World stock markets news summary (US, UK, Europe, Asia) (November 25, 2009)

Date: 25 November 2009
Contributed by Paddy Power Trader

By Paddy Power Trader

King warns of risk to credit rating. (FT/Independent)

Mervyn King, Bank of England governor, warned yesterday that Britain’s credit rating could be at risk unless the government came up with a “credible” plan to tackle the deficit. Independent also wrote that King hints at a gentle end to printing money early next year.

UK economy probably came closer to leaving recession than first estimated. (Telegraph)

City economists are now predicting the economy shrank 0.3% in the third quarter, slightly better than an initial estimate of 0.4%. The Office for National Statistics is scheduled to release a second estimate of the figures at 9:30 am in London. Note, there were rumours yesterday of a markedly strong revision.

Tories believe Brown will go to the country in March. (Independent)

Economic figures may mean that early election suits Prime Minister Gordon Brown.

T-notes finished higher on Tuesday, but traded in a tight range early on. Treasuries rallied to fresh highs following a stellar USD 42bln 5 year note auction which showed strong demand and thus led hedge funds, as well as dealers, to chase prices higher in post auction trade. The FOMC minutes caused t-notes to come off their best levels as policymakers cautioned that excessive USD moves could potentially lead to upward pressure on inflation, however prices resumed the march higher shortly afterwards as the market focused on the auction results. At the pit close t-notes finished up 15 ticks at 120.03. At 0634 GMT UST’s were trading little changed up half a tick to 120.03+ as the market looks ahead to another busy schedule before the US Thanksgiving holiday.

Fed minutes revealed policymakers saw the decline in USD as ‘orderly’ but were wary of falling USD’s impact on inflation. (BBG)

Fed says sees financial market trends as supporting recovery, though bank credit was still ‘tight.’ Also says forecasts for growth and risks to inflation outlooks are ‘roughly’ balanced. Says noted possibility of some negative side effects from ultra low rates for an extended period. Says higher oil price may spur inflation pressure and predict unemployment to stay ‘quite elevated, while commercial real estate was a ‘downside risk’ to updated forecasts.’ Fed forecasts economic growth strengthening in next 2 years and raised forecast for Q4?10 GDP growth to 2.5-3.5% and Q4'10 unemployment now sees 9.3-9.7% vs. Prev. 9.5-9.8%.

USD 42bln 5y note auction drew yields of 2.175% vs. Exp. 2.208%, b/c 2.81 vs. Prev. 2.63 and indirects 60.9% vs. Prev. 54.77%. 67.34% of the issuance allotted at high. (BBG)

ABC Consumer Confidence (Nov 22) W/W -47 vs. Prev. -45 (BBG)

Europe

ECB’s Trichet said that the ECB has been able to prevent deflation in Europe due to its “solid anchoring” of expectations on price stability. (RTRS)

Fitch raises alarm at impact of USD 98bln refinancing on European real estate debt maturing across Europe by 2014. (FT)

ECB said to lean toward again offering loans at 1% fixed rate and is yet to decide on rate for 12 month loans in Dec. (BBG)

ECB says wants to avoid signalling higher interest rates and will debate if rate on loans should rise with benchmark. Says also to debate putting adjustable rate on 12-month loans.

Asia

The 10-year Japanese government bond yield hit its lowest in nearly seven weeks overnight, with JGBs supported by a lacklustre performance from Tokyo stocks and the JPY’s rise against the USD. However, as the Nikkei gained into the close JGBs pared back to trade at 139.42 (-0.02) at 0614 GMT. (RTRS)

BOJ’s deputy governor Yamaguchi said that the global economy is recovering but the financial system remains fragile, adding that central banks must deepen debate on how to deal with asset prices. Yamaguchi also said that funding conditions of smaller firms are still severe. (RTRS)

Forex

RBA’s deputy governor Battellino said that the economy has entered a new upswing, which is to last a few more years yet. (RTRS)

SNB’s Roth says SNB doesn’t have exchange-rate target (BBG/RTRS)

Roth says global unconventional measures to be reversed ’soon’, but will be difficult to find the right moment for exit. Also said there is no intention of selling gold.

IMF’s Strauss-Kahn says EUR is ‘a bit too strong’. (Le Figaro/BBG)

Strauss-Kahn said EUR is too strong and that it was difficult to make an absolute determination of the value of a currency.

Commodities

US crude futures hovered around USD 76 a barrel, after falling 2% the previous day, ahead of a government report on US oil stocks and after an earlier industry report showed a big build in crude inventories. WTI crude futures were trading at USD 76.26, up USD 0.24, at 0610 GMT. (RTRS)

According to the EIA, refinery capacity may be 2mln BPD more than needed, while Q4 distillate demand expected to fall 7%. (BBG)

Nigeria oil minister Lukman says doesn’t see need now to increase OPEC output. (BBG/RTRS)

Lukman says until economy recovers OPEC can’t put too much oil in market that would drive down prices. Says OPEC must weigh world economy in setting output, but prices must stay at a ‘reasonable level’. Says Nigeria’s current crude oil output is 1.7mln BPD, possible to add 500,000 BPD by end of next year and could eventually hit 3.7mln BPD if peace deal holds.

Gold struck a record high for a second time this week, rising above USD 1175 per ounce, as the USD slipped and a newspaper reported that India was “open to buying” more Gold from the IMF. (RTRS)

US API Crude Oil Inventories W/W (Nov 20) +3347K vs. Prev. -4367K

US API Gasoline Inventories W/W (Nov 20) +1707K vs. Prev. -963K

US API Distillate Inventory W/W (Nov 20) -2360K vs. Prev. +507K

Company News

Royal Dutch Shell – Co. is hopeful that it will gain an equity stake in a large Russian gas field in the Siberian Arctic that could supply the world’s gas for a decade. Elsewhere, co.’s Qatari gas projects, Pearl and Qatargas 4, will increase cash flow by USD 4bln a year from 2011 and expects spending on two gas projects to be as much as USD 21bln by the end of next year. Also in the news, co. won’t need to borrow more money if oil remains at about USD 80 a barrel, according to co. CEO. (FT/WSJ)

BG Group – According to sources, co. is looking to acquire an upstream asset in Kazakhstan from state-controlled Kazakh energy giant, KazMunaiGas. (Sources)

Lloyds – Millions of co.’s shareholders who are expected to shun bank’s GBP 13.5bln capital raising will receive about GBP 0.23 a share in compensation, according to a calculations based on present stock market prices. (Times)

Rio Tinto – Market talk that Chinalco could sell down its 12% stake in co. to institutional investors. Chinalco spent USD 14bln on the stake in Feb. 2008. (Australian Financial Review)

Cadbury – Reports say co. could move to buy Kraft’s confectionary business if no other suitor emerges to prevent a low takeover from Kraft. According to the report, Cadbury could afford the buy. (NY Post)

Rentokil – Co. was yesterday rumoured to be selling City Link subsidiary. (FT)

United Utilities – H1 net from continuing ops. GBP 198.1mln. Co. interim dividend of GBP 0.1117. Says sees “sound” performance for rest of year. (BBG)

Compass Group – FY net income GBP 586mln vs. Exp. GBP 526mln, also proposes final dividend of GBP 0.088 per share. (BBG)

Johnson Matthey – H1 net GBP 79mln vs. Prev. GBP 98.6mln, H1 dividend GBP 0.0111 per share. (BBG)

LSE – H1 ptp down 37.4% as average daily UK equity value traded fell 16% vs. H2 last year. (BBG)

Companies going Ex-dividend: AMEC (GBP 0.0610), Man Group (GBP 0.1189), Next (GBP 0.1900)

Equities finished lower following the release of mixed economic data with financials under performing following down beat comments from the FDIC and the S&P. The FOMC minutes showed the Fed forecasts economic growth for the next two years which in turn gave equities a lift in the latter half of the session and saw some of the losses pared back. At the closing bell the S&P 500 closed down 0.05% at 1105.65, the DJIA closed down 0.16% at 10433.71 and the NASDAQ 100 closed down 0.37% at 1786.25.

Bank of America – Fitch places co.’s individual rating on watch positive. (RTRS)

Merck – Co. announces quarterly dividend of USD 0.38/share and new USD 3bln share repurchase program. (RTRS)

Amazon/eBay – Comscore says for holiday season-to-date, USD 8.21bln has been spent online, a 2% increase vs. last year. Comscore also sees online retail spending for Nov.-Dec. period to reach USD 28.8bln, representing a 3% gain vs. last year. (RTRS)

EMC – Co. says will incur a charge of approximately USD 100mln in Q4 2009 due to reorganization, however the charge was not included in the previous business outlook and therefore now sees Q4 non-gaap share at USD 0.30 and Q4 revenue of USD 4bln. (RTRS)

Europe

GERMANY

Volkswagen/Man – The listed German vehicle makers, and Scania, the Swedish vehicle producer, all deny any official talks regarding a truck production alliance. (Handelsblatt)

RWE – Co. is selling the remaining stock it has in American Water Works, using its put option on the 3.7mln share it still owns. (S&P)

Man AG – European market for trucks, buses and coaches fell 30.7% in October to 141,765 vehicles. (ACEA)

Metro – Co. denies planning to sell the German department store chain Real. (Handelsblatt)

OTHER GERMAN COMPANIES

Infineon – Samsung Electronics says talk of interest in co. is untrue. (RTRS) Co. also declines to comment on rumours of Samsung interest. (Die Welt)

FRANCE

Vivendi – Co. places two-part Bond of EUR 1.2bln to increase average maturity of its debt. (BBG)

Air France – Co. is to create an internal commission on flight security in a bid to placate pilot unions who have called for a strike in December. (Les Echos)

Dexia – Co. has denied rumours that Dexia banka Slovensko, the Slovak operation is up for sale. (SME)

OTHER FRENCH COMPANIES

Areva – Alstom and Schneider Electric, the French team bidding for co.’s power-grid unit, agreed to revise the terms of its offer as they seek to strengthen the value of their bid, a person familiar with the situation said. (BBG)

PAN-EUROPEAN

Telefonica – Co.’s board meeting today is to consider buying 20% of PR digital+ satellite television platform for EUR 400mln. (BBG)

ING Groep – Co. will hold EGM today to approve the proposed split up and its EUR 7.5bln Rights Issue. (BBG)

SWISS

UBS – Co. says S&P Report doesn’t reflect bank’s capital position. The bank’s risk adjusted capital ratio (RAC) is estimated to be 7.1% and not the 2.2% reported by S&P. (BBG)

Roche – Co.’s Avastin filed for broader cancer label in Europe for use in combination with standard chemotherapies. (BBG) In other news, co. is open to acquisitions alongside co-operations and licensing deals. (Handelszeitung)

Asia

Nikkei rose 0.4% in choppy trade as shares of exporters such as Sony Corp recouped ground after sharp declines. But Daikyo Inc and shares of other apartment developers as well as some creditors sank after unlisted Anabuki Construction went under in Japan’s fifth-biggest corporate failure this year. (RTRS)

Japan Airlines – Co. secured a JPY 100bln (USD 1.13bln) line of credit from the state-owned Development Bank of Japan. (Nikkei)

Latest Stock Market Reports

World stock markets news summary (US, UK, Europe, Asia) (February 09, 2010)
A hung parliament in Britain looks increasingly likely as the main opposition Conservative’s lead over the ruling Labour Party slips. The Populus polls for the Times newspaper found support for Prime Minister Gordon Brown’s Labour Party up two points from last month at 30%, while the centre-right Conservatives were down one point to 40%. (RTRS) Despite a raft of comments from high-profile speakers such as Jim Rogers, Bill Gross of Pimco and a former chief economist at the IMF – there are number of reasons to believe that the UK won’t end up like Greece. (Telegraph) Firstly, unlike financially distressed members of the Euro, Britain has its own currency. Britain can simply print more money to pay its debts, and arguable has already done so through QE. Obviously, it will be a major blow to Britain’s international standing if it looses its AAA credit rating, but in truth the rating is something of a red herring, and is not the major issue here. The second reason Britain is unlikely to suffer the same fate as Greece, or even Spain, is that the UK has nowhere near the same magnitude of problem. By contrast, UK competitiveness is improving fast, in part because of the flexibility of its labour markets, which has allowed companies to adjust their cost bases quickly by changed circumstances.

Russian stock market daily morning report (February 09, 2010, Tuesday)
The Russian share market began the morning with smooth recovery after the drop of the previous week. However the purchases did not last long and in the afternoon the principal liquid shares were losing 2-4% average. Main reasons of sale were the same – instability of the global economy and worsening of the commodity conjuncture. Investors were actively getting rid of the oil-and-gas and bank sector’s shares. However there were some notes that closed the day positively against the negative background. Polyus Gold and Norilsk Nickel were among the ones that went up due to increased demand of metal.

Indian stock market and companies daily report (February 09, 2010, Tuesday)
The benchmark indices logged marginal gains after swinging sharply in highly volatile trade. IT stocks played the lead role in the recovery; however, metal pivotals remained subdued, as metal prices fell on the LMEX. Telecom stocks advanced on bargain hunting. Rate-sensitive banking shares recovered from the day's low, while auto stocks were mixed. The BSE Sensex and the NSE Nifty rose by a marginal 0.1% each. The BSE Mid-cap and Small-cap indices were down by 0.1% each. Among the front-liners, Bharti Airtel, RCOM, ONGC, HLL and M&M were up by 2-3%, while Tata Steel, Hindalco, Wipro, Jaiprakash Associates and NTPC were down by 1-4%. In the mid-cap segment Chambal Fertilisers, Nagarjuna Fertilisers, Core Projects, Kansai Nerolac, Procter & Gamble were up by 5-7%, while Indraprashtha Gas, Gujarat NRE Coke, Torrent Pharma, Spice Communications and REI Agro, were down by 4-9%

Stocks Recommendations

Godrej Properties IPO review and analysis by Angel Broking, 9 December 2009
Godrej Properties Limited (GPL) intends to develop its projects through joint development agreements with land owners. Under this asset-light model, GPL will enter into revenue, profit or area-sharing agreements with land owners, instead of an outright purchase of the land. This model avoids direct land dealings for GPL and the locking-up of extensive capital in land. Around 80% of GPL's existing land bank will be executed through joint developments with partners. The Godrej brand name has been associated with quality and strong corporate governance. Both of its existing listed entities, Godrej Consumer Products and Godrej Industries have given CAGR Returns of 48% and 77%, respectively, to investors since 2001. We believe that GPL could leverage its parentage brand (with respect to access to the land at Vikhroli and a strong customer preference towards it), assuring a timely delivery of execution. More than 50% of GPL's existing land bank is exposed towards township projects and in one location (Ahmedabad), which will be executed over the next ten years. Any delay in this execution or a fall in property prices in Ahmedabad will impact our NAV estimates, as 50% of our NAV is derived from this project.

JSW Energy Ltd IPO review and analysis by Nirmal Bang, 8 December 2009
JSW Energy Ltd. (JSWEL) is a power project development company, which is developing, and will operate and maintain, power projects in India. The company has two thermal power projects under operation, with a combined installed capacity of 860 MW. JSWEL is a part of the JSW Group, a leading business group in India. JSW Group has a presence in high growth sector like Steel, Energy, Aluminium, Cement, Infrastructure and Logistics. Post IPO holding of Promoter and Promoter Group would be 78.12%

JSW Energy IPO review and analysis by Angel Broking, 7 December 2009
JSW Energy (JSWEL) currently has operational capacity of 995MW and is in the process of executing projects with capacity of 2,655MW. In addition, the company has 7,740MW power generation projects at an early stage of development. A major portion (2,145MW) of JSWEL’s upcoming capacities is expected to be operational by FY2011E thereby providing near-term visibility. Out of the plants under construction, the company expects to commission 570MW by end FY2010E, while another 1,575MW is expected to get operational in FY2011E. Thus, a robust portfolio and near-term Revenue visibility is a major positive for the company.

Surgutneftegas: Currency rates are putting away the dividends..., 26 November 2009
We have revised our model of Surgutneftegas. The reason for that was the output of the 3Q 2009 report, correction of our suppositions of the company’s future development, and also the postponing of the target time and evaluation one year forward. Particularly, in our model of Surgutneftegas we have corrected the former forecast of income for the current year towards reduction: on EBIT – by 2.2%, on the net profit – by 21.5%. Mainly that happened due to the corrections on the operating estimates, and also due to the continuing strengthening of Russian ruble, which, considering significant dollar liquidity of the company, turns into negative currency exchange. Due to the negative currency exchange precisely For the second quarter in a row Surgutneftegas shows low level of the net profit. The fourth quarter, as we see it, will not make an exception and we expect negative currency exchange similar to the ones in the third quarter.

Gazprom: Having passed the bottom, 23 November 2009
We have revised our estimation of Gazprom’s shares. The reason for up-dating the company’s model was the report by IAS for 1H 2009, the budget draft for the next year and corrections of WACC method calculation. The provided financial report of the gas monopoly totally brought no surprises. As it has been expected, the second quarter was worse than the first one and likely was the weakest within the whole year. In 1H 2009 the financial estimates were affected by the decline of the gas sale at all markets by 22.3% average, and by the reduction of the retail price of gas by 9.6% in the state of the far abroad and by 24% in Russia. As a result within the six months of the year 2009 sales slipped by 24.1 bn USD or by 32.8% and formed 49.285 bn USD, operating profit and EBITDA showed reduction by 56.7% and 52.6% respectively and formed 12.98 bn USD and 16.18 bn USD.

Cox and Kings IPO review, analysis and recommendation, 18 November 2009
Cox and Kings proposes to make its IPO in the price band of Rs316-330/share, at a face value of Rs10 each, and to issue 1.85cr shares, of which 30.5lakh shares are offered for sale by Lehman Brothers Opportunity, Deutsche Securities Mauritius and Merrill Lynch Capital Markets Espana. Therefore, the fresh issue by the company will be to the extent of 1.55cr shares. The company plans to use the proceeds for debt repayment (Rs129.6cr), acquisitions and other strategic initiatives (Rs150cr), investment in overseas subsidiaries (Rs62.5cr), and investment in corporate offices and upgrading its existing operations (Rs60cr).

News

Victoria Oil & Gas, Mediterranean Oil & Gas, Max Petroleum, Atlantic Coal, Red Rock Resources, European Nickel news briefs, 9 February 2010

Heritage Oil, Independent Resources, Xcite Energy, Petrolatina, Greystar Resources, Obtala Resources news briefs, 8 February 2010

Heritage Oil, Independent Resources, Xcite Energy, Petrolatina, Greystar Resources, Obtala Resources news briefs, 8 February 2010

Chinas march to prosperity, 8 February 2010

OSIM Posts Steady FY09 Amidst Turbulence, 7 February 2010

Stock Market News: All News | USA News | Indian News | China News

Stock Market Reports: All Stock Reports | USA Stock Market Reports | Indian Stock Market Reports | China Stock Market Reports | Russian Stock Market Reports

About Us | Privacy Policy | Contacts | Links