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Finance & Stock Market News
Glance-Euro zone worries halt FTSE's 6-week winning run
Fri, 20th Jul 2012 18:18
By Viktoria Dendrinou
LONDON, July 20 (Reuters) - Britain's FTSE 100 ended lower
on Frid
financial outlook took a fresh hit, pushing its yields to a new
record high and hitting bank stocks across Europe.
Royal Bank of Scotland, Barclays and HSBC were all down 2.5 percent to 3.5 percent, taking 14.5
points off the broader index after the sector slid in line with
continental peers.
The STOXX Europe 600 Banks index, which includes UK
firms, ended down 3.7 percent, while the euro zone-focused index slid 6.1 percent after news that Spain's Valencia region
was applying for a bailout from Madrid hit the country's bonds.
'We saw the market coming back to the 5,600s as Spanish
yields did not head south of 7 percent,' Octopus fund manager
Bish Limbu said.
Until the region's permanent bailout fund, the ESM, is ready
to buy Spanish bonds, Limbu said, 'yields will continue to creep
up like that and so equity markets will continue to fall when
they do'.
Weakness in the financials proved the main drag on the
broader index, sending the blue-chip FTSE 100 down 62.42
points, or 1.1 percent, to 5,651.77 points.
That late run into the red left the index down 0.3 percent
for the week and meant it failed to chalk up a seventh straight
week of higher closes, a feat last achieved in mid-2005.
RESOLUTION SLIDES
British insurer Resolution led fallers across the
index for most of the session, losing 5.4 percent in heavy
volume at more than three times its 90-day daily average after
it canceled a planned share buyback.
Leading blue-chip Vodafone also suffered in the
tough European trading conditions that have contributed to a
series of weak corporate outlooks from across the region in the
current earnings season.
Hurt by weak demand in debt-saddled Europe and an unexpected
slowdown in emerging markets, it posted a sharp drop in
quarterly growth and said it would launch a new round of cost
cuts.
At the same time as many firms are reporting cautious
outlooks and defensive stocks remain popular, analysts at UBS
suggested buying into sectors that could be early beneficiaries
of any bottoming in the weak economic data.
Matthew Gilman, strategist at the bank, wrote that retail,
leisure, housebuilders and media were all sectors that tended to
perform well around the time of a trough in lead indicators.
Within these sectors, UBS analysts' preferred picks include
a couple of Friday's small group of gainers, William Hill , up 0.9 percent, and WPP, up 0.1 percent and
which traded at almost 1-1/2 times its 90-day daily average.
(Editing by Simon Jessop)
((viktoria.dendrinou@thomsonreuters.com))
Keywords: MARKETS BRITAIN STOCKS/
( For related prices, Reuters users may click on - * UK stock report FTSE index: techMARK 100 index: FTSE futures: Gilt futures: Smallcap index: FTSE 250 index: FTSE 350 index: Market digest: Top 10 by vol: Top price gainers: Top % gainers: Top price losers: Top % losers: * For related news, click on - * UK hot stocks: Wall Street: Gilts report: Euro bond report Pan European stock report: Tokyo stocks: HK stocks: Sterling report: Dollar report: * For company prices, click on - * Company directory: By sector: * For pan-European market data, click on - * European Equities speed guide................ FTSE Eurotop 300 index........................... DJ STOXX index................................... Top 10 STOXX sectors........................ Top 10 EUROSTOXX)
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.
LONDON, July 20 (Reuters) - Britain's FTSE 100 ended lower
on Frid
ay, halting a run of six weekly gains, as Spain's
financial outlook took a fresh hit, pushing its yields to a new
record high and hitting bank stocks across Europe.
Royal Bank of Scotland, Barclays and HSBC were all down 2.5 percent to 3.5 percent, taking 14.5
points off the broader index after the sector slid in line with
continental peers.
The STOXX Europe 600 Banks index, which includes UK
firms, ended down 3.7 percent, while the euro zone-focused index slid 6.1 percent after news that Spain's Valencia region
was applying for a bailout from Madrid hit the country's bonds.
'We saw the market coming back to the 5,600s as Spanish
yields did not head south of 7 percent,' Octopus fund manager
Bish Limbu said.
Until the region's permanent bailout fund, the ESM, is ready
to buy Spanish bonds, Limbu said, 'yields will continue to creep
up like that and so equity markets will continue to fall when
they do'.
Weakness in the financials proved the main drag on the
broader index, sending the blue-chip FTSE 100 down 62.42
points, or 1.1 percent, to 5,651.77 points.
That late run into the red left the index down 0.3 percent
for the week and meant it failed to chalk up a seventh straight
week of higher closes, a feat last achieved in mid-2005.
RESOLUTION SLIDES
British insurer Resolution led fallers across the
index for most of the session, losing 5.4 percent in heavy
volume at more than three times its 90-day daily average after
it canceled a planned share buyback.
Leading blue-chip Vodafone also suffered in the
tough European trading conditions that have contributed to a
series of weak corporate outlooks from across the region in the
current earnings season.
Hurt by weak demand in debt-saddled Europe and an unexpected
slowdown in emerging markets, it posted a sharp drop in
quarterly growth and said it would launch a new round of cost
cuts.
At the same time as many firms are reporting cautious
outlooks and defensive stocks remain popular, analysts at UBS
suggested buying into sectors that could be early beneficiaries
of any bottoming in the weak economic data.
Matthew Gilman, strategist at the bank, wrote that retail,
leisure, housebuilders and media were all sectors that tended to
perform well around the time of a trough in lead indicators.
Within these sectors, UBS analysts' preferred picks include
a couple of Friday's small group of gainers, William Hill , up 0.9 percent, and WPP, up 0.1 percent and
which traded at almost 1-1/2 times its 90-day daily average.
(Editing by Simon Jessop)
((viktoria.dendrinou@thomsonreuters.com))
Keywords: MARKETS BRITAIN STOCKS/
( For related prices, Reuters users may click on - * UK stock report FTSE index: techMARK 100 index: FTSE futures: Gilt futures: Smallcap index: FTSE 250 index: FTSE 350 index: Market digest: Top 10 by vol: Top price gainers: Top % gainers: Top price losers: Top % losers: * For related news, click on - * UK hot stocks: Wall Street: Gilts report: Euro bond report Pan European stock report: Tokyo stocks: HK stocks: Sterling report: Dollar report: * For company prices, click on - * Company directory: By sector: * For pan-European market data, click on - * European Equities speed guide................ FTSE Eurotop 300 index........................... DJ STOXX index................................... Top 10 STOXX sectors........................ Top 10 EUROSTOXX)
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.
