U.S. report showed falling unemployment claims. IHI Corp., a maker of heavy machinery, climbed 6.6 percent, the most in the Nikkei 225 Stock Average. Comsys Holdings Corp., which designs and builds phone and power facilities, rose 6.3 percent and Komatsu Ltd., the world’s No. 2 manufacturer of construction machinery, gained 4.7 percent. Sony Corp., an electronics maker that gets 20 percent of its sales in the U.S., increased 3.3 percent. Tokyo Electric Power Co., which operates a nuclear plant crippled after the quake, dropped 6.2 percent.

Hong Kong - The Hang Seng jumped 243.39 points to 23,158.67 this morning sending the benchmark index to its first advance in three weeks, after corporate earnings exceeded analyst estimates and a U.S. report showed a decline in unemployment claims. Bank of China Ltd., the nation’s third-largest lender by market value, rose 3.1 percent after posting a 29 percent increase in full-year net income, beating estimates. China Construction Bank Corp. gained 1.7 percent ahead of the release of its full-year results today. Anhui Conch Cement Co. and China National Building Material Co. jumped more than 2.9 percent after BNP Paribas recommended investors “buy” shares in the country’s biggest cement makers.

Economics

US GDP (Q4, 3rd release) 12:30 GMT/08:30 EDT

Analysts expect the third release of Q4 GDP to be revised up to 3.2%, reflecting upward revisions to inventories and net trade.

US University of Michigan confidence (Mar, final) 13:55 GMT/09:55 EDT

The steep run-up in gasoline prices since mid- February has had a notable impact on consumer sentiment. The preliminary March reading of the University of Michigan confidence fell 9.3pp to 68.2, from 77.5 in February. The median of five year inflation expectations rose to 3.2%. It will be important to see if the final reading for March shows any further decline in sentiment or an up tick in inflation expectations. Analysts look for the final reading to be revised lower to 67.5.

Corporate

Aviva PLC, the U.K.’s second-largest insurer, has put its RAC auto breakdown unit up for sale and is understood to be looking for at least GBP600 million, U.K. newspaper The Times reports Friday, citing people familiar with the situation. The sale process is in the early stages but Andrew Moss, Aviva’s chief executive, has hired JP Morgan to advise, the report says. It adds that several parties, thought to include both private equity and trade buyers, are understood to have expressed an interest in RAC, which Aviva bought for GBP1.2 billion in 2005.

---

The above details are provided for information only and are not intended to be construed as solicitation for the sale or purchase of any particular investment nor as specific investment advice.

If you would like to discuss any aspect of financial planning or investment, one of the specialist advisors in Lupton Fawcett’s Asset Management Department would be delighted to help.

Initial meetings are without obligation or charge. Please contact Paul Smith on 0113 280 2095 or email paul.smith@luptonfawcett.com

 

Posted: March 25th, 2011 under Asset Management.
Comments: none

 

FTSE 100	5795.88, +33.17	Dow	12086.02, +67.39
FTSE 250	11447.35, +5.78	Nasdaq	2698.3, +14.43
FTSE All Share	3012.74, +15.52	S&P 500	1297.54, +3.77
Nikkei	9435.01, -14.46	Hang Seng	22915.28, +89.88
Oil (Crude)	$105.75, +$0.78	Gold	$1438, +$10.40
Base Rate	0.5%	10 Yr Gilt	3.55%
£/$	1.6226	£/€	1.150
1 month LIBOR	0.617	3 month LIBOR	0.814

 

Markets

London - The FTSE 100 rose 33.17 points to 5,795.88 yesterday, as base metals advanced and minutes from the Bank of England’s last meeting reduced speculation of an imminent interest-rate increase. Minutes from the BOE’s March 10th meeting showed the bank saw “merit in waiting” to examine the effect of higher oil prices on inflation. Policy makers voted 6-3 to keep interest rates on hold this month. Gains were limited after Osborne said the British economy will grow more slowly than forecast in 2011 and the U.K. will need to borrow more than previously thought in the next five years. The Office for Budget Responsibility predicted annual growth this year of 1.7%, down from the 2.1% forecast in November.

Xstrata, the world’s fourth-largest copper producer, climbed 3.5% to 1,422.5p as copper advanced for a second day in London on expectations that demand will improve. Kazakhmys, Kazakhstan’s largest copper miner jumped 4.5% to 1,431p, while Rio Tinto added 2.9% to 4,128p. Antofagasta Plc, owner of copper mines in Chile, increased 2.8% to 1,391p. Eurasian Natural Resources Corp., a Kazakh ferroalloy producer, rallied 3.5% to 929.5p after profit more than doubled to $2.19 billion in 2010 as prices rose, spurring the company to expand abroad. That beat the $1.92 billion average estimate of analysts.

On the downside, Sainsbury dropped 5.4% to 335.3p, the biggest decline since June 2009. Britain’s third-largest supermarket owner reported revenue at stores open at least a year, including value-added tax and excluding gasoline sales, increased 1% in the 10 weeks through March 19. That was less than the 3.6% increase in the third quarter and missed the 2.1% median analyst estimate.

New York - US investors shrugged off global turmoil to send indices higher yesterday as higher metal prices lifted commodity producers and Wells Fargo & Co. said government data showing a record low pace in new-home sales will likely be revised higher. The Dow Jones gained 67.39 points to 12,086.02, the S&P 500 rose 3.77 points to 1,297.54 and the Nasdaq added 14.43 points to 2,698.30.

Stocks fell in the first hour of trading after purchases of new U.S. homes unexpectedly declined in February to the slowest pace on record and prices dropped to the lowest level since December 2003. But Wells Fargo analyst Carl Reichardt said the February home sales data may be revised up and didn’t reflect the market “reality” as bad weather hurt the market. Freeport-McMoRan Copper & Gold Inc. rose 5%, while Alcoa Inc. added 3%, as copper paced gains in commodities amid a surge in stockpile orders for the metal, feeding speculation that demand will outpace supply in 2011.

Elsewhere, Bank of America Corp. fell 1.7% to $13.65 after saying the Federal Reserve objected to its planned dividend increase. The lender “will continue to work with the Fed and intends to seek permission for a modest increase in its common dividend for the second half of 2011, through the submission of a revised comprehensive capital plan.”

Tokyo - The Nikkei slipped 14.46 points to 9,435.01 this morning, led by Tokyo Electric Power Co., after the utility cast doubt on a planned dividend and as carmakers declined on concern parts supplies will be disrupted. Tokyo Electric, which operates the nuclear plant damaged by a March 11 earthquake and tsunami, tumbled 14% as it suspended its decision to pay a second-half dividend. Nissan Motor Co., Japan’s third-largest carmaker by sales, lost 4.6% after the company said about 40 component suppliers remain in difficulty following the record quake.

Hong Kong - The Hang Seng climbed 89.88 points to 22,915.28 this morning, after Cnooc Ltd. posted earnings that exceeded analyst estimates and raw material producers gained. Cnooc, China’s biggest offshore oil producer, climbed 2.1% after saying 2010 profit increased 85% to a record. Jiangxi Copper Co., China’s No. 1 producer of the metal, and Aluminium Corp of China Ltd., the nation’s largest supplier, gained at least 1.9% after a gauge of industrial metals in London rose to a three-week high yesterday.

Economics

UK Retail sales (Feb) 09:30 GMT

January’s retail sales figures showed a surprisingly strong bounce back from a snow affected December, although company and media reports suggested that sales had slowed significantly towards the end of the month as New Year sales came to an end and the VAT increase was passed through to customers. Indications from retailers’ reports and data released by the British Retail Consortium suggest that the sales figures could be quite weak in February, and analysts would certainly expect January’s strong growth in clothing, household goods and non-specialised department stores to be at least partly reversed. Overall, analysts expect a reduction in sales (excluding automotive fuel) of 0.7%, which would take the annual rate of growth down from 5.3% to 2.3%.

US Durable goods orders (Feb) 12:30 GMT/08:30 EDT

Analysts look for durable goods orders to rise by 0.2%, with ex-transportation orders up 0.4%. Boeing reported a relatively low number of aircraft orders in February, suggesting a possible decline in orders for this category.

US Initial jobless claims (week 19 Mar) 12:30 GMT/08:30 EDT

Initial jobless claims fell to 385,000 in last week’s reading – a sign that claims are stabilising at a level consistent with at least moderate jobs growth. The four-week average stands at 386,250. Analysts look for 385,000 this week.

Corporate

Imperial Tobacco Group PLC today said it’s on track to meet full year expectations following an expected rise in first-half sales, but the maker of Lambert & Butler and JPS cigarettes also forecast volumes to fall by around 1%. The world’s fourth-largest global tobacco group by revenue said first-half tobacco sales, at constant exchange rates and excluding Morocco, are expected to increase around 2% year-on-year. It said the drop in combined cigarette and fine cut tobacco volumes is partly due to a change in U.K. trade buying patterns which will shift some volumes from the first to the second half. Still, fine cut tobacco shows strong volume growth overall, it added. Spain remains challenging due to a December duty increase, the ban on smoking in public places and the ongoing weak economy, the company said. But it noted that volumes of its cigarette brands Davidoff, Gauloises Blondes and West have risen, driven by growth in emerging markets. It also said JPS has maintained its "excellent" performance. The company’s first-half trading update reflects a weak second-quarter performance, Evolution Securities analysts said. They said the projections for the top line and volumes contrasts unfavourably with first quarter trends. Last month, the Bristol, England-based company posted higher first-quarter sales and volumes, driven by a strong performance in growing economies. Imperial’s priority is to continue building its position in markets such as Eastern Europe, Africa, the Middle East and Asia. By contrast, smokers in developed markets, who are struggling in tough global economic conditions, are switching to low-cost brands in the face of dented discretionary income as governments impose austerity measures such as tax hikes and public spending cuts to rein in borrowing. The company has offset soft volumes with price rises. Increases are essential in high-exposure; mature markets like Western Europe and the U.S., where volumes are either in long-term decline or at best flat.

Resolution Ltd., the acquisition vehicle set up by insurance entrepreneur Clive Cowdery, on Thursday posted a massive rise in full-year pre-tax operating profit and raised its dividend, boosted in part by contributions from some of the U.K. life insurance assets it bought last year from France’s AXA SA. The company, which also bought insurer Friends Provident in 2009 and Bupa Health Assurance Ltd. in October last year, said it is able to achieve its planned returns for shareholders from its U.K. project without making further acquisitions. Full-year pre-tax operating profit rose to £275 million compared with £6 million in 2009. The year-earlier earnings were restated to exclude the impact of investment volatility in long-term funds, the company said. The AXA U.K. life business was included in the figures for four months following the acquisition and contributed £71 million to pre-tax operating profit. The company declared a full year dividend of 12.57p per ordinary share, up 15% from the year before. John Tiner, chief executive of Resolution Operations LLP, said: "The delivery of cash in 2010 shows early value for shareholders. The non U.K. businesses are performing well and generating value. In the U.K. our restructuring and strategic repositioning continues. As we deliver operationally these businesses will generate valuable growth and cash rewards for shareholders." The company said its focus on cash delivery for shareholders remains a priority. In February, Resolution said it will focus on integrating the three companies it has already purchased, and toned down its previous aim of buying another company for its current life insurance consolidation project by the middle of this year. However, it also said it may look for possible buying and restructuring projects outside the U.K. life insurance industry–and even outside the U.K. "[Resolution] will not contemplate acquisitions that would dilute the returns likely to emerge from the three acquisitions already made. There is therefore a high threshold for evaluating further acquisitions," the company said last month. Resolution shares have risen over 24% since the start of 2011, giving it a market value of just over £4 billion.

---

The above details are provided for information only and are not intended to be construed as solicitation for the sale or purchase of any particular investment nor as specific investment advice.

If you would like to discuss any aspect of financial planning or investment, one of the specialist advisors in Lupton Fawcett’s Asset Management Department would be delighted to help.

Initial meetings are without obligation or charge. Please contact Paul Smith on 0113 280 2095 or email paul.smith@luptonfawcett.com

 

 

Posted: March 24th, 2011 under Asset Management.
Comments: none

 

FTSE 100	5762.71, -23.38	Dow	12018.63, -17.90
FTSE 250	11441.57, -69.67	Nasdaq	2683.87, -8.22
FTSE All Share	2997.22, -12.51	S&P 500	1293.77, -4.61
Nikkei	9449.47, -158.85	Hang Seng	22825.4, -32.5
Oil (Crude)	$104, +$1.67	Gold	$1427.60, -$1.20
Base Rate	0.5%	10 Yr Gilt	3.575%
£/$	1.636	£/€	1.153
1 month LIBOR	0.617	3 month LIBOR	0.813

 

Markets

London - The FTSE 100 fell 23.3 points to 5,762.71 yesterday, the first fall in four days as British inflation rose more than forecast and oil surged amid concern that unrest is spreading in the Middle East and North Africa. A report today showed U.K. inflation accelerated more than economists had predicted to the fastest pace in more than two years in February, adding pressure on the Bank of England to increase its benchmark interest rate. Oil traded near the highest price in more than a week as the airstrikes threatened to prolong a supply disruption.

WPP lost 1.8% to 757p as Exane lowered its stance on the shares to “neutral” from “outperform,” saying that the premium investors need to pay to buy the stock relative to its peers is no longer justified. BHP Billiton, the world’s biggest mining company, slipped 1.3% to 2,275p. Rio Tinto, the third-largest, dropped 1.1% to 4,013.5p. Xstrata Plc, the fourth- biggest copper producer, declined 1.4% to 1,374.5p. Cairn Energy rose 2% to 428p. The oil explorer said revenue for the year jumped to $1.6 billion from $234 million in 2009 as the completion of a pipeline from the Mangala field boosted production. Petropavlovsk Plc jumped 3.1% to 1,046p after the miner of gold in Russia reported a 36% increase in reserves of the metal. Punch Taverns Plc gained 2.3% to 75.3p as the U.K. operator of more than 6,700 pubs said it plans to sell almost half of its 6,000 leased outlets and split the business in two as it struggles with rising debt and declining profit.

New York - US stocks closed lower yesterday as oil rose amid unrest in Libya and concern grew that Europe won’t find an immediate solution to its debt crisis. The Dow Jones fell 17.9 points to 12,018.63, the S&P 500 lost 4.61 points to 1,293.77 and the Nasdaq declined 8.22 points to 2,683.87. Indices snapped a three-day winning streak, the longest in about a month, as Irish notes slid and oil rose 1.6% to $104 a barrel. The slump in Irish notes came after EU finance chiefs settled yesterday on how to enable a permanent rescue fund to lend EUR500 billion as of 2013, while remaining divided over how to get the current stopgap fund to its full capacity.

In corporate news, Walgreen slumped 6.6% to $39.21 after reporting gross margin was little changed at 28.8% in the second quarter. Analysts at Barclays Plc and Citigroup Inc. estimated gross margin would widen at the chain, which operates about 7,700 locations across the U.S. and filled one in five retail prescriptions last quarter. Carnival fell 4.5% to $39.16. The world’s biggest cruise-line operator said it will have fiscal second-quarter profit of 20 cents to 24 cents a share. Analysts had estimated 33 cents on average. On the upside, Netflix gained 4% to $221.39. The mail-order and online movie-rental service was raised to “outperform” from “neutral” at Credit Suisse. The share-price estimate is $280.

Tokyo - The Nikkei fell 158.85 points to 9,449.47 this morning as engineers struggled to connect power to a crippled nuclear reactor and Tokyo authorities advised against giving tap water to infants after finding traces of iodine. Tokyo Electric Power Co., the owner of the damaged plant, sank 4.5%. Toyota Motor Corp., the world’s largest carmaker, dropped 1.2% after saying it will halt domestic production through March 26. JTekt Corp., a car-parts supplier, slumped 6.1%. A series of earthquakes early this morning also damped sentiment.

Hong Kong - The Hang Seng lost 32.5 points to 22,825.40 this morning as China Coal Energy Co.’s earnings missed analyst estimates and engineers struggled to get power to a crippled Japanese reactor. China Coal, the nation’s No. 2 producer of the fuel, tumbled 9.1%. Maanshan Iron & Steel Co., China’s second biggest Hong Kong-traded steelmaker, declined 2.4% after saying second-half earnings slumped 95%. Foxconn International Holdings Ltd. dropped 1.6% on renewed concern damage from the March 11 earthquake in Japan will disrupt supplies.

Economics

UK Bank of England minutes (9-10 March meeting) 09:30 GMT

The publication of the minutes from Monetary Policy Committee meetings have proved to be market-moving events in recent months, but analysts see less scope for any major revelations to emerge from the March meeting given that data releases of the past month have painted a very mixed picture of recovery. Analysts expect another 1-5-2-1 vote to be revealed, with Mr Posen continuing to favour an extension of the QE programme, Messrs Dale and Weale voting for a 25bp hike and Mr Sentance again opting for a 50bp tightening.

UK BBA loans for house purchases (Feb) 09:30 GMT

Although the latest Royal Institute of Chartered Surveyors survey reported some modest improvements in indicators of new sale instructions and buyer enquiries, the overall picture of the UK housing market remains one of stagnant activity. Therefore, while the number of home loans could improve slightly in February, the level will remain depressed. Analysts expect a rise from 28.9 to 29.2.

UK Budget Report 2011 12:30 GMT

The monthly public finance releases suggest that the public sector borrowing forecast of £148.5bn for 2010/11 produced by the Office for Budget Responsibility last November may be undershot by as much as £10bn, but analysts do not expect this slightly enhanced room for manoeuvre to lead to any significant change of course by the Chancellor. The possibility of growth falling short of expectations in future years, and the potential for a reassessment of the economy’s output gap to occur at some point – a move that could substantially raise the bar in terms of tightening required in order to meet the cyclically-adjusted borrowing targets – suggest that the Chancellor will wish to maintain some buffer with regard to his borrowing targets at this early stage of the consolidation process. Both the Chancellor and the Prime Minister have spoken recently of the need to deliver a ‘Budget for growth’, but analysts expect little deviation from the course of stiff fiscal tightening set out in last October’s Comprehensive Spending Review. As a consequence, any measures announced will likely be ‘micro’ in nature, focussing on the supply-side performance of the economy rather than demand, although a reduction in fuel duty will be an obvious candidate should the Chancellor wish to loosen the purse strings a little.

US New home sales (Feb) 14:00 GMT/10:00 EDT

Demand for new homes remains very subdued. January new homes sales fell to 284,000 (from 325,000 in December), close to the lows since the beginning of the data series in 1963. Analysts look for a small rebound to 300,000.

Corporate

Eurasian Natural Resources Corp. PLC said today full-year net profit more than doubled due to record output and higher prices and said it’s boosting its capital expenditure program following its recent acquisitions. FY sales are up 72% at $6.61 billion compared with $3.38 billion the year before. FY underlying Ebitda is up 118.5% at $3.19 billion compared with $1.46 billion a year before, broadly in line with a company consensus forecast of $3.16 billion based on a poll of 12 analysts. The company declares a final dividend of $0.18 a share, up from $0.06/share a year before. Total dividend is $0.31 cents for the full year, up from $0.12/share.

Global technology firm Smiths Group PLC today reported an increase in first half pre-tax profit and said it is considering making targeted acquisitions, while remaining confident on meeting expectations for the full year. Sales hit £1.37 billion for the half year ended Jan. 29 compared to £1.28 billion in 2009. Adjusted operating profit rose to £239 million while Operating profit rose to £208 million. The dividend for the year will be 11.25p compared to 10.5p last year.

J Sainsbury PLC reported fourth quarter same-store sales below market expectations even though it outperformed the rest of the grocery market, as consumers feel the pinch of inflation, tax rises and job losses. Same-store sales in the 10 weeks to March 19 excluding fuel but including VAT rose 1%, behind market expectations of 2% growth. Total sales in the period rose 6.8% including fuel and VAT, and 3.5% when fuel is excluded. The company said its growth was ahead of the market in the period. Chief Executive Justin King said Sainsbury expects the consumer environment to remain tough although the company is confident that it is well-positioned for further growth in 2011/2012. The company added 8.5% new space to its portfolio in the year to March 19th.           

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The above details are provided for information only and are not intended to be construed as solicitation for the sale or purchase of any particular investment nor as specific investment advice.

If you would like to discuss any aspect of financial planning or investment, one of the specialist advisors in Lupton Fawcett’s Asset Management Department would be delighted to help.

 

Posted: March 23rd, 2011 under Asset Management.
Comments: none

FTSE 100	5789.09, +67.96	Dow	12036.53, +178.01
FTSE 250	11511.24,+165.42	Nasdaq	2692..09, +48.42
FTSE All Share	3009.73, +36.09	S&P 500	1298.38, +19.18
Nikkei	9608.32, +401.57	Hang Seng	22857.9, +172.68
Oil (Crude)	$102.33, +$1.26	Gold	$1426.40, +$10.30
Base Rate	0.5%	10 Yr Gilt	3.578%
£/$	1.634	£/€	1.148
1 month LIBOR	0.614	3 month LIBOR	0.805

 

Markets

London - The FTSE 100 jumped 67.96 points to 5,786.09 yesterday, also boosted by progress in Japan. Vodafone Group Plc and BT Group Plc rallied more than 2% following news of the telecommunications merger in the US. Weir gained 4.5% to 1,708p as Credit Suisse upgraded the Glasgow-based engineering company to “outperform” from “neutral.” Essar Energy Plc slid 7.3% to 440.4p as the Indian oil refiner and power plant operator said it incurred delays in gaining approval for the development of some domestic coal blocks.

New York - US indices soared higher yesterday as concern about Japan’s damaged nuclear plants eased and investors cheered a huge merger deal between AT&T Inc and T-Mobile USA. The Dow Jones jumped 178.01 points to 12,036.53, the S&P 500 rallied 19.18 points to 1,298.38 and the Nasdaq surged 48.42 points to 2,692.09.

AT&T gained 1.2% to $28.26. The phone company agreed to buy T-Mobile USA from Deutsche Telekom for about $39 billion in cash and stock to create America’s largest mobile-phone company, trumping Sprint Nextel Corp.’s effort to acquire the business. The deal would allow AT&T, now the second-largest U.S. wireless operator, to add about 34 million customers and surpass Verizon Wireless. AT&T was raised to “buy” from “hold” at Citigroup.

Elsewhere, American International Group Inc. and Hartford Financial Services Group Inc. rallied at least 3.9% as Japan made progress in restoring power to two reactors. Billionaire investor Warren Buffett said Japan’s record earthquake is a buying opportunity and he won’t sell his shares in the country. Buffett cancelled a trip this week to Japan to visit a factory owned by Iscar Metalworking Co’s Tungaloy Corp. in Fukushima prefecture, the site of the worst nuclear disaster in 25 years. Buffett’s Berkshire Hathaway Inc. owns 80% of Iscar, a maker of cutting tools. Tiffany & Co. climbed 5.1% to $60.22. The world’s second-largest luxury jewellery retailer reported a 29% gain in fourth-quarter profit as sales exceeded analyst estimates during the holiday season.

Tokyo - The Nikkei leapt 401.57 points higher to 9,068.32 this morning, sending the Nikkei 225 Stock Average to its biggest two-day advance since April 2009, as the country made progress in stabilizing reactors at a crippled nuclear plant. Tokyo Electric Power Co., the operator of the Fukushima Dai-Ichi nuclear plant which was damaged by the 9.0-magnitude earthquake and tsunami on March 11, soared 16%. Toshiba Corp., a nuclear reactor supplier, surged 13%. JX Holdings Inc. rose 12% as its refining unit resumed operations. Nippon Steel Corp., Japan’s largest maker of the alloy, leapt 7.1%. Mitsubishi UFJ Financial Group Inc., Japan’s largest bank by market value, advanced 8.3%.

Hong Kong - The Hang Seng climbed 172.68 points to 22,857.90 this morning as oil companies gained on higher crude prices and airlines climbed as Japan made progress in stabilizing a crippled nuclear plant. Cnooc Ltd., China’s largest offshore oil producer, and PetroChina Co., the nation’s biggest energy producer, climbed at least 2% as oil climbed on concern airstrikes in Libya and unrest in the Middle East will disrupt supplies. Cathay Pacific Airways Ltd. rose 2.3% as speculation eased that radiation from the damaged nuclear plant will deter travel.

Economics

UK CPI (Feb) 09:30 GMT

UK inflation pretty much conformed to expectations in January, with the CPI measure rising from 3.7% to 4.0%. However, the detail raised concerns that inflation would move higher again in February, with indications that this year’s VAT increase is being passed on to consumers to a greater extent than in 2010. Furthermore, the weak trends seen in clothing and footwear during January are unlikely to be repeated in February, given increases in global commodity prices and (in the case of clothing) methodological changes which appear to have exaggerated seasonality around the New Year sales period. Added to this, petrol prices edged up further over the month while tariff increases by another of the UK’s big six energy suppliers came into effect at the start of the month. Therefore, analysts expect CPI inflation to jump 0.7% m-o-m, for an annual rate of 4.3% in February. Analysts also anticipate a 0.7% rise on the RPI measure, which would see the annual rate edge up from 5.1% to 5.2%.

UK Public Sector Net Borrowing (Feb) 09:30 GMT

The January public sector finance data proved better than expected thanks to a sharp rise in income tax revenues. Given that this increase runs counter to the generally flat trends of employment and wage growth, some other factor – such as the rebalancing of compensation packages in the financial sector – may have been instrumental here, and a weaker level of revenues from this particular area may emerge in the short term. Higher VAT receipts should again be a feature, however, given that a variety of evidence suggests that the 4 January tax hike has been passed on to consumers in a gradual fashion. Overall, analysts look for the public sector borrowing to total GBP6.2bn on an ex-intervention basis in February, well below the GBP9.5bn reported for the same month a year earlier.

UK CBI industrial trends (Mar) 11:00 GMT

The total orders index rose from -16 to -8 in February, while output expectations also improved from +17 to +23. With other indicators of manufacturing activity such as the PMI now beginning to level off (albeit still at very elevated levels), analysts expect little change in the CBI survey this month. However, as the headline total orders balance if anything lags output expectations slightly in this particular survey, there may be scope for a further upward move from -8 to -5.

Corporate

An alliance that strongly opposes News Corp.’s proposed takeover of British Sky Broadcasting Group PLC has urged the U.K. government to block the deal, claiming the media giant’s proposal to spin-off BSkyB’s 24-hour news channel Sky News fails to address concerns about media choice for consumers. In its formal submission to the Department for Culture, Media and Sport, the alliance - which consists of BT Group PLC, Guardian Media Group, Associated Newspapers Ltd., Trinity Mirror PLC, Northcliffe Media and Telegraph Media Group - said "the proposal completely fails to address" serious issues around consumer choice raised by the takeover. If Culture Secretary Jeremy Hunt accepts News Corp.’s undertaking to spin-off Sky News as a remedy to address concerns about its dominance on the local media industry, it would "fail to meet basic public law requirements of reasonableness" and show a "cavalier disregard for the public interest," the alliance said. A BSkyB spokeswoman declined to comment on the issue. News Corp. also declined to comment. Hunt gave provisional approval to News Corp.’s proposed takeover of BSkyB earlier this month after the U.S. Company agreed to spin off Sky News. However, the alliance is concerned that News Corp. would keep a 39.1% stake in the new company, while Sky News will be dependent upon a contract with News Corp. for 85% of its revenue and 25% of its costs. Sky News will also be dependent on News Corp. to distribute its TV news output on the BSkyB network and for its future existence, the alliance said in a statement. Hunt is expected to sign off on the deal unless major issues arise from the public consultation, which closed Monday, avoiding a prolonged investigation by the U.K. competition regulator that could have taken up to eight months. The U.K. government said Monday that it had received more than 38,000 submissions on the proposed takeover by a midday deadline. A government spokesman declined to identify any of the people or parties, but said it is likely it will publish a summary of the responses at some point. News Corp’s move to acquire the 60.9% of BSkyB that it doesn’t already own has been attacked by some politicians and rival media groups, who have expressed concern about News Corp.’s stronghold on local media given its vast newspaper operations. News Corp.’s U.K. unit publishes several newspapers, including the Sun, the News of the World and The Times. News Corp. also owns Dow Jones & Co., publisher of this newswire and The Wall Street Journal. BSkyB’s independent directors rebuffed News Corp.’s 700p a share proposal when it was made last year in June, indicating they would accept an offer of more than 800p a share. The companies have already agreed to cooperate on securing regulatory clearance for the deal. BSkyB provides satellite pay-TV services to more than 10 million subscribers, its big draw being Sky Sports, which airs Premier League Football. It also sells phone and broadband Internet services.

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The above details are provided for information only and are not intended to be construed as solicitation for the sale or purchase of any particular investment nor as specific investment advice.

If you would like to discuss any aspect of financial planning or investment, one of the specialist advisors in Lupton Fawcett’s Asset Management Department would be delighted to help.

Initial meetings are without obligation or charge. Please contact Paul Smith on 0113 280 2095 or email paul.smith@luptonfawcett.com

 

Posted: March 22nd, 2011 under Asset Management.
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