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Sep 20, 2013

The Economist Group | Management Thinking Digest: The Good Bank.



The financial crisis that followed the Lehman Brothers bankruptcy five years ago triggered the most severe economic downturn in decades. The loss of confidence in the financial sector has led both to more stringent regulation and to the recognition that the banking system requires wholesale re-examination. The Good Bank, a new EIU report fuelled by a global online debate and live webcast, discusses the options for improving banking and what that means to a variety of stakeholders.

A new EIU report, Indonesia - a consistent performer but opportunities go begging, commissioned by Aberdeen Asset Management, finds that Indonesia's outsized domestic economy -- a strength during the global slowdown -- means it is missing a competitive export-led manufacturing sector. Will that absence, along with the high cost of doing business in Indonesia, rising wages and protectionist trade measures mean that the country will struggle to compete with its more flexible neighbours in the future?

With the world population predicted to grow to over 9bn by 2050, resource industries are collaborating with governments, scientists and communities around the world in search of sustainable solutions. Join the conversation at a series of EIU events in 2014 that will examine three key resource challenges: delivering improved nutrition and sustainable agricultural markets; identifying the hot opportunities and cold realities of Arctic trade; and making sustainable use of land.

Denis McCauley
Editorial Director, EMEA
EIU

BIV Today's Business News September 20, 2013: B.C.'s major projects capital costs set record, buoyed by LNG plans



Mining and Energy

B.C.'s major projects capital costs set record, buoyed by LNG plans

Total capital costs of major projects hit a new record in 2013's second quarter, according ... READ MORE

 

Tahltan Elders ramp
up Sacred Headwaters
mine protest after
mediator appointment

A Tahltan Elders-led First Nations group known as the Klabona Keepers has ramped up a showdown against ... READ MORE

 

B.C. municipalities
call for modernization
of mining rules

The Union of BC Municipalities voted September 19 to call on the provincial government to work with ... READ MORE

Economy and Finance

 

B.C. only province to
see price declines in
August: StatsCan

Prices declined by 0.1% in the 12 months leading to August in British Columbia – the only province where prices dropped during that period – according ... READ MORE

Media and Marketing

 

SendtoNews inks landmark deal with NFL

Victoria’s SendtoNews has signed
a multi-year agreement with
the National Football League to
distribute ... READ MORE

More News...

   

BroadbandTV launches tool for YouTubers to increase viewers, revenue

Float plane operator Harbour Air buys first wheeled plane

City of Surrey recognized for excellence in social media

This Week's Issue

 

Custom crush business booms

The number of B.C. wine brands will be at an all-time high this harvest season thanks to ... READ MORE

CMI | Spot Prices as of trading in New York September 20, 2013.

 Spot Prices as of close of trading in New York
Friday, September 20, 2013


Updated 9/20/2013 Today Change Week Ago Month Ago Year Ago
GOLD $1,333.15 -$36.70 $1,309.55 $1,374.15 $1,769.10
SILVER $21.92 -$1.38 $21.73 $23.12 $34.72
PLATINUM $1,435.20 -$40.20 $1,447.60 $1,528.40 $1,627.50
PALLADIUM $724.00 -$16.00 $692.50 $753.30 $664.20
GOLD/SILVER RATIO 60.82

MarketWatch | Wall Street at Close Report September 19, 2013: U.S. stocks fall hard but still up for third week

 By Kate Gibson 

NEW YORK (MarketWatch) -- U.S. stocks fell on Friday, but still managed a third week of gains, as investors reacted to the uncertain science of reading verbal signals from U.S. central bankers. It has been a "big week if you're a Fed watcher," said Richard Slinn, co-head of investments for Northern California, J.P. Morgan Private Bank. The bank oversees $910 billion in assets. At 4 p.m. Eastern, the Dow industrials DJIA -1.19% were down 169.11 points at 15,467.44. The S&P 500 index SPX -0.72% shed 12.68 points to 1,709.66. The Nasdaq Composite COMP -0.39% declined 14.66 points to 3,774.72.

ADVFN III Evening Euro markets Bulletin September 20, 2013.

ADVFN III Evening Euro Markets Bulletin
Daily world financial news Friday, 20 September 2013


London Market Report
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London close: Stocks hit by Bullard comments as post-Fed rally fades

The
exuberant post-Fed mood quickly faded on Friday with comments from one
US policymaker dampening stocks before the close of trade.

Risk
appetite was also scaled back as caution set in ahead of the German
elections at the weekend with the outcome still highly uncertain.

The FTSE 100 finished 28.96 points lower at 6,596.43, a fall of 0.44% on the day.


The Federal Reserve surprised analysts on Wednesday with the decision
not to scale back stimulus, sparking a huge surge on global stock
markets worldwide.

After a broadly flat start this morning
however, stocks sank into the red by the afternoon after the head of the
St Louis Fed, James Bullard, said that the central bank could still
taper quantitative easing at its next meeting in October. He admitted
that this month's decision to maintain stimulus was a close call.


"This admission so soon after Wednesday's surprise has introduced an
element of sogginess to today's afternoon trading with investors
reluctant to take on any significant new positions ahead of the weekend,
in what has been a fairly positive week for European equity markets,"
said Senior Market Analyst Michael Hewson from CMC Markets.

Also on investors' minds today will be the looming elections in Germany
this weekend, with the outcome still highly uncertain given that a
rising euro-sceptic movement across the country could complicate things
for Angela Merkel's CDU party.

Chris Beauchamp, Market Analyst at IG
said that the elections is "the only real cloud on the horizon now" and
it would be a major upset if euro-sceptics made significant gains.


He said: "Like most Europeans, Germans have had enough of the crisis
and would rather not rock the boat, even if it is they that are
underpinning the rescue and recovery efforts."

FTSE 100: Miners track metal prices lower

Falling metal prices were weighing on mining stocks today as commodities pulled back after recent gains. Vedanta, Antofagasta, Fresnillo, Randgold, Anglo American and ENRC fell sharply as gold, silver and copper values took a hit.

Food and sweeteners manufacturer Tate & Lyle was also a heavy faller after the stock's rating was cut by Credit Suisse
from 'outperform' to 'neutral'. The bank said: "The long-running
forward price-to-earnings multiple is 12 versus 13.5 today. That looks
right to us."

United Utilities was retreating after yesterday's strong gains, dragged down after Beaufort Securities lowered its recommendation to 'hold'.

Banking stocks were also out of favour with domestic lenders RBS, Lloyds and Barclays among the worst performers. RBS, which announced this morning the sale of a further 20% stake in Direct Line Insurance, was being weighed down by comments by Investec
which said that the third-quarter trading statement on November 1st
"may (once again) prove to be a poor time to own the shares!"

Heading the other way was supermarket chain Sainsbury after Citigroup
upgraded the group to 'neutral' ahead of its second-quarter trading
update in a couple of weeks. The bank said it expects a "big
improvement" in like-for-like sales trends from the first quarter.

BP was also making gains this morning on market chatter that US oil major Exxon
could be interested in making a bid for its smaller rival. One analyst
however suggested that these rumours should be taken "with a pinch of
salt" perhaps as a result of light news flow on Friday.

Pharmaceuticals group AstraZeneca rose after receiving a green light from European regulators for its nasal influenza vaccine for children.

FTSE 250: Premier Farnell, ICAP hit by downgrades

Electronic components distributor Premier Farnell was a heavy faller after yesterday's first-half report as Numis cut the stock to 'hold', outweighing a Cantor Fitzgerald upgrade to 'buy'.

Interdealer broker ICAP was also trading lower after Bank of America Merrill Lynch
downgraded the stock to 'neutral'. The group was also making headlines
on reports that it could soon agree a settlement with regulators over
the LIBOR rate-rigging scandal.

Insurance firm Jardine Lloyd Thompson, meanwhile, was in demand after buying Towers Watson's reinsurance brokerage business for $250m.


FTSE 100 - Risers
Shire Plc (SHP) 2,593.00p +2.01%
Persimmon (PSN) 1,127.00p +1.44%
GKN (GKN) 360.70p +1.41%
Sainsbury (J) (SBRY) 396.40p +1.38%
International Consolidated Airlines Group SA (CDI) (IAG) 328.60p +1.20%
Pearson (PSON) 1,301.00p +1.17%
Centrica (CNA) 402.20p +1.16%
Reed Elsevier (REL) 845.00p +1.14%
Johnson Matthey (JMAT) 2,878.00p +0.91%
Schroders (SDR) 2,631.00p +0.88%

FTSE 100 - Fallers
Vedanta Resources (VED) 1,116.00p -4.37%
Antofagasta (ANTO) 851.50p -3.89%
Randgold Resources Ltd. (RRS) 4,676.00p -3.41%
Fresnillo (FRES) 1,033.00p -3.37%
Anglo American (AAL) 1,591.00p -2.69%
London Stock Exchange Group (LSE) 1,558.00p -2.62%
Tate & Lyle (TATE) 766.50p -2.23%
Old Mutual (OML) 191.90p -1.89%
Standard Chartered (STAN) 1,535.50p -1.82%
Barclays (BARC) 273.45p -1.74%

FTSE 250 - Risers
esure Group (ESUR) 262.70p +5.08%
Bwin.party Digital Entertainment (BPTY) 120.50p +3.97%
Centamin (DI) (CEY) 45.50p +3.27%
Jardine Lloyd Thompson Group (JLT) 942.00p +2.95%
Playtech (PTEC) 739.50p +2.71%
Cranswick (CWK) 1,189.00p +2.50%
Kenmare Resources (KMR) 27.50p +2.23%
Ted Baker (TED) 1,909.00p +2.19%
Countrywide (CWD) 570.00p +2.15%
Big Yellow Group (BYG) 425.60p +1.94%

FTSE 250 - Fallers
Anite (AIE) 112.50p -6.64%
Alent (ALNT) 340.00p -6.21%
Britvic (BVIC) 554.50p -5.78%
Premier Farnell (PFL) 215.20p -5.66%
Vesuvius (VSVS) 432.20p -5.43%
Polymetal International (POLY) 669.00p -5.17%
Hochschild Mining (HOC) 202.40p -4.89%
Daejan Holdings (DJAN) 3,652.00p -4.80%
Lonmin (LMI) 332.00p -4.68%
Tullett Prebon (TLPR) 352.50p -4.60%

Europe Market Report
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Europe close: Stocks mixed as Fed's Bullard signals October taper

- Fed's Bullard signals October stimulus cut
- Germans head to polls Sunday
- Euro-area consumer confidence rises
- EU changes budget policies to support periphery
- UK public finances improve

FTSE 100: -0.43%
DAX: -0.23%
CAC 40: 0.11%
FTSE MIB: -0.39%
IBEX 35: 0.18%
Stoxx 600: -0.24%


European equities ended the week mixed after Federal Reserve Bank of
St. Louis President James Bullard said the central bank may reduce
stimulus at its next policy meeting.

Just two days after the
Fed's announcement that it would keep up its $85bn monthly asset
purchases, Bullard said a tapering could be on the cards for an October
meeting.

In an interview with Bloomberg ahead of his
speech in New York on Friday, he called October a "live meeting" because
"it's possible you could get some data that change the complexion of
the outlook and could make the committee be comfortable with a small
taper in October".

The Fed on Wednesday decided to keep its
monetary easing unchanged following a two-day policy meeting, surprising
economists who had predicted a cut of between $10bn to $15bn per month.

"That was a borderline decision" after "weaker data came in," Bullard said.

Bullard has previously said that the central bank should not rush into trimming its quantitative easing.

The Fed wasn't the only central bank to shock markets this week as the Reserve Bank of India
(RBI) announced a 25 basis-point rise in its main policy rate, to 7.5%
from 7.25%, although it unwound some short-term tightening measures.

German election looms

Germans will head to the polls on Sunday to vote in the federal election.


An INSA opinion poll on the German election published Friday showed the
opposition Social Democrats climbing one percentage point to 28%, 10
points behind Angela Merkel's Christian Democrats party. The parties
both fell short of a majority.

Free Democrats, the governing coalition's partners, failed to reach the 5% threshold they need to enter parliament.

Another survey, conducted by telephone for the public television network ZDF,
showed the Chancellor's centre-right party is backed by 40% of voters,
while the centre-left Social Democrats earned the backing of 27%.
The Free Democrats, were supported by 6%.


Despite Merkel's popularity, the fresh polls signal a difficult road
ahead this weekend, meaning she may have to form a government with
another party.

Also in Europe, consumer confidence rose less
than expected. The European Commission's index of consumer sentiment
increased to minus 14.9 in September from minus 15.6 in August, missing
the minus 14.5 estimate.

EU regulation, Britain's public finances


European finance officials have approved a change to the region's
budget policies which allows for lowered austerity requirements among
the hardest hit countries in the Eurozone.

"The decision to
allow an amendment to a calculation by the European Commission to
alleviate the requirements in relation to the size of budget deficits
being run within each country is certainly controversial and has been
met with significant criticism," said Joshua Mahony, Research Analyst at
Alpari.

"There are worries as to whether such a measure
would allow nations to resume normal business and cast aside austerity
measures with significantly improved data."

However, Mahony
noted that many see this as a necessary towards loosening the framework
for more troubled nations to pull themselves out of financial ruins.


In the UK, public finances showed a smaller than anticipated deficit in
August, supported by a drop in spending by government departments. The
deficit was £13.157 in August, the Office for National Statistics said,
compared to £14.409bn the same month last year and forecasts of £13.5bn.

Tate & Lyle, BP

Shares in food and sweeteners manufacturer Tate & Lyle fell after the Credit Suisse reduced its rating from 'outperform' to 'neutral'.

BP's shares rallied as investors speculated on rumours of a takeover bid by US energy giant Exxon Mobil.

Adidas declined after cutting the lower end of its profit forecast for 2013 by 7.9%.

Mediaset SpA
gained after Morgan Stanley increased its target on the broadcaster
controlled by former Italian Prime Minister Silvio Berlusconi to €3.65
from €2.15.

Direct Line dropped after Royal Bank of Scotland sold 300m shares at 210p each in its third sale of a stake in the insurance company.

A gauge of miners including Randgold Resources, Antofagasta and Vedanta Resources snapped Thursday's rise as the prices of gold, silver and copper retreated.

Brent crude rises

Brent crude futures rose $0.321 to $109.110 per barrel.

The euro fell 0.06% to the 1.3522 US dollar.

US Market Report
US close: Stocks pull back from record highs after Fed surprise

- Dow and S&P retreat from record highs
- Most economic data beats forecasts
- JPMorgan, banks weigh on markets

Dow Jones: -0.26%
Nasdaq: 0.15%
S&P 500: -0.18%

US markets finished broadly lower on Thursday despite some upbeat economic data as analysts continued to digest the Federal Reserve's decision not to taper its stimulus programme.


Both the Dow Jones and S&P 500 snapped a four-day winning streak to
pull back from record closing highs the previous session, though the
tech-heavy Nasdaq ended in positive territory.

"US markets have
stalled following their leap yesterday, and may well stay in this mode
for the rest of the week," said Chris Beauchamp, Market Analyst at IG.


"1,700 [on the S&P 500] might have been firmly breached, but the
latest all-time highs will probably provoke a degree of short-term
selling, such as we saw in late May and early August," he said.

Markets surged on Wednesday after the Federal Open Market Committee
(FOMC) surprised the market by maintaining the rate of its asset
purchases at $85bn a month as it awaits a more sustainable recovery.
However, it did say that this amount could still be scaled back before
the end of the year.

In its report, the Fed said that while
household spending and business fixed investment has advanced, and the
housing sector has been strengthening, mortgage rates have risen further
and fiscal policy is "restraining economic growth".

As such,
as part of its goal "to foster maximum employment and price stability",
the FOMC "decided to await more evidence that progress will be sustained
before adjusting the pace of its purchases".

"I feel the Fed
failed to seize on the opportunity to send the market a strong message
by withdrawing its favourite drug," said Market Strategist Ishaq Siddiqi
from ETX Capital.

Philly Fed index trounces forecasts

US existing home sales increased to an annualised rate of 5.48m in August, from 5.39m in the month before (consensus: 5.25).


The Federal Reserve bank of Philadelphia's monthly manufacturing index
improved to 22.3 points from 9.3 in August (consensus: 10.3).

Initial weekly US unemployment claims rose by 17,000 to 309,000 in the seven days ended on September 7th (consensus: 330,000).


The country's current account deficit improved to -$98.9bn in the
second quarter, from -$104.9bn for the previous three months (consensus:
-$97.0bn).

Financials weigh on markets

JPMorgan Chase
finished in the red as it continues to feel the impact of its 'London
Whale' trading losses. The bank was fined a total of $920m, $221m of
which was by UK regulators due to failures in risk management and
financial reporting systems.

Other banking groups also finished lower, providing a drag on markets, including Bank of America, Citigroup and Goldman Sachs.

Agilent Technologies
jumped after the testing-equipment company announced plans to split
into two listed firms by means of a spin-off of its
electronic-measurement products unit.

Drugstore chain RiteAid surged after the company unveiled quarterly earnings per share which beat consensus estimates by a wide margin.

After a sharp fall early on, software marker Oracle managed to push into the blue despite issuing a weaker-than-forecast outlook.

Shares of food group ConAgra fell steeply after delivering a mixed set of quarterly results with sales missing estimates. Sector peer General Mills was also lower after Wells Fargo Securities downgraded the stock from 'outperform' to market perform'.

Home furnishing group Pier 1 Imports slumped after lowering its full-year earnings guidance after weak second-quarter profits.


S&P 500 - Risers
Pitney Bowes Inc. (PBI) $18.50 +4.64%
CME Group Inc. (CME) $73.86 +4.20%
Agilent Technologies Inc. (A) $50.98 +3.37%
Iron Mountain Inc. (IRM) $29.02 +3.02%
Interpublic Group of Companies Inc. (IPG) $17.51 +2.88%
Allergan Inc. (AGN) $91.20 +2.59%
Lowe's Companies Inc. (LOW) $48.98 +2.58%
T. Rowe Price Group Inc. (TROW) $74.65 +2.54%
Williams Companies Inc. (WMB) $36.84 +2.53%
Fluor Corp. (FLR) $71.45 +2.20%

S&P 500 - Fallers
CIGNA Corp. (CI) $77.72 -4.34%
Regions Financial Corp. (RF) $9.21 -4.16%
ConAgra Foods Inc. (CAG) $30.80 -3.96%
Keycorp (KEY) $11.60 -3.89%
Lincoln National Corp. (LNC) $42.21 -3.67%
Newmont Mining Corp. (NEM) $29.78 -3.53%
Cliffs Natural Resources Inc. (CLF) $22.73 -3.24%
Monster Beverage Corp (MNST) $56.17 -3.21%
MetLife Inc. (MET) $47.08 -3.19%
SunTrust Banks Inc. (STI) $33.14 -3.01%

Dow Jones I.A - Risers
Home Depot Inc. (HD) $78.51 +1.47%
Travelers Company Inc. (TRV) $86.90 +1.15%
Microsoft Corp. (MSFT) $33.64 +0.96%
United Technologies Corp. (UTX) $112.00 +0.89%
Boeing Co. (BA) $119.04 +0.54%
3M Co. (MMM) $121.57 +0.23%
Johnson & Johnson (JNJ) $90.07 +0.18%
Intel Corp. (INTC) $23.92 +0.06%

Dow Jones I.A - Fallers

Unitedhealth Group Inc. (UNH) $70.84 -3.01%
Hewlett-Packard Co. (HPQ) $21.31 -2.23%
Walt Disney Co. (DIS) $65.72 -2.07%
General Electric Co. (GE) $24.46 -1.61%
Alcoa Inc. (AA) $8.44 -1.34%
JP Morgan Chase & Co. (JPM) $52.75 -1.24%
McDonald's Corp. (MCD) $97.92 -0.79%
Cisco Systems Inc. (CSCO) $24.61 -0.73%
Bank of America Corp. (BAC) $14.61 -0.71%
Coca-Cola Co. (KO) $39.31 -0.71%

Nasdaq 100 - Risers
Tesla Motors Inc (TSLA) $177.92 +7.04%
Sirius XM Radio Inc (SIRI) $3.96 +2.59%
Catamaran Corp (CTRX) $52.04 +2.40%
Equinix Inc. (EQIX) $183.29 +2.26%
Yahoo! Inc. (YHOO) $31.03 +1.95%
Fossil Group Inc (FOSL) $118.48 +1.90%
Citrix Systems Inc. (CTXS) $76.33 +1.84%
Mattel Inc. (MAT) $43.41 +1.69%
Facebook Inc. (FB) $45.98 +1.66%
Discovery Communications Inc. Class A (DISCA) $81.76 +1.64%

Nasdaq 100 - Fallers
Monster Beverage Corp (MNST) $56.17 -3.21%
Randgold Resources Ltd. Ads (GOLD) $76.86 -2.94%
Kraft Foods Group, Inc. (KRFT) $53.98 -2.79%
Green Mountain Coffee Roasters Inc. (GMCR) $84.32 -2.64%
Sears Holdings Corp. (SHLD) $58.11 -2.53%
Staples Inc. (SPLS) $14.77 -2.28%
Vodafone Group Plc ADS (VOD) $33.54 -1.85%
Bed Bath & Beyond Inc. (BBBY) $75.59 -1.79%
Alexion Pharmaceuticals Inc. (ALXN) $114.03 -1.64%
Express Scripts Holding Co (ESRX) $61.94 -1.51%


Broker Tips
Broker tips: Tate & Lyle, Sainsbury, Compass

Shares in food and sweeteners manufacturer Tate & Lyle were falling heavily on Friday morning after the stock's rating was cut by Credit Suisse from 'outperform' to 'neutral'.


The bank said its greatest concerns is a proposal in Mexico to tax soft
drinks which would cut demand the group's high-fructose corn syrup. It
has cut its earnings per share estimates for Tate & Lyle by 7-8% and
lowered its price target from 930p to 800p.

Citigroup has upgraded its rating for supermarket chain Sainsbury from 'sell' to 'neutral', saying it expects a "big improvement" in sales trends in the second quarter.


"On both sales and earnings we anticipate that Sainsbury's 1H will show
substantially more progress than either of its UK rivals. This is not a
'sell' in our opinion," said analysts Alastair Johnston and Pradeep
Pratti.

Panmure Gordon has maintained its 'hold' rating for catering group Compass
ahead of its pre-close trading update next week, but highlighted the
company's strong balance sheet and showed optimism about shareholder
returns.

"In our view, Compass remains a high quality, global
growth story albeit the valuation in our view is fair and whilst there
remains some balance sheet potential, is fairly limited. However further
weakness in the share price may provide an opportunity given its
defensive and cash generative characteristics."

Marketwatch | Asian Markets at Close Report September 20, 2013: European stocks drop ahead of German election.

By Sara Sjolin, MarketWatch 
 
LONDON (MarketWatch) European stock markets moved lower on Friday, retreating from multiyear highs reached a day earlier, as investors opted for the sidelines ahead of the German election over the weekend. 

The Stoxx Europe 600 index XX:SXXP -0.27%  lost 0.3% to close at 314.20, trimming its weekly gain to 0.9%. 


Fed decision: Keeping status quo
What the Fed decision reveals about the U.S. economy, why GOP leaders are stepping back from defunding Obamacare in budget talks, and what Amnesty International's decision to embrace Roger Waters says about them. 

The benchmark closed at the highest level since June 2008 on Thursday, spurred by euphoria that the U.S. Federal Reserve abstained from scaling back its asset-purchase program as many analysts had expected. The central bank cited rising mortgage rates and reduced federal spending as headwinds that “could slow the pace of improvement in the economy.” 

“It was very surprising and disappointing for the longer term view. The markets pushed higher on the back of it, but it will only support short term,” said Richard Perry, chief market strategist at Central Markets. 

“But medium term there is still room for a correction in this market and once investors start to realize why Bernanke has gone against what he basically said he would do, I think it’s going to sink in,” he added. 

Tapering could, however, be back on the table as soon as next month, Federal Reserve Bank of St. Louis President James Bullard said on Bloomberg Television Friday. Bullard said the decision not to begin tapering followed weaker economic data, and that a small taper could start in October. The comments weighed on stocks in both Europe and the U.S.

German election

Investors in Europe were also wary of placing any big positions ahead of the German federal election on Sunday. One of the main questions is whether the current Angela Merkel-led CDU/CSU/FDP coalition will be re-elected, or if the conservative CDU/CSU will be forced into a broader coalition with the center-left SPD. 

“There has been remarkable calm in the run up to the German elections in the Dax and the euro and there seems to be a sense of overconfidence as the markets have ignored the possible negative outcome of the elections,” said Ronnie Chopra, head of strategy at Tradenext, said in emailed comments. 

“Recent polls show Merkel’s popularity declining while support for the centre-left Social Democrats has risen. The SPD is keen on further financial regulation and a financial transactions tax which would not be good news for the City and the equity markets,” he added. Read: German grand coalition draws nearer

MarketWatch/William Watts
European stocks drop on Friday.
Germany’s DAX 30 index DX:DAX -0.21% dropped 0.2% to 8,675.73, pulling back from a record close on Thursday. On the week, the index rose 2%.
France’s CAC 40 index FR:PX1 -0.06%  slipped 0.1% to 4,203.66, but ended with a 2.2% weekly gain. 

And the U.K.’s FTSE 100 index UK:UKX -0.44%  gave up 0.4% to 6,596.43, trimming its weekly gain to 0.2%. 

Banks weighed on the indexes, with shares of Commerzbank AG DE:CBK -0.91%  down 1.2% in Frankfurt, Société Générale SA FR:GLE -0.86%  off 0.9% in Paris and heavyweight HSBC Holdings PLC UK:HSBA -1.39%   HBC -1.47%   HK:5 +2.03%  1.4% lower in London. 

Shares of Adidas AG DE:ADS -0.12%  gave up 3% in Frankfurt after the sportswear maker lowered its full-year outlook due to the depreciation of several currencies versus the euro. 

Shares of RWE AG DE:RWE -0.82%  lost 3.9% after the German utility firm said late Thursday that deteriorated earnings prospects have forced it to cut its dividend for this year and beyond. 

On a more upbeat note, shares of J Sainsbury PLC UK:SBRY +1.38% gained 1.4% in London after Citigroup lifted the supermarkets chain to neutral from sell. The analysts said they expect to see stable margins and solid earnings expansion in the second-quarter earnings report. 

Shares of Mediaset SpA IT:MS +1.73%  gained 1.7% to 3.29 euros ($4.45) after Morgan Stanley lifted the target price on the broadcaster controlled by former Italian Prime Minister Silvio Berlusconi to €3.65 from €2.15. 

Sara Sjolin is a MarketWatch reporter based in London. Follow her on Twitter @sarasjolin.

RTTNews Market Analysis September 20, 2013: Nervous Markets Await Next Catalysts After Fed Comfort.

 
 
Nervous Markets Await Next Catalysts After Fed Comfort

The major U.S. index futures are pointing to a mixed opening on Friday, with sentiment turning cautious as traders pause to meditate on their next moves. Some of the economic data released after the Fed appeased the markets with the promise of persisting with its stimulus has been strong enough to trigger anxiety concerning the monetary policy. Additionally, all risky bets that rallied strongly in reaction to the Fed announcement are likely to see some profit taking on the premise of the gains being overdone. The markets are most likely to consolidate around current levels unless the Fed officials scheduled to speak during the day suggest something to move the markets.

After seeing some strength in early trading on Thursday, U.S. stocks retreated on profit taking amid the release of some mixed corporate news and mostly positive economic data. The major averages opened higher but saw volatility, with the Dow Industrials and the S&P 500 Index retreating below the unchanged line in early afternoon trading and declining for the rest of the session. The Nasdaq Composite Index held mostly above the unchanged line amid some volatility before closing modestly higher.

The Dow Industrials fell 40.39 points or 0.26 percent before closing at 15,637 and the S&P 500 Index closed 3.18 points or 0.18 percent lower at 1,722. Meanwhile, the Nasdaq Composite ended up 5.74 points or 0.15 percent at 3,789.

Twenty-two of the thirty Dow components closed lower, with Disney (DIS), Hewlett-Packard (HPQ) and UnitedHealth Group (UNH) leading the declines. On the other hand, Travelers (TRV), Home Depot (HD) and Microsoft (MSFT) advanced notably.

Gold, banking and housing stocks were among the worst performers of the session.

On the economic front, the Labor Department reported that jobless claims rose by 15,000 to 309,000 in the week ended September 14th. The previous week’s claims were upwardly revised by 2,000 to 294,000. Economists expected jobless claims to have increased to 341,000 from the 292,000 originally reported for the week ended September 7th. The four-week average fell to 314,750 from 321,750 in the previous week. Meanwhile, continuing claims calculated with a week’s lag declined to 2.787 million in the week ended September 7th from 2.815 million in the previous week.

The results of the Philadelphia Federal Reserve’s survey showed that manufacturing conditions in the region improved in September. The manufacturing index based on the survey surged up to 22.3 from 9.3 in August. The new orders index climbed to 21.2 from 5.3 and the order backlogs index moved into positive territory for the first time since April 2012. Additionally, the shipments index improved to 21.2 from –0.9, the employment index climbed 6.8 points to 10.3 and the average workweek index increased 14 points. The 6-month outlook index also increased, rising to 58.2 from 38.9.

Also suggesting positivity, the National Association of Realtors reported that existing home sales came in at a seasonally adjusted annual rate of 5.48 million units in August, the highest level since February 2007. Single-family as well as co-operatives sales increased during the month. Inventories measured in terms of months of supply fell to 4.9 from 5. At the same time, the median price of an existing home climbed 14.7 percent year-over-year. First time homebuyers accounted for 28 percent of the total sales.

A Conference Board report showed that its leading economic indicators index for the U.S. rose 0.7 percent month-over-month in August following a 0.5 percent increase in July. The labor market and financial component as well as new manufacturing orders led to the month’s gain by the index. Economists expected a more moderate pace of increase. The coincident economic indicators index rose 0.2 percent and the lagging economic indicators index was up 0.3 percent.

The Commerce Department reported that its current account deficit narrowed to $98.9 billion or 2.4 percent of GDP in the second quarter. The deficit represented the lowest in 15 years.

On Thursday, the Dow Industrials bounced off a support around 15,617 and closed slightly above the level. Given the likelihood of a further pullback, the 15,524, 15,461 and 15,362 levels could serve as further supports.



Crude, Commodity Markets

Crude oil futures are slipping $0.63 to $105.23 a barrel after declining $1.68 to $106.39 a barrel on Thursday. Gold futures are currently trading down $19.60 to $1,349.70 an ounce. In the previous session, gold added $61.70 to $1,369.30 an ounce.

Among currencies, the U.S. dollar is trading at 99.52 yen compared to the 99.45 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.3529 compared to yesterday’s $1.3530.

Asia

The major Asian markets that remained opened for trading closed lower amid some profit taking following yesterday’s sharp rally. The Hong Kong, Chinese, Taiwanese and South Korean markets remained closed for public holidays.

Japan’s Nikkei 225 average, which held mostly above the unchanged line with modest gains in the morning, retreated in the afternoon before closing down 23.76 points or 0.16 percent at 14,742. Resource, construction, real estate, financial stocks were among the worst performers of the session. Export stocks also came under selling pressure.

Australia’s All Ordinaries opened lower and languished below the unchanged line throughout the session. The index closed down 17.80 points or 0.34 percent at 5,271. Healthcare, material and financial stocks declined the most, leading the index lower.

India’s Sensex plunged over 2 percent after the Reserve Bank of India headed by the new Governor Raghuram Rajan unexpectedly raised interest rates in order to curb inflation and also withdrew some of the measures recently introduced to prop up the falling rupee.

Europe

European stocks opened lower and have been languishing in the red since then amid a lack of any major corporate and economic news.

U.S. Economic Reports

Kansas City Federal Reserve Bank President Esther George is scheduled to speak on the economy to the Shadow Open Market Committee in New York at 12:30 am ET. Federal Reserve Governor Daniel Tarullo will speak on macroprudential regulation in New Haven, Connecticut at 12:40 am ET.

St. Louis Federal Reserve Bank President James Bullard is due to speak on monetary policy to the New York Association for Business Economics at 12:55 pm ET. Minneapolis Federal Reserve Bank President Narayana Kocherlakota will talk at a conference on risk in options prices in New York at 1:45 am ET.

Stocks in Focus

TIBCO (TIBX) reported third quarter non-GAAP earnings of 28 cents per share compared to 27 cents per share last year. Total revenues rose to $270.9 million from $255 million in the year-ago period. The results were better than expected.

Cintas (CTAS) reported first quarter earnings of 63 cents per share, up 5 percent from 60 cents per share in the year-ago period. Revenues rose to $792.87 million from $754.84 million in the year-ago period. The earnings were in line and the revenues exceeded estimates. To reflect the impact of its share buybacks, the company updated its 2014 earnings guidance to $2.70-$2.79 per share, while it continues to expect revenues of $4.5 billion to $4.6 billion. The guidance was positive.

Texas Instruments (TXN) said it would increase its quarterly cash dividend by 7 percent to 30 cents per share.

Con Edison (ED) announced that its board has elected John McAvoy as its president and CEO, effective January 1st, 2014. McAvoy will replace Kevin Burke, who will retire as president and CEO on December 31st, 2013 after 40 years of service.

AK Steel (AKS) said it expects to report a loss of 22-27 cents per share for its third quarter, which includes a loss of 9 cents per share related to its previously disclosed unplanned Middletown Work blast furnace outage. Analysts expect a loss of 12 cents per share for the quarter.

Horace Mann (HMN) announced that its board has appointed Marita Zuraitis as its president and CEO and has also elected her to the board.

Moneygram (MGI) announced that it has acquired Advanced ChronoCash Services. Additionally, the company announced a deal to buy Athens-based MoneyGlobe Payment Institution.

Darden Restaurants’ (DRI) first quarter profit declined from the year-ago period. The company also announced steps to reduce its annualized operating support spending by approximately $50 million through a combination of workforce reductions and program spending cuts.

RTTNews Morning Market Briefing September 20, 2013.

Commentary September 20, 2013.

After turning in a lackluster performance throughout the previous session, stocks may continue to experience choppy trading on Friday. The major index futures are currently pointing to a mixed open for the markets. While the Dow futures are down by 14 points, the Nasdaq futures are up by 3 points. (Sep 20, 2013) Full Article 

Economic News

International Monetary Fund Chief Christine Lagarde said global economic growth remains subdued despite signs of recovery taking hold in the U.S., emphasizing the point that economies are moving at different speeds. The stake of U.S. in the global recovery is greater than ever in a world of increasing economic interconnections, Lagarde said. (Sep 20, 2013) Full Article 

India's central bank unexpectedly lifted its benchmark repo rate by a quarter point to contain inflation, while also partially reversing some of the emergency measures taken recently to support the rupee after the Federal Reserve postponed the tapering of bond purchases. At his maiden monetary policy meeting held on Friday, Reserve Bank of India Governor Raghuram Rajan raised the repo rate. (Sep 20, 2013) Full Article 

The U.K. budget deficit narrowed slightly more than expected in August, suggesting that economic recovery started to bring positive developments in public finances. Data published by the Office for National Statistics on Friday showed that public sector net borrowing, excluding temporary effects of financial interventions, came in at GBP 13.2 billion. (Sep 20, 2013) Full Article

Broker Ratings Changes

RBC Capital Markets Lowers Arcelor Mittal (MT) To Sector Perform From Outperform With €11 Price Target
(Sep 20, 2013)  

Todays WS Events

Darden Restaurants Q1 14 Earnings Conference Call At 8:30 AM ET
Darden Restaurants Inc.(DRI) will host a conference call at 8:30 AM ET September 20, 2013, to discuss its Q1 14 earnings results. To access the live webcast, log on at http://www.videonewswire.com/event.asp?id=95935 (Sep 20, 2013)

Goodyear Tire & Rubber Investor Meeting At 9:00 AM ET
Goodyear Tire & Rubber Co. (GT) will host a Investor meeting in New York at 9:00 AM ET on September 20, 2013. To access the live webcast, log on at http://investor.goodyear.com To hear the live call, dial (800) 895-1085 or (785) 424-1055 with Conference ID "Goodyear." A replay of the call can be heard by dialing (800) 283-5758 or (402) 220-0863. (Sep 20, 2013) 

Sealed Air Analyst Day At 8:00 AM ET
Sealed Air Corp. (SEE) Will host its Analyst Day from New York. The event is scheduled to begin at 8:00 AM ET on September 20,2013. To access the live webcast, log on at http://ir.sealedair.com (Sep 20, 2013)  

Towers Watson Analyst Day At 9:30 AM ET
Towers Watson & Co. (TW) Will host an analyst day. The event is scheduled to begin at 9:30 AM ET on September 20,2013. To access the live webcast, log on at www.towerswatson.com (Sep 20, 2013)  

Gold Mining Sector Daily News September 20, 2013: Denver Gold Forum hoping for record as gold appeals to more value investors

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TOP STORIES | Friday , 20 Sep 2013                                                     

Denver Gold Forum hoping for record as gold appeals to more value investors

The premier supply-side gold conference – the Denver Gold Forum – starts this weekend and hopefully the audience will hear some new views from the new CEOs of some of the world’s top gold miners.    Friday , 20 Sep 2013

Agnico’s La India commissioning underway; Goldex restarts

Capex for Agnico-Eagle’s La India and Goldex gold mines remains on budget, as both move along ahead of schedule.    Friday , 20 Sep 2013

Semafo gets 20% 'bump' to Mana gold grades in Burkina

Gold miner Semafo buoys its reserve grade with new ounces from the Siou deposit, one of several comprising its open pit Mana gold mine.    Friday , 20 Sep 2013

ASX Highlights: Gold stocks surge with bullion despite rise in hedging

ASX gold stocks rise despite hedging, Perseus leads the pack and Bollinger discovery gets Sirius.    Friday , 20 Sep 2013

Take two for zinc-lead-silver project once backed by Hunt brothers

Financing jumps to the fore as Canadian Zinc passes environmental scrutiny of regulators on the Prairie Creek project in Canada's north.    Thursday , 19 Sep 2013

Atico raises $27m, inks offtake, as hefty payment looms

Atico gets enough cash and then some to cover $14m option payment over El Roble in Colombia and meantime signs up Trafigura in offtake agreement    Friday , 20 Sep 2013

Peru may buy illegally mined gold to save environment

Peru’s national bank may buy illegally mined gold to convince informal miners to adhere to laws government where and how they can mine.    Friday , 20 Sep 2013

Central Rand Gold quadruples on loan funding

Central Rand Gold shares made their biggest jump since listing in November 2007 after news of debt financing.    Friday , 20 Sep 2013

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