UK/Euro Financial Market Daily Evening Briefing 21-06-2007

£159,906 Profit from TradeWin's bespoke share trading software.
Click here to find out more.

London shares close lower amid ongoing interest rate concerns; NY lower
 
UK blue chips closed lower today having spent much of the afternoon tracking Wall Street which was unsettled by rising oil prices and mixed economic data, but overall was subdued amid ongoing interest rate concerns at home.
   
At the close, the FTSE 100 index was 53.3 points weaker at 6,596, back below the 6,600 level, while all the broader FTSE indices finished lower.  Volume was fairly heavy, with 3.5 bln shares changing hands in 620,638 trades.
   
On Wall Street, by London's close, the DJIA was was 10.2 points lower at 13,479.3, with the Nasdaq composite index down 0.05 points at 2,599.91.
   
US stocks initially pushed lower as oil prices rose, approaching 70 usd a barrel, and with the publication of slightly disappointing weekly jobless data, but recovered slightly with the release of better-than-expected leading indicators.
   
In London, DSG International shares topped the FTSE 100 casualty list at the close, down 6.7 pence at 162.8, extending yesterday's decline after disappointment over its full-year results and news that it would not be bidding to take control of Russian retailer El Dorado.
  
Elsewhere, chemicals group ICI shed 9-1/2 pence to 624-1/4 after being downgraded to 'underweight' from 'neutral' by JP Morgan with a maintained price target of 450 pence.
   
The broker pointed out that following on from ICI's rejection of Akzo Nobel's 600 pence bid offer last weekend, the UK firm's share price already discounts a significantly higher offer.
   
Elsewhere, Segro shares dropped, down 17 pence to 655, on profit taking after a recent speculative run.
   
Among the handful of blue chip risers, at the close Standard Chartered was at the top of the FTSE 100 leaderboard, up 17 pence at 1,675, after JP Morgan upgraded the group to 'overweight' from 'neutral' this morning along with price target upgrades from UBS and HSBC.
   
UBS said that based on organic growth of no lower than 18 pct and given the company's conservative approach to guidance it believes the group is set to deliver revenues of around 10 bln usd in 2007 which is top of the Thomson Financial/IBES consensus estimates.

Lafite 1998:  06-07.. +91%  v  House Price Index:  06-07..  +7%
Latour 1996: 06-07.. +72%  v  Dow Jones:  06-07..  +14%
Liv-ex 100:   06-07.. +45%  v  Ftse 100:  06-07..  + 9%
CGT - 0% vs CGT- 40%

Source: The Times, December 2006. Free Information Pack Click Here

Turning to the midcaps, Weir Group finished as the top FTSE 250 riser, jumping over 10 pct in value with a 67-1/2 pence advance to 701-1/2 as investors welcomed the engineering company's planned 653 mln usd acquisition of SPM Flow Control, a US manufacturer of high pressure well service pumps and related flow control equipment.
   
In reaction, Bridgewell Securities said the deal affords Weir an increased presence in high-growth upstream oil markets and increases its aftermarket service offering. The broker maintained its 'overweight' rating.
   
Keller Group was also a strong mid cap riser, up 37 pence at 1,054, after a strong trading update today. The ground engineering specialist said that trading in the first five months of 2007 had been "excellent", with continued strong sales and an improvement in margins.
   
Keller said it now expects interim results to be ahead of last year's "very strong" first half. In response, Altium Securities increased its price target to 1,150 pence from 1,100 and repeated its 'add' rating.
   
Elsewhere Go-Ahead Group took on 41 pence to 2,435 after the Department for Transport announced that it has awarded a new West Midlands rail franchise to the transport group.
   
Go-Ahead beat off competition from Serco NedRailways West Midlands Limited, a joint venture between Serco Group and NedRailways, the British arm of Dutch state railways.
   
On the downside, Biffa ended down 8-3/4 at 285-1/2, with Morgan Stanley understood to be placing 22.8 mln shares in the waste management firm via an accelerated book-build in a price range of 280-285 pence.
   
And London Stock Exchange shares dropped 13 pence to 1,353-1/2 after the group confirmed after the close last night that it is in merger talks with Borsa Italiana, the owner of Milan's stock exchange.
   
Finally, British Energy fell back 9-1/2 pence to 543-3/4 after Deutsche Bank reduced its price target on the company to 660 pence from 700 pence.
   
Deutsche Bank said it saw lower power prices and lower output for British Energy. The broker said lower output reflected delayed restarts at Hinkley Point and Hunterston. The broker said it was reducing its 2007-08 earnings per share forecast to 39.5 pence from 48.9, and its 2008/09 forecast to 51 pence from 58.3.

Use our professional platform to trade on margin and trade tax free. Speculate on Oil, Gold, Foreign Exchange, Worldwide Indices, Equities and Options. Go long or short on all our markets. Click here.

For a diary of key financial and corporate events in the UK this week, click here

UK Small Cap Report

For a summary of today's trading on the FTSE 250 and the AIM, click here

Paris

Paris shares close down as interest concerns, oil prices weigh
 
The CAC-40 index finished down 63.50 points or 1.04 pct at 6,029.79 on volume of 7.7 bln eur. Among CAC-40 stocks, 4 closed higher and 36 closed lower.  On the Matif, July CAC-40 futures were trading down 44.0 or 0.72 pct at 6,060.5. On the broader indices, the SBF-80 index closed down 75.19 or 1.03 pct at 7,235.93 while the SBF-120 closed at 4,396.78, down 46.22 or 1.04 pct.
   
In the US, the 10-year Treasury note's yield soared to 5.15 pct late Wednesday from 5.09 pct late Tuesday, reigniting fears that high rates could restrain M&A activity and further harm the struggling housing market.
   
Light, sweet crude oil, meanwhile, rose 69 cents to 69.55 usd per barrel on the New York Mercantile Exchange as a general strike in Nigeria -- Africa's largest crude oil producer -- began to weigh on the market.
   
EDF shrugged off the general downward trend, continuing yesterday's surge to close up 2.52 eur or 3.40 pct at 76.62.
   
UBS analysts today raised their target for EDF to 100 eur from 80, while their counterparts at Societe Generale upped their own target to 88 eur from 66.
   
The brokers underlined EDF's strong position with regards to tightening carbon-emissions regulations, thanks to a large nuclear capacity, with UBS noting that EDF's emissions are only a fifth of the sector average.
   
UBS also said it expects the government will move to sell off 7-8 pct of EDF in early September, adding to market speculation from yesterday.
   
EDF shares climbed 3.95 pct on Wednesday, helped also by Areva's announcement that it has begun the pre-licensing process for its European Pressurised Water Reactor (EPR) project in the UK and will work with EDF should the project be approved.
   
Also sharply up was mining group Eramet, which ended the day on gains of 11.48 or 5.86 pct at 207.48. A dealer in Paris said the group is "a world leader in raw materials," and is benefiting from positive investor sentiment on the sector sparked by high commodity prices.

Move to Selftrade and enjoy fast, efficient dealing with connections to over 18 online market makers. Deal in shares, funds, gilts, corporate bonds, covered warrants and Listed CFDs. All trades a flat £12.50. Click here for more information.

Construction stocks were generally out of favour amid renewed interest rate worries, with Bouygues shedding 1.80 or 2.79 pct to end the day at 62.68 and Lafarge slipping 1.94 or 1.45 pct to 131.50.
   
Property stocks were also hard hit by the interest rate worries, as Klepierre ended the day down 4.14 or 3.11 pct at 128.95 and Kaufman & Broad fell 0.46 or 0.79 pct to 57.49.
    
Unibail Holding, meanwhile, dropped 3.53 or 1.80 pct to 193.07. The property group saw profit-taking after it announced that its merger with Rodamco Europe NV had been successfully concluded, with 80 pct of Rodamco investors' shares tendered.
   
The companies said the merger will become effective on June 25, with the new company to be called Unibail-Rodamco and having a 21 bln eur pro forma market capitalisation.
   
Banking stocks were also under pressure from interest rate concerns, with BNP Paribas down 1.52 or 1.67 pct at 89.58, Societe Generale 2.12 or 1.48 pct lower at 141.18, Credit Agricole shedding 0.17 or 0.56 pct to 30.34.
   
Secondliner Natixis was particularly hard hit, ending the day at 18.40, down 0.43 or 2.28 pct. Other falling shares included Rhodia, which tumbled 0.15 or 5.15 pct to finish at 2.76.
   
Earlier today, stock market regulator AMF said it has imposed a fine of 750,000 on French chemicals maker Rhodia for "inaccurate, imprecise and misleading" financial statements, and is seeking a 500,000 eur fine from Jean-Pierre Tirouflet, former Rhodia chairman
   
A local dealer said Rhodia was definitely reacting to the news, although he added that the sharp fall was "perhaps a bit severe."
   
Elsewhere among chemical stocks, Sanofi-Aventis ended down 0.88 or 1.43 pct at 60.77, extending yesterday's losses caused by setbacks to its Acomplia obesity treatment.
   
After a brief rally Tuesday on the widely expected news that it has won a US court case to protect its Plavix patent, doubts over Acomplia came back into view yesterday with the news that a German court has rejected Sanofi's challenge to the non-reimbursement of the drug by Germany's health ministry.
   
The stock has also edged down on renewed talk that it may launch a bid for Bristol-Myers Squibb, which would be dilutive for Sanofi shares.
   
LVMH was ahead of the market, inching down 0.23 or 0.27 pct to 85.15 after it confirmed it is in talks with Pearson to buy business daily Les Echos. LVMH added that the works council of rival La Tribune, which LVMH already owns, will be convened "to analyse the consequences".
   
LVMH was also cited in a report in business weekly Challenges, which claimed that it is one of three companies, along with PPR and L'Oreal, to have shown interest in cosmetics group Clarins.
   
The report sent Clarins shares up 2.46 or 3.78 pct to end at 67.46. Similar speculation sent the stock up sharply in March after the death of founder Jacques Courtin-Clarins was announced, with analysts saying it could be a target for major players.

Projected ROI of between 7-8% in this World renowned resort in St Lucia

Superb buy to let opportunity that allows you to enjoy the benefits of a holiday resort, with a share of room profits.  For more information click here.

German shares close at 1-week low on interest rate fears, oil prices

The DAX was down 125.78 points, or 1.55 pct, at 7,964.71, having traded between 7,905.18 and 8,060.64. The MDAX lost 187.52 points or 1.68 pct to 10,965.81, while the TecDAX was down 15.29 points or 1.63 pct at 922.07 points. DAX futures were 25.50 points or 0.32 pct lower at 8,043.00, while bund futures were unchanged at 110.19.
     
Automotive stocks were a weak feature, with truckmaker MAN slumping 3.26 eur or 2.94 pct to 107.44 eur and DaimlerChrysler falling 1.56 eur or 2.25 pct to 67.62 eur. BMW was down 1.05 eur or 2.13 pct at 48.33 eur and Volkswagen fell 2.04 eur or 1.77 pct to 113.25 eur.
   
Fresenius Medical Care dipped 0.91 eur, or 2.60 pct, to 34.11 eur, correcting from recent gains.
   
Deutsche Boerse dropped 1.53 eur or 1.77 pct to 84.90 eur after WestLB cut its stance on the German exchange operator and maintained a 82 eur per share target, saying that its shares are likely to suffer from a 5 pct downside.
   
Bucking today's negative trend, Infineon shares added 0.15 eur or 1.18 pct to 12.81 eur as the DAX index's only gainers, after the chip maker was seen to benefit from rising dynamic random access memory, or DRAM, prices.
       
Metro eased 0.04 eur or 0.06 pct to 62.37 eur after traders said the stock appeared to be benefiting from higher valuations in the retail sector following reports that peer Karstadtquelle AG offered to buy retailer Rewe Group's tourism business.
       
Over on the MDAX, GAGFAH fell 0.72 eur or 4.09 pct to 16.89 eur as the sharpest decliner.
   
Premiere lost 0.57 eur or or 3.23 pct to 17.05 eur after the pay-TV provider's chief financial officer said that the company won't be able to make its goal of sales of 300 eur per customer in the short-term.
   
MLP was down 0.38 eur or 2.47 pct at 14.99 eur after the financial services provider said chief financial officer Nils Frowein resigned from his post "in friendly agreement", effective June 30.
   
Douglas was one of only two stocks that ended the session in positive territory, closing 0.08 eur or 0.16 pct higher at 48.93 eur. Praktiker was up 0.03 eur or 0.10 pct at 29.89 eur.
   
Tecdax-listed Solarworld was the weakest performer on the index, down 2.22 eur or 3.26 pct at 65.81.
   
On the other end, Carl Zeiss Meditec gained 0.21 eur or 1.31 pct to 16.22 eur.

Save up to 50% on Jermyn Street style shirts and accessories, from silk ties to silver cufflinks, by shirt-maker Joseph Turner.
Click Here

Amsterdam shares close lower tracking Wall Street; Fortis rises

The AEX closed 1.60 points or 0.29 pct lower at 550.54, after trading in a range of 547.22-551.69. Government bonds traded mixed while the euro stood at 1.3398 usd versus 1.3418 usd late yesterday.
   
One of the few gainers was Fortis, which rose 0.84 pct to 31.05 eur, leading gainers after WestLB upgraded the stock to 'buy' from 'hold'.
   
Another gainer was TNT, which added 0.37 pct to 32.90 eur amid news that it is to join a mail delivery joint venture in Germany. TomTom put on 0.05 pct to 38.08 eur after it said it bought the patents porftolio of Horizon Navigation.
   
Aside from Fortis, all other financials ended lower. ABN Amro shed 0.62 pct to 35.15 eur, ING lost 0.71 pct to 33.42 eur and Aegon dropped 0.72 pct to 15.14 eur.
   
Philips lost 0.35 pct to 31.67 eur, Randstad shed 0-.50 pct to 58.26 and Akzo Nobel lost 0.68 pct to 62.72 eur while DSM ended 1.08 pct lower at 36.80 eur.
   
KPN shed 1.43 pct to 12.37 eur, Vedior lost 1.46 pct to 22.33 and Heineken dropped 1.54 pct to 42.93 eur.
   
Among midcap shares, ASMI added 1.36 pct to 20.15 eur amid a surge in spot prices for DRAM memory chips, while Van der Moolen put on 0.52 pct to 3.85 eur after it said it expanded its majority stake in its Specialists subsidiary.
   
Fugro edged 0.17 pct higher at 46.75 eur after ING upped its price target on the stock to 53 eur.
   
Aalberts shed 2.94 pct to 20.27 eur, Wereldhave lost 1.94 pct to 101.54 eur, Boskalis shed 2.02 pct to 29.05, Corio dropped 2.29 pct to 60.10 and SNS Reaal led decliners, shedding 2.58 pct to 17 eur.
   

Closing Forex Rates

ADVFN Services