LONDON (SHARECAST) - 1630:Close The number of mortgages approved in the UK rose to a four-month high in August, but was still well down on the year before, it was announced today. Lenders approved 30,533 mortgages in August, up from 28,750 in July, according to the British Bankers' Association. The consensus estimate had been for an increase of 28,100. Meanwhile, Weir Group was leading the risers on the top share index after analysts at Oriel Securities and Investec said US industrial conglomerate General Electric will probably be drawn to Weir as it looks to build its mining-equipment division through acquisitions. Looking abroad, the US Conference Board´s consumer confidence gauge for the month of September came in at 70.3, well ahead of the 61.3 expected by the consensus. The FTSE 100 closed up 21 points at 5,860.
1617: Weir Group is leading risers on the top share index after analysts at Oriel Securities and Investec said US industrial conglomerate General Electric will probably be drawn to Weir as it looks to build its mining-equipment division through acquisitions.
1603: Shares of GKN are recovering towards the close of trading. Yet technical analysts at Charles Stanley are pointing out the fact that the company´s share price yesterday broke an "upwards" trend-line. For that reason they argue that: "a continuation of the move lower now looks like a realistic expectation and although some support is possible at 211p or so the chart is suggesting that we should anticipate a drop back to around 205p (the upper part of the "bullish gap" it left at the beginning of July) before too long." FTSE 100 up 31 to 5,869.
1503: The US Conference Board´s consumer confidence gauge for the month of September has come in at 70.3, well ahead of the 61.3 expected by the consensus.
1435: Cruise line operator Carnival has just published its third quarter results, which have come in well ahead of forecasts, at $1.53 per share versus the $1.43 expected by the analyst consensus. Its guidance for the full-year on the other hand has come in well below estimates, at between 7 and 11 cents per shares (Consensus: 16 cents).
1309: Market reports have appeared suggesting that BAE and EADS are studying the possibility of modifying the terms of their proposed merger more in EADS´s favour from the current 60 per cent to 40 per cent split.
1237: At first glance analysts at Credit Suisse seem rather dismissive in their initial reaction to the above article, commenting that: “This is not the first time that we have seen this type of story, although whether or not a transaction happens we think it may create a debate.” On the other hand, they make three “observations” which may be of interest. These are: [Credit Suisse believes] Temasek has been trying to shift away from financials towards commodities and other sectors, at the AGM this year they did not support the elections of all the executive directors and given the prominence of the stake for Temasek this could also be interpreted as a negative indicator of their expectations for the group.
1057: This market update should be read with some tranquil music playing in the background, because nothing much is happening. Diageo is the best performing blue-chip after it confirmed it is in talks about taking a stake in Indian rival United Spirits. BAE Systems drifts lower as EADS merger euphoria fades some more. Peel Hunt has cut its rating on investment bank Close Brothers to 'hold' from 'buy' even though it reckons the firm's full-year results were in line with expectations. 'We expect to reduce our July 2013 forecast by 5 per cent, taking a more conservative stance on the assumptions in the Banking division,' the broker said. FTSE 100 is down 7 at 5,832.
0956: This is Credit Suisse´s take on RBS´s update this morning: "Overall the update was broadly in line with previous guidance, although management highlighted a strong Q3 performance so far and some additional cost cutting. With the stock having rallied strongly in the last month with the sector we don't see this event as changing the investment case for RBS, trading at 0.6x 2013E TNAV for a 2% RoTE, we remain Underperform."
0915: RBS boss Stephen Hester is addressing an investor conference this morning, giving a state of play for the nationalised lender and a briefing on the big issues that still need to be tackled. The latter fall into three main categories: Markets restructure; turn-around of Ulster Bank; the reduction of non-core operations. The group is targeting a year-end 2012 & 2013 core tier one ratio - a key measure of balance sheet strength - of around 10 per cent after exiting the government's asset protection scheme and after factoring in regulatory impacts. The restructuring phase should be largely complete by the end of next year, Hester is set to tell the conference. The next phase will see the management focusing on boosting return on equity above the cost of equity, the resumption of dividend payments and completing the remaining restructuring. FTSE 100 is up 8 at 5,847.
0853: Shares of Royal Bank of Scotland are amongst the worst performers now on the top share index. Managers condoned and participated in the manipulation of global interest rates, indicating that wrongdoing extended beyond the four traders the bank has fired, Bloomberg is reporting. On the other hand, the bank´s Chief Executve Officer, Stephen Hester, is set to tell the Bank of America Merrill Lynch Banking & Insurance CEO Conference this morning that it is targeting a resumption of its dividends some time after 2013, which is helping to limit earlier losses. FTSE 100 up 12 to 5,851.
0831: Analysts at Seymour Pierce have downgraded the staffing sector to underweight from neutral. "Given the current economic backdrop, we remain concerned that recruitment shares are overvalued pricing in a significant recovery in activity - despite few signs this is imminent. The eight recruitment stocks we cover are trading on a prospective price-to-earnings ratio of 17.2x. In contrast, smaller capitalisation stocks are trading on 7.6x. Our top picks in the sector on the overweight side are Harvey Nash (BUY) and Nakama (BUY), and, on the underweight side Michael Page (SELL) and Robert Walters (SELL)," they say.
0808: Footsie has opened little changed. Standard Chartered is the worst performing blue-chip in the early going as reports indicate that Singapore investment fund Temasek has sounded out potential buyers for its 6bn pound stake in the emerging markets focused bank. Tesco is wanted after Philip Clarke, the supermarket chain's Chief Executive, confirmed that the retailer would ease up on the use of the 'blunt weapon' that is the promotional coupon and revert to its normal policy of targeted offers through the company's Clubcard scheme. Tesco's 'carpet bombing' approach to money-off coupons was a demonstration of market clout in response to rivals eroding Tesco's market share through heavy promotional activity. FTSE 100 is up 3 at 5,842.