FTSE recovers ahead of Opec and ECB as Johnson Matthey update pleases

Discussion in 'Market News' started by Lily, Jun 2, 2016.

  1. Lily

    Lily Forum Member

    Aug 29, 2015
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    Technology group reports lower profits but optimistic about outlook

    Ahead of a number of key events - the European Cental Bank and Opec meetings today and the US non-farm payrolls on Friday - markets are attempting a revival after recent weakness.

    GlaxoSmithKline however has dipped 3p to 1444.5p despite announcing plans to file a key product for US approval earlier than expected. It said that following discussions with the US Food and Drug Administration, it will seek approval for a three-in-one inhaler for patients with chronic obstructive pulmonary disease by the end of 2016. It plans to file for European approval around the same time. Drug companies are seeking new treatments as they face increased competition from generic products as patents expire. Shore Capital analyst Dr Tara Raveendran said:

    This brings forward the expected submission date in the US to the end of 2016 rather than the first half of 2018 as previously expected and GlaxoSmithKline still expects EU regulatory submission by the end of 2016. The announcement is good news for the company, as its portfolio of new respiratory eases the transition away from Advair, however focus in the near term is likely to remain on Anoro/Incruse/Breo and the novel biologic, anti-IL5 mAb Nucala.

    [The emission control technologies] division should benefit from continued growth in vehicle production in Asia and Europe, and robust demand for trucks in Western Europe....[It] remains well positioned to benefit from the strong growth opportunities provided by continued tightening of legislation around the world.

    It’s all eyes on Vienna Thursday. Both Opec and the ECB meet in the Austrian capital, but neither is expected to announce market-moving news. It’s highly unlikely the Saudis will convince Iran to accept a cartel-wide production ceiling. After years in the wilderness, Tehran is keen to grab market share.

    European policymakers, meanwhile, have enough on their plate implementing measures agreed in March. At best, there is an outside chance that a surge in the oil price to $50 may trigger a rare upgrade to inflation forecasts.

    The Hitwise data set seems more relevant to Moneysupermarket.com than to some other mobile centric models. The long run shows some meaningful shifts in UK competitive position, with Moneysupermarket.com no longer leading the pack. In the near term, the expected pick up in the second quarter of 2016 seems more muted than we anticipated. We trim numbers and move to hold, price target 312p.

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