Friday, February 14, 2014


Market Comment

US indices rose on Thursday led by shares in the Utilities, Semiconductors & Semiconductor Equipment and Consumer Durables & Apparel sectors. The S&P 500 (1829.83) remains above its 20d moving average (1800.2 - negative slope) and its 50d moving average (1810.4 - flat slope).

European markets are expected to open on a flat note.

Foreign Exchange

US Dollar was under pressure against most of its major counterparts on Thursday. On the US economic data front, retail sales advance fell 0.4% MoM in January (flat expected) after a downwardly revised 0.1% decline the previous month. Initial jobless claims rose to 339K (330K expected and 331K prior) in the week ended February 8th.

The Euro was firm against its major counterparts. In Europe, CPI in Germany rose by 1.3 percent in January 2014 over the same period in the previous year.


After the close of Wall Street, WTI Crude Future (MAR 14) was about flat to $100.29. The contract was above its 20D MA (@ $95.67) and above its 50D MA (@ $96.35).

Gold was up $11 to $1302.1. The precious metal was above its 20D MA (@ $1262) and above its 50D MA (@ $1241).

Copper Future (MAR 14) on Comex was about flat to 325.05c/lb. The contract was below its 20D MA (@ 330.62c) and below its 50D MA (@ 326.76c). In Europe, the London Metal Exchange reported its copper inventories decreased 1375 tons to 300675 tons.

UK Market News

Anglo American reported that FY13 net loss narrowed to $961M from $1.5B in the previous year (LPS down to $0.75 from $1.17), pointing out: "The effects of such a difficult macro-economic environment were exacerbated by operating challenges at key operations and adversarial labour relations in South Africa. Despite the challenges, significant operating improvements in Copper, Metallurgical Coal and Diamonds in the second half of the year and the sharp fall in the South African rand in the final quarter, drove a 6% increase in underlying operating profit to $6.6B, with underlying EBITDA increasing to $9.5B, up by 7%. (...) underlying earnings decreased by 7% to $2.7B. (...) the Board has recommended to maintain the final dividend of 53 US cents per share, giving a total dividend of 85 US cents per share for the year (2012: 85 US cents per share)." Further, the Co said: "Supply growth in the near to medium term poses challenges to the prices of some global commodities, most notably iron ore and copper. However, in the long term, prices for Anglo American's products are expected to be supported by supply constraints in many jurisdictions and the challenges producers face in bringing new supply into production. Economic uncertainty, as we are seeing currently, tends to restrain new supply; in the longer term Anglo American therefore expects to see tightening market fundamentals and a recovery in price performance to support further margin improvement and returns."

Vodafone said its India unit has acquired spectrum licences in 11 telecom circles in the Indian government's 900 MHz and 1800 MHZ spectrum auction for appx. £1.9B.

Coca-Cola HBC posted FY13 comparable net income up 3% YoY to E293M (EPS up to E0.81 from E0.78) and comparable EBIT flat at E454M on sales of E6.9B, down 2%. The Co proposed raising dividend to E0.354 per share from E0.340 in the previous year.

European Markets

ECB: Keynote speech by Yves Mersch at the Institute of International European Affairs in Dublin, Ireland. (11am local time)
Automobiles & Parts: Continental (+1.21% to E167) and Rheinmetall AG (+0.98% to E50.66) closed at a 3-month relative high against the Dax.

Construction & Materials: Hochtief (-1.05% to E60.07) reached a new 3-month relative low against the Dax.

Industrial Goods & Services: MTU Aero Engines (-2.26% to E62.3) closed at a 3-month relative low against the Dax.

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