01/07/09

FTSE 100	4249.21, -44.82	Dow	8447, -82.38
FTSE 250	7414.56, -62.65	Nasdaq	1835.04, -9.02
FTSE All Share	2172.08, -22.03	S&P 500	919.32, -7.91
Nikkei	9939.93, -18.51	Hang Seng	18378.73, -149.78
Oil (Crude)	$69.89	Gold	$927.40
Base Rate	0.5%	10 Yr Gilt	3.7%
£/$	1.645	Euro/Gbp	0.855

Markets

Wall Street dropped yesterday but still managed to complete its best quarter in more than a decade yesterday. A weaker than expected consumer confidence report and a slump in oil prices sparked the sell off. The Conference Board said its June Consumer Confidence index fell to 49.3, against expectations of a rise to 55.3.

The Dow Jones dropped 82.38 points to close at 8,447.00 while the S&P 500 fell 7.91 points to end at 919.32. The Nasdaq lost 9.02 points to finish at 1,835.04.

Losses were broad based following the release of the Conference Boards data. Caterpillar caused the biggest weight on the Dow, falling 4.9% and knocking 12.85 points off the blue chip index. International Business Machines followed, knocking 10.66 points off. Financials including Citigroup and JPMorgan Chase dropped as government data showed prime mortgages 60 days or more past due climbed to 2.9% in the first quarter from 1.1% the same time last year.

US light crude oil for August delivery fell $1.60 to $69.89 a barrel.

COMEX gold for August delivery slid $13.60 to $927.40 an ounce.

Treasury prices went lower, raising the yield on the 10 year note to 3.51% from 3.47%.

The Nikkei slipped 18.51 points to close at 9,939.93 this morning. Consumer lenders and airlines were among the biggest losers following a media report that Orix Corp and All Nippon Airways will sell shares. Orix, the nation's largest non bank financial company sank 4.8%, while All Nippon dropped 5.9%.

The Hang Seng fell 149.78 points to 18,378.73 this morning, although the index still managed its best quarterly gain in almost 10 years. Property stocks led the drop on the day as investors locked in profits from one of the best performing sectors over the quarter.

The FTSE 100 is currently 67.16 points higher at 4,316.37. International Power is one of the top performers, up 3.7%, after agreeing to sell its entire Czech business to J&T Group for £738.3 million. Schroders adds 2.7% after Credit Suisse upgraded the stock to Neutral from Underperform. Marks & Spencer gains 3.6% after there trading statement was released. Man Group tops the fallers board, off 4.5%, after beginning to trade ex-dividend. Compass Group is down 0.4% for the same reason.

Economics
UK PMI manufacturing (Jun) 09:30 GMT

Analysts expect the PMI survey to improve further in June as weaker sterling and signs of an improvement in global activity start to stimulate UK manufacturing activity.

US ADP employment change (Jun) 13:15 BST/ 08:15 EDT

Analysts expect June ADP private employment to fall by 370,000. Temporary hiring related to next year’s census rose 62,000 in April and fell 18,000 in May, but the bulk of the hiring will not occur until 2010. The forecast of -350,000 for non-farm payrolls assumes a 20,000 increase in government jobs.

US ISM manufacturing (Jun) 15:00 BST/10:00 EDT

ISM manufacturing has surpassed expectations each month this year, by an average of 1.5pts. In four out of the past five months, the upside surprise was accompanied by higher new orders, which climbed by an additional 3.9pts to 51.1 in May. So far in June, the Empire index (-9.4 from - 4.6) was underwhelming, with shipments declining and new orders holding about steady. However, the Philadelphia Fed (-2.2 from - 22.6) rose strongly and is nearly at breakeven. Shipments and new orders each rose by 21pts in the Philadelphia-area survey, while employment climbed 5pts but remains deeply negative at -21.8. Analysts expect June ISM manufacturing to rise to 47.5, from 42.8 in May. The price paid index could climb to 48, up from 43.5.

US Construction spending (May) 15:00 BST/10:00 EDT

Non-residential construction has risen for three straight months, boosted by increases in areas such as lodging, transportation, communications, and power. Office and commercial construction are still trending lower, as vacancy rates continue to rise. Meanwhile, residential construction rose 0.6% in April, only the third monthly increase since March 2006. Analysts look for total construction spending in May to be unchanged.

US Pending home sales (May) 15:00 BST/10:00 EDT

Pending home sales rose by 6.7% in April and have risen by a combined 12% over the past three months. Sales have started to creep higher in the Northeast, Midwest, and South, while pending sales in the West are down 18% since last September, possibly reflecting slower sales of foreclosed homes. Analysts look for overall pending homes sales to rise by 1% in May.

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