Citywire for Financial Professionals
Stay connected:

View the article online at http://citywire.co.uk/money/article/a659878

Standard Chartered leads FTSE gains but Vodafone drags

Focus remains on currencies, with recently hard-hit Japanese yen and British pound both strengthening.

 
Standard Chartered leads FTSE gains but Vodafone drags

Standard Chartered led small FTSE 100 gains as analysts at Morgan Stanley recommended investors switch their allegiances from Asia-focused competitor HSBC.

Despite missing their usual cue from Wall Street – where markets were closed on Monday due to a public holiday – European stock markets made small gains. Britain’s FTSE 100 rose by 0.1% to 6,325, while the Eurofirst 300 was up 0.3% to 1,163.

On currency markets, the Japanese yen was under market scrutiny yet again, rising strongly against the dollar, up 0.5% to 93.48, after comments from finance minister Taro Aso that the country did not in fact plan to buy foreign bonds. His comments come after prime minister Shinzo Abe said such a policy could be an option for future monetary easing. The Nikkei 225 stock index subsequently closed down 0.3%.

There was little other market moving news, though investors were awaiting a Spanish government bond auction and the German ZEW survey for clues on the strength of sentiment in the eurozone. Angst has been growing ahead of this weekend’s Italian elections, and after last week's poor GDP figures for the fourth quarter of 2012.

With no major UK economic releases, the pound clawed back some of yesterday’s losses, up 0.2% against the euro and dollar to 1.1601 and $1.5495 respectively. The pound and Japanese yen have been the biggest beneficiaries of the so-called 'currency war', whereby countries take steps to bring down the value of their currencies in order to aid their exporters and boost their economic recovery.

Of London shares, Standard Chartered (STAN.L) rose 2.3% to 1,768p after Morgan Stanley raised its recommendation to ‘overweight’, increasing its price target for the bank by 16%. HSBC (HSBA.L) though, which is ‘fairly valued on lower revenue growth expectations’, Morgan Stanley said, moved in the opposite direction, with shares down 0.6% to 721p.

‘We are switching our preference from HSBC to STAN, due to the improvement in the Asian economic environment (a positive for STAN’s asset quality outlook), as well as valuations reaching par,’ the Morgan Stanley team said.

Aberdeen Asset Management (ADN.L), the fund manager on an acquisition spree, was also making gains, up 1.4% to 430p, as Societe Generale raised its target price for the shares to 420p, maintaining its hold recommendation on the shares.

Vodafone (VOD.L) shares dropped as Bernstein cut their rating to 'underperform' from 'market-perform', reducing their target price to 135p from 170p.

Royal Bank of Scotland (RBS.L) investors appeared little moved by comments from British prime minister David Cameron who urged faster restructuring of the 82% state-owned bank.

‘It was a very badly damaged institution but I think they are doing the right thing but obviously we want them to, where possible, accelerate the adjustments that they are making in terms of making it a strong organisation,’ Cameron reportedly said during a trip to India.

Shares in the bank rose by 0.6% to 341p.

leave a comment

Please sign in here or register here to comment. It is free to register and only takes a minute or two.

News sponsored by:

The Citywire guide to investment trusts

In association with Aberdeen Asset Management

Henderson Global Investors: 2014 looks set to be another strong year for UK commercial property


Andrew Friend, acting co-manager*, and Marcus Langlands Pearse, co-manager of the Henderson UK Property Unit Trust (HUKPUT), provide an overview of the key risks and opportunities for the UK commercial property market.

More about this:

Look up the shares

  • Royal Bank of Scotland Group PLC (RBS.L)
    Register or Sign in to receive email alerts for items in your favourites whenever we write about them
  • Aberdeen Asset Management PLC (ADN.L)
    Register or Sign in to receive email alerts for items in your favourites whenever we write about them
  • Vodafone Group PLC (VOD.L)
    Register or Sign in to receive email alerts for items in your favourites whenever we write about them
  • HSBC Holdings PLC (HSBA.L)
    Register or Sign in to receive email alerts for items in your favourites whenever we write about them
  • Standard Chartered PLC (STAN.L)
    Register or Sign in to receive email alerts for items in your favourites whenever we write about them

Archive

Today's articles

Tools from Citywire Money

From the Forums

+ Start a new discussion

Weekly email from The Lolly

Get simple, easy ways to make more from your money. Just enter your email address below

An error occured while subscribing your email. Please try again later.

Thank you for registering for your weekly newsletter from The Lolly.

Keep an eye out for us in your inbox, and please add noreply@emails.citywire.co.uk to your safe senders list so we don't get junked.

Read more...

Diary of a Dumb Investor: I'm Russian for returns

by Dumb Investor on Apr 17, 2014 at 15:01

Sorry, this link is not
quite ready yet