London, England -- (SBWIRE) -- 01/13/2011 -- http://www.cityindex.co.uk/spread-betting/”">Financial spread betting expert Giles Watts of City Index takes a look at the EU markets as equity remains strong on 11th January.
“Equity markets remained strong this afternoon following a positive morning, shrugging off yesterday’s negative move as a day of profit taking.
The UK equity market started the day in robust fashion following well received Alcoa numbers overnight in the US, as well as several positive broker comments along with the recurrence of some M&A rumours.
Wolseley, the distributor of plumbing and heating products, was the recipient of a bullish updates from Deutsche Bank and Citigroup. Analysts at DB revised their price target from 1950p to 2425p and Citigroup likewise from 2125p to 3100p. The latter even suggesting that Wolseley may hit 4500p within 3 years. Woseley hit a high today of 2228p (up +171p).
Cairn Energy, the oil and gas producer, also welcomed a positive upgrade from analysts at Morgan Stanley, who tipped it as one of their top exploration and production picks for the first half of the year. Cairn Energy traded up +26.7p (+6.1%) to a high of 458.1p.
Arm Holdings, the UK listed technology firm, was the biggest winner on the day leading the charge with an impressive +35p (+7.5%) move higher to 500p. Rumours have surrounded Arm Holdings for some time now but it appears buoyed again following a mention on CNBC’s “Mad Money” by Jim Cramer. The high profile talking head recommended Arm as one of several takeover targets.
Smith & Nephew, the healthcare equipment and services provider, was the biggest drag on the FTSE following a lack of confirmation regarding the weekend press of an alleged bid approach from Johnson & Johnson. SN traded down -37p to a low 675p, following yesterday’s bold move to a high intraday of 739p. Investors appear to believe that if no comment is forthcoming then the weekends press must be inaccurate.
Equity markets were also comforted by comment from Japan’s finance minister Yoshikio Noda, who pledged to buy European bonds, alleviating some of the early money press regarding the debt woes of the European region, namely Portugal in the short term.
At 4:15pm the FTSE was +64.2 points (+1.08%) at 6020.5, the DAX was up +88 points (+1.2%) at 6944 and the CAC up +58 points (+1.5%) at 3860.
Alcoa unofficially kicked off the reporting season in the US last night and will be followed by Intel on Thursday and JP Morgan on Friday. Many analysts believe the fourth quarter of last year could be the best on record, stoking the fire of positive sentiment that this year has begun with. Combine the potentially record breaking reporting season with the M&A rumour mill working overtime and it is not hard to see why many analysts are touting the FTSE to hit highs of anywhere between 6700 and 7000 this year.”
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