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Wednesday
Jan142015

 
Past performance is not necessarily a guide to the future, returns are before the application of Titan’s fees, tax legislation can change and you should always take independent advice in relation to your own financial circumstances.
Wednesday
Oct012014

Wednesday's Stock Market report featuring Domino's Pizza, Tesco, UBM, James Halstead and Audioboom

The Markets

UK manufacturing PMI dropped to its lowest level for 17 months in the latest figures published by Markit. The survey of purchasing managers fell from 52.2 to 51.6 in September. suggesting that growth in the sector is slowing but still present as the stagnation of the major Eurozone economies weighs down the industrial sector’s exports. David Noble, CEO of Chartered Institute of Purchasing & Supply, said that “the continued weakness in Eurozone countries and the euro-sterling exchange rate appeared to particularly undermine growth in September, and resulted in near stagnation in new manufacturing orders”. Similar trends were seen in the US manufacturing survey.

Private firms added 213,000 jobs in September according to the ADP employment report, ahead of analysts’ expectations for 205,000 new positions. This suggests that the official figures that are scheduled to be published on Friday are likely to show that substantially more jobs were created last month than the 142,000 added in August. Mark Zandi, Chief Economist at Moody’s Analytics, said that, “especially encouraging most recently is the increasingly broad base nature of those gains [as] nearly all industries and companies of all sizes are adding consistently to payrolls”.

At the London close the Dow Jones had decreased by 179.50 points to 16,863.40 and the Nasdaq had fallen by 42.16 points to 4,007.28.

In London the FTSE 100 closed down by 65.20 points at 6,557.52 and the FTSE 250 fell by 168.83 points to 15,210.89. The FTSE All-Share had decreased by 34.97 points to 3,498.96 while the FTSE AIM Index shrank by 6.25 points to 743.83.

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Broker Notes

Shore Capital has rated Babcock International (BAB) a “hold” with a target price of 1,092p after the firm won a maritime support contract from the UK Ministry of Defense that allows Babcock to add another 2 billion pounds of contracted work to its order book. Together with the Magnox contract that was recently agreed, Babcock’s total orders are now in the region of 20 billion pounds, but these awards were factored into the broker’s forecasts and as a result they have not been adjusted. The shares fell by 6p to 1,086p.

Westhouse Securities has kept its “add” rating on insurance and benefits outfit Jardine Lloyd Thomson (JLT) with a target price of 1,100p in light of the group’s recently announced plans to enter the United States “Speciality” insurance markets and the subsequent drop in the stock price. The broker believes that the firm continues to be underpriced and that, despite poor outcomes from the company’s last attempt to enter the US market, the risks of the move have been overstated in the current market. The shares dropped by 27p to 946.5p.

Domino’s Pizza (DOM) has received mixed reviews from N+1 Singer after the food delivery firm posted a third quarter update. The broker expects that the firm will continue to post good like-for-like growth rates of 8-10% in the three months to September, but remains concerned about the German business and the overall openings programme, leading N+1 to issue a “hold” rating until the situation clears up. The shares rose by 2p to 570p.

Broker still waiting for Domino’s to deliver good results

Blue Chips.

Total retail sales at supermarket J Sainsbury (SBRY) fell by 2.3% over the 16 weeks ended 27th September as a deflationary price environment and a trend towards more frequent visits ate in to average basket sizes. Like-for-like sales fell by 4.1% as the firm opened 25 net new locations and extended or refurbished 5 more. Sainsbury’s believes that current conditions are likely to remain in place for the remainder of the year and expects second half performance to be in line with the first half. The shares fell by 16.74p to 234.76p.

Troubled supermarket rival Tesco (TSCO) has received notice from the Financial Conduct Authority that a full investigation has begun into recent events, separately from the independent inquiry being carried out by Deloitte. Tesco announced last week that it had discovered a 250 million pound overstatement in profit forecasts while preparing for its next set of interim results, which will be published late this month. The shares declined by 6.2p to 180p and have now fallen by 45% so far this calendar year.

Bad news sweeping supermarket sector

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Mid Caps

Marketing and communications firm UBM (UBM) intends to purchase Advanstar Communications for a cash consideration of $972 million (599 million pounds). The board feel that the acquisition is financially attractive and believe that it would immediately increase UBM’s revenues by over 20%. The purchase costs will be paid via a new rights issues and $100 million (61.7 million pound) debt facility. The shares declined by 34.5p to 548.5p.

Real estate investment trust LondonMetric (LMP) has purchased the Dixons Retail distribution centre in Newark for 68.5 million pounds, which represents an initial net yield of 6.4% and will be funded from current company resources. The unit generates rents of 4.5 million pounds per annum and has 18.8 years outstanding on the current lease. LondonMetric’s total distribution portfolio generates rents of 450 million pounds. The shares closed flat at 139p.

Exhibition and conference firm ITE Group (ITE) performed better than expected in the three months to 30th September and as a consequence of this, full year profits before taxation for the 12 month period ending yesterday will be ahead of forecasts at around 174 million pounds. ITE has been significantly affected by currency movements over the current year so while revenues rose 7% on a fixed exchange rate basis, real revenues fell by 6%. The shares fell by 2.75p to 172.25p.

Exhibition firm displays progress

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Small Caps

Engineering firm Avingtrans (AVG) increased revenues by 33% to 60.3 million pounds for the year ending 31st May, due to acquisitions fuelling growth in the aviation and healthcare divisions. Profits before taxation rose from 1.3 million pounds to 2.5 million pounds, despite currency impacts, but management feel that there is a need for further improvements throughout the business to secure long-term growth. The shares rose by 7.5p to 144p.

Flooring products company James Halstead (JHD) saw revenues rise by 3% over the year ended 30th June due to strong demand growth in the firm’s core UK markets. European sales increased by 3%, but there were difficulties in Australasian markets as sales were flat and margins fell. James Halstead remains confident regarding its long term prospects. The shares grew by 4.75p to 294p.

Defence services firm Cohort (CHRT) has acquired J+S Ltd, a systems and support provider, for a cash consideration of 12 million pounds and management believe that the purchase will allow Cohort to expand its activities in the offshore energy sector as well as enhancing the company’s defense industry offerings. The deal is expected to be immediately earnings enhancing and J+S will be integrated in to the firm’s SEA subsidiary. The shares fell by 9p to 210p.

Investment banking services outfit Numis (NUM) increased revenues by 19% over the year ended 30th September, despite a disappointing second half performance where incomes fell from same period last year due to lower market volumes. Client numbers expanded to 171 over the period and the firm’s income from secondary markets exceeded last year’s record levels. The shares dropped by 21.75p to 244p.

North Africa-focused iron ore developer Ferrum Crescent (FCR) continued to work towards starting production at its Moonlight site as it made a pre-tax loss of $2.5 million (1.5 million pounds) over the year ended 30th June. The company is currently carrying out a feasibility study and has signed a financing agreement with Anglo American worth $10 million (6.1 million pounds) in exchange for a 35% stake in the Moonlight development. The shares declined by 0.15p to 0.7p.

Social media audio platform business Audioboom (BOOM) has raised 8 million pounds via the issue of 64 million new shares at 12.5p per share. This placing represents 12% of enlarged share capital of the company and will be used to fund the international expansion of the business and improve its aggregated advertising network. Audioboom directors subscribed for 0.8 million shares, showing continued commitment to the firm. The shares rose by 0.75p to 15.875p.

Investors like the sound of Audioboom as placing oversubscribed

Tuesday
Sep302014

Tuesday's Stock Market Report featuring RBS, Next, QinetiQ, Iofina and Newbury Racecourse

The Markets

The UK economy has been growing faster than previously thought according to the latest figures from the Office for National Statistics which show that GDP grew by 0.9% in the second quarter. This was an upgrade from the previous estimate of 0.8%. However, the first quarter figure was revised downwards from 0.8% to 0.7%, leaving the full year estimate at 3.2%. The agency also believes that the economy shrank by less than has been believed during the economic crisis. James Knightly, an economist at ING Financial Markets, said that “the substantial revisions due to new methodology mean that the UK economy is now 2.7% larger than it was before the global financial crisis started”.

Nationwide has published figures showing that the annual rate of house price growth fell in September from 11% to 9.4%. Prices fell by 0.2% on a monthly basis and the mortgage lender found that there was still strong regional variations. with London and the South-East continuing to lead the market. The overall forecast for the housing sector remains unclear and Robert Gardner, Nationwide’s Chief Economist, wrote that “the outlook remains uncertain. There have been tentative signs from surveyors and estate agents that buyer demand may be starting to moderate, but the low level of interest rates and strong labour market suggest that underlying demand is likely to remain robust”.

At the London close the Dow Jones had increased by 42.57 points to 17,113.79 and the Nasdaq had fallen by 14.43 points to 4,061.60.

In London the FTSE 100 closed down by 23.88 points at 6,622.72 and the FTSE 250 fell by 10.35 points to 15,379.72. The FTSE All-Share had decreased by 10.98 points to 3,533.93 while the FTSE AIM Index grew by 0.50 points to 750.08..

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Broker Notes

N+1 Singer has reiterated its “hold” rating on business-to-business media outfit Euromoney Institutional Investor (ERM) after the firm issued a pre-close update suggesting that underlying revenues had risen by 6%, driven by increased conference attendance and some timing effects. The broker expects that the currency markets will be more conducive to business in the coming year. The shares rose by 6p to 1,031p.

Hydrocarbon explorer Lekoil (LEK) has retained its “buy” rating from Westhouse Securities after the company issued interim reports for the six months ended 30th June showing that losses had fallen to $5,3 million (3.2 million pounds) from $8.8 million (5.4 million pounds) in the prior year. The firm has purchased a 40% stake in a promising Niger delta oil field and the broker believes that the firm could become a major player in the Nigerian oil industry. The shares rose by 1p to 69.25p,

Investec has upgraded Anglo American (AAL) to a “buy” rating, with a 1,573p target price as the broker believes that its 85% owned De Beers business provides a differentiating factor from peers in the mining industry and will allow the firm to benefit from relatively low levels of new diamond finds. The minerals giant is starting to provide more detailed information about its diamond markets activities that will allow the market to more accurately price the stock, which Investec thinks heralds upward movement. Barclays concurs and increased its target price to 1,550p. The shares grew by 2.5p to 1,386.5p.

Investec reckons Anglo American is a diamond investment

Blue Chips

Banking and financial services group Royal Bank of Scotland (RBS) has seen continued improvements to economic conditions in key markets translate into strong operating performance at RBS Capital Resolution. The capital resolution unit’s wind down remains volatile, but if conditions remain favourable the process could be completed ahead of schedule with limited impairments. Overall, the bank expects to outperform previous guidance, with total “bad loans” being significantly lower than previously forecast. The shares rose by 7.5p to 368.9p.

Melrose Industries (MRO) has agreed to purchase heating and drying components firm Eclipse for a cash consideration of $158 million (97.15 million pounds) which will be carried out using current facilities and the deal is subject to US regulatory approval. The acquisition will synergise well with Melrose’s Elster Gas subsidiary, which is specialised in a separate area of the gas components market. The shares rose by 10.3p to 247.7p.

High street fashion retailer Next (NXT) benefitted from cooler weather in August which lead to stronger trading than anticipated. However, this reversed in the more important month of September and means that the chain recorded third quarter growth of 6%, below its 10% target. If the unseasonably warm weather continues through October, full year profit forecasts will need to be cut from the current guidance of between 815 million to 775 million pounds. The shares fell by 245p to 6,620p.

Next faces trouble as high street heats up

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Mid Caps

Technical and engineering firm QinetiQ (QQ) is on track to meet targets for the year ending 31st March 2015, with higher than anticipated utilisation levels in the EMEA region. The drawdown of US defense spending has had an impact on global products bookings and visibility has been limited, but the department has continued to diversify its offering. Full year forecasts remain unchanged. The shares grew by 0.2p to 224.5p.

The management of communications solutions provider KCOM Group (KCOM) has met expectations for the six months ended 30th September with good cash generation. The firm has secured its 10,000 customer for fibre-optic broadband and continues to target key growth markets. Full results for the half year will be published in late November. The shares dropped by 1.75p to 94.5p.

Plastic packaging firm RPC Group (RPC) expects revenues for the period from 1st April to 30th September to be significantly ahead of last year, with recent acquisitions and the growth of the capsule coffee market in the US contributing to the improvement. Profits will be in line with prior expectations, despite currency headwinds and a time lag on certain polymer products. The shares rose by 33.5p to 559p.

Rigid plastics company posts solid results

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Small Caps

Shipping specialist Yujin International (YUJ) has seen first half revenues decline from $7 million (4.3 million pounds) to $3.1 million (1.9 million pounds) as the firm exited the bunker tanker market and the charter segment remained slack. The company made a pre-tax loss of $0.9 million (0.55 million pounds), a sharp decline from the $1.8 million (1.11 million pounds) profit earned in the same period of 2013. The shares closed flat at 19p.

Iodine producer Iofina (IOF) posted revenues of $13 million (7.99 million pounds) for the six months ended 30th June, a 12.6% increase over the same period last year as a number of new facilities went online during the period. However, the firm’s pre-tax loss deepened to $1.3 million (0.8 million pounds) despite positive EBITDA as the company’s administrative and financial expenses ballooned. The shares rose by 4.5p to 47.5p.

Revenues for the six months ended 30th June at retail sector services firm Universe Group (UNG) were 8.7 million pounds, a 33% increase from the first half of 2013 as the company successfully integrated two new acquisitions and expanded its product range. However, pre-tax profits fell by over 50% to 0.32 million pounds as revenue gains were eaten away by sales costs and increased administrative expenses. The shares ended the day flat at 5.75p.

Management services outfit Progility (PGY) recorded revenues of 38.8 million pounds for the year ended 30th June, more than double those from the prior year as the firm rapidly expanded via mergers and acquisitions. The reported loss before tax was reduced, dropping from 3 million pounds to 0.3 million, and management are continuing to pursue an acquisition focused growth strategy in to the current period with the aim of bringing the firm into profit. The shares grew by 1.125p to 9.125p.

Specialist software developer Dillstone Group (DSG) saw revenues increase by 10% to 4.2 million pounds over the six months ended 30th June, driven by a 19% rise in recurring income that more than offset a 6% drop in non-recurring sales. Profits before tax fell to 0.64 million pounds due to currency movements and acquisition costs. Dillstone also announced that it would purchase recruitment software outfit ISV for an initial cash consideration of 0.85 million pounds. The shares fell by 4.25p to 98.5p.

Newbury Racecourse (NYR) increased first half turnover by 3% to 4.86 million pounds, as raceday attendance rose by 9% against the prior year and the site hosted more corporate events. Profits before taxation rose from 0.76 million pounds to 1.57 million pounds as the property development and sale programme continued. Management remain positive about the remainder of the year and plans to renovate racecourse infrastructure are proceeding apace. The shares closed flat at 450p.

Newbury Racecourse remains flat after clearing profit hurdle

Monday
Sep292014

Monday's Stock Market report featuring Citron Research, Plethora, Compass Group, Balfour Beatty and New Trend Lifestyle 

The Markets

New mortgage lending fell in August for the second consecutive month as the number of approvals shrank from 66,100 in July to 64,212, according to new figures from the Bank of England. Data from Hometrack published last week suggested that house prices did not rise during September for the first time in 18 months, as buyers began to worry about higher interest rates and the potential of a housing bubble. However, analysts remain confident that the sector will continue to grow, with IHS Global Insight Chief UK Economist Howard Archer saying that, “with housing market activity moderating from its early 2014 highs, we believe house prices are likely to generally rise at a more restrained rate over the coming months”.

Firm’s confidence in the Eurozone has fallen by 70 basis points in September, according to the European Commission’s survey of Economic Sentiment, as the public outlook once again dipped beneath the long term average. The largest fall came from Italy where there was a drop of 90 basis points. Companies are less certain about export prospects and retailers report that they will cut employment, while the industrial and construction sectors are looking to maintain current staffing levels.

At the London close the Dow Jones had decreased by 51.13 points to 17,062.02 and the Nasdaq had fallen by 5.92 points to 4,047.80.

In London the FTSE 100 closed down by 2.79 points at 6,646.60 and the FTSE 250 rose by 6.38 points to 15,390.07. The FTSE All-Share had decreased by 0.99 points to 3,544.91 while the FTSE AIM Index grew by 0.09 points to 749.58..

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Broker Notes

Interior furnishing firm Walker Greenbank (WGB) has kept its “buy” rating and 205p target price from N+1 Singer ahead of the publication of the company’s interim results on Wednesday. The broker expects that profits before taxation will be around 3.2 million pounds, a 6% increase over the same period last year. N+1 Singer also feels that Walker Greenback is well placed to benefit financially from the wider economic recovery. The shares rose by 2p to 202p.

Westhouse Securities has initiated coverage of media and education company Pearson (PSON) with a “sell” rating. The broker feels that Pearson offers a long-term play on structural change in the global education market, but believes that the stock is overpriced in view of current trading and execution risks. Westhouse has flagged next month’s interim results as a major indicator of the firm’s short term performance, but also views Pearson’s current price as a good point to realise profits. The shares declined by 8p to 1,225p.

Controversial analysts at Citron Research reckon that Nasdaq listed construction management software business Textura (TXTR) is a fraud and advises that shareholders sell now. Citron points to the firm missing analyst expectations for the last three quarters, a ten year history of operating losses and forward PE ratio of 111 for its stance, and also accuses the company of fraud. The analysts added, “Just over one year ago, insiders sold over $100 million in stock while lying to the investing public.” Citron’s final words were, “This story is over, buy or sell, either way this stock goes to $4”. At the London close the shares were down by $2.48 at $25.72.

Pharmaceutical outfit Plethora Solutions (PLE) has been rated as a “buy” by Daniel Steward after the company’s license agreement with Recordati became effective and triggered a €5 million (3.91 million pounds) upfront payment. The broker believes that the deal could be worth hundreds of millions over the coming years and the company has raised $30 million (18.47 million pounds) to reacquire residual interests its PSD502 premature ejaculation drug. Nevertheless, the shares fell by 0.75p to 7.375p.

Daniel Stewart thinks buy rating for Plethora isn’t premature

Blue Chips.

Catering and support service outfit Compass Group (CPG) expects organic revenue growth of 4% for the year ended 30th September on a constant currency basis. Trading has been strong over the last three months, with significant margin improvements and rapid expansion in North American and Emerging Markets. However, the ongoing strength of sterling will negatively impact the firm’s revenues and profits. The shares grew by 23p to 984p.

Assets under management at Aberdeen Asset Management (ADN) rose by 3% over the two months ended 31st August to 331.2 billion pounds, with net outflows falling to 1.7 billion pounds for the period after reaching 8.8 billion pounds in the preceding three months. The improvement in AuM has mainly been driven by market performance and foreign exchange movements. The shares fell by 0.5p to 399.5p.

Aerospace and defense manufacturer BAE Systems (BA) received 7.9 billion pounds of orders over the period from 1st January to 23rd August, of which 2.6 billion pounds came from outside the UK and US markets. There is likely to be some disruption of activities in the United States over the final quarter of 2014 as the federal budget will be operating under a continuing resolution from the beginning of October with no increases to spending. The shares rose by 0.9p to 470.2p.

BAE continues to rise, despite risk of US turbulence

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Mid Caps

Engineering consultancy & project management company AMEC (AMEC) and infrastructure firm Balfour Beatty (BBY) have been selected to build the Box Encapsulation Plant at the Sellafield nuclear facility as part of a joint venture. The four year contract will begin immediately and has a value of between 240 and 336 million pounds. The plant will treat nuclear waste and prepare it for long term storage. However, Balfour Beatty also announced that there would be a further 75 million pound shortfall in its UK construction services business and that KPMG has been appointed to conduct a thorough review of the division’s contracts. Share in AMEC rose by 2p to 1,108p and Balfour Beatty dropped by 34.4p to 190.5p..

Specialist technical services firm Diploma (DPLM) expects that revenue growth for the year ended 30th September will be around 6%, despite strong headwinds from currency movements. The company estimates that underlying organic growth was in the region of 7-8%. Despite slightly lower, but still robust margins and around 16 million pounds having been spent on acquisitions over the period, net cash at the end of the year will be around 20 million pounds. Preliminary results will be published in November. The shares rose by 0.5p to 685.5p.

Diploma expects passing results for the year

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Small Caps

Italian renewable energy researcher Acta SpA (ACTA) posted revenues of €304,000 (237,440 pounds) for the six months ended 30th June, a 27.7% improvement over the same period of last year, driven increased unit sales. However, despite trading at positive gross margins, the firm’s loss has only fallen from €1.9 million (1.48 million pounds) to €1,7 million (1.33 million pounds). Management remain positive on the future of the company and it’s power supply products. The shares fell by 0.53p to 2.33p.

Spanish focused miner Ormonde Mining (ORM) made a pre-tax loss of €1.1 million (0.86 million pounds) for the six months ended 30th June, as it continued to work towards starting production at its potential tungsten mine at Barruecopardo. The firm has received environment permits and is currently building a shortlist of construction partners whilst waiting for the mining concession to be granted. The shares closed flat at 4.5p.

Housebuilder Inland Homes (INL) increased revenues by 28% to 39.8 million pounds over the year ended 30th June 2014. Profits before taxation grew by 65.7% to 8.6 million pounds as the firm completed on more than twice as many units than in the prior period and benefited from excellent market conditions. The company’s outlook is positive with a target of 270 unit sales in the current year, more than double the 114 completions achieved last year. The shares rose by 1.75p to 48.25p.

Minerals exploration outfit Stellar Resources (STG) made a loss of 0.21 million pounds over the six months ended 30th June and retains cash of 1.8 million pounds. The company increased its stake in Horse Hill Development Ltd from 7.5% to 10% as drilling began on the first wells for conventional oil and gas at the site. The firm also holds an interest in a Welsh gold mining venture that is moving towards commercial production. The shares fell by 0.1p to 0.98p.

African budget airline Fastjet (FJET) posted revenues of $23.29 million (14.35 million pounds) for the six months ended 30th June, an 8.5% decline from the prior year, caused by foreign exchange fluctuations and loss making legacy flights which are now suspended. Losses before taxation were $34.47 million (21.24 million pounds), but management say that trading has improved since the period end and believe that the business can grow profitably in the future. The shares fell by 0.18p to 1.3p.

Feng Shui products and services provider New Trend Lifestyle Group (NTLG) recorded revenues of S$4.6 million (2.2 million pounds) over the six months ended 30th June, a decline of 17.7% from the same period last year. The firm’s loss before taxation was S$0.86 million (0.42 million pounds) and the company is looking at readjusting it’s business model to return to growth in future, with larger stores and accelerated growth in the feng shui beauty parlours division. The shares fell by 1.6p to 5.5p.

Feng Shui firm posts aura-ful results

Saturday
Sep272014

Friday's Stock Market report featuring Lloyds, AstraZeneca, De La Rue, Kalimantan Gold and Nighthawk Energy

The Markets

Six major banks are being investigated by the FCA over the rigging of foreign exchange rates. UBS, Royal Bank of Scotland, HSBC, Barclays, JP Morgan and Citi could face fines within the next six weeks, with some observers suggesting that these could exceed the record 160 million pound fine handed out to UBS in response to the LIBOR scandal. The banks may attempt to negotiate a collective punishment, in order to minimise the risk of being singled out and Reuters estimates that the overall fines issued are likely to be in the range of 1.8 billion pounds.

Second quarter US GDP growth has been revised upwards to 4.6%, in line with consensus expectations, as exports rose by 11.3% over the period. Consumer spending increased by 2.5% and pressure is being put on the Federal Reserve to look at an interest rate increase sooner rather than later. Chris Williamson, Chief Economist at Markit, said that “the most likely scenario seems to be that rates are likely to stay on hold until mid-2015, with the Fed tolerating above-trend economic growth to help heal the labour market, but any marked upturns in the inflation outlook could mean the hawks carry a louder voice”.

At the London close the Dow Jones had increased by 66.17 points to 17,011.97 and the Nasdaq had risen by 14.16 points to 4,480.91.

In London the FTSE 100 closed up by 9.68 points at 6,649.39 and the FTSE 250 fell by 42.22 points to 15,383.69. The FTSE All-Share increased by 2.31 points to 3,545.90 while the FTSE AIM Index fell by 1.81 points to 749.49..

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Broker Notes

Shore Capital has maintained a “buy” position on Lloyds Banking Group (LLOY) after the bank completed a fresh placement of a further 11.5% of TSB at a price of 280p which raised proceeds of 161 million pounds. Although the price offers a discount to TSB’s last published NAV and the disposal may trigger further exceptional costs, the broker is confident that a resurgent UK economy will strengthen Lloyds. The shares rose by 0.45p to 76.66p.

Specialist real estate firm Public Service Properties Investment (PSPI) has kept a “buy” rating from Westhouse Securities after the company issued results showing that NAV rose from 51.2p to 51.4p over the six months ended 30th June, a substantial discount to the current share price. With management positioned to sell assets, the broker feels that its target price of 37p is achievable under current conditions. The shares fell by 0.25p to 24.25p.

Infrastructure and construction firm Balfour Beatty (BBY) has been upgraded to a “buy” by Deutsche Bank, with the report saying that the company’s sale of Parsons Brinkerhoff will improve the balance sheet after recent difficulties in the UK construction industry. However, Deutsche are still wary of worsening payment terms and low demand throughout the sector. The shares rose by 4.7p to 224.9p.

BBY rated Buy by Deutsche Bank

Blue Chips.

Pharmaceutical giant AstraZeneca (AZN) has had the EU Committee for Medicinal Products for Human Use adopt a positive stance on naxlogal product following a review of clinical trial data. The drug would be the first of its kind approved in the European Union to treat side effects of opioid use. The treatment was approved for sale in the United States on 16th September. The shares rose by 34.5p to 4,408.5p.

AstraZeneca treatment flowing through EU Committee

Mid Caps

Trading conditions for currency manufacturer De La Rue (DLAR) since 24th July have been difficult and the company has lowered its expectations for the current and next financial years. While currency order volume has been strong, pricing is lower than hoped and the take-up of other products, such as e-passports, have not been as quick as had been anticipated. As a result, the firm expects profits before tax to be in the region of 55 million pounds for the current year. The shares fell by 255p to 504p.

De La Rue printing more cash, but making less money?

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Small Caps

Shares in resources explorer Kalimantan Gold (KLG) soared by 3.3p to 4.03p after the firm announced a maiden Mineral Resource estimate for the Main Zone of the Beruang Kanan prospect in Indonesia. The Inferred Resource of the area is 47 million tonnes, averaging 0.6% of copper, or 621,700,000 pounds of the metal. The resource sits at depths of between 100 to 350 metres and remains open in several directions. Kalimantan is now looking at drill testing further areas with a view to fast tracking the wider BKM Copper project through to an early development option. Broker Shore Capital commented that, “…Kalimantan will soon have to come to the market for further funds if it is to undertake any meaningful work…”

Flooring manufacturer Airea (AIEA) has seen improvements in trading over the second half of the year ended 30th June, as successful product launches and a restructured sales team upped revenues. However, the overall conditions in the UK carpet market remain challenging with revenues of 23.3 million pounds for the year representing a drop of 6.8% from the levels achieved in the prior period. The shares grew by 0.25p to 12p.

Hydrocarbon explorer and producer Nighthawk Energy (HAWK) produced an average of 1,694 barrels of oil per day over August across its wells, despite the effects of planned flow testing at certain sites denting output. Successful drilling at Blackcomb sites means that at least 2 more wells will start production in the near future, returning the company to output growth after a few flat months. The shares fell by 0.15p to 9.35p.

Revenues at costumer acquisition firm Digital Globe Services (DGS) increased by 53% to $38.9 million (23.84 million pounds) over the year ended 30th June. Pre-tax profits at the company were $3.7 million (2.27 million pounds), as operating costs also increased sharply with staff expenses more than doubling. The company plans to drive growth by moving into further geographic and business areas over the coming year. The shares dropped by 0.5p to 160.5p.

Precious metals miner Patagonia Gold (PGD) began production at the Lomada site during the six months ended 30th June, but the flagship Cap-Oeste mine is still planned to become active in 2016. The group loss before tax was $4.8 million (2.9 million pounds), a substantial improvement over last year as the firm began to receive revenues from gold sales. Cantor Fitzgerald rates the stock as a “buy” with a target price of 15p. The shares fell by 0.125p to 7.625p.

China-based LED manufacturer Gowin New Energy (GWIN) recorded revenues of RMB 51 million (5.1 million pounds) over the six months ended 30th June, a 15% drop from the same time last year despite an encouraging first quarter. Changes to government project criteria and short term impacts from new debt policies dampened performance in the three months from April, leading management to state that full year results may not meet expectations. However, the board remain confident that the firm will return to growth in 2015 with a focus on export sales. The shares fell by 0.45p to 1.275p.

Ventilation and heating firm Andrew Sykes (ASY) recorded revenues of 26.7 million pounds over the six months ended 30th June, a 9.1% decline on sales in the same period of last year as the business in the Netherlands suffered over an unusually warm winter. Profits before taxation fell from 6.6 million pounds to 4.3 million pounds as a result of associated losses of income. The shares declined by 65p to 312.5p.

Warm winter cools Andrew Sykes business

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