Date: Friday 01 Jun 2012
- Chinese PMI dissapoints
- Ireland begins counting votes on fiscal treaty referendum
- BP jumps after proposed sale of interest in TNK-BP
London's Footsie index bucked the trend seen across European markets to trade firmly higher on Friday morning, ahead of some crucial payrolls data Stateside due out later today. Company news on the FTSE 350 was thin on the ground early on.
Gloomy manufacturing data from China was weighing on sentiment on the continent early on. China's official manufacturing purchasing managers' index (PMI) - released by the China Federation of Logistics & Purchasing - fell from 53.3 to 50.4 in May, below expectations of around 51-52. Meanwhile, HSBC's own Chinese PMI fell from 49.3 to 48.4, down from an initial estimate of 48.7.
Investors will be keeping a close eye on Ireland this morning after yesterday's referendum on the fiscal treaty; recent opinion polls suggest that 60% of voters will vote in favour of the treaty.
Meanwhile, the sovereign debt crisis in the Eurozone continues to be a bugbear for markets, as Spanish bond yields headed higher early on; the borrowing rate on a 10-year Spanish note was at 6.568%. MQS Asset Management Chief Executive Bob Gelfond said that yields above 6.5% create an unsustainable situation for Spain.
World Bank President Robert Zoellick has said that the “summer of 2012 offers an eerie echo of 2008” and European sovereign debt has replaced mortgages as the risky asset. “Eurozone leaders (should) take precautions, such as getting [European Stability Mechanism (ESM)] capital into banks now and agreeing on a medium-term funding assurance for countries such as Spain. This assurance could come from the ESM or partial deployment of Eurozone bonds in ways that maintain market discipline on state financing,” he said.
BP surged early on after revealing that it wants to sell-up at TNK-BP, the joint venture it set up with a consortium of Russian investors, as speculation has run rampant in recent days of a breakdown in the relationship between the British oil firm and its partners. The group said this morning that it has received "unsolicited indications of interest" regarding its stake in TNK-BP.
Financial stocks were in demand in the opening hour with Man Group, Barclays, Admiral, Standard Life, Lloyds and RBS among the better performers. Admiral fell steeply yesterday after the Office of Fair Trading said it would refer the private motor insurance market to the Competition Commission.
Telecoms giant BT Group rose after saying that it has sold its application development services business in France to the Paris-listed IT services company, Osiatis.
On the FTSE 250, RIT Capital Partners rose after announcing a big increase in its dividend despite reporting a drop in its net asset value (NAV).
Edinburgh Investment Trust edged higher after reporting a resilient performance in the year to March 31st, growing NAV by a tenth in spite of volatile market conditions.
FTSE 100 - Risers
Man Group (EMG) 76.65p +5.14%
BP (BP.) 410.25p +3.89%
Admiral Group (ADM) 1,057.00p +1.73%
Lloyds Banking Group (LLOY) 25.73p +1.40%
Barclays (BARC) 178.75p +1.39%
Royal Bank of Scotland Group (RBS) 20.21p +1.15%
Standard Life (SL.) 207.00p +1.12%
BHP Billiton (BLT) 1,713.00p +1.09%
SSE (SSE) 1,337.00p +1.06%
Glencore International (GLEN) 343.60p +0.91%
FTSE 100 - Fallers
Weir Group (WEIR) 1,523.00p -1.36%
Kingfisher (KGF) 278.50p -1.24%
Croda International (CRDA) 2,212.00p -1.07%
ITV (ITV) 72.15p -1.03%
IMI (IMI) 876.00p -1.02%
InterContinental Hotels Group (IHG) 1,516.00p -0.66%
Legal & General Group (LGEN) 109.70p -0.63%
GlaxoSmithKline (GSK) 1,429.00p -0.63%
GKN (GKN) 181.90p -0.60%
Aggreko (AGK) 2,185.00p -0.59%
FTSE 250 - Risers
Rank Group (RNK) 121.40p +2.88%
Essar Energy (ESSR) 139.90p +2.72%
Gem Diamonds Ltd. (DI) (GEMD) 208.30p +2.06%
Ferrexpo (FXPO) 201.00p +1.93%
SDL (SDL) 639.50p +1.67%
Cape (CIU) 245.30p +1.62%
Murray Income Trust (MUT) 617.00p +1.31%
Premier Farnell (PFL) 160.90p +1.19%
British Assets Trust (BSET) 112.30p +1.17%
Hansteen Holdings (HSTN) 73.85p +1.10%
FTSE 250 - Fallers
Aquarius Platinum Ltd. (AQP) 65.05p -11.32%
Halfords Group (HFD) 235.50p -2.65%
Euromoney Institutional Investor (ERM) 781.00p -2.50%
Howden Joinery Group (HWDN) 114.60p -2.30%
Ruspetro (RPO) 151.90p -2.25%
Perform Group (PER) 354.50p -2.07%
Dixons Retail (DXNS) 13.95p -2.04%
Home Retail Group (HOME) 76.60p -1.86%
Bodycote (BOY) 372.20p -1.82%
Henderson Group (HGG) 97.20p -1.82%
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