Date: Friday 17 Aug 2012
- Merkel backs Draghi's bond-buying proposal
- US data lifts stocks late on
- Chemring receives interest from The Carlyle Group
Global equity markets were lifted higher on Friday on the back of hopes of imminent action from European officials and some decent economic data in the US. However, gains in London were only modest with just 19 points separating the intra-day low and high.
"It’s been pretty much 'more of the same' today on equity markets with London struggling to maintain any kind of momentum, though Italian and Spanish markets have outperformed on the back of raised expectations of ECB intervention in the coming weeks," said market analyst Michael Hewson from CMC Markets.
The mood was lifted this morning after German Chancellor Angela Merkel threw her weight behind the proposal by European Central Bank President Mario Draghi to buy sovereign peripheral bonds in order to bring down yields in indebted countries such as Spain and Italy. She said that Draghi's pledge to do "whatever it takes to preserve the euro" was "completely in line" with the views of euro-area officials.
US stocks edged higher early on after the University of Michigan-Thomson Reuters consumer-sentiment index rose from 72.3 to 73.6 in August, better than forecasts of no change. Meanwhile, the Conference Board's leading economic index increased by 0.4% in July, better than the 0.3% growth estimate.
Shares in military counter-measures specialist Chemring rocketed in the last hour of trade today after confirming that it has received a "highly preliminary expression of interest" from private equity firm The Carlyle Group in relation to a possible offer.
Platinum producer Lonmin pared earlier losses this afternoon but remained lower after riot police shot dead dozens of its workforce at the Marikana project in South Africa, as a week of protests over pay have turned the FTSE 250 group's mine into a war zone. It is thought that around 35 people have now been killed since violent clashes erupted a week ago.
While trade unions have blamed Lonmin for the trouble, saying that their negotiations with employees outside of union structures had started the protests, the firm's Chairman Roger Phillimore said last night that this "is clearly a public order rather than labour relations associated matter."
Electronics stocks were being dragged higher on news that shares in US tech giant Apple were coming close to a record high, after having already risen 57% this year, on reports that it has started manufacturing the iPad mini.
Chip designer ARM Holdings was making gains today after Barclays said that it is in a decent position to benefit from the increased demand of high-tech smart devices.
Electronic components group Laird was also higher after UBS upgraded its rating on the stock to 'buy', saying that Apple's iPhone 5 launch would drive growth in the second half.
Barclays, Royal Bank of Scotland and Lloyds were in demand today as banking stocks across Europe made gains on improving developments in the Eurozone.
Water group Pennon was sinking after saying that trading at its waste management unit Viridor has been significantly below the high level of the first half of the previous fiscal year with recyclate prices remaining under pressure.
Casino and online gaming group Rank advanced after saying that revenues in the 12 months to June 30th rose 3.4%, while pre-tax profits jumped 9.0%.
FTSE 100 - Risers
Lloyds Banking Group (LLOY) 34.22p +3.74%
Barclays (BARC) 192.85p +3.57%
CRH (CRH) 1,151.00p +2.86%
GKN (GKN) 226.10p +2.45%
Kingfisher (KGF) 295.60p +2.32%
Weir Group (WEIR) 1,778.00p +2.30%
Smiths Group (SMIN) 1,069.00p +2.00%
Royal Bank of Scotland Group (RBS) 231.60p +1.89%
Aggreko (AGK) 2,301.00p +1.81%
Aberdeen Asset Management (ADN) 281.60p +1.73%
FTSE 100 - Fallers
Anglo American (AAL) 1,927.50p -2.38%
Shire Plc (SHP) 1,980.00p -1.39%
Smith & Nephew (SN.) 662.00p -1.34%
GlaxoSmithKline (GSK) 1,472.00p -0.84%
AstraZeneca (AZN) 3,000.50p -0.83%
Diageo (DGE) 1,686.50p -0.79%
Eurasian Natural Resources Corp. (ENRC) 369.70p -0.72%
Resolution Ltd. (RSL) 225.80p -0.70%
United Utilities Group (UU.) 721.50p -0.62%
British American Tobacco (BATS) 3,325.00p -0.60%
FTSE 250 - Risers
Chemring Group (CHG) 414.70p +32.32%
Rank Group (RNK) 132.70p +5.57%
Centamin (DI) (CEY) 73.70p +5.29%
Hunting (HTG) 822.00p +5.25%
Ultra Electronics Holdings (ULE) 1,592.00p +5.01%
Ferrexpo (FXPO) 200.70p +4.42%
Redrow (RDW) 141.10p +4.29%
Aquarius Platinum Ltd. (AQP) 37.77p +4.02%
Ophir Energy (OPHR) 531.50p +4.01%
Michael Page International (MPI) 383.50p +3.65%
FTSE 250 - Fallers
Daejan Holdings (DJAN) 2,950.00p -3.15%
IP Group (IPO) 126.00p -3.08%
Barr (A.G.) (BAG) 439.20p -2.72%
JD Sports Fashion (JD.) 675.00p -2.53%
Heritage Oil (HOIL) 169.30p -2.03%
Petra Diamonds Ltd.(DI) (PDL) 103.50p -1.80%
Gem Diamonds Ltd. (DI) (GEMD) 187.80p -1.68%
Hikma Pharmaceuticals (HIK) 738.00p -1.53%
Shaftesbury (SHB) 530.00p -1.40%
Lonmin (LMI) 639.50p -1.31%
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