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Finance & Stock Market News
Glance-Fed disappointment knocks Britain's FTSE lower
Thu, 12th Jul 2012 09:26
* FTSE 100 index drops 0.8 percent
* Commodity stocks, banks retreat
* Aegis soars o
By Jon Hopkins
LONDON July 12 (Reuters) - Britain's top share index fell on
Thursday, led by commodity stocks and banks, due to
disappointment over the lack of a clear signal from the U.S.
Federal Reserve that more moves are in the pipeline to bolster
growth.
Minutes from last month's Fed meeting, published late on
Wednesday, showed the majority of policymakers are unconvinced
that further monetary stimulus is needed for the world's biggest
economy. The outlook will have to worsen further for any such
consensus to build, they showed.
'We would anticipate that any major further stimulus may
wait until after the election in November, purely from a
viewpoint that the Fed will want to appear politically
impartial,' said Shore Capital strategist Gerard Lane in a note.
At 0743 GMT, the FTSE 100 index was down 42.81
points, or 0.8 percent, at 5,621.67, having ended the session
barely changed in low volumes on Wednesday.
Early trading volumes were again thin, at 6 percent of the
90-day daily average.
'The thin trading conditions make the index ripe for
volatile moves and perhaps an expanded range,' said James A.
Hyerczyk, technical analyst at Autochartist.
'With a bias developing to the downside, FTSE traders should
watch for an attempt to take out the two bottoms at 5,622.30 and
5,610.70. The could trigger an acceleration into another
retracement zone at 5,571.05 to 5,534.16,' Hyerczyk added.
Weak miners were the main drag on blue chip
sentiment as copper prices edged lower, falling for a
fifth session in seven on the back of the Fed minutes and
caution ahead of China growth data, to be released on Friday.
Rio Tinto was the biggest sector casualty, down 3.0
percent as the Anglo-Australian miner said its Chief Financial
Officer Guy Elliott would retire at the end of next year, and
that the company would be creating a new position to oversee the
group's strategy.
Fund manager Ashmore Group was the biggest
individual blue chip faller, dropping 5.8 percent after
reporting a fall in the amount of money it manages in its fourth
quarter. Weak performance and the exit of clients saw it lose
more than a fifth of its equity assets.
AEGIS SOARS
Mid-cap Aegis Group soared 45 percent as Japan's
Dentsu Inc agreed to buy the British marketing group
for 3.2 billion pounds ($5 billion), or 240 pence a share. That
will combine the Japanese firm's strong presence in Asia with
the British group's footprint in Europe and digital services.
'Dentsu's proposed agreed bid at 240 pence for Aegis looks a
very full price in our view and we think rival agencies are
unlikely to counter bid,' Investec Securities said in a note.
The marketing sector consolidation gave a boost to blue chip
advertising giant WPP Group, up 0.8 percent, and to
broadcasters ITV and BSkyB, ahead 1.0 percent
and 0.7 percent respectively.
British companies, however, cut their marketing budgets for
the first time in a year in the second quarter, as pessimism
about the economy regained the upper hand, an IPA Bellwether
survey said on Thursday.
Data-wise, markets will eye U.S. weekly jobless claims, due
at 1230 GMT together with June U.S. import and export prices.
June's U.S. Federal Budget is not released until 1800 GMT, after
the London close.
(Reporting by Jon Hopkins; editing by Patrick Graham)
(jon.hopkins@thomsonreuters.com)(02075428954)(Reuters Messaging: jon.hopkins.thomsonreuters.com@reuters.net)
COPYRIGHT
Copyright Thomson Reuters 2012. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
* Commodity stocks, banks retreat
* Aegis soars o
n agreed takeover
By Jon Hopkins
LONDON July 12 (Reuters) - Britain's top share index fell on
Thursday, led by commodity stocks and banks, due to
disappointment over the lack of a clear signal from the U.S.
Federal Reserve that more moves are in the pipeline to bolster
growth.
Minutes from last month's Fed meeting, published late on
Wednesday, showed the majority of policymakers are unconvinced
that further monetary stimulus is needed for the world's biggest
economy. The outlook will have to worsen further for any such
consensus to build, they showed.
'We would anticipate that any major further stimulus may
wait until after the election in November, purely from a
viewpoint that the Fed will want to appear politically
impartial,' said Shore Capital strategist Gerard Lane in a note.
At 0743 GMT, the FTSE 100 index was down 42.81
points, or 0.8 percent, at 5,621.67, having ended the session
barely changed in low volumes on Wednesday.
Early trading volumes were again thin, at 6 percent of the
90-day daily average.
'The thin trading conditions make the index ripe for
volatile moves and perhaps an expanded range,' said James A.
Hyerczyk, technical analyst at Autochartist.
'With a bias developing to the downside, FTSE traders should
watch for an attempt to take out the two bottoms at 5,622.30 and
5,610.70. The could trigger an acceleration into another
retracement zone at 5,571.05 to 5,534.16,' Hyerczyk added.
Weak miners were the main drag on blue chip
sentiment as copper prices edged lower, falling for a
fifth session in seven on the back of the Fed minutes and
caution ahead of China growth data, to be released on Friday.
Rio Tinto was the biggest sector casualty, down 3.0
percent as the Anglo-Australian miner said its Chief Financial
Officer Guy Elliott would retire at the end of next year, and
that the company would be creating a new position to oversee the
group's strategy.
Fund manager Ashmore Group was the biggest
individual blue chip faller, dropping 5.8 percent after
reporting a fall in the amount of money it manages in its fourth
quarter. Weak performance and the exit of clients saw it lose
more than a fifth of its equity assets.
AEGIS SOARS
Mid-cap Aegis Group soared 45 percent as Japan's
Dentsu Inc agreed to buy the British marketing group
for 3.2 billion pounds ($5 billion), or 240 pence a share. That
will combine the Japanese firm's strong presence in Asia with
the British group's footprint in Europe and digital services.
'Dentsu's proposed agreed bid at 240 pence for Aegis looks a
very full price in our view and we think rival agencies are
unlikely to counter bid,' Investec Securities said in a note.
The marketing sector consolidation gave a boost to blue chip
advertising giant WPP Group, up 0.8 percent, and to
broadcasters ITV and BSkyB, ahead 1.0 percent
and 0.7 percent respectively.
British companies, however, cut their marketing budgets for
the first time in a year in the second quarter, as pessimism
about the economy regained the upper hand, an IPA Bellwether
survey said on Thursday.
Data-wise, markets will eye U.S. weekly jobless claims, due
at 1230 GMT together with June U.S. import and export prices.
June's U.S. Federal Budget is not released until 1800 GMT, after
the London close.
(Reporting by Jon Hopkins; editing by Patrick Graham)
(jon.hopkins@thomsonreuters.com)(02075428954)(Reuters Messaging: jon.hopkins.thomsonreuters.com@reuters.net)
COPYRIGHT
Copyright Thomson Reuters 2012. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
