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London close: Markets shrug off poor GDP to finish higher
25-01-2013 16:25
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The FTSE 100 managed to finish the last session of the weak with small gains as traders shrugged off this morning's disappointing UK growth figures.
"Weak UK GDP data for Q4 failed to temper enthusiasm for risk as the FTSE pushed on again, though end of week profit-taking has put a cap on gains this afternoon," said sales trader Matt Basi from CMC Markets.
UK GDP disappoints
It was revealed this morning that the UK economy contracted by 0.3% during the fourth quarter of 2012, worse then the 0.1% GDP decline forecasted. Market chatter is now speculating that a 'triple-dip' recession could be on the cards, after the economy pulled out of a small 'double-dip' in the third quarter of 2012.
"After the stunning albeit distorted Q3 GDP figures last year, today's disappointing Q4 growth figures are a stark reminder of the poor condition of the UK's economy and the difficulty it will have to find the path of sustainable growth in the years ahead," said Andrew Edwards, the Chief Executive Officer of ETX Capital.
Similarly, analyst Simon Hayes from Barclays Research said that, against a backdrop of a weak outlook for household incomes and subdued exports, fiscal austerity means that any recovery "is likely to prove painfully slow".
IFO survey provides some support
Markets across Europe managed to hold on to gains today after the German IFO business climate index for January came in at 104.2, above analysts' expectations of 103.
Meanwhile, US stocks opened in positive territory this afternoon after a number of corporate earnings from Wall Street heavyweights impressed, including those from Procter & Gamble, Halliburton and Starbucks.
"Next week will be the busiest week for European earnings and following on from the better-than-expected earnings we have seen Stateside, expectations are building from a similar showing from European blue-chips," said market strategist Ishaq Siddiqi.
FTSE 100: Miners drop but Polymetal bucks the trend
Miners tracked metal prices lower, with ENRC, Randgold, Evraz, Kazakhmys, Rio Tinto and BHP Billiton among the biggest fallers.
However, precious metals group Polymetal was bucking the trend, rising 2.02% on speculation that it could merge with smaller peer Polyus Gold. UBS upgraded Polymetal to 'buy' this morning, saying "now is the right moment to use weakness in the stock price as potential merger with Polyus Gold may be a strong driver".
Mining group Xstrata was also edging higher after saying that the definitive estimate for the Las Bambas project in southern Peru is $5.2bn.
Airline IAG was a high riser today after JPMorgan Cazenove raised its rating for the stock to 'overweight'.
TUI Travel, the tour operator, saw its shares recover after the stock plummeted earlier in the week following the news that it no longer intended to make a merger offer with TUI AG.
FTSE 250: Enterprise Inns gains ahead of trading update
Pubs group Enterprise Inns was making gains with Numis, Panmure Gordon and Deutsche Bank keeping their 'buy' ratings on the stock ahead of its trading update next week. Analysts pointed out yesterday's departure of Punch Taverns' CEO could also be a reason behind today's move.
Panmure Gordon noted that the shares continue to trade at a discount to sector peers Greene King, Fuller's, Punch Taverns and Young's.
Shares in budget airline easyJet were higher after UBS raised its rating to 'buy' after yesterday's better-than-expected first-quarter results. The broker said that growth is gaining momentum with the company "becoming more positive on 1H performance".
United Drug was higher, despite Investec initiating its coverage of healthcare services provide with a 'sell' rating. The said that the stock's 60% jump (since it announced its intention to seek a premium listing) is not based on business fundamentals. "We think this news [...] has artificially driven up the share price".
Afren shares dropped as market chatter about the stock subsided. Speculators had been saying that Chinese oil company Sinopec might possible make a move for the group.
FTSE 100 - Risers
TUI Travel (TT.) 293.10p +3.94%
Aberdeen Asset Management (ADN) 415.40p +2.44%
Sage Group (SGE) 325.70p +2.39%
Polymetal International (POLY) 1,116.00p +2.39%
International Consolidated Airlines Group SA (CDI) (IAG) 223.00p +2.11%
IMI (IMI) 1,193.00p +2.05%
Associated British Foods (ABF) 1,708.00p +1.97%
Reckitt Benckiser Group (RB.) 4,195.00p +1.89%
Johnson Matthey (JMAT) 2,390.00p +1.57%
BT Group (BT.A) 253.10p +1.56%
FTSE 100 - Fallers
Eurasian Natural Resources Corp. (ENRC) 331.10p -2.39%
Randgold Resources Ltd. (RRS) 6,020.00p -2.35%
Evraz (EVR) 300.00p -2.25%
Hargreaves Lansdown (HL.) 710.00p -2.14%
Kazakhmys (KAZ) 753.50p -2.14%
BHP Billiton (BLT) 2,104.00p -1.61%
Rio Tinto (RIO) 3,518.00p -1.59%
Antofagasta (ANTO) 1,257.00p -1.41%
Tullow Oil (TLW) 1,183.00p -1.17%
Aviva (AV.) 370.50p -1.07%
FTSE 250 - Risers
Enterprise Inns (ETI) 101.80p +7.16%
United Drug (UDG) 281.20p +6.11%
easyJet (EZJ) 945.00p +5.18%
New World Resources A Shares (NWR) 312.90p +4.51%
IP Group (IPO) 130.60p +4.23%
Daejan Holdings (DJAN) 3,124.00p +4.17%
Spirent Communications (SPT) 157.10p +4.04%
Go-Ahead Group (GOG) 1,341.00p +3.95%
Synthomer (SYNT) 202.00p +3.86%
St. Modwen Properties (SMP) 234.80p +3.76%
FTSE 250 - Fallers
Afren (AFR) 143.10p -5.48%
Petropavlovsk (POG) 369.80p -4.96%
ITE Group (ITE) 262.70p -3.91%
Euromoney Institutional Investor (ERM) 920.00p -3.31%
London & Stamford Property (LSP) 113.50p -3.07%
Hochschild Mining (HOC) 427.20p -2.60%
PayPoint (PAY) 838.00p -2.56%
Ophir Energy (OPHR) 540.00p -1.91%
Imagination Technologies Group (IMG) 450.10p -1.53%
RIT Capital Partners (RCP) 1,178.00p -1.34%
BC
"Weak UK GDP data for Q4 failed to temper enthusiasm for risk as the FTSE pushed on again, though end of week profit-taking has put a cap on gains this afternoon," said sales trader Matt Basi from CMC Markets.
UK GDP disappoints
It was revealed this morning that the UK economy contracted by 0.3% during the fourth quarter of 2012, worse then the 0.1% GDP decline forecasted. Market chatter is now speculating that a 'triple-dip' recession could be on the cards, after the economy pulled out of a small 'double-dip' in the third quarter of 2012.
"After the stunning albeit distorted Q3 GDP figures last year, today's disappointing Q4 growth figures are a stark reminder of the poor condition of the UK's economy and the difficulty it will have to find the path of sustainable growth in the years ahead," said Andrew Edwards, the Chief Executive Officer of ETX Capital.
Similarly, analyst Simon Hayes from Barclays Research said that, against a backdrop of a weak outlook for household incomes and subdued exports, fiscal austerity means that any recovery "is likely to prove painfully slow".
IFO survey provides some support
Markets across Europe managed to hold on to gains today after the German IFO business climate index for January came in at 104.2, above analysts' expectations of 103.
Meanwhile, US stocks opened in positive territory this afternoon after a number of corporate earnings from Wall Street heavyweights impressed, including those from Procter & Gamble, Halliburton and Starbucks.
"Next week will be the busiest week for European earnings and following on from the better-than-expected earnings we have seen Stateside, expectations are building from a similar showing from European blue-chips," said market strategist Ishaq Siddiqi.
FTSE 100: Miners drop but Polymetal bucks the trend
Miners tracked metal prices lower, with ENRC, Randgold, Evraz, Kazakhmys, Rio Tinto and BHP Billiton among the biggest fallers.
However, precious metals group Polymetal was bucking the trend, rising 2.02% on speculation that it could merge with smaller peer Polyus Gold. UBS upgraded Polymetal to 'buy' this morning, saying "now is the right moment to use weakness in the stock price as potential merger with Polyus Gold may be a strong driver".
Mining group Xstrata was also edging higher after saying that the definitive estimate for the Las Bambas project in southern Peru is $5.2bn.
Airline IAG was a high riser today after JPMorgan Cazenove raised its rating for the stock to 'overweight'.
TUI Travel, the tour operator, saw its shares recover after the stock plummeted earlier in the week following the news that it no longer intended to make a merger offer with TUI AG.
FTSE 250: Enterprise Inns gains ahead of trading update
Pubs group Enterprise Inns was making gains with Numis, Panmure Gordon and Deutsche Bank keeping their 'buy' ratings on the stock ahead of its trading update next week. Analysts pointed out yesterday's departure of Punch Taverns' CEO could also be a reason behind today's move.
Panmure Gordon noted that the shares continue to trade at a discount to sector peers Greene King, Fuller's, Punch Taverns and Young's.
Shares in budget airline easyJet were higher after UBS raised its rating to 'buy' after yesterday's better-than-expected first-quarter results. The broker said that growth is gaining momentum with the company "becoming more positive on 1H performance".
United Drug was higher, despite Investec initiating its coverage of healthcare services provide with a 'sell' rating. The said that the stock's 60% jump (since it announced its intention to seek a premium listing) is not based on business fundamentals. "We think this news [...] has artificially driven up the share price".
Afren shares dropped as market chatter about the stock subsided. Speculators had been saying that Chinese oil company Sinopec might possible make a move for the group.
FTSE 100 - Risers
TUI Travel (TT.) 293.10p +3.94%
Aberdeen Asset Management (ADN) 415.40p +2.44%
Sage Group (SGE) 325.70p +2.39%
Polymetal International (POLY) 1,116.00p +2.39%
International Consolidated Airlines Group SA (CDI) (IAG) 223.00p +2.11%
IMI (IMI) 1,193.00p +2.05%
Associated British Foods (ABF) 1,708.00p +1.97%
Reckitt Benckiser Group (RB.) 4,195.00p +1.89%
Johnson Matthey (JMAT) 2,390.00p +1.57%
BT Group (BT.A) 253.10p +1.56%
FTSE 100 - Fallers
Eurasian Natural Resources Corp. (ENRC) 331.10p -2.39%
Randgold Resources Ltd. (RRS) 6,020.00p -2.35%
Evraz (EVR) 300.00p -2.25%
Hargreaves Lansdown (HL.) 710.00p -2.14%
Kazakhmys (KAZ) 753.50p -2.14%
BHP Billiton (BLT) 2,104.00p -1.61%
Rio Tinto (RIO) 3,518.00p -1.59%
Antofagasta (ANTO) 1,257.00p -1.41%
Tullow Oil (TLW) 1,183.00p -1.17%
Aviva (AV.) 370.50p -1.07%
FTSE 250 - Risers
Enterprise Inns (ETI) 101.80p +7.16%
United Drug (UDG) 281.20p +6.11%
easyJet (EZJ) 945.00p +5.18%
New World Resources A Shares (NWR) 312.90p +4.51%
IP Group (IPO) 130.60p +4.23%
Daejan Holdings (DJAN) 3,124.00p +4.17%
Spirent Communications (SPT) 157.10p +4.04%
Go-Ahead Group (GOG) 1,341.00p +3.95%
Synthomer (SYNT) 202.00p +3.86%
St. Modwen Properties (SMP) 234.80p +3.76%
FTSE 250 - Fallers
Afren (AFR) 143.10p -5.48%
Petropavlovsk (POG) 369.80p -4.96%
ITE Group (ITE) 262.70p -3.91%
Euromoney Institutional Investor (ERM) 920.00p -3.31%
London & Stamford Property (LSP) 113.50p -3.07%
Hochschild Mining (HOC) 427.20p -2.60%
PayPoint (PAY) 838.00p -2.56%
Ophir Energy (OPHR) 540.00p -1.91%
Imagination Technologies Group (IMG) 450.10p -1.53%
RIT Capital Partners (RCP) 1,178.00p -1.34%
BC
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