London open
City sources predict FTSE 100 will open down 21 points from its previous close of 5,322.
Stocks to watch
Mining heavyweights BHP Billiton and Rio Tinto have further cemented the merger of their Western Australian iron ore assets by signing binding agreement on the proposed joint venture. The pair said today’s deal covers all aspects of how the joint venture will operate and be governed. They’ve filed submissions with the European Commission and the Australian Competition and Consumer Commission. The 50:50 tie-up should complete in the second half of 2010 and bring savings of about US$10bn a year.
A private equity group is sniffing around Shanks Group, the waste management firm, and could be prepared to pay 135p cash per share. The Shanks board, however, is holding out for at least 150p, after holding talks with its two largest shareholders. Shanks’s shares closed at 90.1p on Friday. It said the approach was ‘highly preliminary and unsolicited.’
Cadbury said it will publish its formal response to the unwelcome bid from Kraft Foods on 14 December. The UK confectionery firm said it noted the publication of the offer document from Kraft and said that under US securities law it is not allowed to publish any further information until after it has issued its formal response. A presentation for investors and analysts will be held at 10:30am on the 14th when the company will also give its regular pre-close trading update.
In the Press
Alistair Darling, chancellor, is preparing a crackdown on “extraordinarily high” bankers’ bonuses when he makes his pre-Budget report on Wednesday, but is expected to reject a windfall tax on bank profits. Mr Darling’s officials are in a race against time to draw up some form of supertax to curb what the chancellor fears will be a lavish bonus season, only months before a general election, the FT reports.
But the Chancellor will drive out the very people needed to create growth in Britain if he imposes hefty tax rises on the rich in the pre-Budget report (PBR), the business community has warned. Business groups including the British Chambers of Commerce (BCC) sounded the warning amid mounting expectations that Alistair Darling is contemplating a new 60% to 70% tax rate for those earning more than Ł500,000, as well as a windfall tax on banking bonuses, the Telegraph reports.
Shanks Group has received a Ł535m ($882m) unsolicited takeover approach from the Carlyle Group, the US private equity house, which is being supported by the waste management company’s biggest shareholder. The board of the FTSE 250 company, which raised Ł66.7m in a rights issue in May, discussed the approach at the weekend and was set to make a statement to shareholders on Monday. Carlyle made an approach worth 135p per share, which people close to the situation said was “highly preliminary,” the FT reports.
Joe Lewis, the flamboyant billionaire investor, is threatening to take legal action against Mitchells & Butlers (M&B) in an attempt to force the pub and restaurant operator to reinstate the two representatives of his Piedmont investment vehicle who were ousted last week from the company’s board. Piedmont, which has a 23% stake in M&B, will launch its fight back today against accusations by the All Bar One operator that it has been secretly trying to gain control of the company, the Times reports.
Newspaper tips
On Friday, Amec revealed its strategy for the next five years. Management aims to more than double earnings per share by 2015 to 100p, compared with the current 2009 consensus forecast of 46.4p. This implies an annual growth in earnings over the next five years of about 13%. The stance remains buy says the Sunday Telegraph.
Capping an extraordinary year for the group, FTSE is expected to confirm next week that Russian gold producerPetropavlovsk (formerly Peter Hambro Mining) is to enter the FTSE 100. At the close on Wednesday, the company's market capitalisation needs to be greater than the 90th largest company in the index. The group's expansion plans will grow production to 1m oz by 2012. The stance remains buy ahead of the index reshuffle on Wednesday, says the Sunday Telegraph.
The key thing for housebuilder Berkeley will be to nourish its landbank sufficiently to take advantage of any rise in the property market. However, Berkeley's recovery, more so than that of its peers, is pegged to a rebound in the fortunes of London as a financial centre. Analysts expect full year adjusted earnings per share of 57.3p, putting the shares on a full-looking 15 times forecast earnings. The recovery already looks to be priced in says the FT.
US close
US shares closed higher after a roller-coaster day sparked by much better than expected non-farm payroll numbers.
The Dow was lower at one point, having opened over 100 points higher, but finished 22 points better at 10,388. Nasdaq added 21 at 2,194 while the S&P gained 6 at 1,105.
The strength of the dollar was a major factor in the stock market retreat.It surged after the just 11,000 US jobs were lost last month, whereas the market had been expecting a 100,000 reduction. There was also surprise at a drop in the unemployment rate to 10% from 10.2%.
It appears that the more positive job market may be helping to fuel inflation. The Economic Cycle Research Institute's US Future Inflation Gauge (USFIG), which anticipates cyclical swings in the rate of inflation, rose to 95.7 from 93 in October. The October figure was revised upwards from 91.7. This is the eighth month in a row that the index has risen.
City sources predict FTSE 100 will open down 21 points from its previous close of 5,322.
Stocks to watch
Mining heavyweights BHP Billiton and Rio Tinto have further cemented the merger of their Western Australian iron ore assets by signing binding agreement on the proposed joint venture. The pair said today’s deal covers all aspects of how the joint venture will operate and be governed. They’ve filed submissions with the European Commission and the Australian Competition and Consumer Commission. The 50:50 tie-up should complete in the second half of 2010 and bring savings of about US$10bn a year.
A private equity group is sniffing around Shanks Group, the waste management firm, and could be prepared to pay 135p cash per share. The Shanks board, however, is holding out for at least 150p, after holding talks with its two largest shareholders. Shanks’s shares closed at 90.1p on Friday. It said the approach was ‘highly preliminary and unsolicited.’
Cadbury said it will publish its formal response to the unwelcome bid from Kraft Foods on 14 December. The UK confectionery firm said it noted the publication of the offer document from Kraft and said that under US securities law it is not allowed to publish any further information until after it has issued its formal response. A presentation for investors and analysts will be held at 10:30am on the 14th when the company will also give its regular pre-close trading update.
In the Press
Alistair Darling, chancellor, is preparing a crackdown on “extraordinarily high” bankers’ bonuses when he makes his pre-Budget report on Wednesday, but is expected to reject a windfall tax on bank profits. Mr Darling’s officials are in a race against time to draw up some form of supertax to curb what the chancellor fears will be a lavish bonus season, only months before a general election, the FT reports.
But the Chancellor will drive out the very people needed to create growth in Britain if he imposes hefty tax rises on the rich in the pre-Budget report (PBR), the business community has warned. Business groups including the British Chambers of Commerce (BCC) sounded the warning amid mounting expectations that Alistair Darling is contemplating a new 60% to 70% tax rate for those earning more than Ł500,000, as well as a windfall tax on banking bonuses, the Telegraph reports.
Shanks Group has received a Ł535m ($882m) unsolicited takeover approach from the Carlyle Group, the US private equity house, which is being supported by the waste management company’s biggest shareholder. The board of the FTSE 250 company, which raised Ł66.7m in a rights issue in May, discussed the approach at the weekend and was set to make a statement to shareholders on Monday. Carlyle made an approach worth 135p per share, which people close to the situation said was “highly preliminary,” the FT reports.
Joe Lewis, the flamboyant billionaire investor, is threatening to take legal action against Mitchells & Butlers (M&B) in an attempt to force the pub and restaurant operator to reinstate the two representatives of his Piedmont investment vehicle who were ousted last week from the company’s board. Piedmont, which has a 23% stake in M&B, will launch its fight back today against accusations by the All Bar One operator that it has been secretly trying to gain control of the company, the Times reports.
Newspaper tips
On Friday, Amec revealed its strategy for the next five years. Management aims to more than double earnings per share by 2015 to 100p, compared with the current 2009 consensus forecast of 46.4p. This implies an annual growth in earnings over the next five years of about 13%. The stance remains buy says the Sunday Telegraph.
Capping an extraordinary year for the group, FTSE is expected to confirm next week that Russian gold producerPetropavlovsk (formerly Peter Hambro Mining) is to enter the FTSE 100. At the close on Wednesday, the company's market capitalisation needs to be greater than the 90th largest company in the index. The group's expansion plans will grow production to 1m oz by 2012. The stance remains buy ahead of the index reshuffle on Wednesday, says the Sunday Telegraph.
The key thing for housebuilder Berkeley will be to nourish its landbank sufficiently to take advantage of any rise in the property market. However, Berkeley's recovery, more so than that of its peers, is pegged to a rebound in the fortunes of London as a financial centre. Analysts expect full year adjusted earnings per share of 57.3p, putting the shares on a full-looking 15 times forecast earnings. The recovery already looks to be priced in says the FT.
US close
US shares closed higher after a roller-coaster day sparked by much better than expected non-farm payroll numbers.
The Dow was lower at one point, having opened over 100 points higher, but finished 22 points better at 10,388. Nasdaq added 21 at 2,194 while the S&P gained 6 at 1,105.
The strength of the dollar was a major factor in the stock market retreat.It surged after the just 11,000 US jobs were lost last month, whereas the market had been expecting a 100,000 reduction. There was also surprise at a drop in the unemployment rate to 10% from 10.2%.
It appears that the more positive job market may be helping to fuel inflation. The Economic Cycle Research Institute's US Future Inflation Gauge (USFIG), which anticipates cyclical swings in the rate of inflation, rose to 95.7 from 93 in October. The October figure was revised upwards from 91.7. This is the eighth month in a row that the index has risen.
Sector Risers
| Name | Value | % Change |
|---|---|---|
| Pharmaceuticals & Biotechnology | 8,797.18 | +2.2% |
| Automobiles & Parts | 2,627.99 | +1.7% |
| Beverages | 8,094.54 | +1.6% |
| Tobacco | 23,809.78 | +1.6% |
| Mobile Telecommunications | 3,281.96 | +1.5% |
Sector Fallers
| Name | Value | % Change |
|---|---|---|
| Mining | 20,648.01 | -2.1% |
| Industrial Metals | 5,006.36 | -1.3% |
| Construction & Materials | 3,267.26 | -1.0% |
| Life Insurance | 3,883.21 | -0.8% |
| Oil Equipment & Services | 15,460.58 | -0.8% |
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