London Lower on Ex-Dividend Stocks

Ivaylo
07 Mar, 2007
New York City

London equities were firmer on Wednesday in spite of the benchmark index dipping 29 points from leading financial stocks that began trading without rights to the latest dividend payments. Sentiment was given a boost from strengthening US markets and property companies were higher as JP Morgan named British Land and Great Portland Estates as two of its top picks in the European sector. The FTSE 100 was off 14 points at 6,125.8 having been more than 30 points lower earlier in the session.

[R]9:30AM UK market trades slightly lower on Wednesday on ex-dividend stocks.[/R]
The UK market was lower on Wednesday bby mid-day. The FTSE 100 was off 14 points at 6,125.8 having been more than 30 points lower earlier in the session.

Advancers

Property stocks were higher in London on JP Morgan decision. British Land gained 2.4% and Great Portland advanced 3.1%, while Hammerson gained 3 %. Resolution added 3% as news of a change of top management at the closed life fund consolidator boosted hopes of a takeover.

Severn Trent also advanced 2.8% as Merrill Lynch upgraded the utility from hold to buy. Merrill Lynch also upgraded Kelda Group, up 1.8%.Among the mid-caps, PartyGaming surged 8.4% on bid news raising hopes of consolidation in the sector. Sportingbet rallied 12.2% as it confirmed that it had been approached.

Decliners

Leading banks moving ex-dividend, were the main drag, including Lloyds TSB and Royal Bank of Scotland. Lloyds was off 4.2%, RBS shed 2.2%, Barclays retreated 1.7% and Standard Chartered dropped 1.2%.

Other stocks moving ex-dividend included cigarette maker BAT, down 1.9%, and Diageo, off 1.2%. Other decliners included ITV, off 1.4% as the commercial broadcaster posted lower annual profits and weaker revenue.

J Sainsbury slipped 1% a day after hectic trading in the grocer was powered by news that property entrepreneur Robert Tchenguiz had increased his stake to just over 3% and on market speculation that the CVC-led consortium was close to unveiling its offer for the company.

[R]9:00AM Asian markets end mostly higher on Wednesday, Japan and HK dip.[/R]
Asian markets finished mostly higher on Wednesday. Japanese Nikkei 225 Stock Average fell 0.5% to 16,764.62. Sony fell 1.2%, Canon shed 2.4% and Hitachi slid 1.9%. Steel shares were volatile, with profit-taking erasing their strong gains in the morning session. Nippon Steel ended down 1%, while JFE Holdings sagged 1.2%.Nikko Cordial bucked the trend, rising 1.3% after Citigroup''s announcement Tuesday of its cash-offer price for the brokerage house.

The Hang Seng Index in Hong Kong also fell 0.7% to 18,918.64. The two biggest stocks in the Hang Seng Index fell. HSBC Holdings dropped 0.7% after rising 2.6% Tuesday, and China Mobile, the world largest wireless phone operator by subscribers, ended 2.6% lower after rebounding 2% in the previous session. Cathay Pacific Airways bucked the trend, advancing 1.8% after reporting a better-than-expected 24% rise in 2006 net profit.

In China, the Shanghai Composite Index, which tracks both Class A and Class B shares, ended up 2% at 2,896.59, while the Shenzhen Composite Index rose 2.6% to 750.25, following a 0.7% gain Tuesday. South Korean shares also rose for a second session. The Korea Composite Stock Price Index rose 0.6% to 1,410.95. Daewoo Engineering & Construction gained 5.6%, Posco, the world third-largest steelmaker, advanced for a second day, up 2.3% and Samsung Electronics rose 0.2%.

Other indexes around the region also gained. The Weighted Price Index of the Taiwan Stock Exchange rose 0.4% to close at 7,480.89 and Australian benchmark S&P/ASX 200 index rose 0.9% to 5,825.3.

[R]6:30AM European markets were higher on Tuesday on M&A and retail stocks.[/R]
European stock markets were higher on Tuesday. By mid morning, Frankfurt Xetra Dax added 0.3% to 6,615.78, the CAC 40 in Paris climbed 0.3% to 5,455.81 and the FTSE 100 in London rose 0.2% to 6,148.0.

Advancers

Carrefour, the French retailer, was up 2.6% after two investment groups announced they had jointly acquired 9.1% of the company. Groupe Arnault and Colony Capital said the move was a long-term strategic and industrial investment.

The retail sector was boosted by the development and domestic rival Casino Guichard rose 3.4%, while Metro of Germany climbed 2.6%. Bid speculation lifted Dutch bank ABN Amro 1.5% as an increasing chorus of hedge fund investors suggested the bank would deliver better shareholder returns if it merged with another large group.

Volkswagen, the German carmaker, is a step closer to its hope of integrating the European truckmaking sector after it raised its stake in Sweden’s Scania to just over 20% of share capital and 35% of voting rights. Shares in Volkswagen gained 1.5 %, while Scania added 1% and MAN gained 2.7%.

Decliners

Vallourec, the French maker of steel tubes, fell 5.2% after its 2006 net profit fell shy of market expectations. A number of heavily-weighted British banks which went ex-dividend capped gains. Lloyds TSB fell 3.8%, Barclays lost 2% and Royal Bank of Scotland shed 2.2%.

Oil and gold

Crude oil advanced on speculation that greater gasoline demand in the U.S. will cause inventories to drop as the summer driving season approaches. Crude oil for April delivery rose as much as 33 cents, or 0.5%, to $61.02 a barrel on the New York Mercantile Exchange and was at $60.90 in early trade in London. Brent crude gained 55 cents, or 0.9%, to $61.94 a barrel on the ICE Futures exchange and traded at $61.79 in London. Gold traded in London at $646.35 per troy ounce, up from $641.60 late Tuesday.

Currencies

The U.S. dollar was lower against other major currencies in European trading Wednesday morning. The euro traded at $1.3125, up from $1.3121 late Tuesday in New York. The British pound traded at $1.9300, up from $1.9292. The dollar bought 116.44 Japanese yen, down from 116.67.

[R]5:00AM Gold and silver advanced on Tuesday, copper also rose.[/R]
April gold gained $7 to $646.20 a troy ounce on the New York Mercantile Exchange. May silver also added 23.5 cents to end at $12.985. April platinum rose $18.20 to $1,198.80 an ounce, while June palladium settled up $4.90 to $351.90 an ounce. The most-active May copper contract rose 4.30 cents to settle at $2.7135 per pound.

The front-month April crude oil contract gained 62 cents to close at $60.69 a barrel. April heating oil settled up 2.25 cents at $1.7473 a gallon. April gasoline settled up 0.86 cent at $1.8533 a gallon. April natural gas advanced 21.8 cents to finish at $7.472 per million British thermal units.

On the New York Board of Trade, Arabica coffee futures advanced. The March contract closed up 1.45 cents at $1.12 a pound, with May up 1.50 cents at $1.13. Futures on raw sugar in foreign ports for May settled up 0.10 cent at 10.76 cents a pound, with July up 0.08 cent at 10.64 cents.