FTSE 100	4340.71, +91.50	Dow	8504.06, +57.06
FTSE 250	7506.71, +92.15	Nasdaq	1845.72, +10.68
FTSE All Share	2215.78, +43.70	S&P 500	923.33, +4.01
Nikkei	9876.15, -63.78	Hang Seng	18498.13, +119.40
Oil (Crude)	$69.31	Gold	$942
Base Rate	0.5%	10 Yr Gilt	3.765%
£/$	1.634	£/€	1.160
1 month LIBOR	0.655	3 month LIBOR	1.2

 

Markets

London - The FTSE 100 is currently 37.32 points lower at 4,303.39 as traders look towards the closely watched US jobs data, due this afternoon. Mining stocks hand back some of the previous session’s strong gains in cautious trade, although nerves about a major capital raising in the sector were eased. Rio Tinto said its $15.2bn rights issue was heavily subscribed, and was supported by Chinalco, which took up its full entitlement under the terms of the offer. Tullow Oil falls 2.7% after vague dealing room talks of bid interest in the company from China faded, after helping its stock higher over the previous session. Lower down the market, mid-cap retailer Game Group loses 10.1% after it reported a 15.4% fall in underlying sales in the first half.

New York - US stocks started the new quarter brightly yesterday with all three major indices making gains. Investors were buoyed by reports from the manufacturing and housing sectors. The Institute for Supply Management’s manufacturing index showed a small improvement in June, from 42.8 to 44.8. This still shows that the sector is contracting, but at a slower pace than in May. The National Association of Realtors said pending home sales rose 0.1% in May, against expectations for the level to hold steady from the previous month.

The Dow Jones added 57.06 points to close at 8,504.06 while the S&P 500 gained 4.01 points to end at 923.33. The Nasdaq advanced 10.68 points to finish at 1,845.72.

General Mills helped push Kraft Foods to the top of the Dow leader board. General Mills forecast a stronger than expected annual profit, sending shares 3.9% higher. Kraft Foods jumped more than 5% as a result. Coca-Cola followed, with a gain of 2.5%, as investors bet a decline in the dollar might boost overseas earnings.

AIG was in focus following its annual meeting on Tuesday. Shareholders approved a proposal for a 1 for 20 reverse stock split. The shareholders also ousted the majority of the company’s board, sending shares 22% lower in Wednesday’s trade.

US light crude oil for August delivery fell $0.58 to $69.31 a barrel. COMEX gold for August delivery gained $13.90 to $942 an ounce. Treasury prices were steady, leaving the yield on the 10 year note at 3.53%.

Tokyo - The Nikkei dropped 63.78 points to close at 9,876.15 this morning. Banks went lower on concerns that a merger between Aozora Bank and Shinsei Bank won’t produce a stronger lender. AOC Holdings, which has stakes in South China Sea and North Sea oil fields, slid 1.9% in line with oil prices.

Hong Kong - The Hang Seng is currently 119.40 points higher at 18,498.13. Stocks gained as an expansion in Chinese manufacturing spurred optimism the economy is recovering. Angang Steel, China’s second largest steelmaker, gained 2.3% after the country’s manufacturing expanded for the fourth month.

  
Economics

US Non-farm payrolls (Jun) 13:30 BST/08:30 EDT

Analysts look for non-farm payrolls to fall by 350,000. Payroll employment has shown successively smaller monthly declines since January, including the 345,000 drop in May. The sum of the state-bystate payrolls showed a similar fall of 359,000. Although ADP employment (-532,000) and household employment (-437,000) recorded bigger declines, the trend appears to be improving. The payroll diffusion index rose to 32.7 in May (from 25.8 in April), indicating that a third of industries are now adding workers. So far in June, weekly initial jobless claims have averaged around 615,000, while continuing claims recently recorded its first weekly decline since January. Analysts look for the unemployment rate to rise to 9.6% from 9.4%. Average hourly earnings could rise just 0.1% for the third month in a row, with the year-on-year rate falling to 2.9% from 3.1%.

US Initial jobless claims (week 27 Jun) 13:30 BST/08:30 EDT

Last week’s initial claims rose to 627,000, up from 612,000. The four-week average rose slightly to 617,250. The Labor Department said some states that typically don’t report school year-related layoffs had larger-than-expected job losses in education services. Analysts look for this week’s claims to drop back down to 605,000. Continuing claims for the previous week could decline to 6.73m, down from 6.74m.

US Factory orders (May) 15:00 BST/10:00 EDT

Durable goods orders were stronger than expected in May, rising 1.8%. Nondurable orders could rise by at least 2%, getting a boost from higher oil prices. Analysts see total factory orders rising 1.9%.

Corporate

Game Group reported a fall in underlying sales but an increase in profit margins in its latest trading period. The group forecast first half profit before one off items of between £13m and £16m, down from £36.4m in the previous year. Game said that in the 21 weeks to June 27 group like for like sales fell 15.4 percent. It said the fall was in line with expectations given very strong sales in the comparative period. It said it had seen "good gross margin growth" due to higher margin software and accessory sales being a larger part of the sales mix.

Intermediate Capital Group said today it will turn to shareholders to raise £351m to take advantage of investment opportunities. The rights issue is being offered at a price of 121 pence per share, a 39 percent discount to the ex-rights price based on last nights close. The company said it expects to show a decrease in the number of portfolio companies performing ahead of last year, as the economic environment remains difficult.

WellStream Holdings said today it traded broadly in line with its expectations in the six months to end-June. The group said it was performing strongly operationally, with good progress on BHP Billiton’s Pyrenees project and Seastream’s offshore installation work expected to be completed before year end. Wellstream reports results for the first half on August 20.

Greene King posted a smaller than expected fall in full year profit and said it had benefited from an upturn in trading in recent weeks, driven by a sharp increase in sales of food. Greene King said pre-tax profit for the year to May 3 fell 15 percent to £139.4m on revenues 1.3 percent higher at £942.3m. Analysts expected Greene King to post a profit of £116m for the year. The company held the final dividend at 15.1 pence per share. CE Rooney Anand said "The funds raised by our recent rights issue will further strengthen our position through selective acquisitions. Although the outlook remains uncertain, current trading is encouraging and we look forward with cautious optimism".

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Posted: July 2nd, 2009 under Asset Management.
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