FTSE 100	5602.30, -4.42	Dow	10564.38, +11.86
FTSE 250	9774.68, -11.71	Nasdaq	2340.68, +8.47
FTSE All Share	2862.26, -2.21	S&P 500	1140.44, +1.94
Nikkei	10563.92, -3.73	Hang Seng	21208.29, +0.74
Oil (Crude)	$81.49, -$0.38	Gold	$1122.90, -$1.70
Base Rate	0.5%	10 Yr Gilt	4.06%
£/$	1.492	£/€	1.1001
1 month LIBOR	0.541	3 month LIBOR	0.643

 

Markets

London - The FTSE 100 slipped 4.42 points to close at 5,602.30 yesterday. Liberty International pushed property companies lower after reporting net asset value that missed analysts’ estimates. Imperial Tobacco lost 2.5% after UBS lowered its recommendation for the cigarette maker to “sell” from “neutral”, citing a 41 percent rally in the shares over the past 12 months. Antofagasta gained 1.1%, even though it reported a drop in full year net income to $667.7 million. However, the copper producer said it is seeking a mining licence in Pakistan that may rival its largest project following “very good” talks with the head of the provincial government. This morning the blue chip index falls 7.66 points to 5,594.64.

New York - US indices made small gains yesterday, one year to the day after their worst close in 12 years. Since that day the Dow has gained 61.2%, the S&P 500 68% and the Nasdaq 84%. However, the pace of the advance has slowed this year, as investors have gone from pricing in an economic recovery to waiting for evidence that the recovery has legs. Yesterday, the Dow Jones rose 11.86 points to 10,564.38, the S&P 500 added 1.94 points to 1,140.44 and the Nasdaq gained 8.47 points to 2,340.68. Money flowed out of commodity related stocks as metal prices fell, and into the telecom and transportation sectors. Cisco Systems lifted telecoms after unveiling a higher capacity router that AT&T, the biggest US telecom company, said it had successfully tested. Airlines were boosted after major US carriers said they would continue to explore new fees and cost-cutting measures to enhance profitability, while a report showed business travel picked up. Elsewhere in the transportation sector, Morgan Stanley reiterated its upbeat view on railroads.

 Tokyo - The Nikkei edged 3.73 points lower to 10,563.92 this morning. Renewed concerns over deflation, following a report from the central bank, sent investors to the sidelines. Elsewhere a gauge of commodity-transport fees dropped hurting shares in the sector.

Hong Kong - The Hang Seng rose 0.74 points to 21,208.29 today. A drop among shipping lines and developers countered better than expected earnings for MTR Corp.

Economics

UK Industrial production (Jan) 10:30 GMT

Like the retail spending data, analysts expect adverse weather conditions in the UK in January to have led to a sharp decline in manufacturing production that will more than offset the rise in gas and electricity production. Our analysis shows that in previous periods of snow there has been a sizeable, but temporary, drop in activity

US Wholesale inventories (Jan) 15:00 GMT/ 10:00 EST

The monthly inventory figures are likely to get more attention than usual given the strong influence that they are having on the headline GDP readings and estimates. Wholesale inventories account for around 30% of total business inventories, and analysts look for a flat reading in January.

Corporate

Standard Life posted milder-than-expected 1.5% fall in operating profit for 2009, as the economic recession forced customers to scrimp on insurance spending, but the company said it is starting 2010 "in a good position" after seeing strong sales in the last part of the year. Standard Life said pre-tax operating profit on a European Embedded Value basis was at GBP919 million, down from GBP933 million previously. The Edinburgh-based insurer is recommending a full-year dividend of 12.24 pence a share, up 4% from 11.77 pence a share in 2008. "Today’s announcement highlights good profits and healthy cash flow for the year, and the ongoing delivery of efficiency savings in our business despite the difficult and uncertain year for financial markets," said new Chief Executive Officer David Nish, who took over from Sandy Crombie at the start of the year. Last year, new life and pensions sales fell 7% to GBP14.66 billion from GBP15.68 billion. This fall was mitigated by an unexpectedly strong 29% rise in fourth-quarter sales to GBP4.16 billion, up from GBP3.23 billion in the same period a year ago. Using International Financial Reporting Standards, which doesn’t book future profits from new business, pre-tax profit was up 89% at GBP291 million from GBP154 million in 2008. The result is also higher than the GBP217 million average forecast from analysts. Factoring in unrealized gains on investments, Standard Life had an EEV net profit of GBP305 million, reversing the GBP134 million net loss the previous year. IFRS net profit was at GBP213 million, more than double the GBP100 million net profit in 2008. The company’s capital position remains strong, with a capital surplus of GBP3.6 billion in December, up from GBP3.5 billion at end-2008. Standard Life shares are about 54% higher than they were a year ago, with market capitalization at around GBP4.5 billion.

Tullow Oil Wednesday said full-year 2009 net profit fell 93% due to lower oil and gas prices and lower output, but the company said it remains well funded to continue its medium term exploration, appraisal and development programmes. Full-year 2009 net profit dropped to GBP15 million from GBP223 million a year earlier. Oil and gas production for the year was down 12% to 58,300 barrels of oil equivalent a day, while realised oil and gas prices fell 18% and 25% respectively. Tullow’s gearing–the ratio of net debt to net assets–rose 17 percentage points to 47% as the company invested heavily in Ghana and Uganda. Tullow will spend up to $1.5 billion buying the Ugandan assets of Heritage Oil, although a large part of this cost will be offset by the proceeds of a subsequent partnership deal with French oil major Total SA and China’s Cnooc Ltd. Meanwhile, the company’s Jubilee field offshore Ghana remains on track to produce its first oil by the end of this year, Tullow said. The first phase of Jubilee will produce around 120,000 barrels of oil a day. The company said that its $2.25 billion debt facilities and GBP1.33 billion raised through equity placings in 2009 and 2010 keeps the company well funded to continue with its exploration, appraisal and development plans. "Our 2009 reported results still reflect a period of financial transition," said Tullow’s Chief Executive Aidan Heavey. "First oil in Ghana from the Jubilee field later this year will result in considerable production growth and increased cash flow."

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Posted: March 10th, 2010 under Asset Management.
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