FTSE 100	4249.21, -44.82	Dow	8447, -82.38
FTSE 250	7414.56, -62.65	Nasdaq	1835.04, -9.02
FTSE All Share	2172.08, -22.03	S&P 500	919.32, -7.91
Nikkei	9939.93, -18.51	Hang Seng	18378.73, -149.78
Oil (Crude)	$69.89	Gold	$927.40
Base Rate	0.5%	10 Yr Gilt	3.7%
£/$	1.645	£/€	1.169
1 month LIBOR	0.655	3 month LIBOR	1.2

 

Markets

London - The FTSE 100 is currently 67.16 points higher at 4,316.37. International Power is one of the top performers, up 3.7%, after agreeing to sell its entire Czech business to J&T Group for £738.3 million. Schroders adds 2.7% after Credit Suisse upgraded the stock to Neutral from Under perform. Marks & Spencer gains 3.6% after there trading statement was released. Man Group tops the faller’s board, off 4.5%, after beginning to trade ex-dividend. Compass Group is down 0.4% for the same reason.

New York - Wall Street dropped yesterday but still managed to complete its best quarter in more than a decade yesterday. A weaker than expected consumer confidence report and a slump in oil prices sparked the sell off. The Conference Board said its June Consumer Confidence index fell to 49.3, against expectations of a rise to 55.3.

The Dow Jones dropped 82.38 points to close at 8,447.00 while the S&P 500 fell 7.91 points to end at 919.32. The Nasdaq lost 9.02 points to finish at 1,835.04.

Losses were broad based following the release of the Conference Boards data. Caterpillar caused the biggest weight on the Dow, falling 4.9% and knocking 12.85 points off the blue chip index. International Business Machines followed, knocking 10.66 points off. Financials including Citigroup and JPMorgan Chase dropped as government data showed prime mortgages 60 days or more past due climbed to 2.9% in the first quarter from 1.1% the same time last year.

US light crude oil for August delivery fell $1.60 to $69.89 a barrel. COMEX gold for August delivery slid $13.60 to $927.40 an ounce. Treasury prices went lower, raising the yield on the 10 year note to 3.51% from 3.47%.

Tokyo - The Nikkei slipped 18.51 points to close at 9,939.93 this morning. Consumer lenders and airlines were among the biggest losers following a media report that Orix Corp and All Nippon Airways will sell shares. Orix, the nation’s largest non bank financial company sank 4.8%, while All Nippon dropped 5.9%.

Hong Kong - The Hang Seng fell 149.78 points to 18,378.73 this morning, although the index still managed its best quarterly gain in almost 10 years. Property stocks led the drop on the day as investors locked in profits from one of the best performing sectors over the quarter.
  
Economics

UK PMI manufacturing (Jun) 09:30 GMT

Analysts expect the PMI survey to improve further in June as weaker sterling and signs of an improvement in global activity start to stimulate UK manufacturing activity.

US ADP employment change (Jun) 13:15 BST/ 08:15 EDT

Analysts expect June ADP private employment to fall by 370,000. Temporary hiring related to next year’s census rose 62,000 in April and fell 18,000 in May, but the bulk of the hiring will not occur until 2010. The forecast of -350,000 for non-farm payrolls assumes a 20,000 increase in government jobs.

US ISM manufacturing (Jun) 15:00 BST/10:00 EDT

ISM manufacturing has surpassed expectations each month this year, by an average of 1.5pts. In four out of the past five months, the upside surprise was accompanied by higher new orders, which climbed by an additional 3.9pts to 51.1 in May. So far in June, the Empire index (-9.4 from - 4.6) was underwhelming, with shipments declining and new orders holding about steady. However, the Philadelphia Fed (-2.2 from - 22.6) rose strongly and is nearly at breakeven. Shipments and new orders each rose by 21pts in the Philadelphia-area survey, while employment climbed 5pts but remains deeply negative at -21.8. Analysts expect June ISM manufacturing to rise to 47.5, from 42.8 in May. The price paid index could climb to 48, up from 43.5.

US Construction spending (May) 15:00 BST/10:00 EDT

Non-residential construction has risen for three straight months, boosted by increases in areas such as lodging, transportation, communications, and power. Office and commercial construction are still trending lower, as vacancy rates continue to rise. Meanwhile, residential construction rose 0.6% in April, only the third monthly increase since March 2006. Analysts look for total construction spending in May to be unchanged. US Pending home sales (May) 15:00 BST/10:00 EDT

Pending home sales rose by 6.7% in April and have risen by a combined 12% over the past three months. Sales have started to creep higher in the Northeast, Midwest, and South, while pending sales in the West are down 18% since last September, possibly reflecting slower sales of foreclosed homes. Analysts look for overall pending homes sales to rise by 1% in May.

Corporate

British Airways and trade unions representing cabin crew and ground staff will continue talks today over changes to working conditions despite an end-June deadline for a resolution set by the airline. The company said "Talks have been adjourned and will restart tomorrow". CE Willie Walsh has been trying to drive through cost cuts at the airline in what he has described to staff as a fight for survival. Measures have included voluntary redundancy and staff, including Walsh, agreeing to work for free during July. Pilot’s union BALPA has already urged pilots to accept a deal under which they will receive shares in the company in return for a pay cut.

Standard Chartered is in talks to purchase assets in China and India owned by RBS, a source with direct knowledge of the matter said today. Standard Chartered’s pursuit of the units comes as RBS tries to wrap up the sale of its retail and commercial banking divisions in Asia. The initial plan was to sell the entire group to one buyer for at least $2bn. But that effort failed, and the process is now focused on selling various parts to separate buyers, sources involved with the process say. ANZ said in May that it had submitted a non binding bid for the RBS assets and had raised A$2.5bn in a share sales to both fund the acquisition and strengthen its balance sheet. ANZ is in talks to buy RBS units in Hong Kong, Taiwan, Singapore, Vietnam and Indonesia. The report said Standard Chartered was eyeing the RBS Malaysian assets too.

RBS is refocusing on its core businesses and plan to exit or shrink in up to 36 of the countries where it operates. The bank is selling its commercial and retail banking units in Asia, and keeping its investment banking business. An RBS spokeswoman said "We are well advanced with the sale process, however, due to regulatory constraints and the confidentiality of the process we will not be commenting on any individual bidders or elements of the transaction process until its completion". The Asian assets for sales include 28 branches in India, where RBS has more than 1.3m customers, 20 in Indonesia, where it has the largest foreign owned bank network, and 17 in Taiwan, serving over 1 million customers. RBS has 13 branches in China. RBS is likely to fetch close to $1bn from the sales of its Asian assets than the $2bn that had earlier been expected.

The three main contenders for the Asia assets have been ANZ, HSBC Holdings and Standard Chartered. It was not clear today where HSBC stood in the process. The bank could not be reached immediately for comment. An ANZ spokesman Kevin Foley said "We have already earlier this year said publicly that we were involved in that process, but the outcome at this stage is unknown".

WSP said today trading for the first half of 2009 was in line with its expectations as its business from the public sector remained stable. The company said the private sector continue to be difficult across all territories with a marked slowdown in its businesses in the UK, United States and particularly in the Middle East. They added "The ongoing lack of liquidity in Dubai is affecting both the resolution of existing contracts, which remains extremely slow, and conversion of the pipeline of the future projects". The group said its public sector activities remained stable with its businesses in the UK, Northern Europe and the US were trading well. WSP Group said it was well financed with a £150m committed credit line to 2013, and that while net bank debt was higher than last year end, it was comfortably within its banking covenants.

British Polythene Industries said today first half profit would be comfortably ahead of its prior view, mainly due to more stable input costs, lower expenses and slightly better than expected demand from some sectors. Profit for the six months ended June 30 will be ahead of its earlier forecast even after accounting for the £2m charge from plant closures and restructuring, the company said. The company said demand from the horticultural sector for packaging for garden composts was better than it has been in many years, but construction demand remained depressed. British Polythene also said its polymer suppliers were pressing for increases in polymer prices.

Anite Plc posted a higher full year pre-tax profit on favourable currency movements, but forecast lower profit for the current year due to additional investment in a mobile technology and customer changes in its travel business. The company said it expected lower profit for the current financial year, especially in the first half. CE Christopher Humphrey said "I expect the current trading year to be challenging, particularly in the first half, given the impact of our additional investment in LTE (Long term Evolution) and the effect of customer changes in Travel". LTE helps network operators to support more subscribers on their spectrum allocations at a reduced cost. Anite plans to spend £4m more on its LTE solutions, it said. Anite raised its final dividend to 0.65 pence per share from last year’s 0.6 pence per share. Pre-tax profit was £18.1m for the year ended April 30, compared with £16.7m in the previous year. Revenue fell 3 percent to £90.1m.

John Wood Group said today its performance in the year to date remains in line with expectations. The company said "Although the oil price has strengthened over recent weeks, market conditions remain broadly similar to those outlined in our Interim Management Statement issued on May 13". Wood Group added that it believes the longer term market fundamentals for its services and products remain strong.

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: July 1st, 2009 under Asset Management.
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