Article / 28 April 2014 at 16:35 GMT

Market Review: Markets cheer a surge in corporate deals

Saxo Capital Markets UK
United Kingdom

Forex: USD trading mostly lower
Currencies Intraday











Source: Bloomberg

The USD is trading lower against most of its major peers. Traders mostly overlooked today’s data indicating a more than expected rise in the US pending home sales in March, as concerns over the nation’s housing sector persisted after data released last week showed a sharp drop in new home sales and a modest drop in existing home sales. Going forward, all attention will be on the outcome of the US Federal Reserve’s monetary policy meeting, non-farm payrolls and the preliminary reading of the nation’s first quarter economic growth scheduled later this week. Further, tomorrow’s Eurozone business climate data, German and French consumer confidence and the UK preliminary gross domestic product data will attract market attention. Meanwhile, geopolitical tensions in Ukraine will continue to sway market sentiment. The EUR is trading 0.4 percent and 0.1 percent higher against the JPY and the USD, respectively, while it is trading flat against the GBP.

UK Stocks: End mostly higher
FTSE 100 Intraday











Source: Bloomberg

UK stocks closed in the green buoyed by merger and acquisition news from the region.

The FTSE 100 gained 0.2 percent to close at 6700.2 and the FTSE 250 shed 0.4 percent to settle at 15826.2.

AstraZeneca (AZN) soared 14.4 percent after Pfizer confirmed that it is still interested in taking over the company. Sector peers, Shire (SHP) added 2.4 percent, while GlaxoSmithKline (GSK) slid 0.1 percent.

Premier Oil (PMO) added 0.8 percent after it announced oil and gas discoveries in Indonesia and Pakistan. Ophir Energy (OPHR) lost 0.8 percent as investors reacted to Premier Oil’s decision to reject its merger proposal.

Insurers, Resolution (RSL) and RSA Insurance (RSA) gained 1.2 percent and 1 percent, respectively.

On the downside, mining sector stocks, Rio Tinto (RIO), Glencore Xstrata (GLEN) and BHP Billiton (BLT) declined between 1.1 percent and 2.8 percent, tracking losses in the base metal prices.

US Stocks: Trading in positive territory
Dow Jones Intraday











Source: Bloomberg

US stocks are trading in the green as investors cheered upbeat macroeconomic data.

The Dow Jones has risen 0.5 percent to trade at 16451.3 and the S&P 500 has climbed 0.6 percent to trade at 1873.7.

Pfizer (PFE) has gained 4.7 percent after the company confirmed media reports that it has made a renewed takeover approach to acquire AstraZeneca.

Roper Industries (ROP) has jumped 7 percent after reporting stronger than expected first quarter earnings and raising its full year earnings outlook.

Ford Motor Company (F) has advanced 1.1 percent after a broker raised its rating on the stock to buy from hold.

On the flipside, Newmont Mining Corporation (NEM) has slumped 6.2 percent after it ended merger talks with Barrick Gold.

Bank of America (BAC) has declined 4.8 percent after the lender stated that it will suspend its share buyback program and dividend increase.

European Stocks: Close in the green
EU Stoxx50 Intraday











Source: Bloomberg

European markets finished higher after the recent increase in merger activity lifted investors’ sentiment.

The DAX rose 0.5 percent to end at 9446.4 and the CAC advanced 0.4 percent to close at 4460.5.

Bayer AG (BAYN) climbed 3.3 after posting first quarter profit that surpassed market expectations and following news that it is considering the sale of its USD 10 billion plastics unit, Bayer Material Science.

Mologen AG (MGN) gained 1.3 percent after it revealed positive phase I clinical trial results for its cancer drug, MGN1703.

Medigene AG (MDG1) advanced 4.6 percent after it received a US patent for TCR-modified T cell immunotherapy.

On the contrary, Meda AB (MEDAA) tumbled 7.8 percent after it rejected a second takeover bid from Mylan.

Alfa Laval AB (ALFA) dropped 5.4 percent after the company posted lower than expected first quarter pre-tax profit.

Sandvik AB (SAND) lost 0.3 percent after a broker cut its rating on the stock to hold from buy, citing pressure on its profit margins.

Asia: Asia: Indices end mostly in the red
Nikkei 225 Intraday











Source: Bloomberg

Asian markets finished mostly lower amid some disappointing corporate earnings reports and concerns that western nations might impose further sanctions on Russia in wake of heightened tensions in Ukraine.

In Japan, Japan Exchange Group (8697) and Honda Motor (7267) declined 6.2 percent and 4.5 percent, respectively, after both the companies forecast full year profit that trailed market estimates. Japan Display (6740) tumbled 15.9 percent after it reduced its full year profit estimate. On the upside, NTT DOCOMO (9437) rose 3.7 percent after it announced plans to buy back about JPY 500 billion worth of its shares. Koito Manufacturing (7276) soared 14.6 percent after it posted upbeat full year profit. The Nikkei 225 index dropped 1 percent to end at 14288.2.

In China, China Life Insurance (601628) declined 2.8 percent after posting a drop in its first quarter net income. In Hong Kong, Sands China (1928) retreated 3.3 percent following a report that the Japanese parliament might not pass a bill during this session to allow casinos in the nation. In South Korea, Pan Ocean (028670), CosmoAM&T (005070) and Dongbu Steel (016380) tumbled between 5.3 percent and 10.8 percent, featuring among the major laggards on the KOSPI Index.

Commodities: Trading lower

The Gold futures contract is trading 0.6 percent lower at USD 1293.1 per ounce as market participants speculated that ongoing tension in Ukraine might be shot-lived.

The Brent crude one-month futures contract is trading 0.9 percent lower at USD 108.6 per barrel following a report that Libya may soon reopen some small oil ports.

Macro Update

  • US pending home sales rises more than anticipated in March
  • US Dallas Fed manufacturing activity index expands more than expected in April

Economic Calendar

Country

GMT

Economic Indicator

Relevance

Consensus/*Actual

Previous/ **Previous Est.

Frequency

China

-

Leading Index (Mar)

Medium

-

99.07

Monthly

Germany

6:00

Gfk Consumer Confidence Survey (May)

Medium

8.50

8.50

Monthly

France

6:45

Consumer Confidence (Apr)

Low

88.00

88.00

Monthly

Spain

7:00

Unemployment Rate (Survey) (Q1)

Low

25.85%

26.03%

Quarterly

Eurozone

8:00

Private Loans (YoY) (Mar)

Low

-2.10%

-2.20%

Monthly

Eurozone

8:00

M3 Money Supply (YoY) (Mar)

Low

1.40%

1.30%

Monthly

Eurozone

8:00

M3 Money Supply (3m) (Mar)

Low

1.30%

1.20%

Monthly

Italy

8:00

Retail Sales n.s.a (YoY) (Feb)

Low

-

-0.90%

Monthly

Italy

8:00

Retail Sales s.a. (MoM) (Feb)

Low

0.40%

0.00%

Monthly

UK

8:30

Gross Domestic Product Prelim (YoY) (Q1)

Medium

3.20%

2.70%

Quarterly

UK

8:30

Gross Domestic Product Prelim (QoQ) (Q1)

Medium

0.90%

0.70%

Quarterly

UK

8:30

Index of Services (3M/3M) (Feb)

Low

0.90%

0.90%

Monthly

UK

8:30

Index of Services (MoM) (Feb)

Low

0.30%

0.40%

Monthly

Eurozone

9:00

Consumer Confidence Final (Apr)

Medium

-8.70

-8.70**

Monthly

Eurozone

9:00

Industrial Confidence (Apr)

Low

-3.10

-3.30

Monthly

Greece

9:00

Producer Price Index (YoY) (Mar)

Low

-

-3.50%

Monthly

Italy

9:00

Business Confidence (Apr)

Low

99.50

99.20

Monthly

Germany

12:00

Harmonised Index of Consumer Prices Prelim (YoY) (Apr)

High

1.30%

0.90%

Monthly

Germany

12:00

Harmonised Index of Consumer Prices Prelim (MoM) (Apr)

Medium

-0.10%

0.30%

Monthly

Germany

12:00

Consumer Price Index Prelim (YoY) (Apr)

Medium

1.40%

1.00%

Monthly

Germany

12:00

Consumer Price Index Prelim (MoM) (Apr)

Medium

-0.10%

0.30%

Monthly

US

12:55

Redbook Index (YoY) (18-Apr)

Low

-

3.70%

Weekly

US

12:55

Redbook Index s.a. (MoM) (18-Apr)

Low

-

-0.50%

Weekly

US

13:00

S&P/Case-Shiller Composite-20 (YoY) (Feb)

Low

13.00%

13.24%

Monthly

US

13:00

S&P/Case-Shiller 20 City s.a. (MoM) (Feb)

Low

0.65%

0.85%

Monthly

US

13:00

S&P/Case-Shiller Home Price Index (Feb)

Low

-

165.50

Monthly

US

14:00

Consumer Confidence (Apr)

High

83.00

82.30

Monthly

Eurozone

14:00

Business Climate Indicator (Apr)

Medium

0.40

0.39

Monthly

Eurozone

14:00

Services Sentiment Indicator (Apr)

Low

4.50

4.20

Monthly

Eurozone

14:00

Economic Sentiment Indicator (Apr)

Low

103.00

102.40

Monthly

For more events see TradingFloor.com's real-time financial calendar

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