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Markets: FTSE 100 shakes off torpor on Tuesday

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Interactive Investor's Market Report brings you bite-sized news covering all the day's FTSE and AIM announcements, the latest on commodities, global and domestic economics, gold, oil and currencies as well as US markets. Updated throughout the day, it's the digest you can't afford to miss.

Last updated: 17:05

UK markets: Tuesday's close

The FTSE 100 (UKX) managed to reverse its bad fortunes and close in the black after a German newspaper revealed Greece would get funds to fill the gap in the two-year expansion of its debt-reduction programme agreed by the EU.

However, Angus Campbell, head of market analysis at Capital Spreads, noted that nothing formal had been decided, saying: "There's a danger that we will see the usual sort of fudge from the EU and investors will end up being disappointed once more, so it looks like we will have to wait to hear next week."

London's blue-chip index closed at 5786.25, 18.98 points higher. ITV (ITV) added 9%, while Anglo American (AAL) lost 3%.

On the AIM front, African Medical Investments () plummeted 47%. Shares in Connemara Mining (CON) surged 21%.

Vodafone Group (VOD) was the most actively-traded stock by users of Interactive Investor.

"You've only got to look at a short-term chart to realise that the near-term trend has a distinctly bearish bias and we've got some way to go in order to break those downward-sloping trend lines," Campbell pointed out. "It looks like it's going to need a great deal from EU politicians to put investors' minds at rest."

At a glance...

Currencies Commodities
GBP/USD: 1.5884 Gold: $1,729.45
GBP/EUR: 1.2491 WTI crude oil: $85.45
EUR/USD: 1.2715 All changes from 09:00 GMT.






US markets: 16:40 update

Markets across the Atlantic were trading on a mixed note as signs of improvement in the US housing sector helped offset anxiety about the failure of euro-area leaders to agree on how Greece would pay its debt.

The Dow Jones added 55 points to 12870. The S&P 500 climbed six points to 1386. However, Nasdaq bucked the trend with a one-point fall to 2903.

Vodafone hit by eurozone weakness

Vodafone Group's (VOD) Italian and Spanish arms have dragged the telecommunications company into a six-month loss.

Even with a very healthy $8.5 billion (£5.4 billion) extra dividend from its 45% stake in Verizon, Vodafone posted a first-half loss of £1.98 billion. The substantial drop from last year's £6.68 billion profit saw Vodafone shares fall more than 3.5%.

Orsu Metals announces joint venture

Orsu Metals () jumped 10% on news that it had been granted the exclusive right to form a joint venture in Kazakhstan, while Forte Energy (FTE) commenced drilling in Mauritania.

Read: Tuesday's mining news, to see what they, and four other mining companies had to say.

BP settles AAR dispute

Oil giant BP (BP.) and AAR, joint shareholders in TNK-BP, have announced that they have reached a comprehensive agreement to settle all outstanding disputes between them, including the current arbitrations brought by each against the other.
The agreement includes an immediate waiver of the new opportunities provision in the TNK-BP shareholder agreement, allowing each party to explore new opportunities and partnerships in Russia and the Ukraine, effective immediately.
The parties have agreed to work constructively together with each other and with Rosneft to progress their respective disposals of their shareholdings in TNK-BP.

UK markets: 15:00 update

The FTSE 100 (UKX) continued to linger in the doldrums as Tuesday wore on, losing 35 points to 5732.

Vodafone Group (VOD) was left holding the wooden spoon, down nearly 4%. ITV (ITV) maintained its better form, adding almost 7%.

On AIM, shares in African Medical Investments () plunged 41%. Tyratech (TYR) surged 22%.

At a glance...

Currencies Commodities
GBP/USD: 1.5876 Gold: $1,722.28
GBP/EUR: 1.2511 WTI crude oil: $84.73
EUR/USD: 1.2690 All changes from 09:00 GMT.






US markets: Tuesday's open

Wall Street opened on a negative note on Tuesday, with sentiment dented after eurozone leaders failed to agree on the release of the latest round of aid for Greece and as fiscal cliff worries remained at the fore for investors.

Much of the risk aversion surrounded uncertainty about whether US politicians could reach a deal to keep more than $600 billion (£378 billion) in automatic tax rises and spending cuts from taking effect in January.

The Dow Jones slipped 38 points to 12777. The Nasdaq declined 20 points to 2884, while the S&P 500 trudged down six points to 1374.

House prices slip in September

House prices fell 0.2% month-on-month in September, according to the Office for National Statistics (ONS).

"The modest drop in house prices in September reported by the ONS ties in with our view that there are still significant downside risks to the house price outlook and they could well drift a little lower over the winter months," commented IHS Global Insight's Howard Archer.

However, he stated that some support for house prices should come from recent decent employment growth and likely extended low interest rates, while mortgages look like become increasingly available. helped by the "Funding for Lending" scheme launched at the start of August by the Bank of England.

Persimmon unveils interim management statement

Persimmon (PSN) has released an interim management statement, with sales rates, pricing and margins ahead year-on-year.

Sales rates were running 4% ahead in the second half to date, a small slowdown from the 5% seen in August. Selling prices continued to improve on mix, while margins were said to have continued to improve in the second half, with the group confident of achieving a medium-term margin of between 15% and 17%. Additionally, Persimmon had £508 million of forward sales in hand, up 5% year-on-year.

From an income perspective, Panmure Gordon's Rachael Applegate said the stock continues to have attractions, pointing out that the group is due to pay 75p per share to shareholders in June 2013 as part of a programme of cash returns. This implies a yield of 9.8% at current levels. However, from a valuation perspective, she added that the stock was up with events. She thus rated it a 'hold'.

Greece scrapes enough for Friday's treasury bill payments

Greece has managed to sell €4.06 billion (£3.24 billion) worth of treasury bills, making it possible for Athens to pay almost all of the €5 billion of old treasury bills, which are due for payment on Friday. The remaining €940 million will be raised over the next few days.

Greece needed to raise the money this way because it has not yet received the next tranche of its bail-out loans.

While eurozone ministers agreed on Monday to give Greece two more years, until 2016, to meet its deficit-reduction targets, they delayed a decision on releasing the latest €31.5 billion tranche of bail-out funds. The ministers will meet again on 20 November to discuss releasing the latest instalment.

Gas-fixing scandal makes headlines

Wholesale gas prices have been manipulated, according to whistle-blower Seth Freedman; an accusation that has been denied vehemently by all of UK's big six energy suppliers.

Energy companies buy gas at the wholesale price and then sell it on to businesses and domestic users. It has been claimed that on 28 September, dealers made unrealistic bids, at the time when information was being gathered to set the wholesale gas price, to suit their own trading position.

The allegation is that the market was rigged in a similar way to the fixing of Libor, the inter-bank lending rate.

The Financial Services Authority (FSA) said: "We can confirm that we have received information in relation to the physical gas market and will be analysing the information."

Regulator Ofgem also said it had "received information" and added that it would "consider carefully any evidence of market abuse that is brought to our attention as well as scope for action under all our other powers". However, neither the FSA or Ofgem identified any companies.

Afren posts record sales revenues

Afren (AFR) confirmed it was on track to realise over a billion dollars of net operating cash flow in 2012 as it released its nine-month results. It wasn't all good news in the oil and gas sector though, as Salamander Energy (SMDR) shares dropped on news that the B8/38-8 exploration well, offshore Gulf of Thailand, was being plugged and abandoned as a sub-commercial oil discovery.

For our round-up, read: Tuesday's oil and gas news.

UK markets: Midday update

Red screens were dominant on Tuesday as the FTSE 100 (UKX) showed a decisive risk-off attitude.

London's leading share index declined 36 points to 5731.

Vodafone Group (VOD), the most actively-traded stock by users of Interactive Investor, led the blue chips downwards, slipping almost 4.5%. ITV (ITV) jumped 8%.

On the AIM front, shares in Scotty Group (SCO) soared 40%, while African Medical Investments () lost almost half its market cap.  

"[Monday's] news that the Troika had approved Greek politicians' austerity efforts, granting them another two years of fiscal assistance, has done little this morning to lift the sense of pessimism that traders feel when discussing Greece," noted Alastair McCaig, market analyst at IG.

At a glance...

Currencies Commodities
GBP/USD: 1.5911 Gold: $1,728.20
GBP/EUR: 1.2516 WTI crude oil: $84.79
EUR/USD: 1.2715 All changes from 09:00 GMT.






Outperformance drives ITV higher

ITV (ITV) led the blue chips higher on Tuesday, climbing over 9%, as it confirmed it would "outperform the television advertising market".

"The economic outlook remains uncertain and we continue to see monthly volatility in the UK television advertising market, but the underlying trends have not changed," commented chief executive Adam Crozier.

Read: ITV climbs after bullish statement, for more.

Inflation hits five-month high

Consumer price inflation (CPI) spiked back up to 2.7% in October, significantly above the Bank of England's 2.0% target level, having previously trended down to a 34-month low of 2.2% in September.

CPI was pushed up in October by a sharp increase in the maximum university tuition fees, which added 0.3% to the annual inflation rate, and higher food prices, which have been pressurised by poor grain harvests.

Looking ahead, Howard Archer, chief UK and European economist at IHS Global Insight, was expecting CPI to be pushed up further in the near term by several more utility providers lifting their energy charges, as well as by likely further rises in food prices largely due to the poor harvests pushing up grain prices. Indeed, he said CPI could hit 3.0% again around the turn of the year.

Stobart launches retail bond

Carlisle-based transport and logistics company Stobart Group (STOB) has launched a six-year retail bond paying a coupon of 5.5%.

The interest will be split into two payments each year, paid out to investors in June and December. The first interest payment will be made on 4 June 2013.

For the full story, read: Stobart launches 5.5% retail bond.

Analysts offer mixed views on Cineworld

Cineworld (CINE) has reported its third-quarter interim management statement for the 19-week period to 8 November.

Total revenue for the period was -1.4%, resulting in a flat year-to-date position. Box office performance was weak, with admissions down 4.1%, but benefited from a better average ticket price of 4%, to bring the year-to-date position to 2.1%. Other income was down 17% due to the removal of booking fees and lower 3D glasses sales, resulting from fewer 3D films shown in the period. Screen advertising revenues were flat compared with the same period in the prior year.

The third quarter was impacted by reduced admissions due to the London Olympics and a subsequent lack of major releases. Although "Skyfall" has performed very well and has provided a strong start to the fourth quarter, grossing over £60 million nationally in its first two weeks of play, Panmure Gordon's Lindsey Kerrigan voiced concerns that there was only a very short space of time for admissions to play catch-up on the relative underperformance over the past three months, adding that any adverse weather conditions during the period would impact its potential to meet expectations.

While she had a 'sell' recommendation on the stock, Steve Leichti, analyst at Investec said that the stock offered "a portfolio approach and undervalued defensive growth". He had a 'buy' recommendation on the stock.

Capita confirms 3% organic growth for 2012

A third-quarter interim management statement from Capita (CPI) confirmed trading was in line with expectations, with organic growth of 3% expected to be delivered in 2012.

The outsourcing firm has won £1.7 billion worth of work in 2012. The bid pipeline currently stands at £4 billion versus £4.1 billion in July. The company indicated there was a good flow of opportunities across both the public and private sector as organisations looked to improve the efficiency of their operating models.

There was no commentary on margins per se but Capita expected to deliver a "strong profit performance". Acquisitions looked set to continue, with the pipeline for next year said to remain encouraging.

"The shares could go better [Tuesday] morning on confirmation that it will deliver on 2012 organic growth, but we remain concerned that its above-average margins could prove difficult to sustain in the current environment," commented Mike Allen, analyst at Panmure Gordon, reiterating his 'sell’ recommendation.

UK markets: 09:00 update

With focus remaining squarely on the Greek situation and the US fiscal cliff, there was nothing on Tuesday to inspire investors to drive the FTSE 100 (UKX) higher.

The blue-chip index lost 49 points to 5717.

Eurasian Natural Resources () slipped 4%. ITV (ITV) jumped 5.5%.

On the AIM front, shares in Greka Drilling (GDL) soared 24%, while African Medical Investments () plunged 28%.

Vodafone Group (VOD) was the most actively-traded stock by the users of Interactive Investor.

Eurozone ministers failed to agree on the next loan tranche for Greece on Monday night, pushing Athens even closer to a default.

"This delay shouldn't necessarily surprise investors as they await the Troika's report, but pushing them this close to the edge will leave many spooked," said Mike McCudden, head of derivatives at Interactive Investor. "However, we should expect some resolution will be found before the deadline.

"To add to investor concern we have a slew of macro data out today which will no doubt reinforce the view that all is far from well in the eurozone."

US markets: Monday's close

US stocks finished nearly unchanged on Monday, with the market treading water before talks to head off automatic spending cuts and tax hikes that would begin in January.

Decliners edged just ahead of advancers on the New York Stock Exchange.

The Dow Jones and S&P 500 were unchanged at 12815 and 1380 respectively. The Nasdaq slipped a mild one point to 2904.

At a glance...

Asian marketsCurrenciesCommodities
Nikkei 225: 8661.05 ( 15)GBP/USD: 1.5872Gold: $1,724.30
Hang Seng: 21188.64 ( 241)GBP/EUR: 1.2520WTI crude oil: $85.11
Shanghai Composite: 2047 ( 31)EUR/USD: 1.2686 






08:00 - The FTSE 100 (UKX) opens at 5767.27.