FTSE 100	5261.57, +17.2	Dow	10471.50, +65.67
FTSE 250	9000.65, +42.05	Nasdaq	2190.31, -0.55
FTSE All Share	2682.52, +9.28	S&P 500	1106.41, +4.06
Nikkei	10105.68, -2.19	Hang Seng	22091.14, +189.03
Oil (Crude)	$69.87, -$0.67	Gold	$1119.90, -$6.30
Base Rate	0.5%	10 Yr Gilt	3.85%
£/$	1.625	£/€	1.1074
1 month LIBOR	0.514	3 month LIBOR	0.606

 

Markets

London - The FTSE 100 gained 17.20 points to close at 5,261.57 on Friday. Travel company Thomas Cook topped the table of risers with a gain of 4.35% after a positive recommendation by a broker. The other major gainer was Lloyds Bank. Its shares were 3.49% better at the close. It and other big banks recovered some of recent falls. This morning the FTSE is 51.49 points higher at 5,313.06. Standard Chartered is one of the biggest risers, up 4.7%, as jitters about exposure to Asian markets subside.

New York - US indices were mixed on Friday, with the Dow and S&P 500 closing higher for a third straight session. Positive economic reports gave stocks a boost, but a stronger dollar and weakness among technology stocks kept gains in check. The Dow Jones rose 65.67 points to 10,471.50, the S&P 500 added 4.06 points to 1,106.41 and the Nasdaq slipped 0.55 to 2,190.31. Government reports showed stronger than expected November retail sales and an unexpected rise in business inventories in October. Furthermore, the University of Michigan’s consumer sentiment index rose to 73.4 from 67.4, versus forecasts for a rise to 68.8.

Tokyo - The Nikkei edged just 2.19 points lower to 10,105.68 this morning. Stocks pared losses after Abu Dhabi said it will support $10 billion of Dubai debt. Shares fell as manufacturers’ sentiment rose the least since the economy emerged from recession, according to a government survey.

Hong Kong - The Hang Seng is currently 189.03 points higher at 22,091.14, also lifted by news that the Abu Dhabi government will provide financial support.

Economics

No economic data to report

Corporate

Distribution and outsourcing group Bunzl today said full-year trading is in line with expectations, enabling it to take advantage of opportunities to develop further. The company said full-year revenue rose 11% on the year, buoyed by positive currency exchange. At constant exchange rates, underlying revenue in the second half is some 1% below the 2008 figure but this is a slight improvement in the growth rate compared to the first half of 2009. Bunzl said its operating margin has also improved compared to the first half, largely due to cost cutting and a reduced negative transaction impact from foreign exchange, particularly in the U.K. & Ireland and Australasia. Revenue growth in North America in the second half is slightly stronger than the 2% growth recorded in the first half, due to new customer wins and additional business with existing accounts, but revenue in the U.K. & Ireland continued to be below last year’s - hit by the weak economy.

Cadbury raised its sales and margin targets today for the next four years as it issued a robust defence of its business and once again rejected Kraft Foods Inc’s "derisory" offer. "Kraft is trying to buy Cadbury on the cheap to provide much needed growth to their unattractive low-growth conglomerate business model," said Chairman Roger Carr in a statement to shareholders. "Don’t let Kraft steal your company with its derisory offer." In its response to Kraft’s GBP9.9 billion bid, the U.K. confectioner said it was setting out upgraded targets for the next four years which it said would deliver "significant additional value." The company is now targeting organic revenue growth of 5%-7% a year, up from 4%-6%, while margins are now expected to grow to 16%-18% by 2013. The company had been aiming to grow margins to the "mid-teens" by 2011. Cadbury said it is also targeting 80%-90% operating cash conversion from 2010, with double-digit growth in dividends per share from 2010 onwards. Kraft posted its formal offer to Cadbury’s shareholders just over a week ago, setting in motion a 60-day offer period. The terms of the offer were identical to Kraft’s initial proposal of 300 pence in cash and 0.2589 new Kraft shares in September–an offer repeatedly described by Cadbury’s board as derisory. The offer originally valued each Cadbury share at 745 pence, though a fall in Kraft’s shares means it is now valued at nearer 720 pence. So far, the market has agreed that Kraft’s chances of success are slim unless it raises its bid to at least 800 pence a share.

Hotel and restaurant chain Whitbread said today it expects fiscal 2010 earnings to exceed the top end of market estimates after cutting costs and growing market share, but added that it’s still too early to call a general recovery in the market. Speaking to reporters following the group’s third quarter trading update, Chief Executive Alan Parker said the expected full year outperformance was down to company-specific moves to improve market share and keep costs under control, whereas overall market conditions are likely to remain tough going into the New Year. He said Whitbread would continue to expand at around 2,000 hotel rooms per year, and the company is building up its land bank for when there is a turn in the market, "but we don’t see that quite yet." The company operates over 40,000 rooms. Last year, Whitbread was forced to scale back its expansion plans for Premier Inn, which contributes 70% of group profit, due to softening sales growth. It has instead focused on maintaining cash-flow and cutting costs until the recession is over. In the three months to Nov. 26, sales rose 0.3% on a like-for-like basis across the group, with Premier Inns sales declining 3.1%, a substantial improvement on the 7.2% decline seen in the second quarter. The budget hotel chain has been aggressively targeting the leisure sector, attracting weekend travellers while also growing its business account customers as companies look to save on travel costs. Revenue per available room, or RevPAR, a key industry measure, declined 7.9% in the third quarter at Premier Inns, compared with a 9.2% decline in the first half of the year. The market had been expecting a decline of 6% to 7%. At Costa Coffee, the company’s fast expanding coffee house chain, same-outlet sales were up 6.7%, well ahead of market expectations for a rise of around 0.5%.

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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.

 

Posted: December 14th, 2009 under Asset Management.
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