ADVFN III Morning Euro Markets Bulletin; June 10, 2013.

ADVFN III Morning Euro Markets Bulletin
Daily world financial news Monday, 10 June 2013

London Market Report
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London open: Gloomy Chinese data weighs on markets early on
Market Movers
  • techMARK 2,449.10 +0.13%
  • FTSE 100 6,399.42 -0.20%
  • FTSE 250 14,022.32 +0.12%
Stocks pulled back on Monday morning on the back of a series of gloomy figures from economic powerhouse China, with Severn Trent leading the FTSE 100 lower as its potential takeover is put at risk.

Markets across Europe and in the US finished firmly higher on Friday after a worse-than-expected reading of US non-farm payrolls eased concerns that the Federal Reserve would soon begin to scale back stimulus.

"While the Friday payrolls report, along with last week's weaker US data seems to have put paid to any prospect of Fed tapering before the September meeting, the residual effects of speculation about it are likely to linger for weeks and months ahead," said Senior Market Analyst Michael Hewson from CMC Markets.

Nevertheless, one bright spark this morning came from Japan where economic growth in the first quarter was revised up to an annual rate of 4.1%, ahead of the initial 3.5% estimate. A monetary policy announcement is due out from the Bank of Japan tomorrow.
Chinese data disappoints
Consumer price inflation in China slowed to an annual rate of 2.1% in May, from 2.4% the month before. Given that the consensus forecast was for a pick-up to 2.5%, the slowdown points to continued weak demand, analysts say.

These concerns were compounded by bank lending figures which showed that that banks gave out just 667.4bn yuan in new loans last month, down from 792.9bn yuan in April and well below the 815bn yuan expected.

Year-on-year money supply growth eased from 16.1% to 15.8% in May, worse than the 15.9% expected.
Meanwhile, industrial production rose at an annual rate of 9.2% in May, slightly below the 9.3% increase the month before. Analysts were expected an improvement of 9.4%.

"Cleary such figures are a sharp reminder that China is still struggling to recover with the global economic downturn and there is still a way to go before investors' confidence in the economic giant returns," said Financial Trader Shavaz Dhalla from Spreadex.
FTSE 100: Severn Trent sinks after latest bid rejection
Water group Severn Trent dropped this morning after rejecting the latest takeover proposal from international consortium LongRiver Partners at 2,200p per share.

The firm argues that the 20.5% premium to its share price before the announcement of the initial approach fails to reflect its "significant long-term value" or future potential. However, a spokesman for the consortium said this morning that it would not make a further proposal for Severn Trent unless the UK firm engages in talks.

Mining stocks were under pressure early on as the economic data from China weighed on the outlook for demand. Rio Tinto, Fresnillo and BHP Billiton were all in the red.

Even precious metals producer Polymetal was lower despite signing two export sales contracts with Chinese off-takers for a volume of up to 50,000 tonnes of refractory gold concentrate produced at the Mayskoye gold project. The move will allow Polymetal to start generating free cash flows at its newest mine by the third quarter.

AMEC, the engineering and project management firm, also underwhelmed after saying that it has been awarded an two-year extension to a contract with natural gas giant BG Group worth £110m.

FTSE 100 - Risers
ITV (ITV) 132.80p +2.63%
Royal Bank of Scotland Group (RBS) 332.10p +1.44%
Evraz (EVR) 129.20p +1.33%
Kingfisher (KGF) 350.50p +1.10%
International Consolidated Airlines Group SA (CDI) (IAG) 273.50p +1.03%
Whitbread (WTB) 2,894.00p +0.94%
easyJet (EZJ) 1,205.00p +0.92%
Wolseley (WOS) 3,120.00p +0.87%
William Hill (WMH) 440.00p +0.82%
InterContinental Hotels Group (IHG) 1,839.00p +0.71%

FTSE 100 - Fallers
Severn Trent (SVT) 1,993.00p -3.72%
Polymetal International (POLY) 653.00p -3.33%
Anglo American (AAL) 1,440.00p -1.57%
Antofagasta (ANTO) 908.50p -1.46%
Rio Tinto (RIO) 2,770.00p -1.35%
BHP Billiton (BLT) 1,810.00p -1.23%
Vedanta Resources (VED) 1,226.00p -1.21%
Randgold Resources Ltd. (RRS) 4,995.00p -1.09%
Fresnillo (FRES) 1,132.00p -1.05%
Shire Plc (SHP) 2,085.00p -1.04%

FTSE 250 - Risers
BBA Aviation (BBA) 282.00p +3.71%
Man Group (EMG) 98.20p +3.48%
Kenmare Resources (KMR) 31.78p +3.35%
Unite Group (UTG) 375.60p +3.24%
Betfair Group (BET) 833.50p +2.65%
Petra Diamonds Ltd.(DI) (PDL) 120.00p +2.48%
Afren (AFR) 128.80p +1.82%
Pace (PIC) 246.60p +1.48%
Carillion (CLLN) 250.00p +1.38%
CSR (CSR) 523.50p +1.36%

FTSE 250 - Fallers
African Barrick Gold (ABG) 134.00p -4.15%
Petropavlovsk (POG) 135.10p -3.57%
Amlin (AML) 390.60p -2.45%
Daejan Holdings (DJAN) 3,839.00p -2.24%
Investec (INVP) 442.80p -1.58%
Electrocomponents (ECM) 258.70p -1.56%
Carpetright (CPR) 605.50p -1.54%
Centamin (DI) (CEY) 38.00p -1.50%
PayPoint (PAY) 973.00p -1.47%
UK Event Calendar
Monday June 10

RWS Holdings

Lok'n Store Group

Barloworld Ltd., Topps Tiles

Canaccord Financial Inc., Honeywell International Inc., IBM Corp.

Factory Orders (GER) (11:00)
Harmonised Competitiveness Indicators (EU) (09:00)

Falkland Islands Holdings, Great Eastern Energy Corp Ltd. GDR, Green Dragon Gas Ltd. (DI), Latchways,

Fidessa Group

CEPS, Dexion Absolute Ltd. GBP Shares, European Islamic Investment Bank, GLOBO, Hansteen Holdings, HydroDec Group, OJSC Phosagro GDR (Regs), ShalkiyaZinc NV GDR (Reg S), Sperati CA, Synairgen

Fidessa Group, Hydro International

Europe Market Report
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Europe open: German constitutional court ECB review in focus
- German constitutional court to review ECB OMT program
- Banks deposited 100.9bn euros overnight at ECB

FTSE-100: -0.18%
Dax-30: 0.46%
Cac-40: -0.19%
FTSE Mibtel 30: 0.09%
Ibex 35: 0.32%
Stoxx 600: -0.01%

European equities have begun the week on a mixed footing following Friday's bounce after the release of the latest US employment data, on Friday. What some have characterised as a lacklustre jobs report helped temper short-term worries of Fed tapering.

Nevertheless, the latest batch of Chinese data – out over the weekend – has some economists, such as those at Nomura and Mizuho, again eyeing the possibility of interest rate reductions in the Asian giant should economic growth undershoot current forecasts.

Meantime, and in European affairs, this week's review of the European Central Bank's Outright Monetary Transactions program by the German Federal Constitutional court in Karlsruhe is drawing quite a bit of commentary.
Light company news-flow
SoftBank is in talks with Deutsche Telekom over a possible deal for T-Mobile US Inc, as the Japanese company looks for alternatives to enter the US wireless market should its deal with Sprint Nextel fall apart, three sources familiar with the matter told Reuters.

The German insurance sector has reached a wage deal encompassing approximately 172,000 workers with the Verdi union.

From a sector stand-point the best performance on the DJ Stoxx 600 is now to be seen in the following industrial groups: Travel&Leisure (0.63%), Technology (0.38%) and Retail (0.34%).
Weaker than forecast economic data
Italian industrial production fell by 0.3% month-on-month in April, versus consensus forecasts for a flat reading.

French industrial production rose by 2.2% month-on-month in April (Consensus: 0.3%).

Swiss retail sales grew by 3.3% year-on-year in April.

French business sentiment stayed at the 94 point level in May (Consensus: 95.0).
Small moves in other asset classes

Front month Brent crude futures are now edging lower by 0.249 dollars to the 104.3 dollar per barrel mark on the ICE.

The euro/dollar is now up by 0.14% to the 1.3210 dollar level.

US Market Report
US close: Stocks bounce, end day firmly higher
- PIMCO´s El Erian says inflation could rise in long-term
- Barclays sticks to call for Fed tapering to start in first quarter 2014

Dow Jones Industrials: 1.38%
Nasdaq Comp.: 1.31%
S&P 500: 1.26%

The main US equity market gauges finished the day firmly higher despite the release of a slightly weaker than expected non-farm payrolls report and gains in crude futures and long-term bond yields.

Nevertheless, ironically, and as so often happens, that may actually help to assuage concerns that a tapering of the Federal Reserve's quantitative easing programme is imminent.

Non-farm payrolls expanded by 175,000 in May, right in-line with consensus estimates. The unemployment rate, however, came in at 7.6%, one tenth of a percentage over what was expected.

Similarly, and with negative implications for economic growth at first glance, average weekly earnings were flat, instead of the 0.1% rise which had been projected.

Of interest, according to a survey carried out by Bloomberg economists have actually trimmed their forecasts for the magnitude by which the Federal Reserve will taper its asset purchase programme at the October 29-30th meeting.

They now foresee that it will do so until it reaches a monthly pace of $65bn, versus the fall to $50bn which they were anticipating at the start of May.

US consumer credit rose by 11.05bn dollars in April, versus a consensus estimate for a gain of 12.9bn dollars.

From a sector stand-point the best performance was seen in the following industrial groups: Airlines (4.90%), Electronic office equipment (4.17%)and investment services (3.91%).

10 year US Treasury yields ended higher by 9 basis points at 2.17%.

Front month West Texas crude futures were up by 1.58% to the $96.26/barrel mark on the NYMEX.

S&P 500 - Risers
Morgan Stanley (MS) $27.00 +6.26%
GameStop Corp. (GME) $36.75 +6.15%
NRG Energy Inc. (NRG) $27.10 +5.65%
Apollo Group Inc. (APOL) $21.30 +5.13%
Omnicom Group Inc. (OMC) $63.93 +4.80%
CME Group Inc. (CME) $72.00 +4.47%
Kroger Co. (KR) $34.56 +4.35%
Abercrombie & Fitch Co. (ANF) $51.70 +4.23%
Xerox Corp. (XRX) $9.17 +4.20%
Celgene Corp. (CELG) $120.41 +4.20%

S&P 500 - Fallers
Perrigo Company (PRGO) $0.00 -100.00%
Iron Mountain Inc. (IRM) $28.95 -15.84%
Alpha Natural Res (ANR) $6.39 -4.05%
Cliffs Natural Resources Inc. (CLF) $17.94 -3.29%
Thermo Fisher Scientific Inc. (TMO) $84.58 -2.73%
Newmont Mining Corp. (NEM) $34.11 -2.40%
LyondellBasell Industries (LYB) $64.87 -2.30%
CBS Corp. (CBS) $48.03 -1.66%
QUALCOMM Inc. (QCOM) $62.10 -1.38%
Sprint Nextel Corporation (S) $7.24 -1.36%

Dow Jones I.A - Risers
Boeing Co. (BA) $102.49 +2.74%
Walt Disney Co. (DIS) $64.85 +2.71%
American Express Co. (AXP) $78.04 +2.36%
Hewlett-Packard Co. (HPQ) $24.81 +2.31%
3M Co. (MMM) $111.11 +2.25%
Travelers Company Inc. (TRV) $83.44 +2.08%
General Electric Co. (GE) $23.86 +2.05%
Microsoft Corp. (MSFT) $35.67 +2.03%
Home Depot Inc. (HD) $78.74 +1.92%
United Technologies Corp. (UTX) $94.50 +1.89%

Dow Jones I.A - Fallers
AT&T Inc. (T) $35.45 -1.01%
Merck & Co. Inc. (MRK) $48.19 -0.84%
Cisco Systems Inc. (CSCO) $24.49 -0.24%
Intel Corp. (INTC) $24.59 -0.24%

Nasdaq 100 - Risers
Vertex Pharmaceuticals Inc. (VRTX) $82.81 +6.14%
Celgene Corp. (CELG) $120.41 +4.20%
CA Inc. (CA) $29.14 +4.11%
Catamaran Corp (CTRX) $50.29 +4.03%
Liberty Global Inc. Series A (LBTYA) $76.24 +3.86%
Baidu Inc. (BIDU) $102.67 +3.82%
Check Point Software Technologies Ltd. (CHKP) $50.91 +3.64%
Applied Materials Inc. (AMAT) $15.49 +3.61%
Amazon.Com Inc. (AMZN) $276.87 +3.38%
Starbucks Corp. (SBUX) $65.04 +3.21%

Nasdaq 100 - Fallers
Perrigo Company (PRGO) $0.00 -100.00%
Equinix Inc. (EQIX) $192.57 -5.54%
Randgold Resources Ltd. Ads (GOLD) $77.30 -2.25%
QUALCOMM Inc. (QCOM) $62.10 -1.38%
Maxim Integrated Products Inc. (MXIM) $28.48 -1.25%
F5 Networks Inc. (FFIV) $78.07 -1.18%
Costco Wholesale Corp. (COST) $110.58 -0.46%
Sandisk Corp. (SNDK) $58.31 -0.32%
Seagate Technology Plc (STX) $44.01 -0.25%
Cisco Systems Inc. (CSCO) $24.49 -0.24%

FX and Commodities round-up
FX round-up: Dollar stages sharp rebound after jobs data
The dollar recovered from steep losses the previous session on Friday as data showed the US economy added slightly more than expected jobs in May.

Friday's widely anticipated Labor Department report showed that the US economy created a slightly better than forecast 175,000 jobs in May. The unemployment rate nudged up to 7.6% last month from 7.5% in April.

The report boosted hopes that the US economy is making a steady recovery and also rekindled expectations the Federal Reserve may start to scale back its asset purchases later in the year.

The dollar index, which measures the US currency against six major rivals, rose to 81.658 from 81.531 on Thursday.

Against the yen, the dollar recovered ground after Thursday's plunge and Friday's low of ¥95 to trade at ¥97.44 after the jobs report. The dollar changed hands at ¥97.06 on Thursday.

The euro bought $1.3218 compared to $1.3243 on Thursday after the European Central Bank President Mario Draghi gave no indication that further monetary easing was being planned.

Sterling changed hands at $1.5554 from $1.5601 on Thursday.
Commodities: Crude boosted by steady job growth in May
Crude oil futures settled 1.3 per cent higher on Friday and scored a weekly gain of over 4 per cent as investors took heart from encouraging May US non-farm payroll data.

Crude for July delivery settled up $1.27 at $96.03 a barrel on the New York Mercantile Exchange.

Friday's widely anticipated job figures from the Labor Department showed that US employers added a slightly better than expected 175,000 new jobs in May.

The report underlined hopes that the US economy, and the world's biggest oil consumer, was improving steadily.

Also, earlier in the week supply data said that record high stockpiles were starting to tighten. The US Energy Information Agency said crude oil supplies declined by a bigger than expected 6.3m barrels in the last week.

London rival, Brent crude settled up 95 cents at $1.04.56 on the ICE Futures Exchange.

Among precious metals gold tumbled over 2% on Friday as the better than expected jobs data eroded safe have flows.

Gold for August delivery lost $32.80 to settle at $1,383 an ounce on the Comex division of the New York Mercantile Exchange.

Silver also headed lower with the July contract down 96 cents or 4.3% at $21.74 an ounce.


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