Broker comments in the UK today. Compiled by Dow Jones Newswires Markets Desk, markets.eu@dowjones.com Contact us in London. +44-20-7842-9464 Markettalk.eu@dowjones.com 0918 GMT [Dow Jones] The threat of a tropical storm heading toward BP's (BP) stricken Deepwater Horizon rig is subsiding, points out Olivier Jakob of Petromatrix. There is a 60% chance of a tropical storm forming in the next 48 hours as an area of low atmospheric pressure meets the Yucatan peninsula in Mexico, data from the National Hurricane Center show. But differing computer models suggest the direction of this storm afterwards, will either be toward Florida or toward the south of Texas, bypassing the wrecked BP rig, Jakob notes. BP shares -7.2% at 302p. (patrick.gourlay@dowjones.com) 0918 GMT [Dow Jones] China's delegation at this weekend's G20 meeting might be feeling a little smug; not only is it likely the yuan won't be major focus any more, but also China can point to one or two areas where it's contributing to lowering global imbalances, says Heard on the Street. still, other 19 nations shouldn't imagine China's economy is unambiguously heading in the right direction; turning country's economy towards domestic consumption, away from exports and investments is going to be long process; with household consumption at 35% of GDP, its growth will have to exceed that of overall economy by some distance for it to become more significant portion in coming years. See: =HEARD ON THE STREET: Chinese Economic Math Still Daunting (andrew.peaple@dowjones.com) 0916 GMT [Dow Jones] India interest rate swaps higher on renewed inflation fears after federal government has okayed deregulation in gasoline, diesel prices; front-end swaps likely to bear brunt of news, says trader with private bank. 1-year OIS at 5.47%/5.50% vs 5.43%/5.46% last close, 5-year OIS at 6.73%/6.76% vs 6.70%/6.73% last close. "A hike in fuel prices will add to price pressures, and now an early rate hike looks certain," says trader. However, move may open up interest in playing curve rather than outright flatteners--market based prices likely to help cut fiscal deficit and may actually weigh on long end rates, while front-end likely to spike in coming sessions. (bijou.george@dowjones.com) 0915 GMT [Dow Jones] KLCI ends flat at 1326.45 after having traded in negative territory for most of session; volume thin at 566 million shares. Tech stocks lead losses (down 1.3%) on concerns over global economic recovery. "Without any clear leads, buyers are staying shy today... the market is in a consolidation stage but may rise further," dealer says. Tips 1320-1340 range Monday. Maybank analyst Lee Cheng Hooi says KLCI's chart signals positive, may re-test previous high of 1349. Market breadth negative, 370 decliners vs 250 advancers; MPI (3867.KU) down 3.6% at MYR6.20, Berjaya Sport Toto (1562.KU) down 3.3% at MYR4.33, Top Glove (7113.KU) +2.9% at MYR13.38, HL Bank (5819.KU) +1.5% at MYR8.68. (kwan-por.lee@dowjones.com) 0908 GMT [Dow Jones] UniCredit reinitiates TUI (TUI1.XE) short-dated Dec. 2010 and May 2011 notes with a buy recommendation, regarding the repayment of these issues as high. Also has a speculative buy on the Dec. 2012 issue. "Given the different options TUI has to free up cash and the company's track record in finding innovative funding sources, we see a good chance for the repayment of its outstanding senior debt obligations," says analyst Jana Arndt. (art.patnaude@dowjones.com) 0908 GMT [Dow Jones] EUR/CHF crashes to a fresh all-time low of 1.3505 and that triggers a euro slump across the board. EUR/USD is at the day's low of 1.2266, EUR/JPY the same down 100 sen at 109.89, EUR/GBP gives up almost its entire day's gains and now trades at 0.8247. (gary.stride@dowjones.com) 0901 GMT [Dow Jones] iTraxx Japan Series 13 rises to 136 bps vs yesterday's 128 bps after Greek CDS widens to record high level, while Tokyo stocks weaken, says Japan brokerage dealer; Nikkei ends at 2-week low of 9737.48. "In reaction to Japan's FIFA World Cup victory over Denmark, single-name CDS deal for Honda Motor was actively traded" with ace striker Keisuke Honda scoring significant goals in team's 2 wins. Friday's individual CDS deals include Honda Motor (7267.TO) at 69 bps vs 67 bps on June 24; Nissan Motor (7201.TO) at 120 bps vs 122 bps on June 16, 3-year at 60 bps vs 60, 80 bps on Feb. 2; Resona Bank dollar-subordinated CDS at 128 bps vs 135 bps on March 3; Marubeni Corp. (8002.TO) at 142 bps vs 151 bps on June 11; Dollar-denominated CDS on Japan's 2-year sovereign debt at 31 bps vs 30, 35 bps on May 6.(miho.nakauchi@dowjones.com) 0900 GMT [Dow Jones] India government bonds fall more on CNBC TV18 reports that federal government has okayed market-driven hike in petrol prices, a move which will raise already double-digit inflation and may lead to tighter monetary policy, says dealer. Benchmark 7.80% 2020 bond falls to 101.15 after report vs 101.30 before, 101.58 last close, second-most traded 8.20% 2022 bond falls to 101.65 vs 101.88, 102.20 last close. "The move will lead to an immediate hike in petrol prices and makes a strong case for rate hikes by RBI any time now," dealer says. Tips benchmark 2020 bond in 101.00-101.30 range, 2022 bond in 101.50-101.80 range during session. (khushita.vasant@dowjones.com) 0859 GMT [Dow Jones] Sensex sustains losses, last off 0.5% at 17,643.21, in line with weak regional cues following Wall Street's losses overnight. Market breadth negative with 19 of 30 index issues lower; banks leading decline after recent outperformance. "Trading is subdued, barring some buying by short-term traders in telecom and select pharma stocks", says market participant. Adds, recent macro data out from U.S not been good, funds locking in some profits after recent rally; index up about 6.7% between June 9, June 24. Tips support at 17,570. ICICI Bank (532174.BY) down 1.5% at INR871.50, HDFC Bank (500180.BY) falls 2.4% at INR1,954. Sterlite (500900.BY) down 2.5% at INR169.60, Wipro (507685.BY) off 2.4% at INR391.80. Among gainers, ONGC (500312.BY) +2.8% at INR1,225, Cipla (500087.BY) +2.2% at INR348. (gurdev.singh@dowjones.com) 0857 GMT [Dow Jones] Treasurys are higher in London as equities shed initial gains. The debt troubles in the euro zone remain in focus, with the cost of insuring Greek sovereign debt against default rising to a new record Friday. There is also caution ahead of the G20 meeting in Toronto. On the data front, the third estimate of US GDP is out at 1230 GMT while University of Michigan's confidence survey is due 1400 GMT. The 2-year note is up at 99-31+/32, to yield 0.633%, the 10-year is up at 104-10/32, to yield 3.103%, the 30-year bond is up at 105-02/32 to yield 4.080%. September bunds are down 0.07 at 129.07 and September gilts are unchanged at 120.69. (neelabh.chaturvedi@dowjones.com) 0852 GMT [Dow Jones] Indonesian government bonds down on profit-taking after recent sharp gains; dealer says 5-, 10-year notes too expensive, some investors start shifting to longer tenor or treasury bills. "It's better to sell some of the 5- and 10-year bonds and invest in the 15-year note as it is cheaper," says dealer. Adds, "Treasury-bills maturing early 2011 are also attractive, as the central bank is unlikely to hike rates this year." 5-year FR27 yield at 7.54% vs 7.39% Thursday's close. 10-year FR31 yield +11 bps at 8.24%, 15-year FR40 yield +10 bps at 9.03%. (andreasismar.sandiwan@dowjones.com) 0847 GMT [Dow Jones] USD/MYR higher at 3.2450 in choppy trade vs 3.2320 yesterday, tracking weak Asian currencies; local dealer says volume thin in absence of clear leads. "The weaker stock market (KLCI last +0.2%) is giving some excuse to sell the ringgit," says dealer; adds, some players staying on sidelines awaiting outcome of G20 meeting over weekend. Tips 3.2300-3.2600 range Monday. (kwan-por.lee@dowjones.com) 0918 GMT [Dow Jones] The threat of a tropical storm heading toward BP's (BP) stricken Deepwater Horizon rig is subsiding, points out Olivier Jakob of Petromatrix. There is a 60% chance of a tropical storm forming in the next 48 hours as an area of low atmospheric pressure meets the Yucatan peninsula in Mexico, data from the National Hurricane Center show. But differing computer models suggest the direction of this storm afterwards, will either be toward Florida or toward the south of Texas, bypassing the wrecked BP rig, Jakob notes. BP shares -7.2% at 302p. (patrick.gourlay@dowjones.com) 0817 GMT [Dow Jones] Credit Suisse raises Premier Oil (PMO.LN) price target to 1657p from 1584p, primarily due to higher reserves for gas sales into Singapore. Says lucrative gas sales from Indonesia into the hydrocarbon-poor Singaporean market have significant upside potential. Following an extensive analyst trip to the company's upcoming oil and gas field developments in Vietnam and Indonesia, the brokerage feels even more confident in its forecasts for cash flow growth of 21% per annum to '13. Adds Premier remains its top E&P pick on both a value and growth basis. Reiterates outperform rating on the stock. Shares +0.4% at 1176p. (michele.maatouk@dowjones.com) 0803 GMT [Dow Jones] Exane BNP Paribas cuts National Grid (NG.LN) price target by 6% to 645p to reflect the adjusted number of shares after the rights issue. Also takes into account that National Grid went ex-dividend on June 2. After the rights issue, estimates NG's financing needs are covered until March '12, allowing it to maintain its target of an 8% annual increase in the dividend until then. "The GBP22B capex plan will...improve the group's profile as supportive UK regulation should enable the group to maintain its returns above the cost of capital," adds Exane. Keeps the stock at outperform. Shares +0.2% at 503p. (michele.maatouk@dowjones.com) (MORE TO FOLLOW) Dow Jones Newswires June 25, 2010 05:18 ET (09:18 GMT)
Last checked at 
