LONDON (SHARECAST) - 1630:Close UK stocks have started the month of August in the blue, aided and abetted by the fact that Wall Street was closed in observance of the Labour Day festivity. Miners led the pack today on speculation that economic authorities the world over will soon embark on further economic stimulus, with the US Federal Reserve and the European Central Bank chief amongst them. Fresnillo was the best performer on the Footsie, as silver futures tacked on gains of almost 3% to their 13% July advance, the best of any commodity group. Out on the FTSE 350 Barratt Developments and Taylor Wimpey benefitted from price target upgrades from analysts at Panmure Gordon. The manufacturing sector purchasing manegers’ index for the month of August has come in at 49.5, well above last month’s reading of 45.2 and the consensus forecast of 46.1, despite which economists remain rather restrained in their forecasts for the sector. FTSE 100 up 47 to 5,758.
1616: ECB can buy 3 year bonds Draghi is said to have told the European Union parliament today, Bloomberg reports.
1457: ECB meeting will not be a game-changer for Spain, opine analysts at Royal Bank of Scotland this afternoon. The ECB announcement on September 6 will be no silver bullet against the crisis, in our view. Together with our economists, we think the central bank is likely to deliver more collateral easing and the first steps of a crisis-management framework, which will be based on conditionality and will continue to involve sterilisation. This is a positive for the general market and banks in particular, as it reduces tail risk and improves refinancing activity: for these reasons we are still bullish on credit and long bank senior bonds. Nevertheless, the ECB steps towards more liquidity will not fix the lack of growth and capital across Spain's economy and its banks. FTSE 100 up 32 to 5,743.
1345: Gains in shares of Fresnillo may be due -at least in part- to the market chatter today calling attention today to silver prices' performance during the month of August.
1339: Deutsche Bank has lowered its recommendation on shares of ARM Holdings to sell from hold, saying the company is likely to face increased competition.
1327: Admiral has been among the strongest performers in the insurance sector year to date, up by 41.5%, reflecting improved confidence on bodily injury claims inflation. Yet analysts at Credit Suisse are not convinced that there is further scope for material upside risk to the share price. Amongst other reasons they point to the fact that its shares are now trading at 11.3 times the estimated 2013 price-to-earnings multiple. Furthermore, they believe near term sentiment is likely to be constrained by weaker data-points on vehicle count growth and industry pricing trends, while there is also potential for uncertainty to increase as various regulatory bodies conduct reviews of the industry. Due to all of the above Credit Suisse has decided to downgrade shares of Admiral to hold from outperform. FTSE 100 up 38 to 5,749.
1213: Footsie had a solid morning, largely on the back of the strength of miners, which are rising on the expectation that China will loosen monetary policy some more after this morning's disappointing manufacturing data. Fallen advertising giant Hibu, the company formerly known as Yell, is circling the drain on week-end press reports that a huge debt-for-equity swap is the only way out for the heavily indebeted Yellow Pages publisher. The shares have almost halved today, and are now barely worth a halfpenny - a far cry from the halcyon days of 2007 when the group traded at more than 600p. FTSE 100 is up 34 at 5,745.
1104: The FTSE 100 has held on to gains, trading up 30 points at 5,742. Broker commentary has prompted some movements for some heavyweight stocks this morning: ARM Holdings is a heavy faller after Deutsche Bank downgraded its recommendation to 'sell', while supermarket firm Morrisons was in the red after Nomura cut its rating to 'neutral'. Nomura said that after analysing the recent Kantar grocery survey, it found that Morrisons' volume trends have lagged its peers by around four per cent at the last data point. 'We recognise MRW’s ability to preserve profitability, having faced volume headwinds from both Asda’s Netto conversions (abating) and TSCO’s reset (ongoing), and expect resilient H1 interims (September 6th). However, MRW’s survey volume trend proves the tipping point for us to revise our recommendation to 'neutral' (from 'buy'),
1044: Economists at Barclays have this to say about today´s manufacturing data in the UK: "The government had hoped that a manufacturing renaissance would lead the rebalancing of the economy away from an excessive reliance on financial services and a consumption-led growth model. There are some relative bright spots, such as car production, where high levels of investment are likely to drive further expansion. Nevertheless, we expect to see only a lacklustre recovery from June’s Jubilee-related weakness when we receive July’s official manufacturing production data on Friday. Although today’s news surprised to the upside, this was relative to very weak expectations, and we continue to forecast only marginal growth for the remainder of the year." FTSE 100 up 26 to 5,738.
0856: No talks were held during the weekend, and none are scheduled, between Glencore and Qatar Holding, the biggest opposing shareholder, according to a person who asked not to be named because the plans are private, Bloomberg reports. If the current proposal fails, executives are considering a structure for a new offer that would be more difficult to block, the person said.
0809: Well, so much for the markets moving into gear once Fed Chairman Ben Bernanke's Jackson Hole speech is out of the way; London's leading shares have opened mixed, showing the same lack of direction they showed most of last week prior to Bernanke's speech on Friday afternoon. On the plus side, Footsie is marginally firmer despite weak economic data from China. According to a monthly survey by HSBC, the China manufacturing purchasing managers' index (PMI) dropped from 49.3 in July to 47.6 in August, its lowest reading since March 2009. Miners are largely responsible for Footsie's steady start. Supermarket Morrisons is weaker ahead of results later this week. FTSE 100 is up 5 at 5,716.
