ADVFN III Morning Euro Markets Bulletin March 11, 2013.

ADVFN III Morning Euro Markets Bulletin

Daily world financial news Monday, 11 March 2013

London Market Report

FTSE 100 Euronext Dax perf CAC 40 Please click on the images to view our interactive charts

London open: Italian downgrade weighs on markets early on Market Movers techMARK 2,375.92 -0.20% FTSE 100 6,482.66 -0.01% FTSE 250 14,012.31 -0.05% UK markets opened cautiously on Monday as sentiment was dampened by Fitch Ratings, which downgraded its credit rating for Italy in the aftermath of an inconclusive election. Fitch downgraded Italy to 'BBB+' from 'A-' and kept the outlook at 'negative', saying that last month's elections make it unlikely a stable new government can be formed in the next few weeks. "With fourth-quarter 2012 data confirming that Italy's ongoing recession is one of the deepest in Europe, the increased political uncertainty and non-conducive backdrop for further structural reform measures constitute a further adverse shock to the real economy," Fitch said. The FTSE 100 rallied on Friday after US non-farm payrolls smashed forecasts in February: the economy created 236,000 jobs last month, well ahead of the 160,000 estimate. However, soft economic data from China was also weighing on the mood this morning, causing cyclical stocks in London (such as banks and miners) to take a hit, as industrial output weakened in February and lending and retail sales growth slowed. Ladbrokes extends partnership with Playtech Betting group Ladbrokes surged after unveiling plans to extend its relationship with online gaming software company Playtech as part of the former's 're-invigoration' of its Digital business. Ladbrokes will create a new e-commerce and digital marketing services operation, to be integrated with the company's existing Digital teams in London and Gibraltar, to enable it to make full use of Digital-focused advisory services provided by Playtech. Software company Anite plummeted early on after saying that third-quarter trading reflected a relatively quiet seasonal period. Investec downgraded the stock to 'hold' this morning. Airline group IAG edged higher after saying it has opted to accept a proposal put forth by a mediator regarding its Spanish unit Iberia. According to a news article published on Reuters news website, the mediator proposed that the Spanish airline cut 3,141 jobs rather than the 3,807 that the airline had planned to let go. The proposal also reportedly entitled those subject to the lay-offs with severance pay of 35 days per year worked, rather than 20. Accountancy software firm Sage sunk after Bank of America Merrill Lynch cut its recommendation to 'underperform'. Oil and gas group SOCO was in demand after saying that revenues reached a record $621.6m in 2012, up 166% year-on-year, after a "transformational" year which saw the firm bring on additional production ahead of schedule at its Te Giac Trang (TGT) field in Vietnam. Real estate firm Raven Russia was also up after saying that operating profit rose 63% in 2012, underpinned by profitable acquisitions. Industrial property specialist Hansteen Holdings gained after reporting a sharp increase in full-year profit and underlining its confidence in future trading with an increase in its dividend payment.

UK Event Calendar

Monday March 11 INTERIMS Pure Wafer QUARTERLY EX-DIVIDEND DATE Anglogold Ashanti Ltd. INTERNATIONAL ECONOMIC ANNOUNCEMENTS Balance of Trade (GER) (07:00) Current Account (GER) (07:00) Factory Orders (GER) (11:00) Harmonised Competitiveness Indicators (EU) (09:00) Retail Price Index (GER) (07:00) GMS Anglogold Ashanti Ltd. FINALS Brady, Escher Group Holdings, HaloSource Inc. (Reg S), Hansteen Holdings, Hydrogen Group, Telecom Egypt SAE GDS (Regs) EGMS Petropavlovsk AGMS Hazel Renewable Energy VCT 1, Hazel Renewable Energy VCT 1 A Shares, Hazel Renewable Energy VCT 2, Hazel Renewable Energy VCT 2 A Shares, SVM Global Fund

Europe Market Report

FTSE 100 Euronext Dax perf CAC 40

European stocks are seen opening little changed on Monday, as investors digest Italy's credit rating downgrade. Fitch Ratings lowered Italy's long-term foreign and local currency Issuer default ratings to 'BBB+' from 'A-' with a warning of a further downgrade, citing the inconclusive result of last month's national election, the ongoing recession and rising debt. "The increased political uncertainty and non-conducive backdrop for further structural reform measures constitute a further adverse shock to the real economy amidst the deep recession," the ratings agency said. Meanwhile, the German Finance Ministry plans to cut its net borrowing in 2014 to EUR 6-8 billion from the EUR 17.1 planned this year, Der Spiegel reported, citing government sources. Asian stocks are turning in a mixed performance as a fall in Japan's core machinery orders last month and disappointing data out of China on industrial output, lending and retail sales tempered optimism over the positive U.S. jobs report. Japan's Nikkei index rose half a percent on a weaker yen, Australia's All Ordinaries index added 0. 7 percent in choppy trading and Hong Kong's Hang Seng was up 0.3 percent, while benchmark indexes in China, Indonesia, Malaysia and South Korea are subdued. Data out of Japan showed the nation's core machinery orders plummeted a seasonally adjusted 13.1 percent in January from the previous month, marking its first decline in four months. On a yearly basis, core machine orders dropped 9.7 percent. Official data released over the weekend showed China's inflation hit a 10-month high in February, while reports on industrial production, retail sales and lending came in below analyst forecasts, painting quite a mixed picture about the nation's export outlook. Across the Atlantic, investors will be closely watching reports on retail sales, industrial production, and producer and consumer price inflation to determine the strength of the economic recovery in the face of federal budget cuts and higher payroll taxes. Closer home, German exports grew at a faster than expected pace of 1.4 percent in January from a month ago, data from the Federal Statistical Office showed. Economists had forecast exports to rise 0.5 percent from 0.2 percent in December. In corporate news, John Craven, Michael Blaha and Michael Nolan, the key figures who led to the creation and $1.9 billion sale of London-listed Cove Energy in 2012, have joined hands again to raise funds to explore oil and gas in waters off Mozambique, the Financial Times reported. Irish-Swiss bakery group Aryzta AG reported profit attributable to equity shareholders for the six-month period ended 31 January 2013 of EUR 62.05 million, down from EUR 71.86 million in the year-ago period. Great Portland Estates Plc said it has exchanged contracts to acquire Orchard Court, Portman Square, W1, from Rosanna Holdings, for 37 million pounds. European stocks posted broad-based gains on Friday, with upbeat economic data out of China, Japan and the U.S. underpinning sentiment. The Euro Stoxx 50 index of Eurozone bluechip stocks gained 1.4 percent and the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.9 percent, while benchmark indexes in Switzerland, Germany, the U.K. and France rose between half a percent and 1.2 percent. U.S. stocks rose on Friday after positive export data out of China and a surprisingly strong jobs report suggested the global economic recovery was on track. The Dow rose half a percent to set a fresh record closing high and the S&P 500 also added half a percent, while the tech-heavy Nasdaq advanced 0.4 percent.

US Market Report

US close: Stocks rally as week closes Total wholesale inventory growth quadruple expected rate in January; Number of active oil rigs up year-on-year - Non-farm payrolls ahead of forecasts - Unemployment rate drops Dow Jones Industrial Average: 0.47% Nasdaq Comp: 0.37% S&P 500: 0.44% America's three key US equity benchmarks finished the week higher after a wave of encouraging financial and economic data was published. Total wholesale inventories in the US expanded to four times the expected level, the number of active oil rigs in the country grew and the rate of unemployment in the country contracted. Risers and fallers Shares in tax service provider H&R Black topped the S&P 500 index's risers, followed closely by insurance, annuities and employee benefits programme provider MetLife, whose shares advanced by 4.89% to $39.03. In third place on the S&P risers was consumer electronics retailer Best Buy, whose shares increased by 4.72% to $20.17. Hartford Financial Services Group also saw its shares rise by 4.52% to $25.45. Shares in insurance company Aflac contracted by 2.77% to $50.14. Goldman Sachs Group's share price fell 2.32% to $152.98. Meanwhile San Antonio-based independent petroleum refiner and marketer Valero Energy Corp. saw its shares slide 2.17% to $45.50. Walt Disney Company topped the Dow Jones Industrial Average risers, with its shares climbing 1.90% to $57.39. Fast food chain McDonalds was hot on its heels with its shares up 1.67% to $98.71 and shares in home improvement specialty retailer Home Depot lifted 1.59% to $71.37. Wholesale inventories grow four times more than expected Data published by the US Department of Commerce showed that total inventories of merchant wholesalers after adjustment for seasonal variations was valued at $504.4bn at the end of January, representing an increase of 1.2% from the revised December level. This was four times the 0.3% growth rate which had been predicted. Compared to wholesale inventories one year ago, the inventories were up 6.5% Inventories of durable goods were up 1.1% from December and were up 8.3% from a year ago. Inventories of lumber and other construction materials were up 3.4% from last month and inventories of computer and computer peripheral equipment and software were up 3.2%. Employment rates increase Total nonfarm payroll employment increased by 236,000 in February and the unemployment rate edged down to 7.7%, according to the United States Department of Labor's Bureau of Labor Statistics. Employment increased in professional and business services, construction and health care. The number of long-term unemployed - those jobless for 27 weeks or more- was about unchanged at 4.8m in February. These individuals accounted for 40.2% of the unemployed. Active oil rigs up year-on-year in March The number of active oil rigs in the US was up by eight to 1,341 on March 8th, and up 45 from 1,296 one year ago, according to the latest Baker Hughes Rig Counts data. The company's rig counts are an important business barometer for the drilling industry and its suppliers and act as an indicator of demand for products used in drilling, completing, producing and processing hydrocarbons. The data also showed that the gas rig count was down 13 to 407 and down 263 from 670 a year ago. Crude futures up Front month West Texas crude futures are now up by 0.413 to the $91.94 per barrel mark on the NYMEX. US 10 year bonds climbed five basis points to end the day at 2.04% S&P 500 - Risers H&R Block Inc. (HRB) $27.28 +9.21% MetLife Inc. (MET) $39.03 +4.89% Best Buy Co. Inc. (BBY) $20.17 +4.72% Hartford Financial Services Group Inc. (HIG) $25.45 +4.52% Lincoln National Corp. (LNC) $33.00 +4.33% Newell Rubbermaid Inc. (NWL) $24.94 +3.87% Citigroup Inc. (C) $46.68 +3.73% Starwood Hotels & Resorts Worldwide Inc. (HOT) $62.56 +3.58% Tenet Healthcare Corp. (THC) $43.20 +3.45% Dean Foods Co. (DF) $17.83 +3.24% S&P 500 - Fallers AFLAC Inc. (AFL) $50.14 -2.77% Goldman Sachs Group Inc. (GS) $152.98 -2.32% Valero Energy Corp. (VLO) $45.50 -2.17% Juniper Networks Inc. (JNPR) $20.69 -2.04% Chipotle Mexican Grill Inc. (CMG) $321.84 -1.73% Newmont Mining Corp. (NEM) $39.25 -1.70% Carnival Corp. (CCL) $35.67 -1.57% Bank of America Corp. (BAC) $12.07 -1.55% SLM Corp. (SLM) $19.07 -1.55% Intel Corp. (INTC) $21.58 -1.42% Dow Jones I.A - Risers Walt Disney Co. (DIS) $57.39 +1.90% McDonald's Corp. (MCD) $98.71 +1.67% Home Depot Inc. (HD) $71.37 +1.59% 3M Co. (MMM) $105.71 +1.12% Verizon Communications Inc. (VZ) $47.96 +1.01% E.I. du Pont de Nemours and Co. (DD) $49.15 +0.97% Caterpillar Inc. (CAT) $90.51 +0.96% AT&T Inc. (T) $36.68 +0.80% Hewlett-Packard Co. (HPQ) $21.00 +0.72% Johnson & Johnson (JNJ) $78.19 +0.57% Dow Jones I.A - Fallers Bank of America Corp. (BAC) $12.07 -1.55% Intel Corp. (INTC) $21.58 -1.42% JP Morgan Chase & Co. (JPM) $50.20 -0.85% Merck & Co. Inc. (MRK) $42.97 -0.69% Microsoft Corp. (MSFT) $28.00 -0.50% Wal-Mart Stores Inc. (WMT) $73.03 -0.40% Alcoa Inc. (AA) $8.61 -0.35% Pfizer Inc. (PFE) $28.19 -0.28% Nasdaq 100 - Risers Vertex Pharmaceuticals Inc. (VRTX) $52.81 +5.26% Micron Technology Inc. (MU) $9.20 +2.91% Vodafone Group Plc ADS (VOD) $27.71 +2.74% PACCAR Inc. (PCAR) $50.45 +2.13% News Corp. Class A (NWSA) $30.57 +2.07% Starz Class A (STRZA) $20.41 +2.00% Ross Stores Inc. (ROST) $56.20 +1.76% Viacom Inc. Class B (VIAB) $61.90 +1.73% DIRECTV (DTV) $50.08 +1.71% Garmin Ltd. (GRMN) $35.61 +1.68% Nasdaq 100 - Fallers Facebook Inc. (FB) $27.96 -2.16% Randgold Resources Ltd. Ads (GOLD) $80.94 -1.65% Catamaran Corp (CTRX) $55.36 -1.51% Intel Corp. (INTC) $21.58 -1.42% Baidu Inc. (BIDU) $89.22 -1.33% Alexion Pharmaceuticals Inc. (ALXN) $91.06 -1.28% Whole Foods Market Inc. (WFM) $85.02 -1.17% Activision Blizzard Inc. (ATVI) $14.84 -0.87% Monster Beverage Corp (MNST) $47.34 -0.86% Oracle Corp. (ORCL) $35.71 -0.64%

FX and Commodities round-up

FX round-up: Dollar buoyed by US job figures The dollar made headway against major currencies on Friday as the latest data showed the US economy created more jobs than expected while the unemployment rate fell to the lowest level in four years. Total nonfarm payroll employment increased by 236,000 in February while the unemployment rate fell to 7.7%, the lowest level since 2008, according to government data. The greenback rallied to the highest level in over three years against the Japanese yen on renewed hopes that the US economy is weathering tax hikes and government spending cuts. Against the yen, the US currency rallied to ¥96.537, the highest level since August 2009. The dollar index, which measures the greenback against a basket of six major rivals, jumped to an intra-day high of 82.900 before later trading at 82.750 compared to 82.090 on Thursday. Meanwhile the euro fell against the dollar after Fitch Ratings cut Italy's sovereign credit rating to BBB-plus from A-minus. The ratings agency cited concern about last month's elections and a deeper than expected recession. The single currency traded at $1.2999 from $1.3118 previously but rose against the yen. Sterling fell to $1.4917 from $1.5014 on Thursday after the Bank of England (BoE)refrained from further easing to boost the UK economy and kept interest levels at their record low. Commodities: Crude spikes after jobs data Crude oil futures settled higher on Friday as investors cheered data showing a steadily improving US employment market. Crude for April delivery rose 39 cents to settle at $91.95 a barrel on the New York Mercantile Exchange. Official data showed total nonfarm payroll employment increased by 236,000 in February while the unemployment rate fell to 7.7%, the lowest level since 2008. The upbeat jobs data fuelled hopes of increased demand for oil. Meanwhile a separate report from the US Commerce Department showed wholesale inventories recovered in January by 1.2% to a seasonally adjusted $504.4bn, four times more than expected and the largest monthly increase since December 2011. The stronger dollar however kept bigger crude gains in check on Friday. An increase in the dollar typically reduces appetite for dollar priced commodities as it makes them more expensive for holders of other currencies. The dollar index, which measures the greenback against a basket of currencies, surged to 82.804, up 0.9% from the last session. On the ICE futures exchange Brent crude fell 32 cents to $110.82 a barrel. Among precious metals gold managed to shrug off the stronger dollar and robust jobs data to register slim gains on Friday. Gold for April delivery advanced $1.80 to settle at $1,576.90 an ounce on the Comex division of the New York Mercantile Exchange.