Morning Spread

Morning Spread

Monday 7th October 2013
IndexLevelChg (%)
UK Market6399.27-0.85
Dow Indust Avg15072.58+0.51
S&P 5001690.50+0.71
Nasdaq Composite3807.75+0.89
Nikkei 22513853.32-1.22
Hang Seng22973.95-0.71
IndexLevelChg (%)
Nymex 1m102.66-1.14
Gold Spot1311.86+0.08
GBP/USD1.6070-0.21
GBP/EUR1.1828-0.02
EUR/USD1.3586+0.25
USD/JPY--

European stocks dropped as US House Speaker John Boehner ruled out raising the federal government’s debt limit without setting preconditions. The ESTX 50 (-1.06%), UK Markets (-0.90%), CAC 40 (-1.20%) and the DAX (-1.14%) all posted losses in early trading. Burberry dropped -2.5% after CEO Angela Ahrendts told Les Echos that the slowdown in Chinese sales may lengthen. The Asia Pacific region accounted for 39% of the company’s sales in the 12 months through March 2013. EADS climbed +0.8% after Airbus CEO Fabrice Bregier said the company won an order for 18 A350-900 aircraft and 13 larger A350-1000s from Japan Air. The firm commitment has a value of $9.5 billion at list price. Japan Air also has an option to purchase 25 more planes. Solvay gained +1.6% after saying it will buy Chemlogics for $1.35 billion in cash. The acquisition will generate cash and earnings in its first year according to a statement issued by the company. Solvay said it will issue about €1 billion of hybrid bonds to strengthen its balance sheet.

US stocks rose as optimism grew that the lawmakers would reach a deal to end the budget impasse and avoid a default on the federal debt. The Dow Jones Industrial Average (+0.51%), S&P 500 (+0.71%) and the NASDAQ Composite (+0.89%) all advanced. Freeport-McMoRan Copper & Gold Inc climbed +2.3% as copper prices rallied. Dentsply International Inc jumped +2.9% after Bank of America raised its rating on the company to “buy”. Disney climbed +2% and Boeing climbed +1.7% for the two biggest gains in the Dow. Facebook rose +3.8% after saying it will sell advertising space on Instagram in its first effort to make money from its biggest ever acquisition. The stock has surged +92% in 2013. Delta Air Lines Inc rallied +2.7% after CEO Richard Anderson said that the carrier is not seeing any travel decline from the government shutdown. Union Pacific dropped -1% after saying it predicts third quarter earnings that are less than the average analyst estimate. CSX Corp slid -0.4% after saying it expects Tropical Storm Karen to cause shipment delays of 12 to 24 hours. Exxon Mobil Corp rose +1% after oil rallied as Karen threatened crude production in the Gulf of Mexico region.

Asian stocks fell as US lawmakers wrangled over the debt limit and partial government shutdown. The Nikkei 225 (-1.22%), Hang Seng (-0.71%) and the S&P/ASX 200 (-0.90%) all declined. Sun Hung Kai Properties Ltd declined -2.5% on a report the developer offered to sell units at a Hong Kong residential project at a discount. Sharp Corp sank -8.2% after saying it may price a share sale as early as today. Blumont and Asiasons resumed trading after the commodity investors were suspended after their shares plunged. Singapore’s bourse is prohibiting selling the companies’ stock unless they hold an equal quantity of equity and settle transactions in cash. Blumont had soared more than 1000% this year through September, prompting SGX to investigate. Blumont slumped -76%, extending a 56% decline on 4th October. The plunge also prompted the company to scrap a deal to buy Cokal Ltd. Asiasons tumbled -74% widening a 61% plunge on 4th October. Tokyo Electric Power sank -7.6% leading a decline among utilities.