FTSE 100	4241.01, -11.56	Dow	8438.39, -34.01
FTSE 250	7386.26, +42.95	Nasdaq	1838.22, -8.68
FTSE All Share	2167.29, -3.11	S&P 500	918.9, -1.36
Nikkei	9783.47, -93.92	Hang Seng	18510.12, -90.14
Oil (Crude)	$69.16	Gold	$941
Base Rate	0.5%	10 Yr Gilt	3.66%
£/$	1.653	£/€	1.1793
1 month LIBOR	0.655	3 month LIBOR	1.2

 

Markets

London - The FTSE 100 is currently 8.76 points higher at 4,249.77. Lloyds gains 3.2% after Goldman Sachs upgraded the stock to its Conviction Buy list. Insurance broker, Admiral, advances 3.2% after Credit Suisse upgraded the stock to Outperform from Neutral. Serco rises 2.2% after reporting good first half figures and saying it was on track to meet its 2009 forecast.

New York - The Dow Jones and S&P 500 finished lower on Friday to end their second consecutive week in negative territory. Stocks have stumbled recently, following three months of strong gains, as investors wondered whether the market has got ahead of itself after some mixed economic reports. On Friday this was apparent from data on personal income and saving. The Commerce Department said that personal income rose 1.4% in May, topping expectations. However, rather than spend, consumers have opted to save. Personal saving as a percentage of income rose to 6.9% in May from 5.6% in April.

The Dow Jones fell 34.01 points to close at 8,438.39 while the S&P 500 edged 1.36 points lower to 918.90. The Nasdaq added 8.68 points to finish at 1,838.22.

In corporate news, KB Home tumbled 9% following its latest figures. The homebuilder reported a second quarter loss that was bigger than expected. Also in the sector, Lennar said its second quarter sales and earnings dropped from a year ago. However, new home sales and orders have picked up since the first quarter, resulting in shares slipping just 0.1%.

Elsewhere, Palm impressed investors with a narrower than expected fourth quarter loss, due partly to strong demand for its new Pre Smartphone. Shares in the company surged 16% higher.

US light crude oil for August delivery fell $1.07 to $69.16 a barrel. COMEX gold for August delivery added $1.50 to $941 an ounce. Treasury prices were almost unchanged, leaving the yield on the 10 year note at 3.54%.

Tokyo - The Nikkei dropped 93.92 points to close at 9,783.47 this morning after two brokerages announced plans for public share offerings. Daiwa Securities Group tumbled 12% while Mizuho lost 3.4% after announcing their intentions to raise cash, with the latter potentially starting the process as early as this week.

Hong Kong - The Hang Seng is currently 90.14 points lower at 18,510.12. Commodity related shares lead the decline after oil and metal prices fell. Cnooc, China’s biggest offshore oil producer, loses 1.9% while Jiangxi Copper, the nation’s biggest producer of the metal, slid 2.5%.

 

Economics

UK Mortgage approvals (May) 09:30 GMT

As discussed in the latest UK Housing Market Chartbook, analysts think the level of housing market activity will continue to improve over the course of the year as credit conditions slowly loosen. The British Bankers Association (BBA), which represents more than 60% of the total market, reported a further rise in mortgage approvals in May which would be consistent with this particular measure rising to 47,000. Unsecured lending, however, is likely to remain weak.

Corporate

Serco said today it remained on track to meet expectations for 2009 thanks to a sustained high level of activity in the first half. Serco said it had won a five year contract with the Australian government, worth £180m, to manage and operate seven adult immigration detention centres. Serco was the preferred bidder for the project. The company said it expects a "modest increase" in working capital investment in the first half compared to last year.

Informa is trading in line with its expectations for the full year despite very challenging business conditions, it said today. The company said it expected to be able to maintain full year adjusted operating profit margins at 2008 levels thanks to cost cutting. Informa said restructuring costs relating to savings measures incurred this year to date were expected to be about £10m, with annualised savings estimated at about £20m. Informa said it was reducing volume in its events and training business to protect profitability in the face of weak demand. Informa said last month it planned a two for five rights issue to raise about £242m to cut debt, and said first quarter revenues rose, mainly due to positive currency translation effects. Informa also proposed last month a new corporate structure, under which it would remain listed in London but would be incorporated in Jersey and tax resident in Switzerland, to protect its historic tax rate of about 26-27 percent.

ASOS Plc posted an expected 93 percent rise in full year profit and sad it was confident of another year of strong growth. The group made a pre-tax profit of £14.1m for the year to March 31. This compares with analysts forecasts of £14.2m, and £7.3m in the previous year. Sales increased 104 percent to £165.4m but growth has slowed to 52 percent for the 13 weeks to June 26.

Hargreaves Lansdowne expects full year pre-tax profit to be slightly ahead of the top end of market expectations of £69.1m, it said today. The firm said revenues for the 11 months to end May are around 10 percent ahead of revenues a year ago, it said. The value of assets held within Vantage, the group’s service offering funds and tax advantaged products, rose 15 percent to £10.6bn at the end of May from the end of March. Hargreaves Lansdowne also said that it saw "nothing overtly damaging to our business model" in last week’s FSA consultation paper of the future of the retail investment industry.

Titan Europe warned of a first half loss, and said it expected revenue for the period to be 35 percent lower than a year ago due to further weakening in its markets during the second quarter. The company also said it had cut 35 percent of jobs since the beginning of the year to the end of May. Titan Europe said trading conditions remained difficult, with the construction market continuing to be severely hit by the global recession. It expects construction market volumes to be down by about 50 percent and agricultural and mining markets to be down by 25 percent to 30 percent. However, Titan Europe said there are signs of small improvements in order books in the later months of the current year. Trading performance for the year ending December 31 remains in line with market forecasts, the company said.

Vodafone is considering buying T-Mobile in a move that would make the firm the biggest mobile phone operator in the UK, the FT reported today. Vodafone is interested in acquiring T-Mobile, even though the deal may be blocked by regulators, the paper said. Vodafone has a 25 percent share of the UK market, behind 02. T-Mobile (owned by Deutsche Telekom) has a 15 percent share. Deutsche Telekom has appointed JPMorgan to advise on "strategic options", the newspaper said. Vodafone has previously announced a £1bn cost cutting plan. It was forced to write off £5.9bn in the 12 months to the end of March - mostly related to its Spanish business, as its pre-tax profits fell 53.5 percent to £4.2bn from £9bn a year earlier.

Senior said today it continued to trade satisfactorily with profitability in line with its expectations for the first half of 2009. Strong cash generation and currency benefits have helped the company to reduce its net debt significantly more than anticipated in the six months to June 30, Senior, which makes aerospace and automotive components, said. The company said its customers Boeing and Airbus had seven year order books but for the first five months of the year they reported a combined net order in take of only 21 aircraft, as there were 76 cancellations. However, Senior said it was strongly cash generative and financed for the longer term. The company said "Whilst the group’s end markets are expected to remain challenging for the foreseeable future, Senior is gaining market share, and can look forward to significant future organic growth from new aircraft programmes such as Boeing 787 and Joint Strike Fighter". The company saw a modest improvement in production of land vehicles outside of North America and a further weakening of the business jet market in the second quarter.

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

Posted: June 29th, 2009 under Asset Management.
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