Man Group adds 10 percent on HSBC upgrade

| August 24, 2011
Man Group adds 10 percent on HSBC upgrade

European equities markets were higher Wednesday after the US Commerce Department reported that orders for durable goods, those products meant to last for three years or more, were up by 4 percent in the US in July, more than expected after having dropped in June.

The FTSE 100 was up 1.49 percent to 5,205.85 in London, while the FTSE 250 added 1.2 percent to 10,041.6, with investment managers Man Group (LSE: EMG) up 10.2 percent to lead gains on the 100 after HSBC upgraded its shares from “underweight” to “overweight” and as Pace plc (LSEP PIC) which develops set-top boxes for cable and satellite television systems, was up 10.22 percent as the best performer on the 250.

Admiral Group (LSE: ADM) was the worst performer on the 100, dropping 11.86 percent after pre-tax profits did not meet forecasts and after Investec Securitieds repeated its “sell” recommendation, saying that shares in the auto insurer cost too much, while food manufacturer Premier Foods (LSE: PFD) were down 5.93 percent to lead declines on the 250.

The energy sector was mostly higher with gains led by Tullow Oil (LSE: TLW), which added 8.4 percent as it reported that after-tax profits more than tripled in the first half of the year and after it doubled its interim dividend

Advertiser WPP (LSE: WPP) was the best performer in a mixed media sector as it gained 7.41 percent on better than expected profits in the first half as sales in emerging markets were up.

The FTSE Eurofirst 300 was up 1.29 percent to 935.76 while the IBEX added 1.08 percent to 8,369.1, the CAC-40 was 1.79 percent higher to 3,139.55 and the Dax gained 2.69 percent to 5,681.08.

Markets in the Asia-Pacific region were lower on fears that the US Federal Reserve might not announce that it is going to institute further measures to help the US economy, as well as on mixed earnings news in the region.

The Nikkei 225 was down 1.07 percent to 8,639.61 in Tokyo, while the Topix index was 1.09 percent lower to 742.24 and the Mothers market dropped 1.15 percent to 427.57 after Moody’s Investors Service cut Japan’s credit rating to Aa3, albeit with a stable outlook, with banks lower as Moody’s also cut its rating on Tokyo’s banking sector, which sent Sumitomo Mitsui Financial Group (TYO: 8316) down 1.8 percent while Mitsubishi UFJ (TYO: 8306) dropped 2.9 percent.

Exporters, including carmakers, were lower on a strong yen, with Honda Motor (TYO: 7267) down 1.95 percent while Toyota Motor (TYO: 7203) was 1.63 percent lower.

Elsewhere in the region, Australia’s markets were lower as the Sydney Ordinaries dropped 0.1 percent to 4,235.7 and the S&P/ASX200 was down 4,167.6, the Shanghai Composite fell 0.51 percent to 2,541.09, Taiwan’s Taiex was 0.63 percent lower to 7,502.93, the Kospi was down 1.23 percent to 1,754.78 in South Korea, India’s Sensex fell 1.29 percent to 16,285, the Straits Times Index was 1.64 percent lower to 2,719.9 in Singapore, and Hong Kong’s Hang Seng dropped 2.06 percent to 19,466.8.

New York equities were lower in midday trade after being up earlier on the report that durable goods orders were up in July, with the Dow Jones Industrial Average down 0.2 percent to 11,154.2, while at the same time the S&P 500 had also dropped 0.2 percent, to 1,159.98 and the Nasdaq Composite was 0.71 percent lower to 2,428.73.

Crude oil prices were higher after the US Energy Information Administration reported that crude stockpiles dropped by 2.2 million barrels last week against an expected gain of 2 million barrels, while gasoline inventories added 1.4 million barrels against an expected decline and distillates in storage were up by 1.7 million barrels, more of a gain than had been predicted.

West Texas Intermediate crude was up 38 cents to $85.82 per barrel at midday on the New York Mercantile Exchange, while Brent crude was last reported $1.37 higher to $110.68 per barrel on the ICE Futures Europe exchange in London.

Gold prices plummeted on profit-taking and more risk appetite, with predictions that the price of gold could fall another $100 to $200 per troy ounce in what was being termed a “correction”, with gold down $77.60 to $1,783.70 per troy ounce in midday trade in New York, while silver was $1.85 lower to $40.48 per troy ounce, but copper had added less than a cent to $4.02 per pound.

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